Denver approves agreement directing sales-tax proceeds to Denver Health
The City Council and mayor approved a three-year agreement governing the 0.34% voter-approved tax, which began collections in 2025 and is projected to raise nearly $72 million in 2027.
Denver completed an agreement governing a voter-approved 0.34% sales-and-use tax that directs proceeds to emergency and trauma care, primary care, mental health care, drug and alcohol recovery, and pediatric care at Denver Health.
The Denver City Council approved the agreement Sept. 14, 2026, and Mayor Mike Johnston approved it three days later. The adopted ordinance approves an amendatory agreement between the city and the Denver Health and Hospital Authority. The council’s Sept. 14 minutes record an 11-0 vote, with Councilmember Lewis absent.
The tax is not new to shoppers. Collections began Jan. 1, 2025, under the measure voters approved in November 2024. The 0.34% rate adds 34 cents to a $100 taxable purchase. It applies only to transactions subject to Denver’s sales-and-use tax and excludes specifically exempt transactions. The ballot measure estimated about $70 million in annual revenue, according to the measure’s published text and election information.
Denver reported about $65.7 million in 2025 revenue and projected about $68.5 million for 2026. The proposed 2027 budget includes $71,999,123 for the Denver Health and Hospital Authority Tax Fund, a budget projection, not a guaranteed annual total.
The agreement limits tax proceeds to five service areas: emergency and trauma care, primary medical care, mental health care, drug and alcohol use recovery, and pediatric care. It also extends the city’s arrangement with Denver Health through Dec. 31, 2029.
Denver Health must submit annual spending plans and reports. Beginning in 2026, its annual report is due May 1 for the preceding calendar year and must be made public and provided to the City Council, mayor and auditor with audited financial statements. The agreement requires the reports to detail spending across the five service areas, separate administrative costs from direct patient-care costs, and include patient volumes, demographics, quality measures and selected performance metrics when available.
The city may use up to 1% of annual tax-fund revenue for administration. Unused money within that limit must be returned to the fund. The city will distribute revenue monthly based on estimated receipts and reconcile those payments with actual collections each year.