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HomeMy WebLinkAboutStaff Report 2512-5679CITY OF PALO ALTO CITY COUNCIL Special Meeting Monday, May 04, 2026 Council Chambers & Hybrid 5:30 PM     Agenda Item     A.Q4 CY 2025 Sales Tax Digest (October - December 2025) City Council Staff Report From: City Manager Report Type: INFORMATION REPORTS Lead Department: Administrative Services Meeting Date: May 4, 2026 Report #:2512-5679 TITLE Q4 CY 2025 Sales Tax Digest (October - December 2025) ANALYSIS This report transmits information regarding the City of Palo Alto’s sales tax receipts for the fourth quarter (October - December) of 2025. Highlights from the report are included below. Detailed discussion and data can be found in the Sales Tax Digest (Attachment A). Regional and statewide sales tax - Benchmark Year (Attachment A, pg. 2): Palo Alto: decreased by 5.1% San Francisco Bay Area: decreased by 2.3% California statewide: decreased by 2.9% City’s most significant activity – Benchmark Year (Attachment A, pg. 1): Business to Business – Leasing: decreased by 82.2%; represents 3.6% of total sales tax Transportation – New autos: decreased by 12.2%; represents 12.0% of total sales tax These two segments account for over 15% of Palo Alto’s total sales tax for the period and were the primary drivers of the overall decline. County Pool – 2024Q4 compared to 2025Q4 (Attachment A, pg. 4) Total County Pool: Increased by 23.1% or $7.2 million, from $31.3 million to $38.4 million Total Jurisdiction Share: o Percent of county pool increased by 80 basis points, from 5.9% to 6.7% o Total share increased $0.7 million, from $1.8 million to $2.6 million Over the most recent four quarters, the City received approximately $7.5 million from the County Pool, representing about 22% of the City’s total sales tax revenue of $35.7 million during that period. Further analysis is required to determine the factor(s) contributing to this increase and whether it’s an isolated or ongoing increase. ATTACHMENTS Attachment A: 2025 Q4 Sales Tax Digest Summary APPROVED BY: City of Palo Alto Sales Tax Digest Summary Collections through December 2025 Sales October through December 2025 (2025Q4) neumo.com (800) 800-8181 Page 1 California Overview For the year ending in the fourth quarter of 2025, cash receipts increased 2.2% statewide and S.F. Bay Area increased 3.6% in the same period. However, when adjusted for non-period-related payments, the overall economic sales tax activity for the year ending in the fourth quarter of 2025 decreased by 2.9% statewide and decreased by 2.3% in S.F. Bay Area. City of Palo Alto For the year ending in the fourth quarter of 2025, sales tax cash receipts for the city increased by 3.6% 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 fourth quarter of 2025 decreased by 5.1%. The decrease in Palo Alto's sales tax revenue was primarily driven by the leasing and new auto sales sectors. On an economic basis, leasing sales tax revenue