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Archive for Wednesday, July 14, 2010

On eve of sidewalk sale, city report shows sales tax collections on decline

Store manager Rachel Ybarra pulls sale items from the shelves of The Toy Store, 936 Massachusetts, as she and other staff members work Tuesday afternoon to get organized for the sidewalk sale Thursday, July 15, 2010 in downtown Lawrence. Many local retailers devoted time throughout the early part of the week marking down prices for the sale which begins about 6 a.m. Thursday.

Store manager Rachel Ybarra pulls sale items from the shelves of The Toy Store, 936 Massachusetts, as she and other staff members work Tuesday afternoon to get organized for the sidewalk sale Thursday, July 15, 2010 in downtown Lawrence. Many local retailers devoted time throughout the early part of the week marking down prices for the sale which begins about 6 a.m. Thursday.

July 14, 2010

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Maybe Thursday will get the ball rolling.

Lawrence retail sales down in 2010

Through the first half of 2010, sales taxes collected in Lawrence are down 1 percent. The number is lower than it was expected to be. Enlarge video

Must-have information for the Sidewalk Sale

Thousands of people are expected to pack the streets today for the annual Downtown Lawrence Sidewalk Sale.

The sale is from sunrise to sunset.

Be sure to check in with LJWorld.com throughout the day. We’ll have a live stream of Massachusetts Street as well as photos, videos and updates from reporters at the sale.

You can also submit your photos for our gallery.

Weather

There’s a chance of scattered showers and thunderstorms today, with a slim chance after 8 a.m. and again in the midafternoon as a slightly cooler air mass moves in. Highs are still expected to be near 91 degrees with a light northwest wind, although humidity will still stay fairly high, according to Matt Elwell, 6News meteorologist.

Free bus rides

The T is offering free rides today. Regular service is from 6 a.m. to 8 p.m. Routes 1, 2, 3, 4, 6, 7 and 11 travel downtown.

Win cash

Lawrence Marketplace is looking to put cash in your pocket today. Visit its booth at Ninth and Massachusetts streets to enter to win $25 and $50 Visa gift cards. The booth opens at 7 a.m.

You can also win by completing the trip we’ve set up on Gowalla, a location-based social network similar to Foursquare. Anyone who checks in on Gowalla at all 11 destinations the day of the sale is entered to win a $50 Visa gift card.

On Twitter

If you’re going to the sale and you use Twitter, tag your tweets with #swsale. Anyone who tweets using that hashtag on the day of the sale is entered to win a $50 Visa gift card.

Your #swsale tweets will also be displayed as a live part of our news coverage. Let us know where you found a great deal and what you bought. Our CraveLawrence and LJWMarketplace Twitter accounts will also be tweeting deals and specials.

Learn more about participating vendors and contest rules by visiting the Sidewalk Sale resource page at LJWorld.com/swsale.

As shoppers prepare to swarm downtown Lawrence for its annual sidewalk sale, a new report out of City Hall shows consumer spending hasn’t yet bounced back in 2010.

Sales tax collections for the first six months of the year were down 0.8 percent (not including the new city transit and infrastructure sales taxes that began in April 2009). But some retailers are feeling better about their lot in life nonetheless.

“I feel that I’m beginning to see a turnaround,” said Leslie Ahlert, with downtown’s Stitch On Needlework, 926 Mass. “I don’t think consumers are feeling as much negativity. I’m hearing less negativity anyway.”

The numbers don’t yet show a turnaround, but they do show that pessimism may be waning a bit. The six-month report shows shoppers in Lawrence are spending less, but the rate of decline has slowed compared with 2009. Last year sales tax collections dropped by 3.1 percent, the biggest decline in recent memory. Unless the second half of 2010 takes a nasty turn, the city won’t experience that type of drop this year.

“I don’t think there is as much concern as there was two years ago, but there is still caution out there,” said John Ellena, with Lawrence’s Jack Ellena Honda dealership, 2112 W. 29th Terrace. “Nobody is in a hurry to do anything yet.”

The numbers also show that four out of the six months in 2010 actually saw increases in sales tax collections from the same month in 2009. But the two months that were down — January and March — were down so much that they caused the total to be below last year’s totals.

City Hall leaders are betting on a turnaround for 2011. As city commissioners prepare next year’s budget, they are projecting sales tax collections to increase 2 percent — or about $600,000 — over what they expect 2010 totals to be.

“We’re not talking about dramatic growth,” City Manager David Corliss said. “The historic growth level has been about 3 percent, so we’re still below that. We’re comfortable with the number.”

Some retailers agree.

“The further we get away from the fall of 2008, the more people feel like better times are ahead,” Ellena said. “I do think we’re seeing some improvement.”

But such optimism hasn’t found every corner of the market. Some shoppers noted that 2010 numbers are still down from 2009, which locally was considered one of the poorer shopping years on record.

“I still think we’re two or three years away from a turnaround,” said Sarah Elsen-Ybarra, who was shopping in downtown Wednesday. “I work in education, and I run across people all the time who are being laid off and losing their jobs. It just reminds you that it could happen to you the next day.”

