A group of Boulder residents is gathering signatures to place a measure on the November ballot that would impose a tax on homes and commercial buildings that sit vacant for more than half the year.
Organizers say the petition is part of an effort to address the city’s housing shortage, which drives up costs, and to revitalize commercial areas. The campaign, called Vacancy to Vitality, needs 3,418 signatures by May 27 to qualify for the ballot.
“This measure asks a simple question: should property in Boulder work for the people who live here, or just the people who own it?” Jill Grano, a former city councilmember and spokesperson for the campaign, said in a news release. “This tax is an invitation to put vacant properties back to work for the community that makes them valuable in the first place.”
Also backing the measure are residents affiliated with the Boulder County Democratic Socialists of America, who have advocated for tenant protections in Boulder. The proposed measure comes after the city council enacted a new short-term rental licensing ordinance during the Sundance Film Festival, a move that could prompt some property owners to seek short-term rentals rather than long-term tenants.
City officials have estimated that as many as 4,000 of Boulder’s roughly 48,000 housing units are vacant, according to a May 2024 memo, though more recent estimates are much lower based on water usage data. In the city’s downtown, about 30% of offices are vacant, according to a recent report by The Colorado Group, a local real estate firm.
Under the proposed measure, starting in 2028, property owners would pay an annual tax if their residential or commercial space sits vacant for 183 days or more in a calendar year, consecutive or not, with certain exemptions. Vacant dwelling units would be taxed at $7,000 per year, adjusted annually for inflation.
For commercial properties, owners would be charged on a sliding scale starting at $4 per square foot of vacant space, dropping as the vacant square footage increases. Spaces under 400 square feet are exempt.
Property owners would file annual occupancy declarations under penalty of perjury. The city could audit those filings using utility records, water usage, rental licenses and other data. Residents could also report vacant properties online.
Exemptions would apply to properties under active construction or renovation, spaces marketed for lease, properties damaged by disaster, deed-restricted affordable housing, government-owned properties and nonprofits using property for their charitable mission.
Boulder Chamber President John Tayer said the group has not taken a formal position on the measure. He said some vacancies stem from permitting delays or the broader shift away from traditional office space. The tax would add “insult to injury when you think about the tremendous effort that many of our commercial property owners and brokers are making to fill these spaces.”
The Boulder City Council is also considering a vacancy tax, though it is unlikely to include commercial properties. Both measures could ultimately appear on the ballot. A recent proposal by city officials would impose a $2,000 annual tax on vacant homes, generating an estimated $1 million to $2 million per year, according to city officials. The proposal is part of a broader effort by city leaders to diversify revenue sources and rely less heavily on sales taxes, which can fluctuate with the economy.
Update: This story was updated on March 27 with a link to the organization’s website and a quote from Boulder Chamber President John Tayer.
I can think of a few reasons why someone would oppose this initiative, but I can’t think of any good ones. I am so sick of vacant properties where property owners have property value incentives in place to make them not lower rents to financially viable levels. This town is so depressing sometimes with how abandoned it so often feels. Anything that nudges Boulder in the direction of lower rents is a positive in my book.
I can think of several good reasons to oppose this:
1. There’s no guarantee that it will lower prices and improve housing supply. Indeed, it could even make things worse, according to a case study looking at a real-world example for Vancouver. https://abfer.org/media/abfer-events-2023/annual-conference/papers-realestate/AC23P6023-Frictional-and-Speculative-Vacancies-The-Effects-of-an-Empty-Homes-Tax.pdf.
2. It introduces distortions into the property market. There can be unintended negative consequences, even if the policy is well-meaning. Distortions can raise the overall cost of housing.
3. Implementation is very problematic. How will vacancy be determined in practice? It’s not black and white. There’s a lot of gray area. Regular, normal people could be penalized unintentionally. How would it even be enforced?
4. It adds yet another administrative layer to the city bureaucracy, particularly so given the complications around implementation and enforcement raised above. All taxpayers in the city will have to bear this burden. Realistically, administering this policy properly could require more full-time city employees.
1. Every case study into vacancy taxes that I’ve looked into has had varying degrees of impact but also have been implemented in vastly different ways. Honestly, it’s been hard to draw many conclusions from them because of this, especially since “vacancy taxes” doesn’t mean one thing. You raise a fair point, but I struggle to put much stock in it until I see a meta-analysis, which I haven’t found yet.