decreased by 82.2%, representing 3.6% of the city's total sales tax for the year ending in the fourth quarter of 2025. New auto sales decreased by 12.2% over the same period, contributing 12.0% to the total sales tax revenue for the same period. Same quarter sales tax cash receipts increased by 2.5% in California from Q4 2024 to Q4 2025. Palo Alto citywide sales tax cash receipts increased by 16.9% over the Q4 2024 to Q4 2025 period. In addition to negative misallocations in Q4 2024, it should be noted that the primary reason for the 16.9% increase this quarter was due to a significant increase in cash-related activities in the current period. Consequently, on an economic basis (actual sales activity solely during the Q4 quarter) there was a 5.1% decline. The key reason for the Palo Alto economic decrease this period was a significant decline in the leasing segment, which decreased by 94.4% or $1,413,643 in sales tax compared to Q4 2024. According to the California New Car Dealers Association (CNCDA), California’s new light vehicle registrations increased by 3.3% in 2025Q4. City of Palo Alto neumo.com (800) 800-8181 Page 2 Regional Overview The chart on page two shows adjusted economic benchmark year amounts, which shows the year ended fourth quarter of 2025 compared to the year ended fourth quarter of 2024 (benchmark years are rolling annual comparisons through the current quarter). The divergence in growth rates between California and Palo Alto is attributed to the stronger overall performance of sales tax generating businesses statewide compared to those operating in Palo Alto. Regional Overview Chart (Economic) BENCHMARK YEAR 2025Q4 COMPARED TO BENCHMARK YEAR 2024Q4 32.7 / 12.0 29.9 / -0.8 27.2 / 2.6 31.2 / 2.0 38.1 / -15.3 28.0 / 2.0 36.4 / 0.5 27.8 / 0.1 Food Products 21.4 / 6.9 22.1 / -1.1 24.1 / 2.1 17.5 / -4.1 15.1 / -13.4 24.0 / -0.3 18.7 / 1.0 19.8 / 1.6 Transportation 15.7 / -10.8 21.6 / -6.2 18.2 / -3.7 24.9 / -10.7 21.2 / -15.2 22.2 / -4.7 22.0 / -3.8 27.1 / -5.1 Business to Business 23.0 / -30.9 15.7 / -4.2 19.1 / -14.1 14.3 / -3.2 15.6 / -7.7 15.9 / 0.2 10.5 / -0.1 10.5 / 0.5 Misc/Other 7.3 / 36.5 10.6 / -3.4 11.5 / 2.9 12.2 / 0.0 10.1 / -14.1 10.0 / -1.1 12.4 / -4.5 14.8 / -5.5 Total 100.0 / -5.1 100.0 / -2.9 100.0 / -2.3 100.0 / -5.2 100.0 / -13.8 100.0 / -0.7 100.0 / -1.1 100.0 / -1.9 % of Total / % Change % of Total / % Change % of Total / % Change City of Palo Alto neumo.com (800) 800-8181 Page 3 Leasing 3.7% Restaurants 19.5% Auto Sales -New 12.1% Office Equipment 8.2% Apparel Stores 8.0%All Other 48.5% Net Pools & Adjustments 28.5% $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 Quarterly Benchmark Year Gross Historical Sales Tax Cash Receipts by Benchmark Year and Quarter (Before Adjustments) Net Cash Receipts for Benchmark Year Fourth Quarter 2025: $35,699,342 *Benchmark year (BMY) is the sum of the current and 3 previous quarters (2025Q4 BMY is sum of 2025 Q4, 2025 Q3, 2025 Q2, 2025 Q1) City of