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HomeMy WebLinkAboutLake Elsinore 4Q23 Newsletter CITY OF LAKE ELSI NORE �^ SALES TAX UPDATE 4Q 2023 (OCTOBER - DECEMBER) TIJ I 0.9% I , TOTAL: 4,022,264 • W • y STATE *Allocation aberrations have been adjusted to reflect sales activity SALES TAX BY MAJOR BUSINESS GROUP $1,200,000 $1,000,000 $800,000 $600,000 $400,000 Legend Q4 2022* $200,000 , •Q4 2023* $o General Autos County Restaurants Fuel and Business Building Food Consumer and and State and Service and and and Goods Transportation Pools Hotels Stations Industry Construction Drugs Measure Z .. 1. CITY OF LAKE ELSINORE HIGHLIGHTS TOP 25 PRODUCERS Lake Elsinore's receipts from October costs; however,car shoppers pushed back Aaron Chevrolet Lake Elsinore Honda through December were 1.4% below the and drove the sector to a 10.7%increase. Aggregate Crusher Lowes fourth sales period in 2022. Excluding Specialists Marshalls reporting aberrations, actual sales were Business-industry and building- Arco AM PM down 3.8%. construction both felt substantial Rancho Ready Mix downturnsas companies plus homeowners Canyon Hills Chevron Products Inflation continues to be a burden on began pulling back on capital projects and Chick Fil A RV Ready consumers and businesses as customer home improvements. Circle K RWC Building Products spending has been reduced to essential Costco So Cal Utility Products needs. Higher material costs and credit Transaction and Use Tax Measure Z Elsinore Car Wash& Stater Bros card balances have caused homeowners generated 105.9% of the Bradley-Burns Gas to pull back on non-critical improvement amount, led by the strongest boost from Goodfellow Corporation Target projects. Higher menu pricing, caused general consumer goods. Trust Lake Elsinore Ford by increased labor and food costs, began Home Depot Walmart Net of aberrations, taxable sales for all of Hyperwolf to hamper patrons from venturing out to Riverside Count declined 0.9% over the restaurants. y In N Out Burger comparable time period; the Southern K2 Metals Autos-transportation have been trending California region was down 2.0%. Lake Elsinore Chrysler lower due to the high pricing and financing Dodge Jeep Ram HdL° Companies www.hdlcompanies.com 1888.861.0220 Published by HdL Companies in Spring 2024 4Q 2023 CITY OF LAKE ELSINORE SALES TAX UPDATE (8) STATEWIDE RESULTS California's local one cent sales and use Even though revenue from most major sectors pool collections contracted more taxes tax receipts during the months of October slowed, restaurant sales remained steady allocated directly to local agencies via in-state through December were 2.5% lower than with a modest gain of 1.0%. Results from fulfillment and through existing retail outlets. the same quarter one year ago afteradjusting casual dining establishments grew during the for accounting anomalies.The fourth quarter early winter period as patrons enjoyed indoor Statewide, calendar year 2023 ended with a is notably the highest sales tax generating dining. However,following the greater trend 2.3% decline from 2022. Elevated inflation quarter of the year and exhibited diminished of consumers looking for value, fine dining and interest rates led to higher cost of goods year-over-year returns as consumers eateries experienced lower receipts. The resulting in consumers not spending as much balanced higher prices and financing costs industry is still bracing for implementation as they had prior. Following multiple years with essential household needs. of AB 1228, a new law increasing minimum of post-pandemic tax growth assisted by wages for 'fast food restaurants', on April 1, federal tax policy and temporary workplace Higher interest rates impacted the auto- 2024 accommodations, consumers reassessed transportation sector, especially luxury their economic conditions and limited vehicles, as the group dropped 6.2%. Use taxes remitted via the countywide pools purchases.As the Federal Reserve considers Inventories for many dealers returned, grew 1.0%,marking the first positive rebound delaying softening rates, consumer spending creating downward pressure on prices, after four consecutive quarters of decline. could likely stagnate delaying a return to the further constraining receipts. Lenders have While overall online sales volume is steady, normal historical growth trend in 2024. tightened credit standards, making loan financing challenging. Improved leasing REVENUE BY BUSINESS activity was the lone bright spot.With slow Lake Elsinore This Calendar Year* GROUP movement expected by the Federal Treasury setting interest rate policy, future revenue Fuel growth may stagnate. Food/Drug 7% Pools Cons.Goods 14 Fuel and service stations contributed a 23% similar downturn, as lower fuel prices reduced receipts from gas stations and petroleum providers. While this has been the trend throughout 2023, recently global Restaurants crude oil prices have been on the rise and Bus./Ind. 11% 8% Autos/Trans. should see growth in the coming year. This Building 17% ADJUSTED FOR 9%decline also impacted the general consumer ECONOMIC DATA goods category as those retailers selling fuel experienced a similar drop. TYPES During this holiday shopping period,general Lake Elsinore County HdL State consumergoods experienced lacklustersales Business Type Q4'23* Change Change Change New Motor Vehicle Dealers 444.7 13.0%0 -0.8%© -7.7%© as results pulled back 3.4%.Most sectors saw Service Stations 377.9 -4.9%© -4.3%© -4.9%10 reductions with home furnishings,women's Quick-Service Restaurants 246.2 -4.3%0 1.8%0 0.4%0 apparel, shoe and electronic-appliance Heavy Industrial 233.3 -28.1%© -10.8%19 -8.7%19 stores being the most significant. Returns Building Materials 226.3 -2.5%© -4.6%19 -2.0%10 also marked the fourth consecutive quarter Casual Dining 122.5 7.7%0 -2.1%© 1.8%0 showing comparable declines. Similar to the Cannabis Related 107.4 -25.6%10 -6.4%4) -9.7%10 anticipated trend of new vehicles,consumer Grocery Stores 107.1 -4.7%10 -2.9%10 -4.6%10 Family Apparel 75.0 -1.7%© -1.2%© -0.4%© spending may be sluggish in the near term. Contractors 63.6 -7.1%19 6.0/0° © 1.4/o°*Allocation aberrations have been ad"usted to reflect sales activit "In thousands of dollars