HomeMy WebLinkAboutStaff Report 2410-3617CITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Monday, November 18, 2024
Council Chambers & Hybrid
5:30 PM
Agenda Item
11.Sales Tax Digest Q2 (April-June) 2024
City Council
Staff Report
Report Type: INFORMATION REPORTS
Lead Department: Administrative Services
Meeting Date: November 18, 2024
Report #:2410-3617
TITLE
Sales Tax Digest Q2 (April-June) 2024
DISCUSSION
This report transmits information regarding the City of Palo Alto’s sales tax receipts for the second
quarter (April-June) of 2024. Listed below are highlights from the report; detailed discussion and data
can be found in the attached City of Palo Alto Sales Tax Digest and Legislative Update 2024 Q2
(Attachment A).
Regional and statewide sales tax based upon adjusted economic benchmark year (Attachment A, p. 2)
•Palo Alto: increased 6.6%
•San Francisco Bay Area: decreased 3.4%
•California statewide: decreased 2.4%
City’s Most Significant Reasons for increases during this period (Attachment A, p. 1)
•New Auto Sales segment increased by 25.7%, comprises 15.9% of total sales tax
•Restaurant segment increased by 6.2%, comprises 15.8% of total sales tax
County Pool (Attachment A, p. 4)
•The City’s share of the county pool for this quarter is 6.3%, unchanged from Q2 2023
•Sales tax receipts from the County pool totaled $1.6 million
ATTACHMENTS
Attachment A: 2024 Q2 Sales Tax Digest Summary with County Pool and Legislative Update
APPROVED BY:
Lauren Lai, Administrative Services Director
City of Palo Alto
Sales Tax Digest Summary
Collections through August 2024
Sales May through June 2024 (2024Q2)
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California Overview
For the year ending in the second quarter of 2024, cash receipts decreased by 1.4% statewide and
decreased by 4.7% in S.F. Bay Area. However, when adjusted for non-period related payments, the
overall economic sales tax activity for the year ending in the second quarter of 2024 decreased by 2.4%
statewide and decreased by 3.4% in S.F. Bay Area.
City of Palo Alto
For the year ending in the second quarter of 2024, sales tax cash receipts for the city increased by 1.6%
from the prior year. However, when adjusted for non-period related payments, the overall economic sales
tax activity in Palo Alto for the year ending in the second quarter of 2024 increased by 6.6%. The most
significant reasons for Palo Alto’s increase during this period were the restaurants and new auto sales
segments, respectively. Restaurants increased by 6.2%, which comprises 15.8% of the total sales tax for
the city. New auto sales for the same period increased by 25.7%, which comprises 15.9% of the total sales
tax.
Same quarter sales tax cash receipts decreased by 1.7% in California from Q2 2023 to Q2 2024. The Palo
Alto citywide sales tax cash receipts decreased by 7.2% over the Q2 2023 to Q2 2024 period. Key reasons
for the Palo Alto decrease during this period were: 1) Decrease in the business services segment, 2)
Decrease in furniture & appliance stores (mainly electronics stores) from Q2 2023 to Q2 2024 by 41.9%,
3) Decrease in the leasing segment of 15% which comprises 19.7% of the total sales tax for the city.
According to the California New Car Dealers Association (CNCDA), California’s new light vehicle
registrations fell by .7% in 2024Q2. Tesla’s sales have been on the decline in California with registrations
down a significant 17.0% YTD for 2024Q2.
City of Palo Alto
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% of Total / % Change Palo Alto California
Statewide S.F. Bay Area Sacramento
Valley Central Valley South Coast Inland Empire North Coast
General Retail 26.2 / 2.2 29.1 / 0.0 26.1 / -3.2 28.2 / -3.8 38.2 / 5.8 27.1 / 0.4 35.3 / -1.8 27.1 / 1.8
Food Products 17.5 / 5.5 21.3 / 0.1 22.6 / -1.4 16.9 / -0.9 14.7 / 0.9 23.4 / 1.4 17.9 / -6.0 18.4 / 1.7
Transportation 19.7 / 18.8 23.1 / -6.3 19.1 / -4.4 26.8 / -3.2 22.1 / -3.1 23.9 / -6.1 23.2 / -15.9 28.5 / -2.9
Business to Business 32.9 / 0.6 15.8 / -4.0 21.0 / -4.0 14.4 / -6.3 14.5 / -2.2 15.6 / -2.9 10.5 / -14.0 10.5 / 6.7
Misc/Other 3.8 / 50.5 10.8 / -2.1 11.2 / -4.8 13.6 / -2.3 10.4 / -3.2 9.9 / 0.3 13.1 / -7.0 15.4 / -1.3
Total 100.0 / 6.6 100.0 / -2.4 100.0 / -3.4 100.0 / -3.3 100.0 / 0.8 100.0 / -1.5 100.0 / -8.1 100.0 / 0.4
Palo Alto California
Statewide S.F. Bay Area Sacramento
Valley Central Valley South Coast Inland Empire North Coast
Largest Segment Leasing Restaurants Restaurants Restaurants Miscellaneous
Retail Restaurants Miscellaneous
Retail Restaurants
% of Total / % Change 20.1 / -3.3 15.3 / 0.7 16.8 / -0.6 11.6 / -0.6 16.7 / 19.8 17.3 / 1.8 18.2 / 4.4 11.8 / 3.4
2nd Largest Segment Auto Sales -
New
Auto Sales -
New
Miscellaneous
Retail
Auto Sales -
New
Department
Stores
Auto Sales -
New Restaurants Department
Stores
% of Total / % Change 15.9 / 25.7 11.1 / -5.5 10.0 / 1.6 11.3 / -3.5 10.8 / -0.5 12.0 / -8.2 11.6 / -4.4 11.3 / 12.7
3rd Largest Segment Restaurants Miscellaneous
Retail
Auto Sales -
New
Miscellaneous
Retail Restaurants Miscellaneous
Retail
Auto Sales -
New
Auto Sales -
New
% of Total / % Change 15.8 / 6.2 10.8 / 6.0 9.3 / -3.1 11.1 / -4.8 9.9 / 2.2 9.1 / 8.0 10.7 / -11.0 10.8 / -4.3
ECONOMIC CATEGORY ANALYSIS FOR YEAR ENDED 2nd Quarter 2024
ECONOMIC SEGMENT ANALYSIS FOR YEAR ENDED 2nd Quarter 2024
Regional Overview
The first chart on page two shows adjusted economic benchmark year amounts, which means that it
shows the year ended second quarter of 2024 compared to the year ended second quarter of 2023
(benchmark years are rolling annual comparisons through the current quarter). The growth rates are
different between the state and Palo Alto because the sales tax from businesses in Palo Alto performed
better overall than the statewide average.
Regional Overview Chart (Economic)
BENCHMARK YEAR 2024Q2 COMPARED TO BENCHMARK YEAR 2023Q2
City of Palo Alto
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$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Quarterly Benchmark Year
Leasing
20.1%
Auto Sales -New
15.9%
Restaurants
15.8%
Office Equipment
7.9%Apparel Stores
6.7%
All Other
33.7%
Net Pools & Adjustments
19.3%
Gross Historical Sales Tax Cash Receipts by Benchmark Year and Quarter (Before Adjustments)
Net Cash Receipts for Benchmark Year second Quarter 2024: $36,363,275
*Benchmark year (BMY) is the sum of the current and 3 previous quarters (2024Q2 BMY is sum of 2024 Q2, 2024 Q1, 2023 Q4, 2023 Q3)
City of Palo Alto
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County Pool Results
The California sales tax system is referred to as a ‘sales and use tax’ system which covers both sales tax
and ‘use tax’. The County Pool revenues largely reflect use tax from qualifying transactions that do not
involve a California based point of sale. Businesses report their use tax quarterly based on business activity
conducted throughout the county. The County Pool is distributed each quarter based upon a formula
where the jurisdiction’s quarterly percentage is based upon its total sales tax receipts for the quarter as a
percentage of all sales tax receipts for all jurisdictions within the county. Thus, if local business activity
(sales tax receipts) within Palo Alto increases in the quarter relative to the rest of the county, then the
Palo Alto County pool percentage also will increase for the quarter compared to the rest of the county.