Palo Alto neumo.com (800) 800-8181 Page 4 2023Q1 2023Q2 2023Q3 2023Q4 2024Q1 2024Q2 2024Q3 2024Q4 2025Q1 2025Q2 2025Q3 2025Q4 Quarter Over Quarter Total County Pool 24,937,663 27,690,772 22,345,960 24,427,230 25,411,165 25,387,888 23,265,567 31,312,972 27,268,380 27,503,817 28,287,141 38,540,707 23.1% Jurisdiction Share 1,499,631 1,755,562 1,489,193 1,638,965 1,523,986 1,611,681 1,377,891 1,834,044 1,673,551 1,685,234 1,595,260 2,571,498 40.2% Jurisdiction % of Total 6.0% 6.3% 6.7% 6.7% 6.0% 6.3% 5.9% 5.9% 6.1% 6.1% 5.6% 6.7% Anderson Honda Magnussen's Toyota Shreve & Co. Apple Stores Mercedes Benz of Palo Alto Stanford Health Care Audi Palo Alto Neiman Marcus Tesla Hermes Nordstrom Tesla Lease Trust HP Enterprise Services Restoration Hardware Tiffany & Company JP Morgan Chase Bank Richemont Varian Medical Systems Louis Vuitton Sephora Volvo Cars Palo Alto Lucile Packard Children's Hospital Shell Service Stations Wilkes Bashford Macy's Department Store County Pool Results The California sales tax system is known as a "sales and use tax" system. County Pool revenues primarily reflect the use tax generated from transactions that do not involve a physical point of sale within California. Businesses report their use tax quarterly, based on activity conducted throughout the county. The County Pool is distributed each quarter based on a proportional formula. A jurisdiction's quarterly percentage is determined by dividing its total gross sales tax receipts for the quarter by the total gross sales tax receipts of all jurisdictions within the county. Consequently, if Palo Alto's gross sales tax receipts increase relative to the rest of the county during a quarter, the city's share of the total County Pool will also increase. This quarterly percentage is multiplied by the total countywide pool to determine the jurisdiction's quarterly County pool revenue. In the fourth quarter of 2025, cash receipts for the overall County Pool increased by 23.1% from the same quarter in the prior year. The City’s share of the Countywide Pool decreased to 6.7%. The City’s revenues from the County Pool increased from $1,834,044 in 2024Q4 to $2,571,498 in 2025Q4. 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 in the third quarter of 2025. The Top 25 Sales/Use Tax contributors generate 52.8% of Palo Alto’s total sales and use tax revenue. City of Palo Alto neumo.com (800) 800-8181 Page 5 $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 Benchmark Year 2025Q4 Benchmark Year 2024Q4 Sales Tax from Largest Non-Confidential Sales Tax Segments (Economic) City of Palo Alto neumo.com (800) 800-8181 Page 6 Economic Category % 2025Q4 2025Q3 2025Q2 2025Q1 2024Q4 2024Q3 2024Q2 2024Q1 2023Q4 2023Q3 2023Q2 Business To Business 17.4% 1,887,386 1,446,306 1,829,261 2,584,832 2,352,638 2,228,773 2,366,493 2,149,237 2,343,293 2,943,907 2,683,293 Miscellaneous/Other 14.4% 1,559,981 1,731,803 1,504,679 1,542,138 1,284,493 1,682,849 1,595,196 1,951,428 1,870,170 1,546,096 