Cerritos Report Shows Huge Jump in Sales Tax Revenue

By Brian Hews

The Cerritos Economic Profile, released this past Tuesday, is a report that is prepared on a quarterly basis to conduct market trend analysis and to develop strategies for the city’s business retention.

The profile is comprised of several sections, which includes major revenues of the City, employment, housing, and commercial real estate.

This latest report shows that the city of Cerritos is in a very strong position in relation to 2015 sales tax revenue.

This is in stark contrast and was not mentioned in the staff report behind a proposed half-cent sales tax increase that was released last week, mostly blaming the dissolution of redevelopment for the City’s budget deficit problems.

The sales tax increase was discussed at a meeting this past May 2 that was strangely neither televised nor videotaped.

In the proposed half-cent sales tax agenda report, staff cited “with nondiscretionary expenditures (contract labor, insurance, goods and materials) expected to increase – and revenues anticipated to have plateaued – the city must identify additional revenue sources in order to abate the growth of the deficit and provide funds for infrastructure maintenance.”

But the current economic profile belies the statement “revenues anticipated to have plateaued.”

According to the profile, sales tax revenue has risen for the past four calendar years.

From 2012 to 2013 revenue rose $574,000; from 2013 to 2014 revenue rose $334,000, and from 2014 to 2015 revenue rose a healthy $2.376 million.

The growth in sales tax revenue, the report claims, can be attributed to “renovations and increased in construction activity at the Cerritos Auto Square, the Los Cerritos Center, Plaza 183, and other shopping centers throughout the city.”

But even with these increased revenue numbers, the agenda report behind the half-cent sales tax increase proposal indicated that the current proposed 2016-17 budget projects a $5 million deficit, citing the increase in sheriff’s and public safety expenditures.

The report is certain to raise the ire of Cerritos employees.

According to a report obtained by HMG-CN, Cerritos employee’s last raise was 4% in 2008-09. The next raise was 5 years later for a meager 2%. The current proposed budget pay raise column in the report shows “N/A.”

The report shows payroll data from sixteen cities in Orange and Los Angeles Counties. Over half have received raises totaling over 12.5% since ‘08-’09 with Norwalk, Lakewood, and Whittier gaining the highest increase of 18.5%.

South Gate employees received 15.8%, Irvine 15%, and Orange 12.5%. The report states cost of living, as measured by the Consumer Price Index, has risen 13.4%.

Cerritos and Fullerton employees were last on the list at 6% and 5.5% respectively. The report does not say that Cerritos has not filled, through attrition, 58 positions.

Report obtained by HMG-CN outlining payroll raise data from 16 different cities. Cerritos is third city from the top. The last column on the right is the total amount of raises since ’08-’09. The shaded row is the Consumer Price Index, showing a 13.4% increase since ’08-’09.