The gift cards are part of a city effort to boost its economy and make local dealerships more appealing, said Pat Kelly, general manager of Tracy Chevrolet. He said customers will be rewarded for buying here instead of going out-of-town.
Kelly said that while he’s taken a few calls from people who were interested in the gift cards, as of Wednesday afternoon, he hadn’t sold anything. He said he remained optimistic that as more people hear about the promotion, they would buy cars in Tracy.
“We’re hoping this weekend,” he said.
Jeff Morri of Stan Morri Ford said he sold a Ford Fusion Wednesday to a buyer who was specifically interested in the gift card. He said he’s also seen a lot of media attention from newspapers and TV stations, which should help sales perk up in the near future.
“People are just trickling out right now, and we haven’t even started advertising it,” Morri said.
Morri said that in order to help keep that gift card money in Tracy, his company will give buyers an additional 10 percent if they use the card at his dealership. The cards can be used anywhere, though city officials hope people spend them in town.
At Tracy Toyota, general manager David Cauthen Jr. said he was in the midst of a sale on Wednesday. He’s also had more people go to the dealership and call, expressing interest in the gift card offer.
“Traffic, has it increased greatly? No,” he said. “But have there been a couple people that have come in specifically for that? Yes. So we can already see some kind of interest that has been sparked by it.”
Cauthen said that since it’s still the middle of the week, it’s still too early to tell how much the gift cards will help long-term.
While some dealerships are seeing immediate returns, others are still waiting to reap the benefits. Employees from the Mazda and Nissan dealerships said they haven’t had any response yet.
The gift cards will last until 800 are given away, or until Aug. 1, whichever comes first.
• Contact Tracy Press reporter Justin Lafferty at 830-4269 or jlafferty@tracypress.com.
"Does anyone know where to find the section of the law that bars the gift of public money to private businesses?"
Apparently the Council has declared the sales tax revenue a "public benefit" so that is okay according to the law. Read below. Personally I think it's a waste of public funds which could have been better spent. People will be here this weekend in droves I'm betting from all over the place.
Found this on Google:
The California Constitution (Article XVI § 6) prohibits any public agency from making “any gift of any public money or thing of value to any individual, municipal or other corporation whatever.” The determining factor in whether there has been an illegal gift of public funds is whether the expenditure was for a “public purpose.” Schettler v. County of Santa Clara (1977) 74 Cal.App.3d 990, 10003. If the expenditure is for a public purpose within the jurisdiction of the appropriating board or body, it is not regarded as a gift even though there may be incidental benefits to private persons. Id; Atlantic Richfield Company v. County of Los Angeles (1982) 129 Cal. App. 3d 287, 297. In Schettler, the court stated that “[i]t is .. settled that if a public purpose is served by the expenditure of public funds, the constitutional prohibition is not violated even though there may be incidental benefits to private persons [citations].” Schettler, 74 Cal.App.3d 1004. The Schettler court further held that “[e]ven more importantly, under an unbroken line of cases the determination of what constitutes a public purpose is primarily a matter for the [governing body], and its discretion will not be disturbed by the courts so long as that determination has a reasonable basis.” Id. In Atlantic, the court specifically held that a refund of taxes to the taxpayers was not an illegal gift of public funds because the purpose of the refund was to relieve taxpayer hardship and relief of hardship to a taxpayer is a valid public purpose. Atlantic, supra 129 Cal. App. 3d 287.
"Public purpose". City council said they want to help local car dealerships by offering public funds ($500) to anyone purchasing a new car from Tracy car dealerships. If "public purpose" is to help the car dealerships, then why is the $500 being offered to potential new car buyers? The only ones benefitting from our public funds should be the dealerships...if that's how city council is interpreting the law. Why is the city giving away $500 to buyers then? The example of "public purpose" ..... "the court specifically held that a refund of taxes to the taxpayers was not an illegal gift of public funds because the purpose of the refund was to relieve taxpayer hardship and relief of hardship to a taxpayer is a valid public purpose." .... does not even come close to what the City's intention of helping out dealerships when, in fact, it's the new car buyers who are benefitting from our public funds. Also, the $500 is not limited to "Tracy residents only". So where is the legality of this offer?