1,302,322 General Retail 26.4% 2,867,257 2,128,953 2,096,092 1,813,504 2,466,315 1,828,014 2,044,006 1,739,261 2,315,882 1,834,297 2,017,885 Food Products 14.3% 1,553,055 1,458,554 1,514,585 1,396,065 1,448,644 1,349,524 1,394,270 1,288,207 1,348,051 1,277,173 1,349,926 Subtotal Economic (Local Business)72.4% 7,867,679 6,765,615 6,944,617 7,336,539 7,552,090 7,089,160 7,399,964 7,128,134 7,877,395 7,601,473 7,353,426 Net Pools & Adjustments 27.6% 2,992,086 1,302,731 1,856,667 633,409 1,737,280 1,033,269 1,359,165 1,143,798 1,867,172 1,986,175 2,084,763 Total Cash Receipts 100.0% 10,859,764 8,068,346 8,801,284 7,969,948 9,289,370 8,122,429 8,759,129 8,271,932 9,744,567 9,587,647 9,438,189 Economic Segment % 2025Q4 2025Q3 2025Q2 2025Q1 2024Q4 2024Q3 2024Q2 2024Q1 2023Q4 2023Q3 2023Q2 Miscellaneous/Other 30.0% 3,256,544 3,034,581 3,294,198 4,175,255 3,939,826 4,070,462 4,102,841 4,114,784 4,409,850 4,635,983 4,197,978 Restaurants 13.0% 1,412,846 1,328,254 1,376,526 1,268,403 1,307,103 1,222,917 1,259,885 1,162,863 1,214,598 1,154,189 1,214,502 Miscellaneous Retail 8.8% 958,245 652,655 602,137 529,255 717,726 512,154 582,600 489,040 689,939 480,649 512,077 Apparel Stores 6.7% 725,551 517,728 534,216 455,466 633,554 480,138 531,926 440,402 586,863 478,973 509,894 Department Stores 5.4% 581,270 472,934 503,087 406,470 570,391 432,925 501,499 411,345 549,893 435,388 492,374 Service Stations 1.4% 156,885 183,776 183,941 187,356 187,487 201,591 226,411 198,584 214,900 229,911 222,029 Food Markets 1.1% 118,688 109,640 118,511 107,424 117,774 111,242 114,071 107,031 112,372 103,251 111,465 Business Services 6.1% 657,651 466,047 332,000 206,909 78,229 57,730 80,732 204,085 98,980 83,130 93,106 Subtotal Economic (Local Business)72.4% 7,867,679 6,765,615 6,944,617 7,336,539 7,552,090 7,089,160 7,399,964 7,128,134 7,877,395 7,601,473 7,353,426 Net Pools & Adjustments 27.6% 2,992,086 1,302,731 1,856,667 633,409 1,737,280 1,033,269 1,359,165 1,143,798 1,867,172 1,986,175 2,084,763 Total Cash Receipts 100.0% 10,859,764 8,068,346 8,801,284 7,969,948 9,289,370 8,122,429 8,759,129 8,271,932 9,744,567 9,587,647 9,438,189 Historical Analysis by Calendar Quarter The chart above shows the categories and segments in quarterly economic-based 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 neumo.com (800) 800-8181 Page 7 Economic Category % 2025Q4 2024Q4 2023Q4 2022Q4 2021Q4 2020Q4 2019Q4 2018Q4 2017Q4 2016Q4 Business To Business 17.9% 6,401,386 9,267,252 10,258,589 9,251,173 7,429,378 7,792,163 8,546,122 6,445,906 5,549,122 4,687,305 Miscellaneous/Other 17.8% 6,356,019 6,312,253 6,972,238 6,272,149 6,433,165 5,647,574 7,305,249 7,675,779 5,478,604 6,310,428 General Retail 25.5% 9,094,934 8,123,524 7,695,642 7,690,668 6,886,905 4,457,264 7,708,392 8,243,260 8,105,421 8,679,714 Food Products 16.7% 5,946,873 5,562,100 5,233,335 4,809,224 3,668,040 2,792,282 4,939,660 4,839,275 5,549,122 4,687,305 Subtotal Economic (Local Business)77.9% 27,799,212 