By Sara Martin
Denver is looking to lift the TABOR rule on sales tax to combat climate change. In the 2020 election, Denver voters passed a 0.25% sales tax increase, which created the Climate Protection Fund estimated to accrue $40 million per year.
But with the first year of tax collection in 2021, it had already exceeded the estimate by $1.3 million. Due to Colorado’s Taxpayer Bill of Rights, or TABOR, the city is now required to return the revenue that was obtained through taxes.
TABOR requires the city to ask voters if they want the surplus funds to be put toward the Climate Protection Fund. The measure, 2J, would allow the city to keep the $1.3 million to further fund climate projects and still collect the tax without the $40 million cap.
“It’s very technical in nature. It doesn’t make the original ballot initiative go away, and all it does is ask if we are allowed to keep the money that was raised over the original estimate,” said Grace Rink, Denver’s chief climate officer.
The climate fund has been available to Denver residents in a variety of ways, such as rebates on electric-powered bikes to help cut carbon emissions. Money collected from the Climate Protection Fund tax also helps fund electric cars for the Montbello Connector, a microtransit program-providing free ride-sharing for neighborhood destinations and transit stations. An ordinance mandates that the city invests at least 50% of the fund directly into communities to enhance racial equity and environmental social justice.
In October, the city will break ground on 10 large solar panel arrays supplying community solar. City buildings are the anchor subscriber to those arrays, but low income households will also be fully subsidized subscribers with reduced electricity bills.
Next spring, residents will start to see new trees planted in communities around Denver thanks to the city’s new tree planting initiative. For 2022, the appropriated estimated tax collection is a little more than $40 million, and for 2023, the estimated sum is about $48.8 million, according to city numbers.
“We definitely want people to see how their dollars are being used instead of just having to go to our reports and have us tell them how it’s being used,” said Rink.