To "Buy" For
words By Jolen
by Ryan Watamura
local” is used enough to be considered a
cliché. Often, this rallying cry falls
on unresponsive ears. And, as more and more people
live in outlying communities and commute to the
larger cities, less of the community’s buying
power is actually spent in the city a commuter
at Traffic Magazine wanted to investigate the
“buy local” mantra. Does it really
matter? Or is it just the local small businesses’
attempt at getting more revenue?
First we talked to the City Managers, of Kingsburg
and Reedley. According to Kingsburg City Manager,
Don Pauley, “People should buy in Kingsburg
for a number of reasons; one is to support local
business which supports the local economy. Buying
local creates strong local businesses which generates
interest for more retail development. Second,
when a resident buys locally a portion is returned
to the city and supports the local government
services. More revenue to the city from retail
sales tax means more dollars for police, fire,
and public works. Public works includes street
and park maintenance. When people buy gas at local
gas stations a portion of the gas tax is returned
for street maintenance. The city gets a significant
portion of its street maintenance funding from
gas taxes. Public safety benefits with the police
department receiving an additional amount that
is earmarked from the state which can only be
used for law enforcement.”
City Manager Brian Nakamura added, “Buying
locally helps provide more jobs for the community.
People don’t always realize that.
Reedley residents shop outside of Reedley, those
tax dollars are utilized by another city. If you
shop in Reedley, economists estimate that it recycles
itself seven times. That means for every one dollar
spent, it adds seven dollars to the community.
That dollar provides for 1% of the sales tax.
That’s not a lot per dollar but it adds
up over time. If the business keeps 80¢ of
that dollar and that 80¢ is spent on employees,
then it too multiplies throughout the local economy.”
an economic perspective,” Nakamura continued,
“to provide the economic base of the community,
whether it be Reedley, Kingsburg or wherever –
the strength or weakness of the local economy
is something the community controls, not the government.
What do you do as a family? You go out to dinner,
you use the parks and the recreation services.
Even as a bedroom community your residents should
want to support the services that support the
things they utilize. You might use a recreation
program, a parks program or a service that the
City of Reedley provides. By buying locally you’re
helping to ensure that we can continue to provide
those services in the future.”
city receives 1% of sales tax. In Kingsburg that
is about $600,000 annually. For Reedley it equates
to about $1.2 million annually. In Fresno County
most purchases are currently taxed at 7.875%.
Of that amount, .875% are taxes voted in by Measures
B (libraries), C (transportation), and Z (zoo).
the city’s 1% general fund allocation comes
from 7% of the retail taxes paid, or about .07¢
After having the government officials weigh in,
we thought it would be fun to test their theory.
We started with a local Kingsburg resident who
has lived here since 1966. Mary Hernandez is a
Cashier for Kmart in Kingsburg.
Mary is paid by Kmart, who employs 85 people and,
if they are within the national big-box averages,
have an annual payroll of about $1.5 million.
Mary knows many of her customers and enjoys letting
them know when things are on sale. She likes hearing
about their families, hobbies and lives. When
Mary shops, she goes to places like Nixey’s
Boutique, Our Stuga, Town & Country Market,
and Albertson’s. She banks locally at Citibank.
Mary tells us that the people at those local establishments
treat her very well, know her by name and often
like to converse about family too. Let’s
say, for demonstration purposes, that Mary spends
$100 at Nixey’s Boutique. The purchase has
a sales tax of 7.875%. Since the .875% is for
libraries, transportation and the zoo, we should
only count 7% of the tax. This equates to $7.00.
Of the $7.00 the City of Kingsburg receives .07¢
which will eventually wind up in their General
Fund. Nixey’s Manager, Lindsay McIntyre
lives in Kingsburg. With her paycheck she purchases
from local establishments like Chevron, Anysthings,
For the Birds and Lisa’s Mane Attraction.
Let’s say her $100 purchase at For the Birds
adds another .07¢ to the City’s coffers
and so on. You get the picture.
According to Mr. Nakamura, as that money ripples
through the Kingsburg economy on average of seven
times, then Mary’s original .07¢ tax
contribution to Kingsburg just sent the City .49¢.
it seems that no matter what city you shop in,
you will support that city’s local economy
and subsequent services. The question is do you
want to support the services that you and your
family utilize? Or do you want to support the
services that other people utilize?
In the end, we found that there were a variety
of reasons to shop locally and that most of them
really didn’t have to do with benefiting
the local businesses. Instead, buying locally
seems to have more to do with actually benefiting
each resident on a personal level. The reasons
• Improved law enforcement
• Improved fire protection
• Improved transportation
• Improved parks
• Improved recreational activities
• Improved opportunities for other businesses
to establish locally because of the
• Higher employment rate (which means lower
crime rate and more dollars spent
within the community)
• Maintenance or improvement of the better
quality of life you moved here to enjoy.
next time your car needs to be filled with gas,
consider purchasing it in your hometown. The next
time you have ten things on your list and know
you can only purchase three of them locally, purchase
those three locally.
local purchases will directly benefit the services
provided to you by your local government.