2022 Proposed Climate Tax

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Consultation has concluded

the boulder flatirons on a late-summer aftenoon

Boulder taxpayers have supported the city’s climate work for decades, contributing about $4 million annually to climate and sustainability programs. Early next year, a portion of this funding is set to expire, creating a gap in funding.

To close this gap, the city is proposing the creation of a new climate tax. As designed, the new climate tax would raise approximately $6.5 million per year to fund climate and resilience efforts. If approved by council, the climate tax would require voter approval in the November election.

Funding Proposal: New Climate Tax

By creating a new climate tax,

Boulder taxpayers have supported the city’s climate work for decades, contributing about $4 million annually to climate and sustainability programs. Early next year, a portion of this funding is set to expire, creating a gap in funding.

To close this gap, the city is proposing the creation of a new climate tax. As designed, the new climate tax would raise approximately $6.5 million per year to fund climate and resilience efforts. If approved by council, the climate tax would require voter approval in the November election.

Funding Proposal: New Climate Tax

By creating a new climate tax, the city can simplify climate investments, tackle high-impact projects, better align with the scale of investment necessary and address inequities created by the current tax.

Tax Proposal Details

Note: Details subject to City Council changes.

  • New climate tax to be collected 2023 to 2040

  • Replace existing taxes that fund climate work

  • Fund climate and wildfire resilience projects

  • Continue to collect tax on Xcel Energy utility bills

  • Raise revenues by approximately 6.5 million per year

  • Change rates for customer classes

Proposed Changes to Average Annual Costs, By Customer Type

Customer Type

Current Annual Cost (CAP + UOT)

Proposed Annual Cost (Climate Tax)

Residential

$42.95

$49.66

Commercial

$292.42

$487.37

Industrial

$1,084.11

$1,806.85

Total Revenue for Climate Efforts

$3.9 million

$6.5 million


What would it fund?

If approved, revenues from this tax would support ongoing and new climate and resilience projects. Those could include:

  • Direct cash assistance to homeowners, landlords and businesses to fund energy efficiency upgrades
  • Projects such as microgrids and energy storage to support resilience and renewable energy development
  • Residential and commercial building electrification
  • Expansion of transportation electrification projects and electric vehicle charging stations; and
  • Advancement of natural climate solutions.

Wildfire resilience projects could include:

  • Funding for a dedicated fire risk assessment team;
  • Grants to support residential wildfire risk prevention measures like vegetation management, fence reconstruction and roofing/siding replacement;
  • Strategic undergrounding of power lines; and
  • Ecosystem restoration
Consultation has concluded

Do you have a question about a program or service? Do you want to learn more about the city's plans to achieve net zero carbon by 2035? Use this tool to ask a question for the city's climate team. 

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    When will the City Staff provide a budget breakdown for how the $5 million is expected to be spent if it is approved?

    almost 2 years ago

    Staff will be able to provide a more detailed breakdown of the potential funding once city Council determines the replacement Climate Tax will be placed on the November ballot for voter consideration.  

    As a benchmark, within the current $3.8 million of the combined CAP and UOT, on average a third or less goes to staff salaries, $1.0 million supports voluntary community programs (advising services, rebates, grants, education), $0.1 million supports regulatory programs and reporting consultants  (e.g., help desk support, annual GHG reporting), $0.2 million supports community and equity organizations, and the balance goes to special projects and pilots (e.g., Boulder Energy Challenge, Vehicle to Grid Pilot, strategy development).  

    We anticipate that the additional funding under the new tax would be used to support expanded voluntary programs, particularly in the areas of natural climate solutions and resilience, and to leverage grants and private capital to accelerate these programs. 

     

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    Does City Staff intend to do regular updates with an opportunity for two-way communication with the broad community?

    almost 2 years ago

    The city shares updates, educational material and community stories through biweekly climate newsletters, online newsroom articles and social media.  

    This summer, the city is hosting three virtual information sessions – each with the goal of deepening the community’s familiarity with city climate work and inspiring collective action. Community members will learn about city programs, projects, initiatives and partnerships, and will have the opportunity to ask questions during a Q&A portion of each session.  