2. Vague, I don’t see the point you’re trying to make. “Weird things can happen”?
3. This is a real challenge which isn’t covered here. This article is focusing on a commercial real estate tax, which is MUCH easier to enforce for obvious reasons. It’s also not applying so much to your “regular, normal people”, ie. Reno. Residential is where things get challenging. The city has proposed using water usage as a means of tracking whether a residential unit is being resided in, but even that is relatively easy to bypass if someone really wanted to cheat the system.
4. I can’t imagine the city would pursue this initiative if the administrative cost exceeded the revenue raised. As many have shared, the city has a growing budget crisis that seems to worsen every year as costs increases and current tax revenue stays flat. There’s a very strong incentive in place to have this initiative be more than financially viable for the city.
*Tebo, not Reno. Can I not edit a comment?
I’ve begged and asked about that for years.
i think, regarding commercial properties, it might be helpful to provide incentives for businesses to take over what they deem less-than-ideal spaces—like, for example, the space at baseline & b’way where whole foods once was & has been vacant for years!
It’s a start but it really feels like they put the kids gloves on for commercial real estate. The rate feels too low and the exemptions are too generous.
It feels strategic, because a more aggressive tax would be harder to get voter approval. Getting an established precedent in the first place would be the biggest hurdle.
The petitioners have provided a Web page which makes it much easier to endorse this petition than using the City petition website alone: https://share.google/z1V6aq1wZAd48rNJK
The Whole Foods in Basemar has been unoccupied for ten years. The commercial properties along Moorhead and 27th Way have been abandoned even longer. Developing abandoned commercial properties, perhaps converting them into residential, should be the priority, not taxing part-time residents.
The house behind my house has been abandoned for about ten years. I’ve talked to the owner, she also owns a lovely home on 15th near Baseline and a cabin above Lyons, both abandoned. She mismanaged a living trust so she can’t sell the properties. She’s elderly and broke so she can’t fix up the houses to rent. I talked to the city but there’s nothing they can do to help her.
Someone should help her by advancing the money to fix the properties up and then share in the rent. Maybe contact the Boulder Area Realtors. Or the Senior Center
No bank will give her a loan on the properties because of the living trust. Her mother (professor of French at CU) passed away in 1992 and left her three houses in a living trust. Living trusts are usually dissolved within six months. She’s both the trustee and the beneficiary and failed to dissolve the trust. 35 years later the deeds aren’t in her name, the houses are owned by the living trust. If she dissolves the living trust she’ll become the owner of the houses and have to pay capital gains tax on houses that are now worth over $2 million. But when she passes away her children will inherit the living trust and the valuation resets to market value and her children won’t have to pay capital gains.
This story is great example of how most vacant SFH property has a compelling reason to remain vacant; after all, a typical home is worth $35-60k annually in rent.
that is a crazy story!
Hi Thomas. “She’s elderly and broke” but isn’t willing to pay <25% taxes (federal cap gains and state) to get likely more than $1.5 million after-tax proceeds because it will diminish her children's inheritance? She doesn't need help. She has chosen to suffer.
Her house behind my house had a dozen raccoon-size holes in the roof. It took her more than a year to hire roofers to put on a new roof. (And I doubt they checked for damage below the roof, or cleared out raccoon poop from the crawlspace.) She’s elderly, she can’t handle closing the living trust, paying the capital gains tax, hire contractors to repair the houses and then hire a property manager to rent the houses to pay for all of the above. That’s six if not seven figures of expenditure before she sees income. Selling the houses as-is isn’t that much simpler. Why her children (or whoever will inherit the houses) aren’t helping her, I don’t know.
Great idea, Evan. The city should also help. Time to get creative if they want to free up housing stock.
Before moving forward with any vacancy tax, we should ask a simple question: is the juice worth the squeeze?
San Francisco’s recent experience with a similar vacancy tax highlights the real legal risk—when a tax begins to function as a coercive tool, it may not hold up. Their vacancy Tax was struck down by the court. Beyond that, enforcement requires tracking private property use, raising concerns about privacy and administrative burden. Legal challenges are likely and would consume time and public resources.