The total county pool is multiplied by the city’s quarterly percentage to determine the jurisdiction share
each quarter.
In the second quarter of 2024, cash receipts for the overall County Pool decreased by 8.3% from the same
quarter in the prior year. The City’s share of the County Pool increased to 6.3%. The City’s revenues from
the County Pool decreased from $1,755,562 in 2023Q2 to $1,611,681 in 2024Q2.
TOP 25 SALES/USE TAX CONTRIBUTORS
The following list identifies Palo Alto’s Top 25 Sales/Use Tax contributors. The list is in alphabetical order
and represents the year ended second quarter of 2024. The Top 25 Sales/Use Tax contributors generate
61.6% of Palo Alto’s total sales and use tax revenue.
Anderson Honda Macy's Department Store Shreve & Co.
Apple Stores Magnussen's Toyota Stanford Health Care
Arco AM/PM Mini Marts Neiman Marcus Tesla
Audi Palo Alto Nordstrom Department Store Tesla Lease Trust
Bloomingdale's Richemont Tiffany & Company
Brilliant Earth Rivian Automotive Union 76 Service Stations
Hermes Sephora Varian Medical Systems
HP Enterprise Services Shell Service Stations Volvo Cars Palo Alto
Louis Vuitton
City of Palo Alto
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$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
Benchmark Year 2024Q2 Benchmark Year 2023Q2
Sales Tax from Largest Non-Confidential Sales Tax Segments (Economic)
City of Palo Alto
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Economic Category % 2024Q2 2024Q1 2023Q4 2023Q3 2023Q2 2023Q1 2022Q4 2022Q3 2022Q2 2022Q1 2021Q4
Business To Business 27.0%2,366,493 2,373,414 2,262,034 2,619,833 2,439,519 2,350,567 2,571,178 2,194,817 2,095,020 2,031,199 2,136,501
Miscellaneous/Other 18.2%1,595,196 1,727,252 1,951,428 1,870,170 1,546,096 1,302,322 1,517,005 1,597,816 1,724,861 1,701,538 1,687,189
General Retail 23.3%2,044,006 1,739,261 2,315,882 1,834,297 2,017,885 1,640,927 2,305,038 1,802,777 1,920,316 1,639,417 2,282,253
Food Products 15.9%1,394,270 1,288,207 1,348,051 1,277,173 1,349,926 1,195,458 1,260,287 1,230,824 1,227,240 1,018,577 1,083,309
Subtotal Economic (Local Business)84.5%7,399,964 7,128,134 7,877,395 7,601,473 7,353,426 6,489,274 7,653,508 6,826,234 6,967,438 6,390,731 7,189,252
Net Pools & Adjustments 15.5%1,359,165 1,143,798 1,867,172 1,986,175 2,084,763 1,586,938 1,935,580 1,862,181 686,044 1,721,924 1,806,328
Total Cash Receipts 100.0%8,759,129 8,271,932 9,744,567 9,587,647 9,438,189 8,076,212 9,589,088 8,688,414 7,653,481 8,112,655 8,995,580
Economic Segment % 2024Q2 2024Q1 2023Q4 2023Q3 2023Q2 2023Q1 2022Q4 2022Q3 2022Q2 2022Q1 2021Q4
Miscellaneous/Other 46.8%4,102,841 4,114,784 4,409,850 4,635,983 4,197,978 3,818,384 4,490,992 4,087,158 4,008,008 3,949,786 3,969,954
Restaurants 14.4%1,259,885 1,162,863 1,214,598 1,154,189 1,214,502 1,073,621 1,114,637 1,102,248 1,093,944 902,707 947,771
Miscellaneous Retail 6.7%582,600 489,040 689,939 480,649 512,077 448,322 545,797 381,616 479,710 432,956 679,381
Apparel Stores 6.1%531,926 440,402 586,863 478,973 509,894 423,470 538,573 435,730 495,508 392,724 540,782
Department Stores 5.7%501,499 411,345 549,893 435,388 492,374 356,626 533,032 423,601 454,349 367,144 525,295
Service Stations 2.6%226,411 198,584 214,900 229,911 222,029 192,723 215,640 233,387 250,715 191,755 190,610
Food Markets 1.3%114,071 107,031 112,372 103,251 111,465 101,978 116,810 99,811 104,253 91,634 108,203
Business Services 0.9%80,732 204,085 98,980 83,130 93,106 74,150 98,027 62,683 80,950 62,025 227,256
Subtotal Economic (Local Business)84.5%7,399,964 7,128,134 7,877,395 7,601,473 7,353,426 6,489,274 7,653,508 6,826,234 6,967,438 6,390,731 7,189,252
Net Pools & Adjustments 15.5%1,359,165 1,143,798 1,867,172 1,986,175 2,084,763 1,586,938 1,935,580 1,862,181 686,044 1,721,924 1,806,328
Total Cash Receipts 100.0%8,759,129 8,271,932 9,744,567 9,587,647 9,438,189 8,076,212 9,589,088 8,688,414 7,653,481 8,112,655 8,995,580
Historical Analysis by Calendar Quarter
The chart above shows the categories and segments in quarterly economic basis amounts. The total amount is the net cash receipts, and it was obtained by
adding up the categories/segments with the “Net Pools & Adjustments” amount.
City of Palo Alto
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Economic Category % 2024Q2 2023Q2 2022Q2 2021Q2 2020Q2 2019Q2 2018Q2 2017Q2 2016Q2 2015Q2
Business To Business 27.6%10,040,495 9,969,300 8,254,377 7,360,893 8,200,185 7,601,958 6,117,780 5,419,737 5,120,759 4,034,581
Miscellaneous/Other 19.7%7,151,850 5,809,167 6,965,063 6,165,181 6,109,986 8,481,377 6,433,938 6,213,561 5,828,635 5,526,056
General Retail 21.9%7,952,077 7,747,733 7,551,628 5,666,662 5,910,237 7,946,017 8,423,419 8,318,376 8,180,392 8,079,780
Food Products 14.7%5,335,053 5,058,604 4,402,695 2,882,093 3,939,566 4,902,753 4,784,943 4,602,200 4,609,460 4,323,122
Subtotal Economic (Local Business)83.8%30,479,474 28,584,805 27,173,763 22,074,828 24,159,974 28,932,104 25,760,080 24,553,874 23,739,246 21,963,538
Net Pools & Adjustments 16.2%5,883,801 7,207,098 4,361,944 6,049,923 5,732,251 7,157,724 3,959,941 4,306,130 4,407,390 4,034,611
Total 100.0%36,363,275 35,791,903 31,535,707 28,124,751 29,892,225 36,089,829 29,720,021 28,860,004 28,146,636 25,998,149
Economic Segment % 2024Q2 2023Q2 2022Q2 2021Q2 2020Q2 2019Q2 2018Q2 2017Q2 2016Q2 2015Q2
Miscellaneous/Other 49.0%17,834,573 16,825,593 15,856,081 14,398,600 15,233,370 17,029,556 14,041,527 12,804,075 12,024,028 10,653,521
Restaurants 13.2%4,814,054 4,532,010 3,902,005 2,451,630 3,430,893 4,319,514 4,174,045 3,998,933 4,010,073 3,761,655
Miscellaneous Retail 6.2%2,268,674 1,836,660 2,016,094 1,683,101 1,275,392 1,643,222 1,677,478 2,139,114 1,885,952 1,506,384
Apparel Stores 5.6%2,031,156 1,917,559 1,834,472 1,291,549 1,399,599 1,993,176 1,840,406 1,691,058 1,627,846 1,655,700
Department Stores 5.2%1,898,124 1,809,413 1,735,491 1,124,054 1,260,329 1,885,562 2,068,624 2,065,427 2,250,100 2,397,566
Service Stations 2.4%869,187 870,132 814,968 493,608 572,093 698,074 651,979 587,986 581,619 699,331
Business Services 0.9%319,907 362,604 618,516 296,799 579,113 908,385 807,324 762,159 850,451 799,913
Food Markets 1.2%443,798 430,834 396,135 335,487 409,184 454,615 498,697 505,122 509,177 489,468
Subtotal Economic (Local Business)83.8%30,479,474 28,584,805 27,173,763 22,074,828 24,159,974 28,932,104 25,760,080 24,553,874 23,739,246 21,963,538
Net Pools & Adjustments 16.2%5,883,801 7,207,098 4,361,944 6,049,923 5,732,251 7,157,724 3,959,941 4,306,130 4,407,390 4,034,611
Total 100.0%36,363,275 35,791,903 31,535,707 28,124,751 29,892,225 36,089,829 29,720,021 28,860,004 28,146,636 25,998,149
Historical Analysis by Calendar BMY from 2015Q2 to 2024Q2
The chart above shows the categories and segments in benchmark year economic basis amounts. The total amount is the net cash receipts, and it was obtained
by adding up the categories/segments with the “Net Pools & Adjustments” amount. Benchmark year (BMY) is the sum of the current and 3 previous quarters
(2024Q2 BMY is sum of 2024 Q2, 2024 Q1, 2023 Q4, 2023 Q3).
