The Boulder City Council decided Thursday not to slow scheduled minimum wage increases for tipped workers, ending, for now, a yearlong fight over restaurant labor costs.
Tipped workers’ base pay will keep rising alongside Boulder’s minimum wage, increasing by 35 cents next year and tracking inflation after that.
The decision resolves one of the council’s most contentious debates this year, although councilmembers could revisit the tipped wage next year.
For more than a year, restaurant owners, workers, labor advocates and councilmembers debated how to support a struggling local restaurant industry without reducing scheduled wage increases for its workers. Owners say rising labor costs are pushing them toward closure. Workers say they already cannot afford to live in the city they serve.
The council chambers were full ahead of the discussion. Union members and labor advocates rallied at the Boulder Bandshell and marched across the street to the city building chanting “Sí, se puede.”
Public comment lasted about an hour and came almost entirely from workers and labor advocates, who urged council to keep wage increases on schedule.
“Living in a city that is okay with rent increasing, but not wages, is damaging and demoralizing for residents, especially as a young adult trying to build a future here,” said Avery Powell, a bartender at the Hotel Boulderado.
“I’ve watched workers at many jobs over the years have to move away from Boulder, unable to support themselves and their families with our steep costs of living,” Powell said.
Other pro-labor speakers called the proposal “morally egregious” and “offensive.”
Business representatives argued that rising wages could lead to layoffs and restaurant closures.
“[Restaurants] aren’t asking for relief because they value their employees any less. They’re asking for the ability to continue to employ them,” said Tami Door, CEO of the Downtown Boulder Partnership. “Many independent restaurants operate on margins of just a few percent, while facing rising food costs, insurance, utilities, and labor expenses. They cannot continue raising menu prices indefinitely.”
A city survey found that most community members and workers who responded wanted the scheduled increases to continue. Most restaurant owners who responded wanted the city to slow them.
Most councilmembers had signaled their positions during earlier discussions, and a divided outcome appeared likely. Only Mayor Aaron Brockett and Councilmember Tina Marquis had described themselves as undecided. Councilmembers Taishya Adams, Ryan Schuchard and Nicole Speer had supported keeping the scheduled increases unchanged, while Councilmembers Rob Kaplan, Matt Benjamin, then-Councilmember Mark Wallach and Mayor Pro Tem Tara Winer were expected to support slowing them.
Wallach’s resignation last week over the council’s decision to keep Boulder Municipal Airport open initially appeared likely to leave the council evenly divided. But the expected vote shifted further Thursday.
Marquis and Brockett said they did not support slowing the scheduled increases. Kaplan and Winer, who had previously appeared likely to support the change, also said they now favored maintaining the status quo.
“The last thing that I would want to do is go against community sentiment, and it is clear that the majority of what I have heard is to keep things status quo,” Kaplan said. He also said conversations with his 21-year-old son and his friends influenced his decision.
“There is a level of anxiety just to pay rent and just to make ends meet that I didn’t even realize,” he said.
Benjamin had been the strongest supporter of changing the tip credit. He argued that the city had three ways to help restaurants: lower labor costs, reduce taxes or boost the economy.
“We’ve taken two off the table,” he said. “I think we’ve heard loud and clear not to touch labor costs, so we won’t. We’re not to touch taxes and fees, because we haven’t done it yet. So we’re putting all our eggs in one basket, which is just to generate more revenue. That’s a gamble. I do expect to see some restaurants close their hours or reduce labor.”
Speer, who has made labor issues a focus of her time on council, welcomed the decision but criticized the path council had taken to get there.
“When we passed the minimum wage increase in 2024, we said we’d revisit the tip credit in a few years, when we had data and could make an informed decision,” she said. “We didn’t have to take this up in 2026. We chose to before we had the data, analysis, and voices that we needed to find a mutually beneficial solution.”
Several councilmembers also expressed interest in creating a task force comprising restaurant owners and workers to study other ways to provide relief to restaurants.
Boulder is one of a handful of cities in Colorado with a minimum wage higher than the state’s. The city’s minimum wage is currently $16.82 an hour. Tipped workers earn a base wage $3.02 below that. Tips are supposed to close the gap, and when they don’t, employers must make up the difference.
A state law passed last year lets cities with higher minimum wages widen that $3.02 gap, known as the tip credit. The law, designed to provide relief for restaurants, allows a city to raise its minimum wage for all workers without raising tipped workers’ base pay by the same amount.
Proponents of the new law argued that it would allow cities to raise their minimum wages more aggressively. Boulder City Council raised the city’s minimum wage by 8% last year rather than 15%, largely out of concern for local restaurants.
Many restaurant owners have said that servers earn well above minimum wage after tips are counted and that increasing the tip credit would free up money to raise pay for back-of-house employees. Some say they will close if the city does not address rising labor costs.
A recent city report found that “growth in the restaurant industry is slowing or even declining,” citing stagnating restaurant sales-tax revenue, declining visits and falling employment.
Workers and union members have said that Boulder’s rising minimum wage still falls tens of thousands of dollars short of the city’s estimated living wage, the amount a person needs to cover basic necessities.
The city report also found that restaurant workers are among the lowest-paid employees in Colorado and that pay across the industry varies widely. The highest-paid 10% of tipped workers in Boulder earn close to $40 an hour. The lowest-paid workers earn near minimum wage.
Attendees cheered when Brockett announced that the council would take no action, leaving tipped wage increases to proceed on schedule. The meeting ended unexpectedly early, around 8 p.m.
