Boulder narrows 2026 ballot research: council asks staff to study public-realm levy, vacancy tax, debt authority and sales-tax consolidation

A City Council study session on Wednesday moved the city's 2026 ballot planning from a broad menu to a prioritized research list, with staff tasked to refine and poll four options for further consideration.

Krista Morrison, the city's chief financial officer, presented the long-term financial strategy and previewed a range of ballot mechanisms grouped into transformational, mid-range and structural categories. Transformational ideas included a sales-tax-on-services and a revenue-neutral swap shifting revenue from sales tax to a property-tax mill levy. Mid-range options included a general-purpose mill levy, a public-realm mill levy, and a residential vacancy excise. Structural options included authorizing general-fund debt, increasing the mill-levy cap and consolidating multiple dedicated sales-tax increments into one fund.

Council discussion and outcome: after a round of short comments and targeted questions from council members, Tara (mayor pro tem) ran a guided straw-poll process. The council signaled they will not pursue transformational items for 2026 but asked staff to move forward with deeper analysis and polling on the following items for possible inclusion in the 2026 process:

- Public-realm mill levy expansion or increase (option 4): councilors broadly supported further study and suggested options that either expand eligible uses or combine a modest rate increase with clarified guardrails.

- Residential vacancy excise tax (option 5): several councilors voiced interest in this tool as a potential revenue source and disincentive for short-term vacancy; members also raised administrative-cost and legal questions and asked staff to model higher-rate scenarios and enforcement costs.

- General-fund debt authorization (option 6): staff described authorizing debt (staff suggested exploring $75'$100 million scenarios) as a structural mechanism that does not increase taxes immediately but provides financing capacity. Multiple council members characterized debt authority as high-impact if coupled with clear project lists and fiscal safeguards.

- Consolidation of dedicated sales-tax increments (option 8): staff presented combining several dedicated sales-tax funds into a single flexible fund as a structural change to increase capital planning flexibility; councilors supported further work and transparency on usage and reporting.

Why it matters: the options the council asked staff to study would alter how the city funds capital and program priorities. Staff noted the city currently relies heavily on sales tax (roughly 35% of city revenues) while property tax yields only about 12% of the city's revenue share, a dynamic the long-term strategy seeks to rebalance. Morrison said council will receive more detailed cost estimates, fiscal scenarios and polling recommendations in April and May ahead of any ballot referral decisions.

What staff will do next: staff will incorporate council feedback, prepare distributional analyses (who pays and who benefits), model debt-service trade-offs and assemble polling instruments for council review. The facilities funding conversation in April will provide project-level context to help the council prioritize whether to pair financing authority with specific capital projects. Tara closed the meeting by summarizing the four items staff will take forward for additional analysis and polling.