City of Palo Alto
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Campbell -2.8%3.2%0.1%13.4%14.2%2,679,731 3,422,075 -21.7%Bldg.Matls-Retail Restaurants I.T. Infrastructure Light Industry
Cupertino -1.6%1.5%0.3%-8.2%-1.1%7,049,719 6,008,649 17.3%Office Equipment I.T. Infrastructure Florist/Nursery Business Services
Gilroy 1.5%2.9%-5.2%-7.4%-4.0%4,232,785 4,295,810 -1.5%Department Stores Service Stations Misc. Vehicle Sales Apparel Stores
Los Altos -13.4%-0.8%15.1%-3.0%-11.3%626,392 639,528 -2.1%Service Stations Electronic Equipment Green Energy Miscellaneous Retail
Los Gatos -5.0%8.5%-8.7%42.2%-19.3%1,486,396 1,535,244 -3.2%Food Processing Eqp Restaurants Miscellaneous Other Auto Sales - New
Milpitas -1.7%3.1%-1.8%28.0%21.5%5,992,871 5,757,900 4.1%Electronic Equipment Bldg.Matls-Whsle Office Equipment Miscellaneous Retail
Morgan Hill -5.6%3.3%-8.1%-7.9%-3.4%2,546,968 2,732,488 -6.8%Restaurants Miscellaneous Other Misc. Vehicle Sales Heavy Industry
Mountain View -4.1%0.4%4.2%-32.6%-28.8%4,259,335 4,591,858 -7.2%Auto Parts/Repair Restaurants Business Services Auto Sales - New
Palo Alto 2.0%3.8%-2.5%123.1%34.0%7,399,964 7,401,454 0.0%Office Equipment Miscellaneous Retail Leasing Furniture/Appliance
San Jose 3.1%3.1%-2.7%-2.8%-0.1%56,006,362 58,515,924 -4.3%Miscellaneous Retail Restaurants Office Equipment Green Energy
Santa Clara 7.1%6.5%-3.4%24.8%27.8%13,613,584 12,449,511 9.4%Light Industry Business Services Office Equipment Auto Sales - New
County of Santa Clara 4.2%-1.2%-23.1%-15.3%-10.6%1,243,253 1,363,454 -8.8%Restaurants Food Markets Bldg.Matls-Whsle Food Processing Eqp
Saratoga -19.5%2.1%20.8%36.3%42.3%267,993 262,342 2.2%Service Stations Auto Parts/Repair Miscellaneous Retail Furniture/Appliance
Sunnyvale 34.9%4.3%-18.2%-17.1%37.0%7,660,841 7,416,916 3.3%Miscellaneous Retail Light Industry Auto Sales - New Bldg.Matls-Whsle
Quarterly Analysis by Sales Tax Category: Change from 2023Q2 to 2024Q2 (Economic)
Unlike the chart on page one which showed a ‘benchmark year’ through the second quarter of 2024, the chart above shows a comparison of one quarter only –
second quarter of 2024 to second quarter of 2023. This chart is for local ‘brick and mortar’ businesses, and it excludes county pools and adjustments.
City of Palo Alto
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California Avenue % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
FOOD PRODUCTS -1.1%97,704 98,820 59.0%60.8%
GENERAL RETAIL 11.7%22,895 20,505 13.8%12.6%
ALL OTHER 4.4%45,034 43,138 27.2%26.6%
TOTAL 2.0%165,633 162,464 100.0%100.0%
El Camino Real and Midtown % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
FOOD PRODUCTS -4.3%153,816 160,747 29.4%42.0%
GENERAL RETAIL -5.6%36,560 38,735 7.0%10.1%
ALL OTHER 81.6%333,136 183,471 63.6%47.9%
TOTAL 36.7%523,512 382,952 100.0%100.0%
Greater Downtown % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
FOOD PRODUCTS 1.0%542,523 537,207 61.4%61.6%
GENERAL RETAIL -15.8%228,058 270,854 25.8%31.1%
BUSINESS TO BUSINESS 24.0%53,804 43,404 6.1%5.0%
CONSTRUCTION 474.3%48,831 8,503 5.5%1.0%
MISCELLANEOUS -27.6%6,123 8,463 0.7%1.0%
TRANSPORTATION 17.4%3,848 3,276 0.4%0.4%
TOTAL 1.3%883,187 871,707 100.0%100.0%
Stanford Shopping Center % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
GENERAL RETAIL 4.2%1,518,464 1,457,305 78.7%77.0%
FOOD PRODUCTS 1.3%169,662 167,448 8.8%8.8%
ALL OTHER -9.7%241,807 267,918 12.5%14.2%
TOTAL 2.0%1,929,933 1,892,671 100.0%100.0%
City of Palo Alto Geo Areas & Citywide Chart Data: Change from 2023Q2 to 2024Q2 (Economic)
City of Palo Alto
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Town And Country Shopping Center % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
FOOD PRODUCTS -0.2%122,784 123,015 61.1%61.5%
GENERAL RETAIL 6.7%78,073 73,144 38.8%36.6%
ALL OTHER -93.5%249 3,857 0.1%1.9%
TOTAL 0.5%201,107 200,016 100.0%100.0%
All Other Geos combined with Balance of Jurisdiction % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
BUSINESS TO BUSINESS -6.0%2,188,898 2,329,347 32.5%34.0%
GENERAL RETAIL 0.7%1,964,890 1,950,901 29.2%28.5%
TRANSPORTATION -2.5%1,282,611 1,315,458 19.1%19.2%
FOOD PRODUCTS 0.7%1,179,030 1,170,370 17.5%17.1%
CONSTRUCTION 99.0%66,301 33,321 1.0%0.5%
MISCELLANEOUS -17.5%47,259 57,263 0.7%0.8%
TOTAL -1.9%6,728,989 6,856,660 100.0%100.0%
All Geo Areas Total Comparison 24Q2 & 23Q2 % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
Balance of Jurisdiction -9.6%3,025,617 3,346,850 45.0%48.8%
Stanford Shopping Center 2.0%1,929,933 1,892,671 28.7%27.6%
Greater Downtown 1.3%883,187 871,707 13.1%12.7%
El Camino Real and Midtown 36.7%523,512 382,952 7.8%5.6%
Town And Country Shopping Center 0.5%201,107 200,016 3.0%2.9%
California Avenue 2.0%165,633 162,464 2.5%2.4%
TOTAL -1.9%6,728,989 6,856,660 100.0%100.0%
Palo Alto citywide QE 24Q2 & 23Q2 % CHANGE QoQ 2024Q2 QE 2023Q2 QE 24Q2 % OF TOTAL 23Q2 % OF TOTAL
BUSINESS TO BUSINESS -5.1%2,366,493 2,494,782 32.0%33.7%
GENERAL RETAIL 1.5%2,043,997 2,013,002 27.6%27.2%
FOOD PRODUCTS 3.8%1,394,270 1,343,533 18.8%18.2%
TRANSPORTATION -2.5%1,286,021 1,319,459 17.4%17.8%
MISCELLANEOUS 12.6%209,545 186,015 2.8%2.5%
CONSTRUCTION 123.1%99,639 44,663 1.3%0.6%
TOTAL 0.0%7,399,964 7,401,454 100.0%100.0%
City of Palo Alto Geo Areas & Citywide Chart Data: Change from 2023Q2 to 2024Q2 (Economic) Cont.
