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Denver voters to decide on sales tax increase that would go toward services to help the homeless

November ballot measure would raise taxes by 0.25% starting 2021
Posted at 4:14 PM, Aug 25, 2020
and last updated 2020-08-25 21:48:49-04

DENVER – Residents will vote in November on whether to increase the city’s sales tax by 0.25% to help invest in services aimed at resolving homelessness in Denver.

The measure, which seeks to significantly increase housing options, shelter and other services to help the unhoused, was unanimously approved by Denver City Council Monday night. If passed, the fund would generate an average of $40 million a year by collecting 2.5 cents for every $10 spent by residents starting in 2021.

While specific plans for the funds are still pending a public and stakeholder process, the money would be spent on housing, shelters, establishing catalytic projects as well as other programs to alleviate Denver’s homeless crisis, city officials said in a news release following the vote.

"These dollars have the potential to make a difference," said Councilwoman Robin Kniech, who sponsored the measure. "Supportive housing, for example, we know can take someone directly from the streets, help them get housing and help them get back on their feet successfully. So it can and it will take people out of camps into housing over time."

And while the fund would collect approximately $40 million yearly over the first decade, actual tax collection would fluctuate depending on sales activity, officials said, adding an estimated lower tax collection in 2021 due to the economic effects of the coronavirus pandemic in the state.

"We think that with additional funding we could build and provide supportive services for about 1,800 affordable, supportive housing homes for those who are experiencing or exiting homelessness," said Deputy Director of Operations for Department of Housing Stability, Laura Brudzynski.

The measure has the blessing of Mayor Michael Hancock.

“From new 24/7 shelters to tiny homes and social impact bonds, we have deployed a number of innovative programs that we know are working. This funding will increase the positive impact of these proven strategies and allow us to do more where we need to do more,” he said in a prepared statement.

If the ballot measure is approved, Denver would join Los Angeles, San Francisco, Portland, Austin and Charlotte, who’ve already established funding to help people get out of homelessness.