Denver caps administrative spending in three tax-funded programs
Nonprofit administrators face caps of 7% for Caring for Denver and preschool and 5% for Prosperity Denver; city administrative costs are capped at 1% for each fund.
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Denver City Council approved new administrative-spending caps for the Caring for Denver, Denver Preschool Program and Prosperity Denver funds on Oct. 5. The mayor approved the ordinances Oct. 7.
The caps apply to administration, not the total amount available for grants or student assistance. Nonprofit administrators may spend up to 7% of annual tax revenue on administration for Caring for Denver and the Denver Preschool Program, and up to 5% for Prosperity Denver. The city’s administrative costs are capped at 1% for each fund.
The Caring for Denver ordinance directs at least 10% of annual revenue to city responses that include alternatives to jail, co-responder and alternative-response programs, and first-responder training. For the first two years after the ordinance takes effect, another 10% is directed to developing a facility offering alternatives to jail for people with mental health or substance-use needs. The ordinance also excludes mental health or wellness services specifically for the nonprofit’s own staff from eligible grant purposes.
The Denver Preschool Program ordinance keeps the city’s agreement with the nonprofit subject to audit. Contract spending must support preschool programs and services benefiting Denver residents, and remains subject to annual City Council appropriations.
The Prosperity Denver ordinance renames the Denver College Affordability Fund. It requires the nonprofit corporation to report at least annually on students receiving assistance, student progress, finances and planned work. The fund’s 0.08% sales and use tax is scheduled to continue through Dec. 31, 2030.
Each ordinance specifies Jan. 1, 2027, as the effective date for Section 1; the ordinances give no separate calendar date for their remaining sections.