In Oakland, 1 in 6 businesses don't pay their taxes

(The Center Square) - The city of Oakland is projecting a $177 million deficit in its general fund for the 2023-24 fiscal year, and part of the problem is local businesses are not paying their taxes.

For the past three years, about 7,200 businesses a year have skipped out on paying taxes to the city, costing it an estimated total of $34.7 million over that span. The city says the statute of limitations to collect these unpaid taxes is three years.

There were 6,960 delinquent businesses in 2023-24, according to city documents . There were 45,021 businesses that paid their business taxes in 2023-24, meaning more than one in six businesses in the city haven’t paid their taxes.

The city has started trying to track down the businesses it believes has not paid its taxes but said some of them may no longer be in business. The city has 1,183 delinquent business accounts that have been referred to collections. The city stated there is $11.36 million total in collections.

The City Council received the report at an April 30 meeting.

Police cost overruns are also contributing to the budget deficit.

The city also projects that the police department will overspend its $333.34 million budget by $25.64 million mainly due to overtime. The police department was originally budgeted for $325.39 million in 2023-24. The police department was budgeted for $267.4 million in 2019. The police budget has increased to $358.9 million by the end of 2024, an increase of 34% over that five-year period not adjusted for inflation.