Item 28 - Public Hearing - ZOA No. 20204-01 South Coast Technology Center

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SECTION III ta www.FinanceDTA.com DESCRIPTION OF RECURRING FISCAL REVENUES/COSTS regarding the property tax assumptions utilized in the FIA. Property tax revenue generated in this category is presented later in the report in Table 10. A.3 Sales Taxes Direct sales tax revenues are generated by taxable sales from businesses within the City. The current sales tax rate in the City is 9.25%, with sales tax collected by the State and distributed to the City. The City currently receives approximately 2.54% of taxable sales receipts, which include a 1.00% sales tax established by Municipal Code 535.51 and Measure X sales tax, a 1.50% voter -approved sales tax to provide funding for neighborhood safety, homeless prevention, and essential City services enhancement. In addition, the City currently receives approximately 8.87% of the Proposition 172 sales tax receipts generated within the City (a 0.50% voter -approved sales tax dedicated to local public safety), which is equivalent to 0.04% sales tax rate. Measure X rate will decrease to 1% in 2029 and sunset in 2039. In generating the fiscal impact models for this Report, DTA has conservatively assumed that Measure X sales tax at the Project's build -out will only be 1%. In aggregate, 2.04% of taxable sales receipts are passed through to the City for purposes of this FIA. As reflected in Table 5, the proposed on -site non-residential land use types are conservatively assumed not to generate any taxable sales. Table 5: Sales Tax Assumptions a - Percentage of Sales Tax Passed Through to the City 2.04% Local Employee Spending (Spending in Fast Food/Deli/Lunch Eateries) $951 Non -Project Capture Rate of Retail Spending (Within the City) 25% Taxable Sales per BSF Industrial Building One $0.00 Industrial Building Two $0.00 Industrial Building Three $0.00 Indirect sales tax revenues, as summarized in the table above, are generated by the purchases made by the Project's employees within the City. With respect to on -site employee retail spendings, DTA conservatively limited the scope to meal purchases occurring in quick -service restaurants. Based on studies outlined in the International Council of Shopping Projects' Office -Worker Retail Spending in a Digital Age, DTA estimates that an employee within the Project will spend an average of $951 annually in the Fast Food/Deli/Lunch Eateries category near their place of work. Assuming the off -site businesses in the City would capture on average 25% of the Project employees' annual spending, each employee is estimated to spend $238 annually off -site within the City. The direct and indirect tax revenues generated are presented later in the Report in Table 10. EPD Solutions, Inc. May 1-7 2024 South Coast Technology Center Fiscal Impact Analysis Report ■ 9