NEWPORT BEACH -- The weakest source of major revenue in Newport Beach is
sales tax, according to a recent city report comparing the city's
revenues and expenditures to the 31 other cities in Orange County.
"Perhaps we're not capturing enough sales tax from tourism," said
administrative services director Dennis Danner, who headed the study.
The comparison, an extension of last fall's five-year financial forecast,
compared such areas as general revenue, property tax, sales tax, public
safety expenditures and general government expenditures.
In terms of bed tax and property tax, Newport Beach ranks second and
fourth, respectively. However, the city spends more on public safety per
capita than any other city in the county. The top-ranking city in the
majority of categories was Anaheim -- not surprising since it's also the
home of a major tourist attraction in Disneyland.
"I think the real issue is that we need to protect our sales tax," said
Mayor John Noyes, adding that with the newly renovated Shops in Mission
Viejo, competition on the important source of revenue is growing.
As for Costa Mesa, it ranks lower than Newport Beach in most revenue
categories, except sales tax. Thanks to South Coast Plaza, Costa Mesa
ranks fourth in comparison to other cities in the county.
The city also spends much more on general government -- nearly one-third
more than Newport Beach. Like its neighbor, however, Costa Mesa places a
great deal of importance on public safety and spends almost the same
amount as Newport Beach.
"[The figures] are pretty accurate in terms of quantifying and comparing
revenue from one city to another," said Costa Mesa City Manager Allan
Roeder. "But on the expenditures side, the accuracy falls off unless you
go through each city's budget, line by line."
The conclusion that Newport Beach might need to boost its sales tax
supports last November's five-year financial forecast, which predicted
the city needed to find additional revenue sources to maintain its high
level of service in the future.
"I wasn't really surprised about the sales tax," said Councilwoman Norma
Glover, who requested the study.
Sales tax is a lingering issue in the city, especially with the Irvine
Co.'s recent withdrawal of its Newport Center expansion plans. Glover
said the council should encourage the Irvine Co. to go forward with its
plans to improve Macy's and Neiman Marcus.
While these improvements might help, Fashion Island still does
significantly less business than South Coast Plaza. Fashion Island did
