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Sales Tax Growth Keeps Lafayette Leaders Happy -- But Wary

Despite a stubborn recession and some lengthy downtown construction work, double digit sales growth is keeping Lafayette in the black.

 

Even with an unforgiving recession and a lengthy sidewalk restoration project some feared would reduce foot traffic downtown, the City of Lafayette is weatherin the financial storm just fine -- so far.

In his Friday Summary, City Manager Steven Falk reported that sales tax revenues for the city were up 10.4 percent for the reporting period ending June 30, beating budget predictions by about $56,000.

"Every little bit helps," Falk wrote. And while that may not seem like a lot of money to many, city leaders say it is cause for celebration during a time of unprecedented financial uncertainty.

"Only two of the other eighteen Contra Costa cities had higher growth rates," Falk wrote.

While Falk and other civic leaders may be breathing a little more easily given the comfort level a tax surplus affords, he admits that Lafayette's recently proven inability to successfully pass measures to pay for better roads or police services has prompted them to keep a careful eye on their neighbors.

"We will be watching with great interest this November to see if Orinda voters approve its and, likewise, how Moraga voters treat the that has been placed before them," Falk wrote.

Falk said passage of those measures would benefit the residents of Lafayette's neighboring villages, but it remains to be seen if a constituency with a decided predeliction against paying for anything they don't have to right now will be able to muster sufficient support for the measures.

Chris Nicholson July 31, 2012 at 05:52 pm
I expect that much of this is due to new openings versus a general uplift in "same store sales." As such, unless the new development pipeline is full, there is no reason to expect future revenue growth at these levels.
Regular Guy July 31, 2012 at 08:31 pm
Whole Foods?
bcrane1 August 1, 2012 at 12:27 pm
based on what? your gut feeling?
I expect the growth IS from same store sales, as such we should see similar future results. This is based on the same evidence you used, which is none.
Chris Nicholson August 1, 2012 at 01:01 pm
Based on logic and experience. An expectation of 10% long term growth in consumer spending is inconsistent with macro trends. Among major countries, only China approaches those levels. The U.S. was <2% GDP growth last year.
Furthermore, as California budget watchers will know, sales/use tax receipts are down big this year on a statewide basis..... All of that said, of course your might be right. It just seems unlikley.
bcrane1 August 1, 2012 at 02:03 pm
10% sustained growth does seem unlikely given global, national and local trends, but why can't existing local businesses be doing well? Anecdotally, Diablo Foods is doing better than ever. Chow's is ALWAYS packed (no idea why). The local coffee shops seem busy.....
The article also did not indicate the time frame -- a quarter? annual? and was the previous time period being compared to an anomaly. Was that period abnormally down? Too much info we don't have to make any judgement regarding a trend.
CJ August 1, 2012 at 02:45 pm
It would be interesting to compare Orinda and Moraga revenues for same period. I would suspect the bleeding of those 2 sorry retail markets is shifting to Lafayette.
c5 August 2, 2012 at 02:30 pm
if the city is assuming anything close to 10 pct growth to sustain their budget we are all going to be disappointed....but i think some credit for ongoing resilience in lafayette local economy is due to the good work being done to promote buying local and to get more retail and food businesses in the town. now if they can only get fentons deal done the city will get another nice boost...

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