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Denver Voters OK 2 Sales Tax Hike Measures

By Paul Williams · Nov 4, 2020, 2:06 AM EST

Denver voters approved two ballot measures Tuesday that will each raise the city's sales tax rate by 0.25 percentage point, with one dedicating revenue to initiatives to curb carbon emissions and the other earmarking funding for homeless services.

Voters approved Measures 2A and 2B, agreeing to raise the city's sales tax rate to 4.81% from 4.31% for a combined local-state rate of 8.81%, starting Jan. 1. Both measures are estimated to raise an additional $80 million in annual revenue.

As of late Tuesday, Measure 2A was approved 64.3% to 35.7% and Measure 2B was approved 64.8% to 35.2% with 277,910 votes reported. 

Tax revenue generated from Measure 2A will go toward a host of programs, including job creation and workforce training in clean energy technology, that aim to reduce the city's greenhouse gas emissions. The revenue will also be used to increase investments in renewable energy and improve the energy efficiency of homes and office buildings.

Half of the funding to combat pollution will be invested in long-term projects "with a strong lens toward equity, race and social justice," according to the measure.

Revenue from Measure 2B will be directed to funding to assist supportive services for the homeless, including expanding rental assistance, increasing the number of beds at homeless shelters and offering substance treatment and employment counseling.

The Denver City Council referred both measures to the ballot this year. Measure 2A is part of a broader package of recommendations from a task force that Mayor Michael Hancock and the council formed to develop a comprehensive plan to combat climate change.

Other long-term revenue recommendations in the task force's July report included carrying out a congestion pricing program similar to the one on tap in New York City and petitioning state lawmakers to create a fee on ride-hailing services such as Uber or Lyft.

Measure 2A supplanted a citizen-supported measure that climate activist group Resilient Denver placed on the ballot, which sought to impose a tax on electric and natural gas energy use. The group agreed to remove the question in exchange for the council's approval of Measure 2A.

While members of the council voted unanimously to place Measure 2B on the ballot, Council Member Kevin Flynn had expressed reservations about 2A. Flynn said he would have rather seen the Resilient Denver question remain on the ballot because he disagreed with imposing a regressive sales tax on residents to accomplish the task force's climate change goals.

Other city officials had acknowledged that asking residents to raise the sales tax rate during the novel coronavirus pandemic could be a tough sell, but nonetheless agreed that funding for the climate change initiatives' goals were worth putting to a vote.

--Editing by Neil Cohen.

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