East Side, Southampton Sales Tax Revenues Jump; Industrial Park Drops

The good news is that sales tax revenue is up in most retail areas of Benicia. The bad news is, in the Benicia Industrial Park, where the vast majority of the sales tax is generated, revenues are down significantly.

During the fourth quarter of 2009, the city generated $1,215,376 in sales tax revenue, more than the $1,088,894 than was generated in the same period in 2010. The change in revenues represents a 10.4 percent drop citywide even though most areas of the city saw an increase.

The Southampton shopping area had the largest percentage gain, with sales tax revenues up nearly 29 percent. , owner of , said his fourth quarter was unremarkable in terms of sales and his sentiment was echoed by Stan Houston of , who recently moved to First Street from Southampton Center.

The big increase in revenues from the center is almost entirely due to the opening of  Neighborhood Cafe. Owner says his sales tax payment for the fourth quarter was between $15,000 and $20,000. After losing their downtown location, the business closed for a year and opened last summer in its new Southampton location.

The East Side shopping area also showed significant gains after the reopening of the store.

According to the city's finance director, Rob Sousa, the drop in revenues from the Benicia Industrial Park has two elements. The first is the loss of a major account by an industrial park business and the second is a a postponement of capital improvement projects by area refineries.

Citing confidentiality issues, Sousa wouldn't name the company but said the loss in sales tax revenue over time will be significant.

Regarding the refineries, however, he said the conditions in  the retail gas markets caused area refineries to halt their capital expansion plans, which led to a drop in orders for many firms based in the industrial park that work primarily in the petrochemical field.

"We don't see a turn around because of the cost of oil and the price at the pump," Sousa said.