City of Palo Alto
www.avenuinsights.com (800) 800-8181 Page 11
FOOD PRODUCTS,
-1.1% CHANGE, $97,704 ,
59.0% TOTAL
GENERAL RETAIL,
11.7% CHANGE, $22,895 ,
13.8% TOTAL
ALL OTHER,
4.4% CHANGE, $45,034 ,
27.2% TOTAL
California Avenue 2024Q2 SALES TAX AMOUNTS
FOOD PRODUCTS, $98,820 ,
60.8%TOTAL
GENERAL RETAIL,
$20,505 , 12.6%TOTAL
ALL OTHER, $43,138 ,
26.6%TOTAL
California Avenue 2023Q2 SALES TAX AMOUNTS
FOOD PRODUCTS,
-4.3%CHANGE, $153,816 ,
29.4%TOTAL
GENERAL RETAIL,
-5.6% CHANGE, $36,560 ,
7.0%TOTAL
ALL OTHER,
81.6% CHANGE,
$333,136 ,
63.6%TOTAL
El Camino Real and Midtown 2024Q2 SALES TAX AMOUNTS
FOOD PRODUCTS, $160,747 ,
42.0%TOTAL
GENERAL RETAIL,
$38,735, 10.1%TOTAL
ALL OTHER, $183,471
47.9%TOTAL
El Camino Real and Midtown 2023Q2SALES TAX AMOUNTS
City of Palo Alto Geo Area Pie Charts
City of Palo Alto
www.avenuinsights.com (800) 800-8181 Page 12
FOOD PRODUCTS,
1.0%CHANGE, $542,523 ,
61.4%TOTAL
GENERAL RETAIL,
-15.8% CHANGE,
$228,058 ,
25.8%TOTAL
BUSINESS TO BUSINESS,
24.0% CHANGE, $53,804 ,
6.1%TOTAL
CONSTRUCTION,
474.3% CHANGE, $48,831 ,
5.5%TOTAL
MISCELLANEOUS,
-27.6% CHANGE, $6,123 ,
0.7%TOTAL TRANSPORTATION,
17.4% CHANGE, $3,848 ,
0.4%TOTAL
Greater Downtown 2024Q2 SALES TAX AMOUNTS
FOOD PRODUCTS,
$537,207 , 61.6%TOTAL
GENERAL RETAIL,
$270,854 , 31.1%TOTAL
BUSINESS TO BUSINESS,
$43,404 , 5.0%TOTAL
CONSTRUCTION, $8,503 ,
1.0%TOTAL
MISCELLANEOUS, $8,463 ,
1.0%TOTAL TRANSPORTATION, $3,276 ,
0.4%TOTAL
Greater Downtown 2023Q2 SALES TAX AMOUNTS
GENERAL RETAIL
$1,457,305 ,
77.0%TOTAL
FOOD PRODUCTS, $167,448 ,
8.8%TOTAL
ALL OTHER, $267,918 ,
14.2%TOTAL
Stanford Shopping Center 2023Q2SALES TAX AMOUNTS
GENERAL RETAIL,
4.2% CHANGE, $1,518,464 ,
78.7%TOTALFOOD PRODUCTS,
1.3% CHANGE,
$169,662 ,
8.8%TOTAL
ALL OTHER, -9.7% CHANGE,
$241,807 , 12.5%TOTAL
Stanford Shopping Center 2024Q2SALES TAX AMOUNTS
City of Palo Alto Geo Areas Pie Charts
City of Palo Alto
www.avenuinsights.com (800) 800-8181 Page 13
FOOD PRODUCTS,
-0.2%CHANGE, $122,784 ,
61.1%TOTALGENERAL RETAIL,
6.7% CHANGE, $78,073 ,
38.8%TOTAL
ALL OTHER, -93.5% CHANGE, $249 , 0.1%TOTAL
Town And Country Shopping Center 2024Q2SALES TAX AMOUNTS
FOOD PRODUCTS,
$123,015 ,
61.5%TOTAL
GENERAL RETAIL,
$73,144 ,
36.6%TOTAL
ALL OTHER, $3,857 , 1.9%TOTAL
Town And Country Shopping Center 2023Q2 SALES TAX AMOUNTS
BUSINESS TO BUSINESS,
-6.0%CHANGE,
$2,188,898 ,
32.5%TOTAL
GENERAL RETAIL,
0.7% CHANGE, $1,964,890,
29.2% TOTAL
TRANSPORTATION,
-2.5% CHANGE,
$1,282,611,
19.1% TOTAL
FOOD PRODUCTS,
0.7% CHANGE, $1,179,030 ,
17.5%TOTAL
CONSTRUCTION, 99.0% CHANGE,
$66,301 , 1.0%TOTAL
MISCELLANEOUS,
-17.5% CHANGE, $47,259 ,
0.7%TOTAL
All Other Geos combined with Balance of Jurisdiction 2024Q2
SALES TAX AMOUNTS
BUSINESS TO BUSINESS,
$2,329,347 ,
34.0%TOTAL
GENERAL RETAIL, $1,950,901,
28.5% TOTAL
TRANSPORTATION,
$1,315,458 ,
19.2% TOTAL
FOOD PRODUCTS,
$1,170,370 ,
17.1%TOTAL
CONSTRUCTION,
$33,321 , 0.5%TOTAL
MISCELLANEOUS,
$57,263 , 0.8%TOTAL
All Other Geos combined with Balance of Jurisdiction 2023Q2
SALES TAX AMOUNTS
City of Palo Alto Geo Area Pie Charts
City of Palo Alto
www.avenuinsights.com (800) 800-8181 Page 14
Balance of Jurisdiction,
-9.6%CHANGE,
$3,025,617 ,
45.0%TOTAL
Stanford Shopping Center,
2.0% CHANGE, $1,929,933 ,
28.7%TOTAL
Greater Downtown,
1.3% CHANGE,
$883,187 ,13.1%TOTAL
El Camino Real and Midtown,
36.7% CHANGE, $523,512 ,
7.8%TOTAL
Town And Country Shopping Center,
0.5% CHANGE, $201,107 , 3.0%TOTAL California Avenue, 2.0% CHANGE,
$165,633 , 2.5%TOTAL
All Geo Area Totals 2024Q2 SALES TAX AMOUNTS
Balance of Jurisdiction,
$3,346,850 , 48.8%TOTAL
Stanford Shopping Center,
$1,892,671 , 27.6%TOTAL
Greater Downtown,
$871,707 , 12.7%TOTAL
El Camino Real and Midtown,
$382,952 , 5.6%TOTAL
Town And Country Shopping Center,
$200,016 , 2.9%TOTAL California Avenue,
$162,464 , 2.4%TOTAL
All Geo Area Totals 2023Q2 SALES TAX AMOUNTS
BUSINESS TO BUSINESS,
-5.1%CHANGE, $2,366,493 ,
32.0%TOTAL
GENERAL RETAIL,
1.5% CHANGE, $2,043,997 ,
27.6%TOTAL
FOOD PRODUCTS,
3.8% CHANGE,
$1,394,270 ,
18.8%TOTAL
TRANSPORTATION,
-2.5% CHANGE, $1,286,021 ,
17.4%TOTAL
MISCELLANEOUS, 12.6% CHANGE,
$209,545 , 2.8%TOTAL
CONSTRUCTION,
123.1% CHANGE, $99,639 ,
1.3%TOTAL
Palo Alto citywide 2024Q2 SALES TAX AMOUNTS
BUSINESS TO BUSINESS,
$2,494,782 , 33.7%TOTAL
GENERAL RETAIL,
$2,013,002 ,
27.2%TOTAL
FOOD PRODUCTS,
$1,343,533 ,
18.2%TOTAL
TRANSPORTATION,
$1,319,459 17.8%TOTAL
MISCELLANEOUS, $186,015 ,
2.5%TOTAL CONSTRUCTION, $44,663 ,
0.6%TOTAL
Palo Alto citywide 2023Q2 SALES TAX AMOUNTS
City of Palo Alto Geo Area & Citywide Pie Charts
CALIFORNIA
Legislative Update
September 4, 2024
The legislature concluded its two year session late Saturday
night, forgoing some standard legislative procedures and
shutting down floor debate to pass bills moments before
the midnight deadline. It was a notable end-of-session, not
only because of the push to beat the clock, but also
because the tension between the administration, Senate,
and Assembly was palpable.