    Staff will also collect feedback on the proposed Climate Tax ballot measure through focus groups with businesses and target communities. These sessions will be an opportunity to listen to and acknowledge concerns and aspirations voiced by community members most impacted by the climate crisis.  

    The public can ask questions and contribute ideas related to Boulder’s climate work at any time on Be Heard Boulder, the city’s online engagement platform. Visit Be Heard Boulder to learn more and participate.  

    Furthermore, the city has invited community members to record and share their vision for a climate resilient Boulder. Recordings will be accepted throughout the year and may be woven into an audio collage of community voices. Learn more about the project. 

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    Has the City of Boulder provided, or will COB provide educational materials on passive solar design principles?

    almost 2 years ago

    The city’s energy code (https://bouldercolorado.gov/services/energy-conservation-codeis a performance-based code that supports passive solar design principles.  The city has routinely done outreach to educate and encourage passive solar design, such as through staff presentations at the Colorado Green Building Guild.  Staff expects to increase its education and outreach in the near future and have been an active supporter of enhanced incentive programs for passive solar new construction through Xcel Energy. 

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    What quantitative analyses has the city done on the economics of heat pumps?

    almost 2 years ago

    The city has both conducted its own quantitative analysis and reviewed the analysis of other third parties.  Staff would offer some of the following as comprehensive references: 

    Independent Study by the Southwest Energy Efficiency Project:  https://swenergy.org/pubs/southwest-heat-pump-study-2022 

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    Has the City of Boulder considered, or will COB consider educational materials and rebates on solar thermal applications?

    almost 2 years ago

    The city currently offers both rebates and grants for residential solar thermal systems through the EnergySmart program (see https://energysmartyes.com/rebates-and-financing/).  The city also offers a custom rebate program for commercial projects, which can be used to support solar thermal, through the Partners for a Clean Environment (PACE) Program (https://www.pacepartners.com/program-areas/energy/#1546284927411-1cf67786-37f7). 

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    The Clean Energy Collective solar garden developer filed for bankruptcy and now the Cowdery Meadows solar garden is not providing REC payments and has also not produced for the last month or so. Is this something the City of Boulder Staff could help with?

    almost 2 years ago

    Regarding the REC payments, it is staff’s understanding that Xcel Energy has continued to make REC payments to Clean Energy Collective for solar production associated with the garden.  Because the further transfer of the REC payments to subscribers is private contractual arrangement between the garden and its subscribers, the city would not be in a legal position to intervene.  It’s also the case that there are many subscribers to that garden that are not Boulder residents.  Staff did contact Xcel Energy and they confirmed the production issue and will follow up with Clean Energy Collective. 

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    I am a dedicated environmentalist with a deep concern about the climate crisis. We need to transition to Net Zero Energy, defined by the use of energy conservation, demand side management, smart and micro grids, energy efficiency, and renewable generation, to account for 100% of our energy usage as soon as possible. Having said that I am concerned about the city staff proposal for an additional tax to fund their climate change work. As far as I can tell and for too long, the city staff has asked for funding without measurable outcomes. Specifically what projects are we asking the community to fund, and what are the metrics that will be used to measure carbon/methane reduction resulting from funding those projects? 

    almost 2 years ago

    The Climate Initiatives Department invests in strategies that support the city’s climate-related goals and targets including:  

    • Reduce emissions 70% by 2030 from a 2018 baseline  

    • Become a net-zero positive city by 2035  

    • Become a carbon positive city by 2040 

    Since the original CAP Tax was passed by voters in 2006, the city has reported annually on the community's progress towards its climate-related goals and targets. Since 2016, the City of Boulder has contracted with Lotus Engineering and Sustainability LLC (Lotus) to complete an annual greenhouse gas (GHG) inventory as a means of measuring the effectiveness of the city’s efforts and the progress towards its climate goals. The inventory is prepared following the Global Protocol for Community-Scale Greenhouse Emission Inventories (GPC). The GPC protocol provides a robust framework for accounting and reporting city-wide GHG emissions. The details and around our community’s accounting and the metrics for tracking progress are at: https://bouldercolorado.gov/projects/community-greenhouse-gas-inventory. 

