Denver Mayor Mike Johnston’s first budget focuses on homelessness

Denver Mayor Mike Johnston’s efforts to combat homelessness in Denver have relied heavily on one-time federal dollars. But even as that source of money is expected to dry up soon, his first proposed budget as mayor, unveiled Thursday, would commit to investing another $242 million on homelessness resolution and prevention as well as housing initiatives.

While much of that money will replenish existing city-funded programs, a healthy chunk will pay for a rapid-rehousing initiative he has launched since taking office in July.

Johnston has said repeatedly at town hall meetings focused on his emergency homelessness efforts that he views getting people living on Denver’s street out of tents and into safer environments as a moral issue. His first city spending plan — which soon will be the focus of City Council budget hearings — reflects that.

“The most significant mistake we can make when we look at hard problems is believing that those problems are unsolvable. We actually know that these problems are solvable,” Johnston said Thursday afternoon as he presented his budget plans in a media briefing, echoing some of his campaign trail rhetoric. “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 is proposing $1.74 billion in general fund spending, 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.

Inflation and interest rates will put a limit on the city’s growth, Chief Financial Officer Margaret Danuser cautioned.

In the cover letter for his 2024 budget proposal, 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 and energizing downtown, making the city more environmentally friendly and aiming to provide “housing for all.”

Here are some highlights:

Housing for all

Mayor Johnston’s boldest campaign promise — ending street homelessness in four years — is also a focal point of his first proposed budget.

Earlier 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 people living in encampments on the city’s streets. His goal is to do that by the end of the year.

The price tag of that is $48.6 million, almost $29 million of which would 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 remains to be spent. It’s restricted to a variety of purposes — not all can be used for homelessness — and city finance officials said must all be allocated by the end of 2024.

Once the calendar flips over to 2024, though, his administration’s focus will be on sustaining services for the people who have been moved into converted hotels, micro-communities of Pallet shelters or tiny homes, and other types of shelter or housing.

Next year’s proposed budget calls for $39.2 million to continue the rapid-rehousing approach.

Another $12.6 million has been tabbed to prevent more people from slipping into homelessness through rental assistance. 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 as he has focused on homelessness, the mayor repeatedly has highlighted his goal to create or preserve 3,000 units of affordable housing in the city each year. He aims to start that in 2024.

The budget letter didn’t provide a line-for-line roadmap for how the administration will accomplish that, but Johnston says he aims to leverage local, state and federal sources to generate $100 million in affordable housing spending.

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 to put toward a study and public input process. Three new inspectors will be added in the department, specifically to focus on affordable housing project reviews.

Johnston’s stated goal is for the city to issue permits for affordable housing projects within 90 days.

Public safety

Johnston has dedicated $8.2 million to grow Denver’s police force next year, with that total allowing the department to add 167 officers, Johnston projects.

That echoes former Mayor Michael 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 into further expanding that program, which dispatches mental health clinicians and paramedics to some 911 calls that police officers otherwise would have responded to.

Another $7.2 million in combined spending would go to creating more treatment alternatives to jail, including $3 million earmarked for adding 90 beds in community corrections facilities for people receiving that treatment.

Kickstarting downtown

Johnston says in his budget letter that a key component to making downtown more inviting is addressing unsheltered homelessness. But the city also would invest $58 million in initiatives and projects aimed at drawing more people back to the city’s core.

While not broken down dollar by dollar, Johnston wrote in his letter that he would do that by expanding the tree canopy along the still-under-construction 16th Street Mall, providing funding to stabilize local businesses already operating there and seeking to attract new business to the mall and the area immediately around it.

Digging in on converting outmoded office buildings into housing also will be on the city’s 2024 priority list, the mayor says.

Greener Denver

The administration aims to zero in on transportation infrastructure to make Denver a more climate-friendly city next year, Johnston says. He highlighted that 45% of the city’s greenhouse gas emissions are tied to transportation.

Specific spending there would include $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.

Another $15 million has been proposed for micro-mobility projects. Those include expanding bike lanes, improving pedestrian crossings and continuing the city’s highly popular e-bike voucher program to the tune of another $2.8 million worth of rebates.

This is a breaking news story and will be updated.

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