Cash for Clunkers Helps Local Government

August 4, 2009 12:34:31 AM PDT
The "Cash for Clunkers" incentive program seems to be generating more business than some dealers can handle.Joe Stasikonas traded in his old Ford Van for a new Chevy Aveo, after trying to buy a Toyota. "I went next door to the Toyota dealer and they said you need to make an appointment to even talk to a salesman, and I said, well forget that, I'll go next door and see what I can work out over there." Stasikonas said. But while Stasikonas got to drive his new car home , the Chevrolet dealer he bought it from is being cautious on future sales. Owner Brett Hedrick explains, "We are making deals, we are holding the vehicles, we are holding the paperwork, we don't want to commit that customer when we can't be absolutely sure."

Certainty won't come until the Senate votes to approve the additional two billion dollars already approved by the House for the program. But some dealers are confident the money will be there. Across the street at Future Ford, they plan to keep making deals, anticipating the government will not let this successful program die. The surge in sales is welcome news to the City of Clovis, which relies on car sales for a good chunk of its sales tax revenue.

City Manager Kathy Millison says each sale means about $300 in taxes. "For us, sales tax is about 40% of our revenue for critical services like police and fire. And our auto dealers are at least 40% of that, if not more." Millison said.

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