Sales tax revenue figures for Lincoln released

Third quarter of 2016
By: Steve Archer, Reporter
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Sales tax receipts, for Lincoln’s third quarter of 2016, show a slight increase, according to the city’s economic development director Shawn Tillman.

Tillman said it is common for the city to receive sales tax revenue as much as two quarters, or six months, after they are generated.

“Every category is up, except for fuel and auto sales,” Tillman said Feb. 24, at a Downtown Lincoln Association meeting. “Lincoln gas stations sell a lot of fuel and sales are consistent but the price of gas has been down so the sales tax is down.”

Tillman said gross receipts for Lincoln’s sales tax, in the third quarter of 2016, came to $852,516. The city of Lincoln uses figures generated by Hinderliter, de Llamas and Associates, or HdL Companies, a firm that provides auditing and tax analysis services to local governments.

And, Tillman added, the city’s central business district showed improvement.

“Downtown, as a geography, consistently outperforms the city as a whole ever since the bypass opened,” Tillman said. “Most of the downtown businesses are unique to Lincoln. There’s the potential for experiences here not found in other communities.”

The top 25 producers of sales tax in Lincoln, for the third quarter of 2016, in alphabetical order were 7-Eleven, Arco AM-PM, Big 5, Catta Verdera Country Club, Chevron, CVS Pharmacy, Home Depot, Lincoln Express Mart, Lowes, McDonalds, Pabco Clay Products, Patriot It, Petsmart, Raleys, Red Robin, Ross, Safeway, Safeway Fuel, Sun City Lincoln Hills Community Association, Target, TJ Maxx, Tower Market, Verifone, Walgreens and Walmart.

Tillman said the top 25 producers are listed alphabetically because information regarding specific businesses is confidential.

As far as employment, Tillman said existing businesses produced 300 jobs last year and new businesses created 100 jobs, He added that three new employers will create more jobs:

  • In-N-Out Burger
  • Pride Industries will “produce more than 100 jobs when it is all said and done,” Tillman said.
  • An unnamed food distribution company is expected to move to set up shop soon in Lincoln and could create more than 50 jobs.

Lincoln City Manager Matt Brower said the report shows part of the story.

“What you don’t see is the massive amount of sales tax leaking into Roseville and Rocklin,” Brower said.

Sales tax leakage is more accurately described as retail sales leakage, according to Tillman.

“It’s not a loss, per se,” Tillman said. “We can estimate the amount of retail sales the community is capable of and we can measure what doesn’t get purchased.”

Tillman said Lincoln’s retail sales per capita is $1,800, which is unusually low, and Roseville’s retail sales per capita is $8,000, which is unusually high.

“The state average is $3,600 per capita, and for Rocklin, it is $4,000 per capita,” Tillman said. “For every dollar spent in Lincoln, 48 cents stays in Lincoln.”

“Retail sales leakage is occurring in home furnishing, appliances and discount department stores,” Tillman said. “Grocery stores and lumber or building materials, there is no leakage; those retailers are meeting the city’s purchasing needs.”

Also, Tillman said, two factors contribute to the low per capita retail sales in Lincoln: the rapid rate of residential growth followed by “a complete stoppage of commercial development.”

“The normal commercial development did not happen or it got caught up in the recession,” Tillman said. “Attracting new retailers is really difficult right now because of the changing nature of retail. Also, from a retail perspective, Lincoln is considered and analyzed as part of the Roseville market. That impacts our ability to attract new retail development.”