Governor Gavin Newsom convened a special session of
the legislature on oil and gas prices on the final day of
session, after Assembly leadership declined to pass
eleventh-hour legislation championed by the governor.
The Assembly gaveled in the special session, while Senate
pro Tempore Mike McGuire (D-Geyserville) stated that
the Senate would not be convening the special session, as
he had been willing to consider the proposal within the
regular session. It is unclear what will result from the
refusal, however, hundreds of bills are awaiting the
governor’s signing or veto, potentially giving Newsom
some leverage.
As is customary, the two houses of the legislature
participated in a bit of gamesmanship, holding on to bills
from the other house longer than necessary. What was
unusual, was that the final exchange of bills was at 11 p.m.,
which led to the Assembly waiving rules and sending a few
bills that had not been vetted in a policy committee
directly to the governor. In the final minutes before
midnight, Assembly Member Bill Essayli (R-Corona)
repeatedly objected to the decision to limit debate to 30
seconds, shouting and pounding on his desk, then
departing prior to the close of session.
The subject matter of the most controversial legislative
proposals competing for attention in the last days of
session was far ranging. The legislature passed bills
addressing a ban on leaded aviation fuel, artificial
intelligence and “deep fakes,” affordable housing and
jobless aid for undocumented immigrants, pharmacy
benefit managers, and medical debt reporting on credit
reports. Prescriptive legislation impacting warehouse
design and build standards, AB 98 (Carrillo) briefly
outlined in the economic development section of this
memo, was easily the most debated measure impacting
local jurisdictions. The measure passed the legislature
without being heard in an Assembly policy committee, and
is on the governor’s desk.
Last month, Governor Newsom signed a major package of
legislation targeting organized retail theft and aiming to
head off more stringent measures proposed under Prop.
36, which voters will consider in November. The package
is intended to make it easier to prosecute retail and vehicle
thefts, while preserving provisions contained in Prop. 47
(2014) which reduced prison sentences for nonviolent
crimes.
For the remaining bills passed by the legislature, the
governor has until September 30 to sign or veto legislation.
Unless the legislature gathers prior to December to act on
the special session, they will next convene on December 2
in Sacramento to open the 2025-26 legislative session.
Below is a summary of key legislation we have been
following this year, most of which are awaiting action by
the governor.
Broadband
AB 1588 (Wilson) Affordable Internet and Net
Equality Act of 2024. As amended 7/3/24. This bill
would require the California Public Utilities Commission
to establish an expedited process by which an existing
regulated telephone service provider that offers broadband
services or has an affiliate that offers broadband services
can become an eligible telecommunications carrier for the
purposes of providing Lifeline services.
Status: Held on the Senate Appropriations committee
suspense file – dead.
Cal Cities Position: Watch
AB 1826 (Holden) Digital Equity in Video
Franchising Act of 2024. As amended 8/15/24. This bill
makes various modifications to cable franchise
requirements to expand the authority of the California
Public Utilities Commission to regulate cable video
services. The measure also modifies the cable franchise
2
application and renewal process to require public hearings
before the issuance or renewal of a cable franchise and
raises local fines for violations of certain customer service
requirements.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2239 (Bonta) Digital discrimination of access:
prohibition. As amended 7/3/24. This bill would define
“digital discrimination of access” and prohibit entities that
provide, facilitate, and affect consumer access to
broadband internet from engaging in it.
Status: Held on the Senate Appropriations committee
suspense file – dead.
Cal Cities Position: Watch
SB 1383 (Bradford) California Advanced Services
Fund: Broadband Public Housing Account. As
amended 4/9/24. This bill expands eligibility for the
California Advanced Services Fund Broadband Public
Housing Account, authorizes the use of Public Housing
Account funds for devices that improve existing
broadband service, and enables Public Housing Account
recipients offering new broadband plans within low-
income communities to provide a free or low-cost
broadband plan to those communities as a condition of
obtaining the grant.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
Cannabis
AB 1111 (Pellerin) Cannabis: small producer event
sales license. As amended 8/15/24. This bill requires the
Department of Cannabis Control (DCC) no later than Jan.
1, 2026, to issue small producer event sales licenses that
authorizes the license holder to sell cannabis or cannabis
products, containing cannabis cultivated by that licensee, at
licensed state temporary events, and requires the DCC to
charge each small producer event sales licensee a licensing
fee. The bill authorizes a licensee who holds a valid annual
state cultivation license and a valid license, permit, or other
authorization for cannabis cultivation issued by a local
jurisdiction, and who meets specified other requirements,
to apply for a small producer event sales license. Finally,
the bill limits the retail sales of cannabis and cannabis
products by a small producer at state temporary events to
$175,000 in gross revenue per year. Starting Jul. 1, 2027,
the DCC may increase this cap through regulation after
reevaluation.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 1610 (Jones-Sawyer) Cannabis: Department of
Cannabis Control. As amended 6/19/24. This bill would
make changes to the testing standards for licensed
cannabis, including requiring testing for cannabigerolic
acid and heavy metals. The bill would also subject testing
laboratories to in-person audits by the DCC at least once
every 2 years and would require the results of those audits
to be posted on the DCC’s website.
Status: Held on the Senate Appropriations committee
suspense file – dead.
Cal Cities Position: Watch
AB 1616 (Lackey) California Cannabis Tax Fund:
Board State and Community Corrections grants. As
introduced 2/17/23. This bill would amend the Board of
State and Community Corrections’ (BSCC) Prop. 64 Public
Health and Safety Grant Program to expand the eligibility
criteria so that all of California's 482 cities and 58 counties
may apply for grant funding. The bill further directs the
BSCC to prioritize the allocation of BSCC grants to
programs addressing unlawful retail and cultivation
activities.
Status: Referred, but never heard in the Senate Public
Safety committee - dead.
Cal Cities Position: Support
AB 1775 (Haney) Cannabis: local control: cannabis
consumption. As amended 8/23/24. This bill authorizes
a local jurisdiction to allow for the preparation or sale of
non-cannabis food or beverage products by a licensed
retailer or microbusiness in the area where the
consumption of cannabis is allowed, and to allow, and to
sell tickets for, live musical or other performances on the
premises of a licensed retailer or microbusiness in the area
where the consumption of cannabis is allowed. The bill
additionally specifies that these provisions do not
authorize a licensed retailer or microbusiness to prepare or
sell industrial hemp or products containing industrial
hemp, as provided.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2223 (Aguiar-Curry) Cannabis: industrial hemp.
As amended 5/16/24. This bill would revise the
requirements governing industrial hemp products to clarify
and expand the prohibition on synthetic forms of THC,
limits hemp products to no more than one milligram of
THC per product, including no more than 0.25 milligrams
per serving, establishes a seizure and embargo process for
3
unlawful hemp products, and provides for the integration
of hemp products into the marketplace for cannabis
regulated by the DCC.
Status: Held on the Senate Appropriations committee
suspense file – dead.
Cal Cities Position: Support
AB 2555 (Quirk-Silva) Sales and use tax: exemption:
medicinal cannabis: donations. As amended 4/8/24.
This bill ensures continued access to medicinal cannabis
donations for low-income patients by extending
indefinitely the sales and use tax exemption for medicinal
cannabis or medicinal cannabis products that are donated
by cannabis licensees by extending the current exemption
for an additional five years to Jan. 1, 2030.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 820 (Alvarado-Gil) Cannabis: enforcement: seizure
of property. As amended 5/1/23. This bill would
authorize any local jurisdiction or the DCC, upon
obtaining an inspection warrant, to seize property in the
place, building, yard, or enclosure where unlicensed
commercial cannabis activity is conducted, and authorizes
the forfeiture, sale, and distribution of such property, as
specified.
Status: Held on the Assembly Appropriations committee
suspense file - dead.
Cal Cities Position: Support
SB 1059 (Bradford) Cannabis tax: cannabis retailers.