We also need to be honest about market realities when it comes to commercial spaces. Vacancy is often not a choice—it reflects tenant demand and broader economic conditions. Penalizing it risks further destabilizing an already fragile commercial environment. In many cases today, property taxes and insurance alone for commercial properties meet or exceed base rent—already a strong disincentive to vacancy.
We all want active, vibrant spaces. The question is whether this approach solves the problem—or creates new ones. It seems like to many in Boulder, more taxes are always the easy answer and go to – I’d challenge that more taxes will lead to more vibrancy and community – seems like the opposite might happen.
The city is swirling and no one is reporting on it. That’s the reality. There’s too much commercial vacancy. Homes are not selling. City budget is in the red. The list goes on.
Vacancy is often a symptom, not the cause. The underlying issue is constrained supply and regulatory friction, not landlords sitting on empty gold mines.
The reality is, very few property owners, especially those carrying mortgages, taxes, insurance, and ongoing maintenance, want vacant space. That’s not how the economics work. Vacancy is typically a result of transition, reinvestment, or market mismatch. Not intent.
We also need to be careful not to design policy around edge cases. A small subset of second-home owners or unique financial situations shouldn’t drive a framework that penalizes the broader market, particularly local owners who are actively trying to lease and improve their properties.
There’s also a broader pattern here: vacancy taxes are politically attractive but economically weak. They persist because they’re easy to understand: “empty homes are bad”, and they resonate with voters. But when it comes to implementation, they’re difficult to define, hard to enforce, and often underperform.
If the goal is to support active, high-quality districts and neighborhoods, then we should be advancing policies that enable investment, reduce friction, and support long-term value creation, not ones that push toward short-term occupancy at any cost.
This has socialism written all over it.
“This has socialism written all over it.”
Good! It’s well past time to acknowledge that neoliberal capitalism has failed to benefit the vast majority of people (the working class) or create prosperity except for that of a small, rapidly shrinking group of individuals who at best contribute little of value to our society, if not actively harm it. There would be no need for such an article or reform efforts otherwise.
Yeah, we don’t need any more private equity “investment” or “value creation” in Boulder. That’s one big reason why rents are so sky high now and no one but the wealthy can afford to move here or start a business.
With respect to commercial, the commercial property taxes are so high in Boulder that many businesses that are on the margin of being profitable are priced out. The triple nets on many properties I’ve looked at are more than the actual gross rents in other parts of the country. In fact, I’ve seen buildings for sale in places where the purchase price per square foot is less than annual triple nets here. It’s sucking the character out of Boulder.
And yes, it would be great to convert unused commercial space to residential. But do folks want to navigate approval and permitting in Boulder? I consider myself a staunch leftie, but Boulder takes things to the extreme and makes things unbearable.
Your argument about commercial property taxes already being high and pricing out businesses doesn’t make sense here. If a business is operating and paying rent on commercial property, by definition the property isn’t vacant. Ergo, no additional tax on small businesses.
Evan, The Baseman center has had a vacant mini Whole Foods for a while. I heard that years ago it was to be developed and then. I heard that the city was going to forbid housing there (which is correct, how much housing do we need, how big Evan do you need Boulder to be? do you want it at 200,000 people when the students are here? drive down Baseline in the afternoon, you are in a stop and go line from 14th to Baseline. We DO NOT NEED MORE HOUSING> EVERYBODY CAN”T LIVE IN BOULDER OK. get over it). Now, back to Baseline…..I am hearing that some Tenants are looking to leave because something may be happening. That is a great center and maybe Whole Foods has locked another small grocery from going in there by leasing it…..I do not know that answer. But I believe that is the only vacancy there and probably with the Dark Horse area being developed somebody will move over there. Basemaren is the least of our City problems Evan…the least!
At one point I had heard that Carelli’s was interested in that space and about that time the For Lease sign was taken down, but later put back up. Now that the WVII is a done deal, some of those places being dumped might want to move to Basemar. It’s so close, I would think they could retain their same customers.
you are stop and go from 14th and Baseline to Broadway…every day
I’m not necessarily opposed to vacancy tax but this measure is NOT fully thought through.
First:
“spaces marketed for lease”
Most commercial vacant space in town is being marketed. So this measure will do nothing to hit big commercial landlords in the pocket. Zero. Zilch.