29,265,128 30,159,803 28,023,214 24,417,489 20,689,283 28,499,423 27,204,221 24,682,269 24,364,752 Net Pools & Adjustments 22.1% 7,900,131 5,177,732 6,686,812 6,020,425 5,612,325 4,668,143 6,361,699 6,244,760 5,295,766 4,084,050 Total 100.0% 35,699,342 34,442,860 36,846,615 34,043,639 30,029,814 25,357,425 34,861,122 33,448,980 29,978,035 28,448,802 Economic Segment % 2025Q4 2024Q4 2023Q4 2022Q4 2021Q4 2020Q4 2019Q4 2018Q4 2017Q4 2016Q4 Miscellaneous/Other 35.2% 12,582,752 16,313,250 17,989,753 16,507,494 14,581,954 14,129,286 16,847,766 15,326,141 12,962,210 11,731,829 Restaurants 15.2% 5,411,777 5,027,092 4,720,065 4,285,102 3,205,358 2,345,053 4,376,129 4,245,471 4,152,092 4,125,811 Miscellaneous Retail 7.8% 2,775,721 2,304,850 1,995,983 1,855,168 1,945,828 1,217,861 1,609,497 1,669,589 1,967,644 2,791,724 Apparel Stores 6.2% 2,210,778 2,096,219 2,005,484 1,863,457 1,610,038 1,007,654 1,912,796 1,979,854 1,852,621 1,769,711 Department Stores 5.5% 1,963,761 1,936,091 1,834,447 1,781,740 1,537,775 777,559 1,795,157 1,980,754 2,003,859 2,115,072 Service Stations 2.1% 735,984 817,672 864,329 892,331 645,586 436,265 700,254 697,083 602,264 551,829 Business Services 4.7% 1,663,123 316,947 314,007 424,716 527,001 418,514 814,625 835,259 665,486 813,964 Food Markets 1.3% 455,316 453,006 435,735 413,206 363,948 357,092 443,199 470,070 476,093 464,812 Subtotal Economic (Local Business)77.9% 27,799,212 29,265,128 30,159,803 28,023,214 24,417,489 20,689,283 28,499,423 27,204,221 24,682,269 24,364,752 Net Pools & Adjustments 22.1% 7,900,131 5,177,732 6,686,812 6,020,425 5,612,325 4,668,143 6,361,699 6,244,760 5,295,766 4,084,050 Total 100.0% 35,699,342 34,442,860 36,846,615 34,043,639 30,029,814 25,357,425 34,861,122 33,448,980 29,978,035 28,448,802 Historical Analysis by Calendar BMY from 2016Q4 to 2025Q4 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 (2025Q4 BMY is sum of 2025 Q4, 2025 Q3, 2025 Q2, 2025 Q1). City of Palo Alto neumo.com (800) 800-8181 Page 8 Ge n e r a l R e t a i l Fo o d P r o d u c t s Tr a n s p o r t a t i o n Bu s i n e s s t o B u s i n e s s Mi s c / O t h e r 20 2 5 / 4 T o t a l 20 2 4 / 4 T o t a l % C h g La r g e s t G a i n Se c o n d L a r g e s t Ga i n La r g e s t D e c l i n e Se c o n d L a r g e s t De c l i n e Campbell 5.3% -0.3% -4.7% 1.4% 5.4% 2,573,104.04 2,623,758.41 -1.9%Miscellaneous Retail Bldg.Matls-Retail I.T. Infrastructure Misc. Vehicle Sales Cupertino 5.2% 2.3% -11.5% -7.6% 0.8% 4,862,050 9,920,067 -51.0%Electronic Equipment I.T. Infrastructure Office Equipment Bldg.Matls-Whsle Gilroy -1.1% 4.6% -8.0% 0.3% 3.6% 4,523,852 4,546,702 -0.5%Restaurants Business Services Auto Sales - New Apparel Stores Los Altos 32.4% 3.8% -3.2% -35.5% 97.0% 724,842 678,779 6.8%Miscellaneous Retail Restaurants Electronic Equipment Recreation Products Los Gatos 4.1% -5.0% -7.5% -29.3% -27.3% 1,396,763 1,503,556 -7.1%Miscellaneous Retail Furniture/Appliance Restaurants Business Services Milpitas 27.1% 