As amended 4/24/24. This bill clarifies that the state’s
15% excise tax is calculated based on gross receipts of
cannabis products and does not capture any tax or fee
imposed by a local jurisdiction.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 1064 (Laird) Cannabis. As amended 8/22/24. This
bill revises the Medicinal and Adult Use Cannabis
Regulation and Safety Act licensing scheme for
commercial cannabis activities by adding a combined
activities license classification, as defined as a state license
that authorizes 2 or more commercial cannabis activities at
the same premises.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
SB 1109 (Bradford) Cannabis licensure. As amended
5/16/24. This bill requires the DCC to collect
demographic data about a person applying for a state
license.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
Online Sales
SB 1144 (Skinner) Marketplaces: online marketplaces.
As amended 7/1/24. This bill expands existing provisions
requiring online marketplaces to collect certain
information from high-volume third-party sellers and
extends the authority to enforce these provisions to the
district attorney in any county, a city attorney in any city,
or a county counsel in any county.
Status: Chapter 172, Statutes of 2024.
Cal Cities Position: Support
Short-Term Rentals
AB 2202 (Rendon) Short-term rentals: disclosure:
cleaning tasks. As amended 8/15/24. This bill requires a
place of short-term lodging or a website, application, or
other similar centralized online platform to include
specified disclosures to be affirmatively acknowledged by
the consumer about additional fees and charges that will
be added if a consumer fails to complete certain cleaning
tasks and a description of those tasks.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 683 (Glazer) Hotels and short-term rentals:
advertised rates: mandatory fees. As amended 9/7/23.
This bill would, beginning Jul. 1, 2024, require a person or
a website, application, or other similar centralized platform
that advertises a hotel room rate or short-term rental rate
before the public in this state, or from this state before the
public in any state, to include in the advertised hotel room
rate or short-term rental rate all mandatory fees, that will
be charged in order for the consumer to stay in the hotel
room or short-term rental and include in the total price to
be paid, before the consumer reserves the stay, all taxes
and fees imposed by a government on the stay.
Status: Placed on the Assembly inactive file - dead.
Cal Cities Position: Watch
Sales and Use Taxes
AB 52 (Grayson) Income tax credit: sales and use
taxes paid: manufacturing equipment: research and
development equipment. As amended 8/15/24. This bill
4
allows a credit under both the Personal Income Tax Law
and the Corporation Tax Law equal to the amount of sales
tax reimbursement or use tax paid on purchases that were
partially exempt under the existing sales and use tax
exemption for manufacturing and research and
development.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: None
AB 2061 (Wilson) Sales and Use Tax: exemptions:
zero-emission public transportation ferries. As
amended 5/1/24. This bill, beginning Jan. 1, 2025, and
until Jan. 1, 2030, provides a partial sales and use tax
exemption for a zero-emission public transportation ferry.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
AB 2274 (Dixon) Taxation: sales and use taxes:
exemption: tax holiday. As amended 3/21/24. This bill
would, on and after Jan. 1, 2025, exempt from sales and
use taxes the gross receipts from the sale of, and the
storage, use, or other consumption of, any tangible
personal property purchased during the first weekend in
August, beginning at 12:01 a.m. on Saturday and ending at
11:59 p.m. on Sunday.
Status: Referred, but never heard in the Assembly Revenue
& Taxation committee - dead.
Cal Cities Position: Oppose
AB 2443 (Carillo) Transactions and use taxes: Cities
of Lancaster, Palmdale, and Victorville. As amended
8/6/24. This bill authorizes the cities of Lancaster,
Palmdale, and Victorville to impose a transaction and use
tax for the support of countywide transportation programs
or general services. The tax rate may be up to 1%, even if
it causes the combined transactions and use tax rate to
exceed the statutory limit of 2%, provided certain
conditions are met. The bill specifies that any tax imposed
under this authorization will not count towards the 2%
combined rate limit. The authorization for these cities to
impose the tax will be repealed on Jan. 1, 2029, if an
ordinance proposing the tax has not been approved by
that date.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2854 (Irwin) Bradley-Burns Uniform Local Sales
and Use Tax Law. As amended 8/15/24. This bill
requires local agencies to publish on their websites and
provide to the California Department of Tax and Fee
Administration specified information relating to each
agreement resulting in the direct or indirect payment,
transfer, diversion, or rebate of Bradley-Burns Sales Taxes.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
AB 3259 (Wilson) Transactions and use taxes: County
of Solano. As amended 8/22/24. This bill authorizes the
cities of Campbell and Pinole, Solano County, or any city
within Solano County, to impose a transaction and use tax
for general or specific purposes that exceeds the 2%
statutory limitation, by ordinance of citizen’s initiative. The
bill repeals this authorization on Jan. 1, 2029, if an
ordinance or citizens’ initiative proposing the tax has not
been approved by that date.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
Property Tax
AB 1093 (Patterson) Property taxation: manufactured
homes: tax collection. As amended 7/13/23. This bill
would revise the Manufactured Home Property Tax Law
procedures for issuing a tax clearance certificate or a
conditional tax clearance certificate and for the collection
of unpaid, estimated taxes. With respect to the collection
of taxes that are not yet payable, the bill would require
those taxes to be computed by a certificate or statement
prepared by the tax collector, upon request by an escrow
officer, as provided, giving their estimate of those taxes or
assessments for the current fiscal year and one succeeding
fiscal year.
Status: Held on the Senate Appropriations committee
suspense file - dead.
Cal Cities Position: Watch
AB 1868 (Friedman) Property taxation: assessments:
affordable housing. As amended 8/22/24. This bill
makes a rebuttable presumption that an assessor shall not
include the value of the deed of trust on certain
affordability-restricted properties utilizing the community
land trust model.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2353 (Ward) Property taxation: welfare exemption:
delinquent payments: interest and penalties. As
amended 8/21/24. This bill prohibits a county tax
collector from taking or continuing any collection action
for any delinquent installments of property taxes levied on
a taxpayer that intends to develop the property for rent at
5
affordable rates to low-income households, among other
conditions.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2506 (Lowenthal) Property taxation: local
exemption: possessory interests: publicly owned
housing. As introduced 2/13/24. This bill would
authorize a county board of supervisors to exempt from
property taxation any possessory interest held by a tenant
of publicly owned housing with a value so low that the
total taxes and applicable subventions on the property
would amount to less than the cost of assessing and
collecting them.
Status: Referred, but never heard in the Assembly Revenue
& Taxation committee - dead.
Cal Cities Position: Watch
AB 2564 (Boerner) Property tax postponement: Senior
Citizens and Disabled Citizens Property Tax
Postponement Fund. As introduced 2/14/24. This bill
requires money to be transferred, on Jun. 30, 2025, and on
Jun. 30 each year thereafter, from the state General Fund
to the Senior Citizens and Disabled Citizens Property Tax
Postponement Fund when the balance in the latter fund is
less than $15 million.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
AB 2647 (Low) Property taxation: disabled veterans’
exemption: welfare exemption: housing for law
enforcement and firefighters. As amended 4/10/24.
This bill would expand the disabled veterans’ property tax
exemption and would provide an unmarried surviving
spouse a property tax exemption in the same amount that
they would have been entitled to if the veteran was alive
and if certain conditions are met.
Status: Referred, but never heard in the Assembly Revenue
& Taxation committee - dead.
Cal Cities Position: Watch
AB 2897 (Connolly) Property tax: welfare exemption:
community land trusts. As amended 8/20/24. This bill
makes changes to the definition of a community land trust
(CLT) for purposes of property tax assessment and adds
cross references in various statutes to the definition of
CLT.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 3134 (Chen) Property taxation: refunds. As
amended 8/23/24. This bill makes changes to laws guiding
property tax refunds by allowing refunds to be paid
without the taxpayer filing a claim under certain
circumstances. Additionally, the measure increases from
$5,000 to $10,000 the thresholds for automatic refunds
due to value reductions, roll corrections, cancellations, and
when the refund is issued to the recorded owner of the
property rather than to the person who actually paid the
tax.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 3277 (Committee on Local Government) Local
agency formation commission: districts: property tax.
As introduced 2/27/24. This bill requires a commission to
determine the amount of property tax revenue to be
exchanged by an affected local agency if the proposal
includes the formation of a district and the applicant is
seeking a share of the 1% ad valorem property taxes.
Status: Chapter 70, Statutes of 2024.