Second, threshold billing:
Threshold billing will create odd decisions. Once you get slapped with the vacancy tax, the tax will provide no further motivation for presumably 365 days.
Third: short term license incentives: if this bill incentivizes anything for owners of truly vacant homes (of which there are far fewer than many believe), it incentivizes getting their short term license. Airbnb it for Sundance and Boulder creek fest and you’ll never pay vacancy tax.
Fourth:
Meanwhile, from the not our intention:
– if Larry the little residential landlord gets cancer and can’t get his unit rented because he’s in the hospital, the city will preemptively slap a $7k bill on his taxes.
– if Grandma homeowner has to move into a facility, even temporarily (rehab stays can be lengthy when elderly), she’ll be expected to empty her home, get a rent license, lease it out temporarily, then boot the tenant when she’s back? Preposterous.
– the extreme calendar cycle nature of Boulder rental real estate means that if a tenant moves out or is evicted during the holidays or spring term, the earliest available tenants to lease the house will typically be August 1 for the coming year. So is that available for lease? Only until it’s pre-leased?
Fifth:
Water bill detection:
Since the city of Boulder has single water meters (no irrigation tap), detecting vacancy May 15 to September 15 will likely be impossible for any property with irrigation. But you also can’t assume the reverse as some homeowners have wells for irrigation and others may have xeriscaped the property fully. Meanwhile, you can’t (AFAIK) use xcel bills; IIRC those bills are considered private. A lightly used house that isn’t vacant can also have extremely small water bills. Is 1-2k water use considered vacant? Then you’ll be kicking conservation minded owners in the groin. If not, then vacant owners will easily circumvent it with a dripping sink faucet (never a bad idea in winter).
Sixth: some SFH landlords already have vacancy penalties via their insurance company. Policies on SFHs can double after a period of 90-180 days of vacancy.
None of this even addresses the fundamental question of private property rights.
Targeting residential properties is the wrong move. Target vacant commercial properties that have been vacant for more than 365 days. If owners set the price right, they will lease!
Right now there’s no reason for them to reduce lease rates, it’s a tax write off if they sit vacant. Meanwhile, people leave Boulder to shop and bring that tax revenue with them.
This proposal almost totally exempts commercial real estate and heavily penalizes residents.
Who does this proposal really benefit?
Boulder’s housing costs are undeniably high. But before we rush to adopt policies like this one, we should be honest about what’s driving those prices. It’s not vacancy. It’s scarcity.
More importantly, a vacancy tax does nothing to address the core issue: it is extremely difficult and expensive to add supply in Boulder. Between regulatory complexity, long entitlement timelines, high construction costs, and layered requirement, from inclusionary housing to energy code, only a narrow band of projects are financially viable. And those projects almost inevitably require higher rents to make sense. That’s the system we’ve built. High rents are not a mystery, they’re the outcome.
The proposal being considered by the City Council raises serious concerns about fairness and priorities. While addressing housing shortages is an important goal, the council’s apparent plan to tax only vacant residential properties—while leaving commercial vacancies untouched—creates the clear appearance that commercial property interests are being protected at the expense of residents.
If vacancy truly harms the community, it does so regardless of whether the building is a home or a commercial office. The article itself notes that roughly 30% of downtown office space is vacant, a level that significantly affects the vitality of Boulder’s business districts. Yet the council’s proposal focuses exclusively on homeowners. That selective approach raises an obvious question: why are residents being singled out while commercial property owners are shielded?
Residents are already the backbone of the community. They pay property taxes, support local schools, and sustain neighborhood life. Targeting them with a vacancy tax—while ignoring large commercial vacancies—suggests a troubling imbalance in whose interests the council prioritizes. The optics are difficult to ignore: the policy appears designed to avoid inconveniencing commercial property owners while shifting the burden onto homeowners.
This imbalance becomes even more concerning when compared with the citizen-led proposal. The initiative circulating for the ballot would apply the vacancy tax to both residential and commercial properties, recognizing that unused space of any kind reduces community vitality and economic activity. That approach at least attempts to distribute responsibility more fairly.
By contrast, a policy that taxes only homes sends a message that vacant offices and storefronts are acceptable, while vacant residences are not. Such a stance risks reinforcing the perception that the City Council is more responsive to commercial real estate interests than to the residents it represents.
A tax on vacant commercial property?, is this an early April Fool’s joke?