8.1% -6.8% 22.3% 63.1% 7,282,106 6,780,397 7.4%Miscellaneous Retail Bldg.Matls-Whsle Electronic Equipment Auto Sales - New Morgan Hill -1.0% 3.9% -6.2% 3.4% 7.4% 2,495,591 2,527,387 -1.3%Restaurants Leasing Misc. Vehicle Sales Light Industry Mountain View 2.1% 4.2% 13.6% -4.2% 14.6% 4,741,724 4,398,152 7.8%Restaurants Auto Sales - New Auto Sales - Used Service Stations Palo Alto 8.8% 4.8% 19.3% 11.2% 8.9% 7,867,907 7,797,829 0.9%Business Services Auto Sales - New Leasing Service Stations San Jose 7.3% 4.7% -3.9% -1.4% -1.3% 58,581,356 59,643,956 -1.8%Miscellaneous Retail Restaurants Office Equipment Auto Sales - New Santa Clara 6.6% -3.4% 2.9% 42.0% 47.3% 15,900,018 16,526,981 -3.8%Bldg.Matls-Whsle Electronic Equipment I.T. Infrastructure Light Industry County of Santa Clara 38.9% 0.9% -28.3% 6.4% 1.3% 1,298,121 1,224,869 6.0%Miscellaneous Retail Electronic Equipment Health & Government Auto Parts/Repair Saratoga 18.9% 2.8% -3.7% -17.9% -26.5% 283,203 273,265 3.6%Restaurants Miscellaneous Retail Food Processing Eqp Food Markets Sunnyvale -11.0% 0.9% -25.0% 28.4% -8.9% 8,323,811 9,138,359 -8.9%Light Industry Bldg.Matls-Whsle Auto Sales - New Business Services Quarterly Analysis by Sales Tax Category: Change from 2024Q4 to 2025Q4 (Economic) Unlike the chart on page one which showed a ‘benchmark year’ through the fourth quarter of 2025, the chart above shows a comparison of one quarter only – fourth quarter of 2025 to fourth quarter of 2024. This chart is for local ‘brick and mortar’ businesses, and it excludes county pools and adjustments. City of Palo Alto neumo.com (800) 800-8181 Page 9 California Avenue % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL FOOD PRODUCTS 5.7% 114,060 107,871 68.7%65.6% GENERAL RETAIL -11.2% 17,941 20,196 10.8%12.3% ALL OTHER -6.4% 34,136 36,473 20.5%22.2% TOTAL 1.0% 166,138 164,540 100.0% 100.0% El Camino Real and Midtown % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL FOOD PRODUCTS -0.3% 168,476 168,965 32.6%37.1% GENERAL RETAIL -5.6% 36,792 38,972 7.1%8.5% ALL OTHER 25.7% 311,706 247,924 60.3%54.4% TOTAL 13.4% 516,975 455,861 100.0% 100.0% Greater Downtown % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL FOOD PRODUCTS 2.6% 590,037 574,839 58.2%61.6% GENERAL RETAIL 17.8% 337,011 285,967 33.2%30.6% BUSINESS TO BUSINESS 33.5% 67,354 50,462 6.6%5.4% MISCELLANEOUS 15.4% 8,752 7,583 0.9%0.8% CONSTRUCTION -29.8% 7,722 11,007 0.8%1.2% TRANSPORTATION 0.0% 3,454 3,356 0.3%0.4% TOTAL 8.7% 1,014,329 933,214 100.0% 100.0% Stanford Shopping Center % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL GENERAL RETAIL 4.0% 1,720,207 1,653,612 87.3%88.4% FOOD PRODUCTS -7.7% 151,804 164,506 7.7%8.8% ALL OTHER 86.4% 97,558 52,328 5.0%2.8% TOTAL 5.3% 1,969,569 1,870,447 100.0% 100.0% City of Palo Alto Geo Areas & Citywide Chart Data: Change from 2024Q4 to 2025Q4 (Economic) City of Palo Alto neumo.com (800) 800-8181 Page 10 Town And Country Shopping Center % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL FOOD PRODUCTS 14.5% 122,936 107,394 55.4%54.6% GENERAL RETAIL 10.0% 96,835 88,001 43.7%44.7% ALL OTHER 56.6% 2,012 1,285 0.9%0.7% TOTAL 12.8% 221,783 196,681 100.0% 100.0% All Other Geos Combined % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL GENERAL RETAIL 5.8% 2,267,670 2,142,908 39.2%32.7% FOOD PRODUCTS 4.1% 1,264,688 1,214,659 21.8%18.5% BUSINESS TO BUSINESS -51.6% 1,078,237 2,225,704 18.6%33.9% TRANSPORTATION 18.6% 1,030,293 868,714 17.8%13.2% MISCELLANEOUS 26.8% 101,187 79,818 1.7%1.2% CONSTRUCTION 80.9% 48,646 26,885 0.8%0.4% TOTAL -11.7% 5,790,722 6,558,688 100.0% 100.0% All Other Geo Area Totals with Balance of Jurisdiction Comparison 25Q4 & 24Q4 % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL Stanford Shopping Center 5.3% 1,969,569 1,870,447 34.0%28.5% Balance of Jurisdiction -36.0% 1,881,092 2,937,945 32.5%44.8% Greater Downtown 8.7% 1,014,329 933,214 17.5%14.2% Town And Country Shopping Center 18.0% 537,811 455,861 9.3%7.0% El Camino Real and Midtown 12.8% 221,783 196,681 3.8%3.0% California Avenue 1.0% 166,138 164,540 2.9%2.5% TOTAL -11.7% 5,790,722 6,558,688 100.0% 100.0% Palo Alto citywide QE 25Q4 & 24Q4 % CHANGE QoQ 2025Q4 QE 2024Q4 QE 25Q4 % OF TOTAL 24Q4 % OF TOTAL GENERAL RETAIL 10.7% 2,867,257 2,589,613 36.4%33.2% BUSINESS TO BUSINESS -20.6% 1,887,386 2,377,195 24.0%30.5% FOOD PRODUCTS 4.8% 1,553,055 1,481,751 19.7%19.0% TRANSPORTATION 19.3% 1,040,140 871,918 13.2%11.2% MISCELLANEOUS 8.2% 383,594 354,610 4.9%4.5% CONSTRUCTION 11.2% 136,474 122,742 1.7%1.6% TOTAL 0.9% 7,867,907 7,797,829 100.0% 100.0% City of Palo Alto Geo Areas & Citywide Chart Data: Change from 2024Q4 to 2025Q4 (Economic) Cont. City of Palo Alto neumo.com (800) 800-8181 Page 11 FOOD PRODUCTS, 5.7% CHANGE, $114,060 , 68.7%TOTAL GENERAL RETAIL, -11.2% CHANGE, $17,941 , 10.8%TOTAL ALL OTHER, -6.4% CHANGE, $34,136 , 20.5%TOTAL California Avenue 2025Q4 SALES TAX AMOUNTS FOOD PRODUCTS, $107,871 , 65.6%TOTAL GENERAL RETAIL, $20,196 , 12.3%TOTAL ALL OTHER, $36,473 , 22.2%TOTAL California Avenue 2024Q4 SALES TAX AMOUNTS FOOD PRODUCTS, -0.3%CHANGE, $168,476 , 32.6%TOTAL GENERAL RETAIL, -5.6% CHANGE, $36,792 , 7.1%TOTALALL OTHER, 25.7% CHANGE, $311,706 , 60.3%TOTAL El Camino Real and Midtown 2025Q4 SALES TAX AMOUNTS FOOD PRODUCTS, $168,965 , 37.1%TOTAL GENERAL RETAIL, $38,972 , 8.5%TOTAL ALL OTHER, $247,924 , 54.4%TOTAL El Camino Real and Midtown 2024Q4 SALES TAX AMOUNTS City of Palo Alto Geo Area Pie Charts City of Palo Alto neumo.com (800) 800-8181 Page 12 FOOD PRODUCTS, 2.6%CHANGE, $590,037 58.2%TOTAL GENERAL RETAIL, 17.8% CHANGE, $337,011 , 33.2%TOTAL BUSINESS TO BUSINESS, 33.5% CHANGE, $67,354 , 6.6%TOTAL MISCELLANEOUS, 15.4% CHANGE, $8,752 , 0.9%TOTAL CONSTRUCTION, -29.8% CHANGE, $7,722 , 0.8%TOTAL TRANSPORTATION 0.0% CHANGE, $3,454 , 0.3%TOTAL Greater Downtown 2025Q4 SALES TAX AMOUNTS FOOD PRODUCTS, $574,839 , 61.6%TOTAL GENERAL RETAIL, $285,967 , 30.6%TOTAL BUSINESS TO BUSINESS, $50,462 , 5.4%TOTAL MISCELLANEOUS, $7,583 