A new report by the town of Oro Valley shows just how much money is slipping through Oro Valley’s fingers.
In 2024, residents living in three Oro Valley ZIP codes spent more than $1.18 billion at restaurants and retailers outside of town. That figure comes from a first-of-its-kind leakage study conducted by the Town of Oro Valley using Placer.ai data analytics software.
The study found residents made 13.4 million shopping and dining trips outside the town last year, with purchases ranging from food and gas to cars and appliances. Most notably, Oro Valley has no car dealerships, resulting in 100% of vehicle sales leaking to other communities—a total of $195.85 million in lost auto sales alone.
"We knew that was going to be a 100 percent source of leakage," said Paul Melcher, the town’s Community and Economic Development Director. "But looking at Costco and some of the other destinations, yes, we were very much surprised by how much a destination can pull [residents]."
Melcher says that kind of behavior—residents making multiple purchases in one trip outside of town—is part of why the town is missing out on major revenue. For example, while there is a Home Depot in Oro Valley, people often opt for the one near Marana’s Costco when they’re already there.
Altogether, the town estimates it lost $17.2 million in potential sales tax revenue in 2024 due to this leakage. That’s significant, Melcher says, because nearly half of Oro Valley’s general fund revenue comes from sales taxes. Those funds support police services, parks and recreation, permitting and community programs.
“When we get and receive community requests for additional shade structures or other similar types of improvements, that’s what limits our ability to provide those or budget adequately for that."
The town is now budgeting $50,000 to launch a “Shop Local, Dine Local” campaign in the next fiscal year. The goal is both educational and practical—to make residents more aware of how their spending habits impact town services.
To tackle the issue head-on, Melcher said the town has prioritized several categories for potential recapture:
- Big-box retail, like Costco
- Popular mid-level restaurants, such as Chick-fil-A and Raising Cane’s
- Targeted supporting retail, like appliance or electronics stores
Even modest improvements could yield big returns. “If we could start with that one percent, you're talking about 100 million dollars in recapture right away...that adds up pretty quickly,” Melcher emphasized.
Residents seem to agree there’s room for improvement.
“Oro Valley doesn't have everything we should have,” said resident Michael Bowman. “I'm not sure when they're going to put in some of the stores we could use.”
Jean Scott, another resident, pointed out that many people head to Marana or Tucson when they need appliances or electronics.
“We don’t buy a lot of those things, but when you do need them, we don’t have it—at all,” she said.
While the town can't bring in every missing retailer, Melcher says they want to use the data to focus their recruitment efforts on the businesses residents are already driving to—and keep more of those dollars circulating in Oro Valley.
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Kenny Darr is a reporter for KGUN 9. He joined the team in January 2023. Before arriving in Arizona he was an Anchor and Reporter at KADN in Lafayette, LA. Share your story ideas with Kenny by emailing kenny.darr@kgun9.com or by connecting on Facebook, Instagram or Twitter.
