Tri-Citians are shopping again for cars and RVs and spending money to fix their homes and gardens.
The latest taxable retail sales numbers from the state Department of Revenue show Pasco showed the biggest gain at 12 percent from January to March, compared with the same period a year ago. In all, those sales totaled $193 million,
Kennewick businesses reported about $332 million in taxable retail sales in the first quarter, an increase of 4.6 percent. And Richland companies had about $183 million in sales, up 2.4 percent.
Local gains come at a time when sales declined statewide 2.9 percent for the period.
Ron George, owner of Chief's RV Center in Pasco, said he believes the sales jump is because of "pent up demand."
Sales of new RVs are OK, but sales of used RVs are quite high, he said.
And the demand for parts and services is holding steady, which means current RV owners are making sure their motorhomes last longer, he said.
George said the growing retail sales suggest the area's agricultural economy, the wine industry, the presence of innovative small businesses and the influx of retirees is helping the community move away from a Hanford-based economy.
Charlie Grigg of Grigg's Department Store in Pasco, said sales of clothes, shoes, sporting goods and garden supplies increased in the first quarter. A short warm spell in March may have helped bump up sales, he said.
The store has seen a steady increase in the last three years. "We are responding better to customer demands," he said.
But while Pasco's first quarter retail revenues are better than last year's, they are about 8 percent below the 2008 level, said City Manager Gary Crutchfield.
People seem to be willing to buy big ticket items and invest in a home, thanks largely to federal tax credits, he said.
And construction projects definitely helped the city grow its share of sales tax revenues, Crutchfield said.
If sales tax revenues continue to grow as projected, less of the city's reserves will be needed to balance the budget. "It's a good sign, butwe aren't yet out of the woods," he said.
Kennewick's retail sales revenues also are down about 2 percent from first quarter 2008.
Marie Mosley, support services executive director for the city of Kennewick, said the loss of $60,000 in a quarter is substantial considering retails sales taxes are the city's largest source of revenue.
Last year, Kennewick lost Joe's Sports and Shumate Motorsports and saw the Honda dealership move to Richland, she said.
But the first quarter results suggest construction and retail growth have rebounded, she said.
Mosley said she's looking forward to the opening of McCurley's new Mercedes Benz showroom on Kennewick's Clearwater Avenue. A building permit was issued recently for the $1 million project.
Also, Hobby Lobby, an arts and crafts retail chain, has told the Herald it is looking to open an outlet in the Tri-Cities, though it hasn't yet said where.
But retail sales can be volatile and make revenue projections go haywire, Mosley said. "We are seeing a rebound. This is a revenue source we spend a lot of time reviewing."
Cities in Benton and Franklin counties get a little under a penny for every retail sales tax dollar spent in the area.
Kennewick is being cautious after experiencing sharp sales declines last year, she said.
But in the first quarter, Kennewick sales of electronics and appliances grew from about $10.3 million to $11.6 million.
Consumers seem to be buying TVs and music systems instead of appliances like refrigerators, said Daniel Bunch, a salesman at Bunch-Finnigan Appliances on Columbia Drive. Their sales are up 20 percent compared with the same time last year, he said. It's somewhat of an impulse purchase, he said
Bunch said the sale of "white goods" or appliances like refrigerators and washers may be slower, because people tend to perceive them as big-ticket items.
In Richland, the Circuit City liquidation sale in early 2009 helped generate $6.4 million in sales in the electronics and appliance sectors. But this year, sales fell to about $2.7 million in the first quarter.
"That's why we don't want to project revenues too high," said Gary Ballew, Richland economic development manager.
Retail has picked up, but construction sales taxes still are lagging, he said. Many construction projects have stalled because of problems with financing. "We are seeing activity, but it's not like 2007 or 2008," he said.
Auto sales are helping generate a lot of revenue for the city since McCurley's Honda dealership moved to Fowler Street in Richland, Ballew said.
Sales at the Honda dealership increased 250 percent to $7.22 million in the first quarter, compared with sales at the former Lithia Ford dealership -- at the same spot last year, said Bill McCurley, president of McCurley Integrity Dealerships, which owns the Honda dealership.
But at McCurley's Pasco location, vehicle sales to large farms, businesses and commercial and industrial accounts is still lagging, he said.
Businesses delayed buying vehicles in the first quarter, he said, probably because of the construction slowdown.