0.8%TOTAL CONSTRUCTION, $11,007 1.2%TOTAL TRANSPORTATION 0.0% CHANGE, $3,356 , 0.4% TOTAL Greater Downtown 2024Q4 SALES TAX AMOUNTS GENERAL RETAIL $1,653,612 , 88.4%TOTAL FOOD PRODUCTS, $164,506 , 8.8%TOTAL ALL OTHER, $52,328 , 2.8%TOTAL Stanford Shopping Center 2024Q4 SALES TAX AMOUNTS GENERAL RETAIL, 4.0% CHANGE, $1,720,207 , 87.3%TOTALFOOD PRODUCTS, -7.7% CHANGE $151,804 , 7.7%TOTAL ALL OTHER, 86.4% CHANGE $97,558 , 5.0%TOTAL Stanford Shopping Center 2025Q4 SALES TAX AMOUNTS City of Palo Alto Geo Area Pie Charts City of Palo Alto neumo.com (800) 800-8181 Page 13 FOOD PRODUCTS, 14.5%CHANGE, $122,936 , 55.4%TOTAL GENERAL RETAIL, 10.0% CHANGE, $96,835 , 43.7%TOTAL ALL OTHER, 56.6% CHANGE, $2,012 , 0.9%TOTAL Town And Country Shopping Center 2025Q4 SALES TAX AMOUNTS FOOD PRODUCTS, $107,394 , 54.6%TOTAL GENERAL RETAIL, $88,001 , 44.7%TOTAL ALL OTHER, $1,285 , 0.7%TOTAL Town And Country Shopping Center 2024Q4 SALES TAX AMOUNTS GENERAL RETAIL, 5.8%CHANGE $2,267,670 , 39.2%TOTAL FOOD PRODUCTS, 4.1% CHANGE, $1,264,688 21.8%TOTAL BUSINESS TO BUSINESS, -51.6% CHANGE $1,078,237 , 18.6%TOTAL TRANSPORTATION, 18.6% CHANGE, $1,030,293 17.8%TOTAL MISCELLANEOUS, 26.8% CHANGE, $101,187 , 1.7%TOTAL CONSTRUCTION, 80.9% CHANGE, $48,646 , 0.8%TOTAL All Other Geos Combined 2025Q4 SALES TAX AMOUNTS GENERAL RETAIL, $2,142,908 , 32.7%TOTAL FOOD PRODUCTS, $1,214,659 , 18.5%TOTAL BUSINESS TO BUSINESS, $2,225,704, 33.9%TOTAL TRANSPORTATION, $868,714 , 13.2%TOTAL MISCELLANEOUS, $79,818 , 1.2%TOTAL CONSTRUCTION, $26,885 , 0.4%TOTAL All Other Geos Combined 2024Q4 SALES TAX AMOUNTS City of Palo Alto Geo Area Pie Charts City of Palo Alto neumo.com (800) 800-8181 Page 14 GENERAL RETAIL, 10.7% CHANGE, $2,867,257 , 36.4%TOTAL BUSINESS TO BUSINESS, -20.6% CHANGE, $1,887,386 , 24.0%TOTAL FOOD PRODUCTS, 4.8% CHANGE, $1,553,055 , 19.7%TOTAL TRANSPORTATION, 19.3% CHANGE, $1,040,140 , 13.2%TOTAL MISCELLANEOUS, 8.2% CHANGE, $383,594 , CONSTRUCTION, 11.2% CHANGE, $136,474 , 1.7%TOTAL Palo Alto citywide 2025Q4 SALES TAX AMOUNTS GENERAL RETAIL, $2,589,613 , 33.2%TOTAL BUSINESS TO BUSINESS, $2,377,195 , 30.5%TOTAL FOOD PRODUCTS, $1,481,751 , 19.0%TOTAL TRANSPORTATION, $871,918 , 11.2%TOTAL MISCELLANEOUS, $354,610 , 4.5%TOTAL CONSTRUCTION, $122,742 , 1.6%TOTAL Palo Alto citywide 2024Q4 SALES TAX AMOUNTS GENERAL RETAIL, 10.7% CHANGE, $2,867,257 , 36.4%TOTAL BUSINESS TO BUSINESS, -20.6% CHANGE, $1,887,386 , 24.0%TOTAL FOOD PRODUCTS, 4.8% CHANGE, $1,553,055 , 19.7%TOTAL TRANSPORTATION, 19.3% CHANGE, $1,040,140 , 13.2%TOTAL MISCELLANEOUS, 8.2% CHANGE, $383,594 , CONSTRUCTION, 11.2% CHANGE, $136,474 , 1.7%TOTAL Palo Alto citywide 2025Q4 SALES TAX AMOUNTS GENERAL RETAIL, $2,589,613 , 33.2%TOTAL BUSINESS TO BUSINESS, $2,377,195 , 30.5%TOTAL FOOD PRODUCTS, $1,481,751 , 19.0%TOTAL TRANSPORTATION, $871,918 , 11.2%TOTAL MISCELLANEOUS, $354,610 , 4.5%TOTAL CONSTRUCTION, $122,742 , 1.6%TOTAL Palo Alto citywide 2024Q4 SALES TAX AMOUNTS City of Palo Alto Geo Area & Citywide Pie Charts