Denver’s Spending Grew 60% in a Decade, But Revenues and Population Lagged Far Behind

By Shaina Cole | Contributing Writer, Rocky Mountain Voice

Denver’s budget has grown sharply over the past ten years, far faster than its population and its ability to bring in tax dollars. A new analysis from the Common Sense Institute shows inflation-adjusted spending per resident rose about 60 percent since 2015. During that period, revenues grew more slowly, at about 40 percent, while the city’s population increased by less than 7 percent.

The mismatch is why Denver now faces a projected $250 million gap over the next two years, even as officials push a $950 million bond proposal for housing, roads, and other projects.

Spending Priorities Have Shifted

Where the money goes has changed dramatically. Construction and infrastructure costs have ballooned, climbing more than elevenfold since 2015, largely because of major bond packages such as Elevate Denver approved by voters in 2017. Spending on community development has also surged, while health programs now cost about twice what they did a decade ago.

Other services have slipped down the list. Police, fire, and emergency response once accounted for a third of the budget. Today, they make up less than a quarter. City hall has chosen to shift more resources into housing programs, homelessness, and social services.

That shift is visible in the city’s own numbers. The Department of Housing Stability is budgeted to spend $229 million in 2025 on homelessness and housing, supported in part by a special tax passed by voters in 2020. Last year, the city also devoted about $90 million to migrant services, a move that forced $45 million in cuts across other departments to stay balanced.

Revenues Falling Behind

While expenses climbed, revenue growth has slowed. The city cut its 2024 general fund forecast by $34 million, citing weaker sales and use tax collections. Projections now show little to no growth through 2026.

That slowdown reflects a bigger trend. Federal Reserve FRED data shows Denver has posted negative domestic migration in recent years, with more households leaving than moving in. CSI estimates metro-wide in-migration has dropped about 70 percent since 2015. International arrivals continue to add people, but many of those residents initially rely more on services than they contribute in taxable spending.

What’s Driving Higher Costs

Several forces explain why the city’s bills have grown faster than its population. Rising homelessness has required more shelters, more rental assistance, and more encampment cleanups. Since 2022, thousands of migrants have arrived in Denver, creating sudden costs for housing, case management, and schools. Denver has, also, put more money into mental health and addiction services. Some of the funding comes from the “Caring for Denver” tax that voters passed in 2018. 

Police and firefighters, along with other city employees, receive contracts that guarantee ongoing salary increases and employee benefits. The cost of these expenses tend to increase at a rate higher than general inflation levels. The 16th Street Mall reconstruction and new recreation center construction projects result in increased financial pressure for the city.

Why More Residents Are Leaving

Population patterns help explain the revenue squeeze. Last year, 10,950 arrived in metro Denver, a steep drop from the 32,621 in 2024. More people are leaving for other parts of the country, leaving international arrivals to make up most of the difference.

High housing prices remain the main reason people leave, driving many families to cheaper areas such as Colorado Springs or even out of state. Remote work has made it less necessary to live near downtown, erasing some of the area’s past advantages. Many residents also point to traffic, overextended infrastructure, and worries about safety as reasons for leaving. A CSI downtown recovery study noted that safety was the single biggest factor discouraging people from living, working, or shopping in the city center.

Recent state and local data back this up. A State Demography Office report this spring found that nearly 69 percent of Colorado’s population growth between 2023 and 2024 came from migration, but Denver’s share leaned heavily on international arrivals. Denverite reported that about 56,000 immigrants moved into the metro between 2020 and 2024, helping to offset domestic outflows.

Property Values Under Pressure

The city’s property tax base is also weakening. The Assessor’s Office cut values on major downtown properties this year. The Wells Fargo Center lost nearly 20 percent of its value in just two years. The city’s largest hotel downtown dropped about 25 percent. Retail vacancies along the 16th Street Mall now hover around 25 percent, far higher than the metro average.

Because commercial properties provide an outsized share of tax revenue, those losses hit the city especially hard, even if residential assessments hold steady.

Inflation and Fixed Costs

Inflation has added more strain. Since 2015, consumer prices in Denver have climbed about 36.5 percent, with construction costs even higher. Delivering the same services now costs more across the board. Pensions, employee healthcare, and debt service on bonds add further fixed costs that do not decline when revenues shrink.

Political Reaction

The budget challenges are also drawing fire at the Capitol. State Sen. Barbara Kirkmeyer blasted Gov. Jared Polis and legislative Democrats after a Colorado Sun article suggested the state had weathered multiple crises.

“The @GovofCO & the Democrats in the legislature successfully ‘kicked the problem down the road’ and you’re assisting them with deflecting blame on someone other than themselves,” she wrote. Kirkmeyer argued that the state was $700 million in the red in June, is still $300 million short this year despite a $252 million tax hike, and will start the next budget cycle at least $800 million underwater. “How the heck is that ‘tackling 2 budget crises’?” she asked.

Her criticism mirrors CSI’s warning that both Denver and Colorado are spending beyond sustainable levels.

The Bigger Picture

CSI’s latest findings line up with its earlier work. A 2023 migration report warned that slowing in-migration and high housing costs were eroding the state’s growth advantage. Another study of downtown recovery pointed to crime concerns, high office vacancies, and weak foot traffic as barriers to revitalization. Those problems now show up in Denver’s budget.

Denver today spends far more than it did ten years ago, especially on big construction projects, housing initiatives, and social programs. But the city’s tax base has not kept pace. Migration trends, falling downtown property values, and weaker consumer activity are all cutting into revenue.

What Comes Next

The question is whether Denver can keep up this pace. Should voters approve new bonds, Denver’s debt payments will climb higher. And if sales tax collections fail to recover, the city may be forced to either cut more deeply or search for new sources of revenue.

Denver now faces a tough reality. Population growth has slowed. The demand for services continues to rise. Meanwhile, the city’s tax base is the weakest in years. The choices city leaders make will decide whether the budget can be brought back into balance… or if the gap between spending and revenue keeps stretching wider.