    Since Boulder started completing an annual GHG inventory, the city has experienced year over-year reductions in emissions. As of 2020, the Boulder community reduced emissions by 36% compared to the original 2005 baseline and 22% since the new 2018 baseline. Despite growth in Boulder’s population, gross domestic product (GDP), and square footage since 2005 (by 10%, 87%, and 12% respectively), Boulder continues to reduce its emissions year over year. 

    At a high-level, community GHG emissions from electricity generation, natural gas combustion and vehicle emissions are measured in mt CO2e, and emissions by source sector is published on the Boulder Measures Website: https://bouldercolorado.gov/boulder-measures/community-greenhouse-gas-emissions 

    In addition to community-based emissions measured in CO2e, the city also publishes metrics associated with related targets on the Boulder Measures website including:  

    • Progress towards zero waste  

    • Local Renewable Electricity Generation 

    • Greenhouse Gas emissions from city operations and facilities 

    Staff has outlined many of the targeted strategies and projects to be funded should voters approve replacing the CAP and UOT taxes with a new Climate Tax. in their June 8, 2021, and February 22, 2022, memos to City Council.   

    Attachment D of the June 8 memo, illustrates the targets and key performance indicators (KPI’s) by which project investments would be measured in addition to their contribution to community-based emissions:  https://boulder.novusagenda.com/agendapublic/AttachmentViewer.ashx?AttachmentID=4165&ItemID=3794 

    Attachments C and D of the February 22 memo illustrates the types of “Big Move” projects and scales of costs associated with those efforts that are envisioned:  https://boulder.novusagenda.com/agendapublic/AttachmentViewer.ashx?AttachmentID=4786&ItemID=4279 

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    Does the city still believe that Decarbonize, Decentralize and Democratize are it’s guiding principles for electricity? How has this changed since 2020?

    almost 2 years ago

    When the city began its exploration into municipalization, the process reveled three central themes that became guiding principles for the process.  The first was decarbonization, where we could put an emphasis on renewables. The second was decentralization, where we could make decisions locally and be resilient at a smaller scale. And the third was democratization, where the community could have a bigger say in how their utility runs programs and how it retains and uses the revenue it generates. While Boulder voters chose to shelve the city’s municipalization efforts, The city still believes these are the right guiding principles for our community’s full spectrum of energy efforts.    

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    What specific programs have come out of the Boulder Xcel Advisory Group?

    almost 2 years ago

    In December 2021, the city published a review of accomplishments from year one of the partnership: https://bouldercolorado.gov/news/year-one-accomplishments-xcel-partnership 

    On May 11, the Advisory Panel shared recommendations for renewable energy and electrification: https://bouldercolorado.gov/news/xcel-advisory-panel-shares-renewable-energy-and-electrification-recommendations 

    The next step is to evaluate options to implement the recommendations. 

    In addition to the advisory panel recommendations, work is underway on the following projects: 

    • Undergrounding 

    • Zero Emissions Communities: project to add utility-scale renewables and storage to reduce system-wide electricity emissions equal to Boulder’s consumption above and beyond the Xcel baseline.  

    • Street light acquisition 

    • Chautauqua sustainability and resilience 

    • Expansion of the city’s vehicle-to-grid pilot 

    • Public transit charging hub 

    • City fleet EV charging infrastructure 

    • Regional and Boulder EV roadmaps 

    • Accelerating heat pump adoption through contractor training and consumer outreach 

    • Distribution system planning for improved reliability 

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    What carbon reductions are expected from those programs coming out of the city's partnership with Xcel Energy?

    almost 2 years ago
    • Zero Emissions Communities targets approximately 175,000 short tons of COper year by 2030 (though the incremental reductions may begin as soon as 2026). 

    • Combined building electrification efforts contribute towards the city’s goal to reduce natural gas emissions by approximately 170,000 short tons of CO2 per year by 2030.