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Cerritos Continues on Path of Solid Economic Growth, Setting Record for 2017 Third Quarter Sales Tax Revenue

By Brian Hews

The Winter 2017-2018 Cerritos Quarterly Economic Profile, an exhaustive study by Cerritos’ Advanced Planning Department, reports that the City continues to show substantial economic growth, reporting just over $7 million in sales tax revenue in the third-quarter, the first time in history that the quarter exceeded $7 million.

The statistical data behind the report is compiled from a wide variety of sources, including Cerritos’ Finance Division, the California Employment Development Department, and several real estate publications.

Overall from 2013 to 2016, total annual sales tax revenue has grown $4.7 million, an impressive 20.43%, from $23 million to $27.7 million.

For the third-quarter 2017, the Cerritos Auto Square (CAS) generated the greatest amount of sales tax at $3.8 million, followed by the Los Cerritos Center (LCC) which generated nearly $1 million.

In the fourth quarter, the CAS sold a total of 14,088 cars which was actually a decrease of 913 cars, or 6.1%, from last year‘s all-time high for the same quarter. It is anticipated that the sales tax revenue will be higher due to the increased price of automobiles.

Cerritos homeowners will be happy to know that the fourth quarter average for single-family three and four bedroom dwellings in the City was over $740,000, 10% higher than comparable cities in the area.

The continued growth in sales tax revenue “can be attributed to an increase in consumer confidence which resulted in increased shopping activity at all the major shopping areas and the auto square in Cerritos.”

The Cerritos Industrial Park was the third highest sales tax generator, contributing over $780,000 in revenue which was a $140,000 increase, a healthy 21.9%, over last year.

The fourth quarter TOT, which is 12% of the room rate charged by a hotel operator in the City, generated almost $300,000, a 9.5% increase from the same quarter last year.

Other sectors not including the industrial park generated nearly $543,000 in sales tax revenue. These businesses include retail sales, machine shops, wholesaling, and warehousing.

There was a bit of bad economic news in the report that should draw the attention of City staff.

In a trend that could reflect the increase in online sales, the LCC sales tax revenue declined by over $136,000. This was the first decline in sales tax revenue from the LCC since 2014.

Also, the city issued 878 new and renewal business licenses generating over $256,000 in fees for the general fund, a decrease of 9.4%. Given the average license fee is $291 ($256,000/878), that drop represented a loss of over $23,000.

Housing prices increased dramatically in 2017 logging a 5.6% climb in October 2017, 6.1% in November, and 6.6% in December, with values now standing at over $740,000.

The one-year trend that shows an average increase of $47,000 from December 2016 to December 2017.

Comparing houses housing prices regionally, Cerritos homeowners enjoy a substantial positive gap from comparable cities such as Cypress, Glendora, Lakewood, and Downey.

Cypress values sit at $673,000, Glendora $610,000, Lakewood $569,000, Downey $585,000.

Condominiums were hotter than single-family homes, with values increasing by 9.2% in October 2017, 9% in November 2017, and 9.5% in December 2017.

“You can’t argue with facts, and the facts show that Cerritos remains a great place to do business,” said Scott Smith, President/CEO of the Cerritos Regional Chamber of Commerce. “The strong local economy is a reflection of the great mix of retail, restaurants, entertainment, and industrial businesses.”

 

Click here to see report.

 

 

 

 

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