Simi's auto dealers, who've seen a precipitous drop in revenue over the past five months, are among the local industries hardest hit by the economic slide.

Larry Hibbler, president of Simi Valley Ford, said his sales are down 50 percent from 2007. A 40year veteran of the car business, he said he's never seen the industry in such bad shape.

"Usually when sales are down, service picks up; usually when new cars are down, used cars pick up. But in today's environment, everything is off," Hibbler said.

Darrell Coletto, owner of First Honda, First Nissan and First KIA, said his business is experiencing the same struggles, calling it a "rough road" since September.

"People are a little unsure of what's going on so they're not spending their money," Coletto said. "People are afraid of losing their jobs and where they're going to be tomorrow."

This drop in sales has hit city coffers hard since auto dealers, along with building construction suppliers, are typically top generators of sales tax revenue. One percent of the sales tax on purchases made within the city's boundaries goes directly to city projects.

In the 12-month period ending September 2008, Simi's auto and transportation industry saw a nearly 15 percent drop in sales tax revenues generated for the city compared to the same period the previous year (see chart at right).

Building construction suppliers, which include lumber and hardware businesses like Lowe's and Home Depot, registered an even larger decrease over the same time period—almost 24 percent.

2008's sharp decline in sales for both industries meant the city received $952,486 less in sales tax revenues than it did the year before. Combined with smaller decreases in business and industry and general merchandise, the city's sales tax revenues fell nearly 6 percent.

While the most recent numbers available to the city only reflect the beginning of the economic downturn, City Manager Mike Sedell said the figures should remain about the same this year.

Based on receipts from previous quarters, he said, the city is anticipating a 6 percent to 8 percent drop in total sales tax revenues for the fiscal year 2008-09.

"I think this was a bigger downturn than anyone anticipated," he said. "We did anticipate a downturn, and as we saw it getting worse, we went to the council and gave them recommendations for cutting back."

While the cities of Oxnard and Port Hueneme approved half-cent sales tax increases in the November election and the city of Thousand Oaks is surveying its residents to see if they would support a similar increase, Sedell said a tax increase is not something Simi leaders are considering.

"It would require much more dire circumstances than we are in fiscally, and it would be one of the last resorts our council would look to," he said.

Mayor Paul Miller agreed, saying that residents are having a hard enough time as it is.

"That is something that I would not entertain because I would not vote for it," Miller said. "We're going to have to just survive on what we have coming in."

Sedell said the city has ongoing dialogue with the business community, including management at Simi Valley Town Center and the car dealers, to gauge where the community is headed.

"We're trying to anticipate what's coming and provide services to the residents of this community as they've come to expect while recognizing there are less revenues available to the city," he said.

This means finding new ways to do business and making a lean organization even more efficient. Dozens of jobs remain unfilled by the city, leaving staff to shoulder the extra work.

When the economy turns, the city does plan to hire back and fill in the now-vacant positions, but the city manager said not everything will go back to the way it was before the financial crisis.

"We're not going to go back to where we were before when the community was expanding, even though there may be revenues," he said.

Despite the current situation, Sedell said he believes the dealers on Auto Center Drive will survive the economic storm. In a time like this, he said, it's even more important that people who are looking for a new car buy locally.

"If they don't, they are giving that $200 to $400 worth of sales tax to some other community," the city manager said.

Hibbler and Coletto said that if a resident is looking for a brand of car sold in town they should buy it in Simi because oftentimes the price is identical to what is found at other auto malls. If not, it can be matched.

"I just wish the citizens in this town would give the dealers the opportunity to earn their business," Hibbler said.

While shopping in Simi boosts the local business community, sales tax dollars also help the city pay for essential government services for residents.

"I just don't think the consumer realizes how important it is to spend in town," Hibbler said. "They take it for granted. We think the streets are always going to be safe, the roads are always going to be paved."

Sedell said the Shop Simi Valley First program—which was earmarked for $100,000 this fiscal year through community development agency funds—is beginning to have an impact on local shopping patterns. For every $100 spent in the community, $1 goes back to the city's general fund. Sedell said that while that 1 percent kickback may not seem like a lot, residents' purchases add up.

Though business is difficult right now, Coletto believes he and Simi's other auto dealers will navigate the rough waters.

"It is tough; we've got to tighten our belts, but we are confident that we are going to be here for a long time," he said. "I'm looking forward to March, April and May for business to start to turn and for the confidence level to be a little higher."

The city will have a more complete picture of its financial landscape Feb. 9, when the midyear report is presented to the City Council. The report will include sales tax figures from the holiday season, which Sedell estimates dropped 8 to 10 percent from '07.

"We're hopeful that in six to nine months we will start seeing things turn around," he said.

Sedell cited $115 million in projects the city will start moving forward on once the economy bounces back. These include street and road improvements, sewer and landscape projects, energy conservation plans and the beautification of the Arroyo Simi.