The Boulder City Council on Thursday, March 12 directed city officials to begin developing ballot measures for the November election that would impose a tax on vacant homes, potentially raise property taxes to fund parks, open space and other public projects, and restructure existing taxes to give the city more spending flexibility.
The vacancy tax would apply to homes that sit empty for more than half the year. The goal would be to encourage property owners to rent or sell their homes in a city with a shortage of housing. Revenue would go toward general city purposes.
The city’s Utilities Department reviewed water usage data and found about 500 single-family homes that were vacant for more than six months. A $2,000 annual tax on those homes would generate between $1 million and $2 million, city officials estimate. Staff said it was difficult to get vacancy data for multifamily buildings and excluded them from the estimate. The city could also tax vacant commercial properties.
Council also signaled interest in raising property taxes for the first time in more than a decade. Staff recommended that council consider increasing the mill levy that funds the Permanent Parks and Recreation Fund and expanding what that money can be spent on. Council could also opt to expand the fund’s allowable uses without a tax increase.
The move would not just raise revenue but also mark an incremental step away from sales taxes, which make up the city’s largest single source of revenue and are particularly vulnerable to economic downturns. Sales taxes are also considered more regressive than property taxes, meaning lower-income residents pay a larger share of their income in them.
City officials are also considering restructuring existing taxes to gain more flexibility over how revenue is spent. Councilmembers indicated support for potentially consolidating the Open Space Fund, Transportation Fund and Parks and Recreation sales tax fund into a single “Public Realm Fund.” Councilmembers were also interested in a measure authorizing the city to take on up to $100 million in debt for capital projects such as recreation and senior centers.
Thursday’s direction to city staff was not the council’s final decision on ballot measures. The city will survey likely voters and revisit which measures to put before voters several times in the coming months before making a final decision in late summer.
Unbelievable. A vacant home tax. Why does the city of Boulder think they have a right to tell people how and when they use their houses? How will this be enforced? Why would anyone tell the city of Boulder their house is vacant for more than 6 months? Boulder, we love and appreciate you, but really? Must you control everything?!
Using water utility data to detect vacant homes appears to be an imprecise tool. As the city noted, multi-family properties are not possible to measure this way, so the $3m pied-a-terre owner at The Arête gets off the hook while the middle-class retirees who split their time between Martin Acres and Phoenix are faced with a bill. Unless they are smart enough to program their lawn irrigation for the summer to look like someone is home, in which case – no one gets taxed!
Interesting that “as many as 4,000 of Boulder’s approximate 48,000 housing units are vacant” (https://boulderreportinglab.org/2025/04/13/boulder-city-council-eyes-vacancy-tax-as-thousands-of-homes-sit-empty/) has now become only 500 homes once the City applied the questionable water-use proxy for “vacancy”. Surely they will develop more accurate criteria in the future – can’t imagine they’re going to impose that vacancy tax on properties that are in the midst of a redevelopment process that might stretch on for more than a year?