Cal Cities Position: None
SB 726 (Archuleta) Property taxation: exemption:
disabled veteran homeowners. As amended 4/13/23.
This bill would increase the disabled veterans’ exemption
from property taxation to $863,790, and indexes the
increased amount for inflation, for lien dates between Jan.
1, 2024, and Jan. 1, 2034.
Status: Referred, but never heard in the Assembly Revenue
& Taxation committee - dead.
Cal Cities Position: Watch
SB 871 (Archuleta) Property taxation: homeowners’,
veterans’, and disabled veterans’ exemptions. As
amended 9/1/23. This bill would amend the homeowners’
exemption from property tax to allow a property that
receives the homeowners’ exemption to also receive the
disabled veterans’ or veterans’ exemptions; and takes effect
only if voters approve SCA 6 (Archuleta). SCA 6, outlined
below, is also dead for the year.
Status: Referred to, but never heard in the Assembly
Revenue & Taxation committee - dead.
Cal Cities Position: Watch
SB 1072 (Padilla) Local government: Proposition 218:
remedies. As amended 6/17/24. This bill provides that, if
a court determines that a fee or charge for a property-
related service violates Prop. 218, then the local agency
must credit that amount against the cost of providing the
property related service.
6
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
SB 1164 (Newman) Property taxation: new
construction exclusion: accessory dwelling units. As
amended 5/16/24. This bill would enact a property tax
new construction exclusion for the addition or
construction of an accessory dwelling unit between Jan. 1,
2025, and Jan. 1, 2030.
Status: Referred, but never heard in the Assembly Revenue
& Taxation committee - dead.
Cal Cities Position: Oppose
SCA 6 (Archuleta) Property taxation: veterans’
exemption. As amended 4/26/23. Upon approval of
voters, this bill would allow a dwelling that receives the
veterans’ exemption or the disabled veteran’s exemption to
also receive the homeowners’ exemption. Additionally, it
would authorize the legislature to exempt property eligible
for the veterans’ exemption in an amount up to the full
value of the property. If the legislature increases the
homeowners’ exemption, the measure would require that
the legislature provide the same increase in the veterans’
exemption, except as limited by the full value of the
property.
Status: Never referred to a policy committee in the
Assembly - dead.
Cal Cities Position: Watch
Corporation Tax
AB 1973 (Lackey) Personal Income Tax Law:
Corporation Tax Law: Bobcat Fire: exclusions. As
amended 4/18/24. This bill would, for taxable years
beginning on or after Jan.1, 2024, and before Jan. 1, 2029,
provide an exclusion from gross income for any qualified
taxpayer, for amounts received in settlement for costs and
losses associated with the 2020 Bobcat Fire in the County
of Los Angeles.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: None
AB 3160 (Gabriel) Insurance, income, and corporation
taxes: credits: low-income housing. As amended
8/23/24. This bill provides that an additional allocation of
$500 million to the Low Income Housing Tax Credit is
not subject to an appropriation in the annual Budget Act
for calendar years 2026 through 2030.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 542 (Dahle) Personal Income Tax Law:
Corporation Tax Law: wildfires: exclusions. As
amended 7/3/24. This bill, for taxable years beginning on
or after Jan. 1, 2022, and before Jan. 1, 2027, provides an
exclusion from gross income for any qualified taxpayer, for
amounts received in settlement for costs and losses
associated with the 2021 Dixie Fire in the counties of
Butte, Plumas, Lassen, Shasta, and Tehama, or the 2022
Mill Fire in the County of Siskiyou.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: None
Revenue and Taxation
AB 2557 (Ortega) Local agencies: contracts for special
services and temporary help: performance reports. As
amended 7/3/24. This bill would impose new
requirements on the governing bodies of local agencies
that wish to contract out for certain services, as specified,
including posting contracts and related documents on the
local agency’s website and providing advance notice to the
public agency’s affected workforce union representative, as
specified. The bill would also require public contracts for
functions currently or previously performed by unionized
public employees to include specified information
beginning Jul. 1, 2026.
Status: Held on the Senate Appropriations committee
suspense file - dead.
Cal Cities Position: Oppose
AB 2561 (McKinnor) Local public employees: vacant
positions. As amended 8/23/24. This bill requires a
public agency to present the status of vacancies and
recruitment and retention efforts during a public hearing
before the governing board at least once per fiscal year and
entitles the union for a bargaining unit to make a
presentation at the public hearing, as specified.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Oppose
AB 2813 (Aguiar-Curry) Government Investment Act.
As amended 6/26/24. This is a companion bill to ACA 1
and ACA 10 which were approved by the legislature in
2023 and 2024 respectively, and placed on the November
2024 ballot as Prop. 5. If Prop. 5 is approved by California
voters, this bill defines “affordable housing” to include
rental housing, ownership housing, interim housing, and
affordable housing programs such as down payment
assistance, first-time homebuyer programs, and owner-
occupied affordable housing rehabilitation programs.
Additionally, the bill requires a local government to ensure
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that any project that is funded with Prop. 5 bonded
indebtedness or Prop 5 special taxes to have an estimated
useful life of at least 15 years or 5 years if the funds are for
specified public safety buildings, facilities, and equipment.
Status: Chapter 155, Statutes of 2024.
Cal Cities Position: Watch
AB 3005 (Wallis) Motor Vehicle Fuel Tax Law:
adjustment suspension. As introduced 2/16/24. This
bill would authorize the governor to suspend an
adjustment to the motor vehicle fuel tax, scheduled on or
after Jul. 1, 2025, upon determining that increasing the rate
would impose an undue burden on low-income and
middle-class families. Additionally, the measure would
require the governor to notify the legislature of an intent
to suspend the rate adjustment on or before Jan. 10 of that
year and would require the Department of Finance to
submit to the legislature a proposal by Jan. 10 that would
maintain the same level of funding for transportation
purposes as would have been generated had the scheduled
adjustment not been suspended.
Status: Never heard in policy committee - dead.
Cal Cities Position: Oppose
Development Fees
AB 1820 (Schiavo) Housing development projects:
applications: fees and exactions. As amended 8/20/24.
This bill authorizes a development proponent that submits
a preliminary application for a housing development
project to request a preliminary fee and exaction estimate,
as defined, and requires a local jurisdiction to provide the
estimate within 30 business days of the submission of the
preliminary application. For development fees imposed by
an agency other than a city, county, or city and county, the
bill requires the development proponent to request the fee
schedule from the agency that imposes the fee and requires
the agency that imposes the fee to provide the fee schedule
to the development proponent without delay.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Neutral
AB 2430 (Alvarez) Planning and zoning: density
bonuses: monitoring fees. As amended 8/23/24.
This bill prohibits a city, county, or city and county from
charging a monitoring fee on a 100% affordable housing
development using State Density Bonus Law (DBL) to
ensure the continued affordability required under DBL
and any applicable local inclusionary housing ordinance if
the units in the development are subject to a regulatory
monitoring agreement with certain state agencies.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2663 (Grayson) Affordable housing fees: reports.
As amended 6/17/24. This bill defines “inclusionary
housing in-lieu fees” to mean fees imposed as an
alternative means of compliance with an inclusionary
housing requirement. The bill, commencing on Jan. 1,
2026, and every 5 years thereafter, requires a local agency
that collects inclusionary housing in-lieu fees to post on its
internet website the amount of those fees collected in the
past 5 years and the project those fees were spent on.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2729 (Patterson, Joe) Residential fees and charges.
As amended 8/21/24. This bill extends residential
development entitlements by 18 months.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 3177 (Carrillo, Wendy) Mitigation Fee Act: land
dedications: mitigating vehicular traffic impacts. As
amended 8/19/24. This bill prevents local agencies from
imposing land dedication requirements on new housing
developments in transit priority areas to widen a roadway
for vehicular traffic purposes, or for achieving a desired
roadway width, with certain exemptions.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 937 (Wiener) Development projects: permits and
other entitlements: fees and charges. As amended
8/22/24. This bill prohibits a local government from
requiring payment of fees or charges for public
improvements or facilities on a designated residential
development project before the development receives a
certificate of occupancy, except under certain conditions.
