West Berkeley Carries City’s Sales Tax Load By MATTHEW ARTZ

Tuesday June 28, 2005

Berkeley’s economic engine is located West of Sacramento Street, according to a report released last week tracking sales tax revenue among City Council districts. 

Fifty percent of all sales tax revenue for the city is generated from the two West Berkeley council districts, with 30 percent coming from District 1, which is north of University Avenue and 20 percent from District 2, which is south of University. 

Overall in 2004 the city took in over $13 million in sales tax revenue. Following the two West Berkeley districts, District Four, central Berkeley, accounted for 19 percent of sales tax revenues and District 7, which includes Telegraph Avenue, brought in 11.5 percent. 

The report comes as the city is considering rezoning parts of West Berkeley to further boost economic activity. 

The concentration of revenue from West Berkeley should not come as a surprise, said David Fogerty of the city’s office of economic development. Thirteen of the city’s 25 top sales tax producers are located either on San Pablo Avenue or west towards the Bay. 

Fogerty said that the thriving Fourth Street Market boosted District 1 sales tax revenues, but that it was not a major factor in West Berkeley’s preeminence in generating revenue for the city. 

Currently the city is considering changing zoning rules in the area to foster more commercial growth. Plans are underway to permit more retail shops on Gilman Street, auto dealerships adjacent to I-80, and a new Berkeley Bowl just off of Ashby Avenue.  

All three proposals have met resistance from local industrialists and artists who fear that more retail shops will drive up rents. 

Councilmember Kriss Worthington didn’t think that the report would alter the debate over West Berkeley’s future. “Some people will argue what would be the harm of having more retail in the area and their opponents could say that West Berkeley is a success under the current zoning so why change the rules,” Worthington said. 

Recent city reports show that among most Berkeley shopping districts revenues have remained relatively flat over recent years. 

The exception is Fourth Street, which has seen general retail sales tax revenue roughly double from $300,000 a year as of the first quarter 1997 to $600,000 as of the fourth quarter of 2004. “Fourth Street is the only business district that has consistently grown,” Fogerty said. He attributed the growth to the continued addition of retail space to the district. 

The Downtown Business Improvement District has seen sales tax revenue dropped from about $450,000 from 1997 to $400,000 in 2004. North Shattuck has seen sales tax revenues increase about $50,000 over the past seven years from about $200,000 to $250,000.  

The Elmwood saw a spike in sales tax revenue for food products, jumping from roughly $40,000 in 1997 to about $90,000 last year, while South San Pablo Avenue experienced a surge in revenue from business to business sales. The figure jumped from just under $50,000 in 1997 to roughly $250,000 last year. Fogerty said the jump was due to the growth of a single business, which some observers believe to be Powerlight, a solar energy company which is one of Berkeley’s top 25 sales tax producers. 

Telegraph Avenue remains a large sales tax generator among city business districts, taking just under $1 million a year, Fogerty said. 

Berkeley’s top 25 sales tax producers generate 34 percent of the city’s sales tax revenue. They are: Amoeba Music, Andronico’s Market, Ashby Lumber Company, Berkeley Bowl, Berkeley Ready Mix, Cal Student Store, Cody’s Books, Financial Services Vehicle Trust, Jim Doten’s Honda, Longs Drug Stores, McKevitt Volvo/Nissan, McNevin Cadillac/Volkswagen, Office Depot, Orchard Supply Hardware, Powerlight Corporation, Recreational Equipment Company, Restoration Hardware, Toyota of Berkeley, Truitt & White Lumber Company, UC Berkeley, Urban Outfitters, Walgreens, Weatherford BMW, Whole Foods and Xtra Oil Company.