Solana Beach’s Cedros Avenue hit hardest by recession

Sales tax revenue down across districts

As Solana Beach struggles to make up for a $600,000 loss in sales-tax revenue from two fiscal years ago, a more specific look reveals no area has been hit harder in generating business than the Cedros Avenue Design district.

“There’s a lot of discretionary spending there,” said City Manager David Ott. “That’s what goes down in a recession.”

Even so, Sean MacLeod of the Cedros property owners association is optimistic that the situation is getting better.

“You just kind of try not to let it get you down psychologically realizing that over time it will improve,” he said. “I think that within the past, oh, I’m going to say three months, there has been an uptick in both confidence and activity. I can’t give you any hard numbers but I can tell you that people aren’t as gloomy.”

According to city financial documents, Cedros Avenue generated $126,947 in sales-tax revenue in the third quarter of 2006. In the same time period of 2009, it generated $75,685. The design-oriented shopping district includes high-end jewelry and furniture stores, cafes and the Belly-up Tavern, among other establishments.

Nearby, Highway 101 went from generating $122,672 in sales-tax revenue in third quarter 2006 to $95,583 in third quarter 2009.

Ott said losses on the 101 are magnified by the decline in the transient occupancy tax revenue paid by hotels and short-term rentals — down roughly $330,000, or 32 percent from two fiscal years ago, according to a recent city staff report. Highway 101 includes the Holiday Inn Express, Marriott Courtyard, and both chain and locally owned restaurants.

The two districts that have remained fairly consistent despite the recession are the Lomas Santa Fe Plaza and Town Centre West. These consist of grocery stores and large retailers such as Staples, CVS and Vons. Town Centre West, for example, produced $191,243 in third quarter 2006, and $179,305 in that same period of 2009. Lomas Santa Fe Plaza generated $72,411 in third quarter 2006 and $61,930 in third quarter 2009.

In an effort to make up for the decline in sales-tax revenue, the city is proposing a tax on all area businesses. The measure, which will be on the June ballot, is estimated to ultimately generate $500,000 dollars for the general fund and city services, though $250,000 its first year due to the council’s phase-in approach.

Depending on 2009 gross receipts, businesses will pay between $25 and $875 by this October if passed. Solana Beach is one of the last cities in San Diego County that does not already levy this tax on area businesses.

If approved, Ott said the $75 initial license and $16 yearly inspection fees would be dropped.

Related posts:

  1. Solana Beach Business tax nears ballot
  2. Tough times pave way for changes in Cedros efforts
  3. Mayor’s View: City responding to the recession
  4. Area braces for impact of fair
  5. Gaming industry weathers the global recession

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Posted by on Mar 25, 2010. Filed under Archives. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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