Jim Ruffalo: Auburn’s entrepreneurs prevail in tough times

Looking Behind the Scenes
By: Jim Ruffalo
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By now, most of us read the story in The Journal last week where Gov. Jerry Brown was singing the blues because just a month into the state budget, tax revenues are so far south that there already is another half-billion dollars added to the deficit. Well, don’t blame Auburn. A quick check of the record (available at City Hall) shows that in the final quarter of last year, the city saw a healthy 13 percent rise in local sales tax. Wait! It gets better. For the first quarter of this year, that figure jumped another 30 percent. Not bad at all, especially considering that the statewide average is about 6 percent in the black. Don’t get me wrong. Auburn isn’t recession-proof, but those sales tax numbers show something is going right. Bruce Cosgrove, who heads up the local Chamber of Commerce, says those hikes are attributable to local businesses “having the ability to adjust to any given set of circumstances. “They (the local entrepreneurs) see what a situation is, assess it, then figure out a way to use it to their advantage,” he said, thankfully omitting the overworked bromide about making lemonade whenever there is a surplus of lemons headed your way. Probably a perfect example of how it’s done is the rash of luncheon specials dotting the menus of many local restaurants these days. Assuredly many of the eateries load you up on carbohydrate calories, but while you fatten up, your wallet doesn’t have to diet. City Manager Bob Richardson is aware of the glowing figures and says it’s citywide. “No one particular business group is doing it by itself. Instead, the rise is along all business categories,” he said. Auburn can use the extra money, especially when other avenues of revenue continue to evaporate. The most recent report shows that the city’s share of property tax revenues dropped by 3 percent. “We expected that. In fact, our budget predicted it, and a 3 percent drop is better than most California cities have,” Richardson added. Meanwhile, federal fiscal follies continue to make life bleak for those of us still working private sector jobs. Thankfully, and I can’t believe I’m grateful to a sitting congressman, I want to pass along kudos to Tom McClintock. He was one of fewer than two-dozen Republicans who had the smarts and the guts to vote against the recent debt ceiling bill. McClintock said it was an easy choice for him, especially when the law did absolutely nothing to lower the current deficit. “Not only that,” he said, “but it provides the president with a more than a $2 trillion line of credit for his next political campaign.” McClintock said he had some discussions with the Standard & Poor’s folks prior to the vote and was told that if the country did not slash the deficit by $4 trillion, the credit rating would be lowered. “I asked S&P if a $3 trillion cut would suffice and was told it would not,” he added. “I also told (the Republican leadership) we were making a critical mistake in how we were going about it. Instead of putting together a proposed budget — as the Constitution says the House should do — we worked on drafting something to the liking of the Senate.” The result? A Dow Jones Industrial Average plummeting lower than whale dung, a still-soaring deficit and enough fiscal uncertainty that even the most cash-laden of companies are afraid to hire a new employee. McClintock feels that many Republicans, including more than a few tea party reps, have already forgotten the message delivered only last November. “That message,” he said, “clearly was to stop spending. But then, it takes more than one election to shift the direction of the country. We still have a great deal of work to do.” He’s 110 percent correct. Somewhere in time perhaps we’ll all need to learn the folly of spending what we do not have on what we cannot afford. Jim Ruffalo’s column runs on Sundays. Reach him at