www.hdlcompanies.com | 888.861.0220
Q2 2022*
Q2 2023*
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$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
SALES TAX BY MAJOR BUSINESS GROUP *Allocation aberrations have been adjusted to reflect sales activity County
and State
Pools
Fuel and
Service
Stations
Business
and
Industry
Restaurants
and
Hotels
Building
and
Construction
Food
and
Drugs
Autos
and
Transportation
General
Consumer
Goods
CITY OF FORTUNA HIGHLIGHTS TOP 25 PRODUCERS
Published by HdL Companies in Fall 2023
Ace Hardware & Garden
Beverage Plus Foods
Dollar General
Eel River Brewing
Forbusco Lumber
Fortuna Chevron
Fortuna Gas 4 Less
Grocery Outlet
Hummel Tire & Wheel
Les Schwab Tire Center
McDonald’s
Mercer Fraser
O’Reilly Auto Parts
Peterson Tractor
Ray’s Quality Cars
Rite Aid
Safeway
Sequoia Gas
Sunbelt Rentals
Tractor Supply
Valley Pacific Petroleum
Services
Village Sport & Cycle
Walgreens
Wildwood Saw &
Workwear
Wyckoff Plumbing
SALES TAX UPDATE
CITY OF FORTUNA
2Q 2023 (APRIL - JUNE)
Fortuna’s receipts from April through
June were 2.7% below the second sales
period in 2022. Excluding reporting
aberrations, actual sales were flat.
Business-industry had a large infusion
of activity from one segment that was
partially offset by a slump from gardenagricultural. The countywide use tax pool had lower ecommerce and third party
automotive purchases for a modest drop
in the City’s allocation.
Restaurant receipts improved driven by
customers enjoying quick service meal
options. Economic reports indicate eating
at home is now more affordable than
dining out. Spending on transportation
needs improved as auto supply stores
were busy with people who have opted
to invest in maintenance.
Service station payments suffered when
compared to last spring when prices to
fill up at the pump were at record levels.
Supply cuts from OPEC have influenced
pricing in recent months for pricing
to trend upward again, as have some
outages at California refineries.
While Measure E posted positive results
from local restaurants, declines from
service stations and fewer new/used
vehicle purchases offset these gains.
Net of aberrations, taxable sales for the
Far North region declined 6.2% over the
comparable time period.
TOTAL:
-2.8%
$486,454
Measure E
TOTAL: $ 554,691
-0.1% -3.2% -2.9%
COUNTY STATE
FORTUNA
2Q2023
TOP NON-CONFIDENTIAL BUSINESS TYPES
Q2 '23
Fortuna
Business Type Change Change Change
County HdL State
Service Stations 64,736 -12.6% -20.4% -19.9%
Casual Dining 45,497 0.0% -4.5% 4.6%
Automotive Supply Stores 30,024 5.0% 2.5% 3.3%
Garden/Agricultural Supplies 27,207 -7.2% -11.5% -3.1%
Quick-Service Restaurants 24,538 17.4% 6.3% 3.2%
Contractors 19,805 -15.1% 6.3% -3.0%
Auto Repair Shops 14,624 18.2% 2.5% 2.3%
Convenience Stores/Liquor 14,453 0.3% -2.4% -5.2%
Electronics/Appliance Stores 10,770 -19.7% -14.3% -6.2% Second-Hand Stores 5,092 17.1% 1.6% -5.6%
*Allocation aberrations have been adjusted to reflect sales activity
REVENUE BY BUSINESS GROUP
Fortuna This Fiscal Year*
19%
Pools
13%
Restaurants
10%
Autos/Trans.
12%
Building
12%
Bus./Ind.
8%
Cons.Goods
11%
Food/Drug
14%
Fuel
*ADJUSTED FOR
ECONOMIC DATA
2Q 2023 CITY OF FORTUNA SALES TAX UPDATE
STATEWIDE RESULTS
California’s local one cent sales and use tax
receipts for sales during the months of April
through June were 2.8% lower than the
same quarter one year ago after adjusting
for accounting anomalies. The second
quarter of the calendar year was impacted
by continued wet weather and a difficult
comparison with the prior year, which
experienced dramatic growth.
The fuel-service stations sector contributed
the most to this decline as year-over-year
(YOY) falling fuel prices at the pump reduced
receipts from gas stations and petroleum
providers. Russia’s invasion of Ukraine and
other world events during this period last
year, pushed the global cost of crude oil
to record highs. This dynamic also carried
into general consumer goods as retailers
selling fuel experienced a similar drop.
Recently, OPEC and Russia have maintained
production cuts having upward pressure on
pricing again leading to future comparative
growth.
Sustained wet conditions further delayed
projects, especially those from the prior
quarter, hindering building-construction
returns. YOY lumber price declines added
to the pull back from building materials
providers. Higher interest rates represent a
significant headwind for the industry with
potential impacts of limited commercial
development activity, slowing public
infrastructure projects and homeowners left
unable to access equity for renovations.
Despite a significant increase in new
car registrations, revenue from autostransportation fell by 1.4%. The improved activity can largely be attributed to rental
car agencies restocking their fleets.
However, these are wholesale transactions
with sales tax charged upon rental of these
vehicles. Weak demand for recreational
vehicles, boats and motorcycles coupled
with elevated overall financing costs remain
challenges going forward.
Use taxes remitted via the countywide
pools decreased 0.75%, marking the third
consecutive quarter of decline. While
overall online sales continue to rise, pool
collections dropped with the offsetting effect
of more in-state fulfillment generated at
large warehouses and through existing retail
outlets allocated directly to local agencies.
Restaurant sales were a bright spot as the
summer season began. Although menu prices
have flattened after a year of sharp gains,
patrons are making more restaurant trips
and are favoring spending their disposable
income on experiences. Better sales by office
material suppliers and enhanced investments
of warehouse-farm-construction equipment
contributed to improved returns for the
business-industry category.
Sales tax for the remainder of 2023 appears
likely to follow the recent trend of moderate
declines before leveling off in early 2024.
Cooling consumer confidence and greater
pressure on household budgets may lead to a
lackluster upcoming holiday shopping period.
Furthermore, the possibility of a longer and
more pronounced slowdown in economic
activity exists as the Federal Reserve
considers additional interest rate increases to
combat high prices that are already stretching
consumer wallets.