City of Morgan Hill Economic Blueprint.docx

category that includes furniture/appliance stores, apparel stores, and department stores among others), the overall leakage is 31 percent. Given the City’s small size and location in the large and crowded South County retail trade area, as well as the shrinking of many retail categories, it is unlikely that Morgan Hill will ever capture 100 percent of residents’ purchases.

One strategy to increase the City’s retail sales is by upgrading older strip retail centers (for example, along Monterey Road) and continuing to support the transformation of Downtown Morgan Hill into a pedestrian-oriented, mixed-use destination. There are also opportunities to attract new retailers, particularly in categories such as restaurants and food stores for which residents and workers are less likely to drive long distances to dine and shop.

However, there are opportunities to improve the retail picture in Morgan Hill.

Figure 17: Sales Tax Leakage in Morgan Hill (Percent of Residents’ Disposable Income Captured in the City), 2 nd Quarter, 2016

Total Sales Construction General Retail

Transportation Food Products

Auto Sales-New Service Stations Misc. Vehicle Sales Total Sales

Miscellaneous Retail Busines to Business Drug Stores Florist/Nursery Building Materials-Wholesale Restaurants Department Stores Building Materials-Retail Food Markets Auto Parts/Repair

Furniture/Appliance Recreation Products Apparel Stores

Food Processing Equipment Liquor Stores Auto Sales-Used

0% 100% 200% 300% 400% 500% 600% 700% Percent of Residents' Disposable Income Captured in Morgan Hill

Source: MuniServices, "Morgan Hill: 2nd Quarter 2016 Sales Tax Capture & Gap Analysis Report."

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