Small increase in sales tax revenue Small increase in sales tax revenue (August 11, 2004)

By Rebecca Wallace
Almanac Staff Writer

At first blush, the latest quarterly sales tax revenue report looks like more bad news for Menlo Park. It says the revenues received by the city were about $1.3 million in the first quarter of 2004, down 23.4 percent from the year-earlier period.

But the adjusted amount isn't really a drop, according to city Finance Director Uma Chokkalingam.

The figure for the retail sector in the first quarter of 2003 was artificially inflated to $448,714 because one retail taxpayer in the Sand Hill/Sharon Heights area reported revenue for the entire year, rather than for one quarter, she said.

So after adjusting for last year's spike of revenue, the total sales tax revenue actually went up $44,369 -- 3.6 percent -- from the year-earlier period. No one's breaking out the party hats yet, but this does provide some welcome news in recession-strafed Menlo Park.

"It's not a lot," Ms. Chokkalingam said levelly. "But at least it didn't go down."

And it's been a while since Menlo Park saw an upswing in the amount of sales tax revenue it takes in. "The last increase that we saw was in the second quarter of 2001 versus the second quarter of 2000," Ms. Chokkalingam said.

Ms. Chokkalingam declined to name the company that reports annually, saying the amount of sales tax each company pays is considered confidential information.

According to Ms. Chokkalingam's report, the city's business-to-business sales tax revenue in the first quarter of 2004 was up 21.2 percent to $509,707, while retail sales tax revenue downtown declined 7.3 percent to $103,700.

Ms. Chokkalingam also mentioned another notable decline. The transportation sector, which includes auto sales, fell 10.2 percent to $271,836.

"Auto sales in other parts of the county have picked up whereas the auto sales in Menlo Park (are) still lagging behind," Ms. Chokkalingam wrote in the report. She said she didn't have any theories on why.

Menlo Park and San Mateo County get a total of 1 percent, or 1 cent on the dollar, of taxable sales in the city. Of that amount, the city receives 90 percent and the county gets 10 percent.

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