Denver now knows how much Mayor Mike Johnston plans to spend this fall and next year on his ambitious effort to offer shelter rapidly to potentially thousands of people living on the city’s streets.
When Johnston unveiled his proposed 2024 budget Thursday, affordable housing and homelessness resolution and prevention were at the forefront, adding up to $242 million next year.
Much of that money will replenish existing city-funded programs, but a healthy chunk will pay for a rehousing initiative he has launched since taking office in July. The mayor’s goal through the end of this year, at a cost of nearly $49 million, is to move 1,000 people into temporary or permanent accommodations, including converted hotels and a network of micro communities set up on parking lots or vacant land.
Next year’s proposed budget includes a $40 million allocation that could help 1,000 additional people get sheltered or stay off the streets, a doubling-down on the initial effort.
“What this (budget) lays out is our first version of a strategy to deliver that dream of Denver that is a city that is vibrant, that is safe, that is affordable and that provides housing for everyone,” Johnston said Thursday as he presented his budget plans in a media briefing.
Overall, Johnston’s budget proposes $1.74 billion in general fund spending in 2024, a 3.7% increase over this year’s record $1.68 billion. City financial analysts expect Denver’s general-fund revenues to grow 4% in 2024 to $1.7 billion, driven by increased sales, use and property tax collections.
But inflation and interest rates will put a limit on the city’s growth, Chief Financial Officer Margaret Danuser cautioned.
All told, including capital projects and agencies that operate on enterprise funds, such as Denver International Airport, the city is planning to spend $4 billion next year.
At Thursday’s briefing, Johnston highlighted his five top priorities as he moves into his first full calendar year in office: making the city more affordable, making neighborhoods safer, revitalizing downtown, making the city more environmentally friendly and aiming to provide “housing for all.”
His calendar-year budget proposal will face hearings by the City Council and potential amendment requests before a final vote in November.
A goal of housing for all
Johnston’s boldest campaign promise this year — ending street homelessness in four years — is also a focal point of his first proposed budget.
This week Johnston laid out a roadmap to use existing city funding sources, including significant remaining pandemic relief money, to pay for his effort to provide at least short-term shelter to 1,000 of the people who are living in encampments on the city’s streets. His goal is to do that by the end of the year.
That price tag is $48.6 million, almost $29 million of which will come from American Rescue Plan Act money provided to the city to respond to COVID-19 and its impact.
That money is quickly dwindling. Denver was allocated $308 million in ARPA funding in recent years, and just $76.3 million remains. It’s restricted to a variety of purposes, and city finance officials said it all must be allocated by the end of 2024.
That said, the Department of Housing Stability’s $242 million budget for 2024 will still rely on ARPA to the tune of $72.7 million, according to the city budget director Stephanie Adams. Not all of that is new. More than $30 million of it is leftover ARPA money previously dedicated to other city agencies for programs that since have been “right-sized,” Adams said.
She expects that topic to be talked about at length in the coming council budget hearings.
A year ago, then-Mayor Michael Hancock proposed $254 million in housing and homelessness resolution spending in his 2023 budget, including $77.7 million from ARPA — slightly more than Johnston proposes to lay out.
Johnston on Thursday emphasized the importance of keeping the momentum going.
“We are seeing some of the beginnings of the federal (funding) cliff that people were worried about. … There was a great opportunity in the last couple of years for historic investments in housing because of those ARPA funds,” Johnston said. “We’re really excited to be maintaining that commitment even despite the significant drop in federal dollars. We’ve backfilled with a deeper investment of city dollars.”
Nearly $13 million has been tabbed to offer rental assistance to prevent more people from slipping into homelessness. That will be backed up by a $2 million commitment in free legal aid for households facing eviction.
Affordable housing more broadly
While overshadowed in the early days of Johnston’s administration by his homelessness focus, the mayor repeatedly has highlighted his goal of creating or preserving 3,000 units of affordable housing in the city each year. He aims to begin that in 2024.
Although the mayor didn’t provide a line-for-line spending roadmap, Johnston hopes to combine local, state and federal sources to generate $100 million in affordable housing spending next year.
The city’s beleaguered building permits process, viewed as a major choke point for housing development, will get some attention in the form of $200,000 for a “process reform study” of the building and zoning codes. And the budget includes $365,000 to pay for three new inspectors to help speed affordable housing project reviews, Johnston said.
Public safety spending
Johnston has dedicated $8.2 million to grow Denver’s police force next year, with that total allowing the department to add 167 officers, the mayor projects.
That echoes former Hancock’s final budget. He allocated $8.4 million this year toward growing DPD’s ranks.
Expanding Denver’s highly touted Support Team Assisted Response, or STAR, program was a popular promise among many mayoral candidates this spring. Johnston plans to invest $7.2 million in further expanding that program, which dispatches mental health clinicians and paramedics to some 911 calls that police officers otherwise would have responded to.
Kickstarting downtown
Johnston wrote in the cover letter for his budget that a key component to making downtown more inviting is addressing unsheltered homelessness. But the city also plans to invest $58 million in initiatives and projects aimed at drawing more people back to the city’s core.
Johnston plans to do that by expanding the tree canopy along the under-renovation 16th Street Mall, helping to stabilize local businesses operating there and working to attract new businesses to the mall and the area immediately around it.
Greener Denver
His administration will zero-in on transportation infrastructure to make Denver a more climate-friendly city next year, Johnston said. He highlighted Thursday that 45% of the city’s greenhouse gas emissions come from vehicles.
Specific spending proposed includes $2 million to replace aging parts of the city’s fleet with electric vehicles and $1.5 million to expand EV charging options around town.
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