The city does not share directly in regional sales expansion due to its modest retail sales tax base. The total tax base is a critical component of the city's annual revenue collection, constituting nearly 65 percent of all annual General Fund revenues. Sales and property taxes, the two most important components of the city's tax base, historically have experienced only modest growth. Collectively, these two sources have grown at a rate less than general inflation.
As the city ages, preserving and enhancing the city's existing tax base becomes increasingly important. In order for the city continually to take advantage of increased regional sales activity, it will need to add to and improve its inventory of retail establishments. Given the economic realities in California, each local jurisdiction must maintain its own fiscal viability. This requires a combination of land use policy, attraction of business, and local revenue policy, including taxation. It must be also recognized that long-term fiscal viability requires incremental public and private investment.
Limited Land Area for Development
Monterey Park's land configurations and parcels tend to be small, with very few vacant parcels available. This built-out character limits the city's ability to attract large development projects capable of creating the critical mass necessary to stimulate the local economy. This predicament leaves the city with a narrow range of options for new development. One tool that can be utilized by the city is its ability to acquire properties and consolidate and reconfigure the resulting lots. The city's Redevelopment Agency has utilized this approach.
High Land Costs
The cost for properties in Monterey Park are generally above the average for communities in the region, thereby reducing the city's ability to compete with business centers having less expensive properties. Because of Monterey Park's strategic location, among other factors, land has been purchased at premium rates and has driven up the area's overall land costs. Property owners generally are in positions where they can "sit on" the property until they get a desirable offer for their land. During the 1980s and 1990s, this situation was aggravated by land use restrictions that increased development costs.
Plans to Meet These Challenges - The Priorities
The city's economic development goals and policies respond to known challenges and build on the Economic Opportunities section of the city's 1995 Economic Development Strategy Plan, which addressed many of the issues of continuing concern. In the short term, the city has three generalized areas of focus for its economic development efforts:
- To build retail credibility and national credit tenant status in the North Atlantic Boulevard and OII / Edison focus areas.
- To strengthen the city's hotel / meeting center facilities in the Downtown focus area by capitalizing on the city's ethnic identity as a center for the Asian community.
- To create a land use and infrastructure environment in the Monterey Pass Road focus area that will be conducive to future flex-tech and other high-end manufacturing users.
These targeted business development goals primarily pertain to dedicated efforts in specific areas of the city and do not encompass all of the identified focus areas under consideration in the Land Use Element.
Preserving, retaining, and building the city's tax base will allow Monterey Park to continue to provide a high level of public services, and to invest in public improvements that enhance the business environment and overall visual character of the community.