Comments

del888 4 years, 5 months ago

Just wondering.... Is the sales tax 'collections' down (like the heading says), or are the sales down which results in the taxes being down. The heading indicates that sales are OK, but the merchants aren't doing their job collecting the appropriate taxes.

David Reynolds 4 years, 5 months ago

Look out for the city to request more taxes in some form. Maybe they can cut some of the "FAT" out of the city manager's office and other excess staff. Why do we need so many city planners & inspectors now that the construction industry is decimated. Maybe the city will realize that construction was a significantly viable "Tax Paying" industry, prior to the downturn.

By the way, where are all of those "shovel ready" stimulus jobs our "progressive" president & his minions promised with his $800+ billion pork barrel bill that was supposed to "stimulate" the economy.

50YearResident 4 years, 5 months ago

Sales tax will be down even more when the Special tax areas start collecting extra tax and people start shopping out of town.

Rich Lorenzo 4 years, 5 months ago

As taxes go up, the actual number of sales will go down. The city, county, state and federal gov'ts can't continue to increase our taxes and expect us to have lots of extra income to spend.

Richard Heckler 4 years, 5 months ago

Over building = negative economic growth = tax increases because new construction is not paying back = keep coming back to the same number of taxpayers or less to pick up the loss.

Economic displacement = no economic growth

"City Hall leaders are betting on a turnaround for 2011. As city commissioners prepare next year’s budget, they are projecting sales tax collections to increase 2 percent — or about $600,000 — over what they expect 2010 totals to be"======= reckless thinking!

It would be best to assume no gains in tax collections and halt all new new infrastructure installations. Otherwise Lawrence is still on the "boom town economics" road as if nothing changed in the world. So so reckless.

If the city wants to keep people employed STOP ADDING NEW TAX DOLLAR RESPONSIBILITY and fix existing problems such as sidewalks - make a few wider. Lawrence can keep people fixing older infrastructure. This is what governments do in hard times!!!!!!

Richard Heckler 4 years, 5 months ago

Schedule sidewalk sales for October AND April when WAY MORE customers are in town in every town surrounding Lawrence.

How to maximize sales? When Wayyyyyyyyyy more customers are available which is NOT during vacation season and when most all the schools are not in session.

David Reynolds 4 years, 5 months ago

Over building = negative economic growth = tax increases because new construction is not paying back = keep coming back to the same number of taxpayers or less to pick up the loss.

Sorry merrill we have been down that road. The city commission of anti-/controlled growth folks did a study and did not finish it because it demonstrated construction paid for itself within the first year and provided 100% yield income every year after that into perpetuity!

The problem is Lawrence City Hall does not have any viable economic model or criteria to set its expenditures. We just keep spending based on prior years. We have done such a good job of not being competitive in the "Economic Development Area" we are stuck with no way to generate real income growth. Thus the burden is unduly placed on residents.

Until the citizens of Lawrence get in the "Know" & start saying "NO" to the "Anti-Everything" folks nothing will ever change. {:->)

David Reynolds 4 years, 5 months ago

Merrill your point about when we do sidewalk sales makes a lot of sense. Your point is a great example of the fact we are not being creative in our strategies for economic growth and revenue creation.

I am sure the merchants downtown are doing this during a traditionally slow sales time of year. I think your point is why not do a sale more than once a year?

Alabamastreet 4 years, 5 months ago

You and Merrill may need some help understanding basic retail sales. I suggest you go downtown and talk to business owner, they'll explain it to you.

Eride 4 years, 5 months ago

With wages declining every year it is asinine to expect that by increasing taxation on things like sales and property tax that you will increase tax income.

The city is pulling a scam. Every time someone floats the idea of increasing services by increasing taxes it hurts us all. Simple fact is, the cities services need to be cut... heavily and the tax rate along with it.

Richard Heckler 4 years, 5 months ago

The construction industry may be making big profits however that is no indication that the homes are paying back the community considering the demands of city hall that are attached to each residential unit. At which point residental housing becomes a tax dollar liability.

deskboy04 4 years, 5 months ago

You could always "ride the T" to get to the sidewalk sale!

Richard Heckler 4 years, 5 months ago

"At which point residental housing becomes a tax dollar liability." This is a typical tax dollar issue associated with bedroom communities.

WHY?

Thousands of residents commute to employment primarily because commuting is where the best paying salaries are located. Lawrence cannot employ all new residents. The local economy was initially set around Kansas University which was substantial and could support the community.

Until the bedroom community came about Lawrence was a resilient economy.

Then a few decided they wanted to make a ton of dough at taxpayers expense = Lawrence bedroom community. Then these people thought basketball was soooooo great that they could turn Lawrence into the regional "shop till you drop mecca" AT taxpayer expense. Yep these folks made some bad decisions as developers and as former city,county and planning commissioners again at taxpayer expense. It's time to stop.

Richard Heckler 4 years, 5 months ago

Ride The T, walk with a big stroller or ride the bike pulling the stroller behind.....

