DENVER – Denver Mayor Mike Johnston’s proposal to increase the sales tax by five cents on every ten dollars now faces another reading after he voted unanimously for it at Monday night’s City Council meeting.

Much of the discussion centered on City Councilman Shontel Lewis’ proposal to use the estimated $100 million raised by the tax to encourage homeownership. The amount of the tax would be based on how much people earn compared to the Denver median income (AMI).

Lewis proposed the amendment to avoid using public money to build rental housing that was already at market price, but the amendment was ultimately defeated by 5 votes to 8.

City Councilwoman Flor Alvidrez said she felt there was a discrepancy here, explaining that even a household with an annual income of $100,000 could struggle to live comfortably at Denver’s market prices.

“I believe there are families that make that much but are struggling to get market rate because at 100% of AMI they can’t pay that rent. So I think we can definitely prioritize lower AMIs. But to exclude those families and working people – like two couples making 50,000 each – from benefiting from affordable housing is a huge loss, so I can’t support that tonight,” Alvidrez said.

When Mayor Johnston presented his proposal in July, city council members were skeptical. Some said more clarity was needed.

This is now the 23rd version of this regulation since its creation.

If passed, it would be the highest special sales tax in Denver’s history.

Denver’s affordable housing sales tax moves closer to being placed on the November ballot