New Transparency Requirements for Local Tax Sharing Agreements (AB 2854)

Beginning in 2025, California law (AB 2854) requires cities, counties, and other local government agencies to publicly report certain financial agreements made with retailers. These agreements, often called sales tax sharing agreements, allow businesses to receive a portion of the local sales tax they generate in exchange for bringing jobs, investment, or economic activity to the community.

To increase transparency, this new law requires local governments to:

• Annually report details of these agreements to the state by April 30 each year.

• Post that same information online on the agency’s official website, where it is easy for the public to find.

• Disclose key facts like which businesses are involved, how long the agreements last, and how much sales tax is being shared.

If a local government does not have any such agreements, it must still notify the state and is not required to post anything online.

This effort helps ensure that the public has easy access to information about how local tax dollars are being used to support economic development.

For more information on the tax revenue sharing agreement please visit the CA Department of Tax and Fee Administration's website:  CDTFA 

The City of El Cajon currently has five (5) Tax Sharing Agreements that are based on Sales Tax and are applicable to the new reporting requirement and one (1) Tax Sharing Agreement that is based on Transient Occupancy Tax (TOT) that is not applicable to the new reporting requirement.

Copies of All Tax Sharing Agreements are linked below as well as the City's submission of the required annual reporting to the CDTFA.