In our present distribution of sales tax dollars, the money goes back to the point (city) of origin. This may leave the cities where these shoppers actually live short of money for essential services: police, fire, sanitation, roads, etc. This is also the reason for everyone’s "Shop Your Hometown" campaign.
It is some kind of irony that we want everyone to shop Downey when some half of all buyers are from out of town; then we give those sales tax dollars away in Redevelopment projects to out of town developers.
There have been discussions for a long time on the benefits of redirecting the sales tax back to cities based on population. The city where the people live is where the services are being supplied and it may be they who most need the money. As more and more populous cities without car agencies and big box retailers feel the pinch of increasing social needs, we can expect a push for a change in the division of spoils and those cities that have sold their soul for retail will begin to see the other side of the coin.
This is particularly true in many California cities where Redevelopment projects have given away not only the land and the property tax increment, but also the sales tax money.
Many of these projects did not have any justification for subsidy in the first place. Think about the further drain on the general fund when in the future some sales tax dollars will be shifted to neighboring cities and we will be required to make up the shortfall. Those bonds will still have to be paid.
So much for deficit financing, so much for deficit development.