Authorizes a local government to collect certain unpaid
fees or charges in accordance with a specified procedure if
the housing developer does not post a performance bond
or letter of credit.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Oppose unless amended
Economic Development
AB 98 (Carrillo) Planning and zoning: logistics use:
truck routes. As amended 8/28/24. This bill prohibits,
commencing Jan. 1, 2026, cities and counties from
approving new or expanded logistics uses unless they meet
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certain standards including buffer zones and mandatory
truck route provisions; requires cities and counties to
update their circulation elements to include truck routes;
and imposes study requirements on the South Coast Air
Quality Management District.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Oppose
AB 761 (Friedman) Local finance: enhanced
infrastructure financing districts. As amended 5/20/24.
This bill allows an enhanced infrastructure financing
district enacted primarily to develop and construct
passenger rail projects in Los Angeles County to last 75
years instead of 45 years if they receive specified federal
transportation loans.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 930 (Friedman) Local government: infrastructure
financing districts: Reinvestment in Infrastructure for
a Sustainable and Equitable California (RISE)
districts: housing development: restrictive covenants.
As amended 6/13/2024. This bill would authorize two or
more specified local governments to jointly form a RISE
district to use tax increment financing and other revenue
options to finance infill supportive infrastructure and
affordable housing, among other things, near major transit
stops. The bill would also require the Governor’s Office of
Planning and Research to develop guidelines for the
formation of RISE districts, and require the Infrastructure
and Economic development Bank to establish a RISE
District Revolving Loan Program, upon appropriation by
the legislature, to provide RISE districts with initial startup
funding for eligible projects.
Status: Held on the Senate Appropriations committee
suspense file - dead.
Cal Cities Position: Watch
AB 1569 (Garcia) Salton Sea geothermal resource area:
Lithium Valley Office of Development. As amended
5/18/23. This bill would establish the Lithium Valley
Office of Development in the Energy Commission, and
require the office, in consultation with relevant state and
local agencies, to coordinate activities related to funding,
economic development, construction, manufacturing,
technical development, and reclamation of lithium located
in the Salton Sea geothermal resource area.
Status: Held on the Senate Appropriations committee
suspense file - dead.
Cal Cities Position: Watch
AB 1819 (Waldron) Enhanced infrastructure financing
districts: public capital facilities: wildfires. As amended
8/14/24. This bill allows enhanced infrastructure financing
districts to finance specified firefighting equipment if the
district is at least partially in a high or very high fire hazard
severity zone.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2488 (Ting) Downtown revitalization and
economic recovery financing districts: City and
County of San Francisco. As amended 8/23/2024. This
bill allows the City and County of San Francisco to create a
Downtown Revitalization and Economic Recovery
Financing District to finance office-to-residential
conversion projects using incremental property tax
revenues.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2922 (Garcia) Economic development: capital
investment incentive programs. As amended 8/23/24.
This bill reinstates the Capital Investment Incentive
Program until Jan. 1, 2035, and expands the program to
cover lower initial investment amounts if a project
proponent meets additional job creation requirements.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Support
SB 440 (Skinner) Regional Housing Finance
Authorities. As amended 8/19/24. This bill authorizes
two or more local governments to establish a regional
housing finance authority to raise, administer, and allocate
funding for affordable housing and provide technical
assistance at a regional level for affordable housing
development.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 864 (Smallwood-Cuevas) Workforce development:
workplace rights curriculum. As amended 7/3/23. This
bill would require the California Workforce Development
Board to assist the governor with partnering with the labor
commissioner and other subject matter experts in
developing a workplace rights curriculum to be provided
to all individuals receiving individualized career services,
supportive services, or training services through the
California workforce system. The measure would require
each local workforce development board to ensure the
provision of workplace rights training consistent with that
workplace rights curriculum. The bill would require the
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comprehensive 4-year local plan to include a description of
how the local board plans to comply with this requirement.
Status: Held on the Assembly Appropriations committee
suspense file - dead.
Cal Cities Position: Watch
SB 1140 (Caballero) Enhanced infrastructure
financing district. As amended 8/8/24. This bill makes a
series of changes to the enhanced infrastructure financing
district formation process, and expands the type of
projects that these districts and other similar districts can
finance to include projects that improve air quality.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
Transit
AB 1853 (Villapudua) San Joaquin Regional Transit
District: meetings: surplus money investments. As
amended 6/3/24. This bill authorizes the San Joaquin
Regional Transit District board to provide, by ordinance or
resolution, that each board member receive $100 for each
board meeting and committee meeting attended, not to
exceed $500 in a calendar month.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 1924 (Nguyen, Stephanie) Sacramento Regional
Transit District. As amended 5/13/24. This bill allows
the Sacramento Regional Transit District to expand its
service area to any city within Sacramento County and any
other portion of the unincorporated territory within the
boundaries of Sacramento County where the county has
declared a need for the district to operate and reduces the
number of Board Members that may be appointed by the
City of Sacramento from 4 to 3.
Status: Chapter 92, Statutes of 2024.
Cal Cities Position: Watch
AB 2325 (Lee) San Francisco Bay Area Rapid Transit
District: officers: designation and appointment. As
amended 5/30/24. This bill eliminates the treasurer and
controller as specifically designated officers of the San
Francisco Bay Area Rapid Transit District and as positions
subject to appointment and removal by the board. It
additionally eliminates specified qualifications applicable to
the controller.
Status: Chapter 106, Statutes of 2024.
Cal Cities Position: None
AB 2553 (Friedman) Housing development: major
transit stops: vehicular traffic impact fees. As amended
8/13/24. This bill requires cities and counties to set lower
traffic impact mitigation fees for transit-oriented housing
developments near major transit stops, instead of just at
transit stations, and changes the definition of a major
transit stop.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
AB 2634 (McCarty) Sacramento Regional Transit
District. As amended 5/30/24. This bill exempts the
Sacramento Regional Transit (SacRT) District from a
requirement that each transit operator that offers reduced
fares to senior citizens must also offer reduced fares to
disabled persons at the same rate established for senior
citizens until Jan. 1, 2027. Further mandates that if SacRT
offers reduced fares to senior citizens only, under this
exemption, the district shall not increase fares for disabled
persons or disabled veterans. Lastly, the bill requires, under
this exemption, that if SacRT offers reduced fares to
senior citizens only, then SacRT is to submit a report to
the legislature by Jan. 1, 2026.
Status: Chapter 111, Statutes of 2024.
Cal Cities Position: None
SB 904 (Dodd) Sonoma-Marin Area Rail Transit
District. As amended 8/19/24. This bill expands the
authority of the Sonoma-Marin Area Rail Transit District's
board. In addition to submitting a retail transaction and
use tax ordinance to the voters, the bill allows for special
district taxes to be imposed by a qualified voter initiative.
It requires the boards of supervisors in Sonoma and Marin
counties to call a special election for any tax measure
proposed by either the district’s board of directors or a
qualified voter initiative. The bill also mandates that the
district reimburse the counties for the incremental costs of
submitting the measure to voters, upon request.
Status: Enrolled, awaiting action by the governor.
Cal Cities Position: None
SB 960 (Wiener) Transportation: planning: transit
priority projects: multimodal. As amended 8/22/24.
This bill requires Caltrans to include complete streets
assets in its asset management plan, system highway
management plan, and in the plain language performance
report for the state highway operation and protection
program (SHOPP). The measure further requires Caltrans
to develop and adopt transit priority policy and guidelines;
and requires Caltrans to commit to specific 4-year targets
to incorporate complete streets facilities in the SHOPP.
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Status: Enrolled, awaiting action by the governor.
Cal Cities Position: Watch
SB 1031 (Wiener) San Francisco Bay area: local
revenue measure: transportation improvements. As
amended 5/20/24. This bill would authorize the
Metropolitan Transportation Commission to propose new
taxes, allocate new revenue, and issue bonds for specified
transportation projects, and require the State
Transportation Agency to consider transit agency
consolidation within the San Francisco Bay area.
Status: Never assigned to a policy committee in the
Assembly - dead.
Cal Cities Position: None
SB 1417 (Allen) Transit districts: prohibition orders.
As introduced 2/16/24. This bill provides that the Santa
Monica Department of Transportation is also a transit
district for purposes of provisions regarding prohibition
orders.
Status: Chapter 189, Statutes of 2024.
Cal Cities Position: None