HdL Sales Tax Report for CY2022 Q3 Saleswww.hdlcompanies.com | 888.861.0220
Q3 2021*
Q3 2022*
Legend
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
SALES TAX BY MAJOR BUSINESS GROUP*Allocation aberrations have been adjusted to reflect sales activity
General
Consumer
Goods
County
and State
Pools
Restaurants
and
Hotels
Autos
and
Transportation
Fuel and
Service
Stations
Food
and
Drugs
Building
and
Construction
Business
and
Industry
TOP 25 PRODUCERSCITY OF ENCINITAS HIGHLIGHTS
Published by HdL Companies in Winter 2023
SALES TAX UPDATE
CITY OF ENCINITAS
3Q 2022 (JULY - SEPTEMBER)
7 Eleven
76
Alila Marea Beach Resort Encinitas
Best Buy
BMW of Encinitas
Chevron
Dick’s Sporting Goods
Encinitas Ford
Financial Services Vehicle Trust
Hansen Surfboards
Herman Cook Volkswagen
Home Depot
Home Goods
IFE Marketing
Pacific Coast Grill
Quick Shine Car Wash
REI
Scotty Cameron Gallery
Shell Car Wash At Encinitas Ranch
Target
TJ Maxx
Total Wine Spirits Beer & More
Valero
Vons
Walmart Supercenter
Encinitas’s receipts from July through
September were 9.8% above the third
sales period in 2021. Excluding reporting
aberrations, actual sales were up 7.5%.
As the summer months brought better
weather and patrons enjoyed the
opportunity to enjoy traveling again
the City’s restaurants-hotels group saw
positive returns. This in turn naturally
created an interest for consumers to eat
out from tourist and locals alike which
lead to modest profits in the casual
dining and quick service restaurants. In
addition, as people slowly returned back
to their workplace, services stations
continued to see solid profits while gas
prices remain high.
The food and drug category saw strong
revenue returns from convenience
stores and drug stores.
General consumer goods sales continue
to soften as customers slowly adjust
to inflation cost related to food and
gas prices. As a result, this sector is
not benefitting as much from the
discretionary spending as other
industries which provide experiences or
services.
A delayed payment from an auto-
transportation business provided
increased growth in sales tax collections,
the City’s allocation from the countywide
use tax pool improved 8.2%. The pools
remain a solid source of local revenue,
boosted by taxes on ecommerce, out-of-
state retailers, and third party auto sales.
Net of aberrations, taxable sales for all
of San Diego County grew 8.6% over the
comparable time period; the Southern
California region was up 8.1%.
TOTAL:$ 4,637,157
7.5% 8.6% 8.0%
COUNTY STATE
ENCINITAS
3Q2022
TOP NON-CONFIDENTIAL BUSINESS TYPES
Q3 '22*
EncinitasBusiness Type Change Change ChangeCountyHdL State
18.5%11.1%4.8% 410.3 Service Stations
10.1%12.8%14.3% 402.0 Casual Dining
4.0%6.5%-1.5% 189.2 Quick-Service Restaurants
-4.2%-3.1%-2.6% 178.7 Sporting Goods/Bike Stores
3.1%2.4%0.6% 166.6 Grocery Stores
-6.2%1.6%-14.0% 118.8 Home Furnishings
6.1%10.9%-1.7% 116.7 Fast-Casual Restaurants
1.8%6.4%32.0% 112.5 Convenience Stores/Liquor
-1.7%11.6%-4.2% 105.0 Family Apparel
4.0%6.7%7.6% 104.5 Specialty Stores
*Allocation aberrations have been adjusted to reflect sales activity *In thousands of dollars
REVENUE BY BUSINESS GROUP
Encinitas This Quarter*
19%
Pools
17%
Restaurants
16%
Autos/Trans.
7%
Building
4%
Bus./Ind.
21%
Cons.Goods
7%
Food/Drug
9%
Fuel
*ADJUSTED FORECONOMIC DATA
SALES TAX UPDATECITY OF ENCINITAS3Q 2022
STATEWIDE RESULTS
Local one cent sales and use tax for sales
occurring July through September was 8%
higher than the same quarter one year ago
after adjusting for accounting anomalies
and back payments from previous quarters.
These returns mark another strong period of
growth for the California spending economy.
Even as the Federal Reserve Board continued
ramping up interest rates in an effort to curb
the larger concern of inflation, consumers
maintained purchases on multiple fronts,
especially automobiles. Surprisingly, new
car dealers experienced 10% gains over
the comparable period in 2021. Limited
inventory and demand for higher mileage
vehicles including electric and hybrid
models helped support growth. In addition,
the increased cost of used vehicles has
pushed many into the new vehicle market;
in contrast, sales of recreation vehicles and
auto leasing activity remained soft.
For Californians, the summer of 2022
had the highest gas prices on record;
subsequently fuel and service stations
receipts jumped 21%. Commuters and
summer travel remained steady, yet overall
consumption still trails pre-pandemic levels
by approximately 13%. Although the Russia-
Ukraine conflict initially caused a dramatic
shift in global crude oil markets, prices have
begun to pull back closer to historical norms.
Restaurants experienced a strong uptick as
increased menu prices, consistent desire
to dine out and strong tourism contributed
to this favorable news. Just as important,
theme parks, leisure-entertainment venues
and hotels pushed positive momentum
back to 2019 levels. With tightening profit
margins and sustained labor concerns, future
improvement could be slowed compared to
the last two years.
Busy contractors and plumbing-electrical
suppliers boosted the building-construction
sector. Solid residential and commercial
housing prices persisted despite recent
interest rate hikes. Tenant improvements
further support spending activity as
businesses assess future office needs. With
statewide new housing requirements and
federal infrastructure funding on the horizon,
current forecasts stay optimistic.
Steady investment in capital equipment
coupled with the overall increased price of
goods enhanced both business-industry and
countywide use tax pool allocations.
For the second straight quarter, fuel sales
linked to discount department stores
propped up general consumer goods
results. Otherwise, retailers experienced
flat to decreased receipts as many apparel
categories, home furnishings and sporting
goods struggled to keep pace with the
prior year. As consumers balanced summer
opportunities and higher prices, in-store
shopping appears to have taken a temporary
back seat.
Sustained price increases and interest rate
hikes certainly have consumers contemplating
where to spend their dollars. However,
historically low statewide unemployment
rates and the recovery of the national stock
markets from declines earlier this year leave
modest optimism heading into 2023.