Boulder's 2025 city budget has come one step closer to being adopted: City Council members on Thursday night voted unanimously to advance the $589.5 million budget proposed by city staffers.
The city first outlined its 2025 recommended budget early last month. For months, city staffers have been sounding the alarm that Boulder is likely headed for choppy financial waters amid an economic slowdown, with sales and use tax revenues flattening and an uncertain future for property taxes.
Property taxes are now expected to decrease because of new property tax legislation passed this year. In May, the state Legislature passed a bill restricting revenue from property taxes, and in a special session in late August, lawmakers approved an additional property tax cut to stave off two conservative-backed ballot measures for this November that would have cut taxes even further.
Federal American Rescue Plan Act funding is also set to expire soon, and unless other sources of funding can be found, Boulder's ARPA-funded city programs will end. The city will also raise its minimum wage in 2025, and although the exact amount of the increase has yet to be determined, a slight majority of council members (5-4) favored an 8% wage increase each year in 2025, 2026 and 2027. The minimum wage impacts the budgets for some city departments that employ seasonal, part-time and other non-full-time employees.
The budget recommendations for 2025 reflect those constraints. The city's recommended 2025 budget includes a $399.3 million operating budget and a $190.2 million capital budget. The suggested 2025 operating budget, which includes investments in city programs and services, is 1.3% larger than the operating budget for 2024, excluding debt service payments and internal service charges, but that increase is smaller than in previous years.
The city has one-time funding available to spend on various programs and projects. For example, the 2025 budget includes $12.2 million to develop and rehabilitate more than 140 affordable housing units and $4.3 million for maintaining city infrastructure. It also includes $515,000 in one-time and ongoing increases to human services programs and rental assistance.
But that amount of human services funding may not be enough to meet the ever-rising need for those services. During a public hearing at Thursday's council meeting, Julie Van Domelen, executive director of the nonprofit Emergency Family Assistance Association, said there has been unprecedented demand this year for the nonprofit group's safety-net services. EFAA offers financial assistance, a food bank and other services for people in need.
In June alone, Van Domelen said, about 8,500 individuals visited EFAA for emergency services -- the highest number of visitors ever. She estimated that about 8,000 of those people were Boulder residents. Since Boulder has a population of about 100,000 people, the estimated number represents just under 8% of Boulder's population.
Because of a contraction in government safety net funding, EFAA workers have reduced available financial assistance from $3.2 million to $2.7 million. That decrease is partly due to ARPA dollars and certain grant funding drying up, and there's also been a reduction in private fundraising. But as a result, EFAA has had to cut its maximum monthly rental assistance amount from $1,000 to $800, Van Domelen said.
"The safety net is less protective in the face of high rents. We have had to increase the number of emergency appointments over the last two months from people coming in with 10-day notices for eviction from 60 to 80 slots," Van Domelen said. "It's so overwhelming out there."
Human services organizations like EFAA are struggling to keep up with demand. Van Domelen asked the council to put more funding toward EFAA's programming, if at all possible. City Council members on Thursday acknowledged there's not enough funding available to meet all of the community's needs.
"There are still a lot of needs that are out there, a lot of harm still being done, because we cannot meet some of those needs," said Councilmember Matthew Benjamin. "... We need to recognize that."
Still, the council praised city staffers' "Herculean effort" in compiling the 2025 budget, especially when the city is facing such limited resources. Council members did not ask for any changes to be made to the budget and voted unanimously (8-0) to advance it to a second reading. Councilmember Tara Winer was absent from the meeting.
Although the budget is not officially adopted yet, the council will likely adopt it at the budget's second reading, currently set for Oct. 17.