Centerville 4 years, 5 months ago

When you let your legislators raise the sales tax by 20%, you should expect sales to go down. It's called, uh , obvious.

David Reynolds 4 years, 5 months ago

Merrill I am not sure where where you acquired your ideas regarding economics. Yes KU is an asset to Lawrence in the sense it add prestige and jobs. The only issue is KU pays zip-zero taxes of any kind to the city, county or state. It is the 800 pound gorilla in the middle of the city. KU shops for the low bidder with much of their business going to out of town businesses.

As studies show Lawrence looses sales and thus tax revenue to neighboring communities in spite of all those KU jobs.

Lawrence would still be in financial trouble if it had never grown. Lawrence's infrastructure would still be rotting with limited income beyond residences to pay for same.

Lawrence does not have a vision of it's future...it has no clear idea of where it is going or how it is going to get there. Lawrence definitely has no idea regarding how to pay for our future in terms of future revenue streams. Well in one respect it does, it still is trying to control land usage to the extent it is strangling this city...thus leading higher and higher taxes on a community that can not afford them. Net result less disposable income...less sales...more taxes. Hmmmm...

There are some that say hooray...we have finally killed Lawrence.

Richard Heckler 4 years, 5 months ago

Green space cost taxpayers very little if anything. Once green space is annexed and infrastructure is installed taxpayers take a hit forever.

National surveys (through American Farmland Trust) show that county costs in services required by farmland and open space generally is only 35 to 60¢ for every $1.00 in revenues they generate, producing a net gain for counties.

In contrast, residential use in counties costs $1.11 to $1.60 in services for every $1.00 generated.

With increased numbers of houses you have increased demand on services, and historically the funding of revenues generated by residential housing does not pay for the services they require from a municipality.

Lawrence,Kansas is not a thriving metropolis. It is a small college town with limited financial resources.

The local economy was initially set around Kansas University which was substantial and could support the community and produced enough revenue to support a small college town economy. Did so for many many many many years.

Until the high tax dollar bedroom community came about Lawrence was a resilient economy.

Richard Heckler 4 years, 5 months ago

KU has good paying jobs and is the largest employer in Lawrence,Kansas.

LadyJ 4 years, 5 months ago

Drove through a town in another state recently and passed a huge sign proclaiming free land for industrial development. Wonder how that is going to work for them?

Richard Heckler 4 years, 5 months ago

Unfortunately small business USA is left to the free market while big government tax dollars provide those multi billion dollar anti american tax dollar haters with a leg up GIVING AWAY our tax dollars INSTEAD of saying make it on your own.

" Here’s what happens. And this is a good example of where the news media hasn’t done a good job. I have tons of news clips that say, oh, this new shopping mall is coming or a new Wal-Mart or a new Cabela’s store, and thanks to tax increment financing, this store is going to be built. Well, what is tax increment financing? I’ll tell you what it is.

You go to the store with your goods, you pay for it at Wal-Mart, and there’s a very good chance that that store has made a deal with the government that the sales taxes you are required to pay, that government requires you to pay, never go to the government. Instead, those sales taxes are kept by Wal-Mart and used to pay the cost of the store. And typically in those deals, the store is tax exempt, just like a church.

Now, there are two ways that it’s important to think about this. One is, that means your kid’s schools, your police department, your library, your parks are not getting that money. And you’ll notice we keep saying we’re starved for money. We’re twice as wealthy as we were in 1980, but we’ve got to close hospitals, and we’ve got to close schools, and we don’t have money for all sorts of things like after-school programs, even though we’re twice as wealthy.

The second thing to think about is, imagine that you own Amy Goodman’s or Juan’s department store across the street. You suddenly have to compete with people whom the government is giving a huge leg up on. You think you would go broke after a while? Well, in fact, you will. "

Richard Heckler 4 years, 5 months ago

"Enforcement is a joke these days, because there simply are no cops. Johnston said that, while the number of US taxpayers is growing rapidly, the number of IRS auditors is down by a third—and, not surprisingly, cheating is on the rise. The story is the same at the Department of Labor, OSHA, and other agencies tasked with keeping America 's economic and employment rules fair and equitable.

Johnston then boggled the crowd with a blunt assertion: "We pay billions of dollars in taxes that never get to the government." Much of the sales tax we pay at big box stores and shopping centers is diverted to the large companies that own the stores. It's just one of the many swindles these chains have learned to perpetrate against city and county governments. This is so effective that the Cabela family, which owns a chain of big-box sporting goods stores, receives 137% of its profits from taxpayer subsidies. If they couldn't work this scam, they wouldn't be in business at all.

The heart of the wealth transfer is tax increment financing (TIF). Store owners come to town leaders and offer to build a new store that, they promise, will "create jobs." In exchange, the city gives them the land, builds the store to their specifications, and finances it all with tax-free municipal bonds (which are usually held by associates of the store owners). To cap it all, the store keeps the sales tax generated in the store to pay off the bond holders. If the store is built on government land, it's also exempt from paying any property taxes."

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