Denver Faces Revenue Decline: Impact Of Pandemic Recovery On City Finances

(The Center Square) – The growth of the city of Denver's general fund revenues have dropped for three consecutive years after recovering from the pandemic.

And in 2024, the projected growth fell short of initial projections, meaning the city will have to look at reducing costs. The city is getting more money, however. General Fund appropriations have increased from $1.30 billion in 2017 to $1.64 billion in 2024.

The city released its revenue and budget updates, which showed lower-than-projected revenue, according to the July 30 Finance and Governance Committee meeting documents.

Before the pandemic, the city's general fund revenues grew from 2.7% to as high as 10.8% from 2013-2019.

However, in 2020 during the pandemic, general fund revenues dropped to a negative 9.4%. In 2021, it shot up to 12.1% and then has dropped three straight years to 9.3% in 2022, 4.6% in 2023 and now 2.3% in 2024. The city originally projected a 4.7% growth in 2024.

"Cities across the country are facing flattening revenues due to a number of reasons, including slower national economic growth, rising housing costs, and shifts in consumer spending," said Jordan Fuja, press secretary to the mayor, in an email to The Center Square. "Because our charter requires the City and County of Denver to have a balanced budget, all departments are taking a close and thoughtful look at their spending to identify ways we can continue to provide world-class services for residents even with softening revenue."

"Additionally, while the city’s General Fund reserve declined during the pandemic, it has been back at the target 15% threshold for several years now," Fuja stated. "In line with best financial management practices, the City and County of Denver maintains a healthy reserve to ensure we can continue to provide the services residents count on, despite fluctuations in revenue."

The Mayor's proposed 2025 budget release deadline is Sept. 15, 2024.

The city has placed one property tax initiative on the November 2024 ballot and hopes to add a second, as previously reported by The Center Square.