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Emeryville Retail Down Over 22% – Is That What Alameda Aspires to?

At a recent event hosted by the International Conference of Shopping Centers, Alameda Mayor Beverly Johnson was quoted saying that “Alameda needs more chain retail.” Evidently, our Mayor hasn’t been paying attention to what’s happened to Emeryville lately.

In December, the New York Times reported that Emeryville’s retail sales tax revenue has fallen more than 22% over the past year. The City of Alameda has long coveted Emeryville’s high per-capital retail sales tax figures all the while ignoring some important facts – Emeryville covers no more than 2 square miles, much of which is covered with big-box stores and acres of parking lots, and hosts a mere 10,000 or so residents. It’s also at the junction three major interstates, which facilitate auto-traffic to Emeryville’s shopping centers.

Now, Emeryville is hurting as consumer spending has dropped off, and more than 25% of the City’s revenues come from retail sales tax. We have long counseled City Hall against following the same path as Emeryville – our estimated annual retail sales tax revenue leakage of $410,000 is a drop in the bucket compared to the annual $75 million general fund budget, and we’re unlikely to steal much in the way of sales from Emeryville given it’s prime location and freeway access which we don’t have in Alameda.

It would make more sense for Alameda to focus on bringing more companies like Clif Bar, Peet’s Coffee and Donsuemor’s Cookies to Alameda – into Bay Farm Island and into Alameda Point to re-use the existing buildings there – to build up our business-to-business sales tax revenue. Increasing retail sales tax depends on aggressively increasing the population on our already crowded island – business-to-business sales tax doesn’t rely on bringing more people to the island, and can grow exponentially as our local businesses increase trade nationally and globally.

There’s no doubt Alameda needs a diversified sales tax base that includes retail sales tax. But by focusing on bringing business-to-business sales tax revenue to Alameda, we can create more jobs in Alameda and put more people in the pockets of our residents, which they can use to spend at our existing retail centers on Park and Webster Street. Maybe on day the Mayor will figure that out.

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