Reworked carbon tax, zero-waste ballot initiatives proposed by Denver climate activists

Polluters Must Pay proposal revives 2019 energy tax measure opposed by Xcel, Hancock

An aerial view of downtown Denver. (Mitch Tobin/The Water Desk)

The activists behind a slew of recent environmental ballot initiatives in Denver are back again with a pair of proposals they hope to put to voters in an upcoming city election.

Preliminary language for the two initiated ordinances, dubbed Polluters Must Pay and Waste No More, was filed with Denver elections officials on Tuesday by a group of activists including Ean Thomas Tafoya and Brandon Rietheimer.

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Tafoya and Rietheimer were among the backers of the Denver green roof initiative, which was passed by voters in 2018 and later revised and broadened by the City Council, as well as a series of proposals that led to the enactment of a new city climate-change tax last November. The final version of that initiative took the form of a small sales tax increase that will raise roughly $40 million annually to fund city climate programs.

The Polluters Must Pay proposal unveiled Tuesday, however, more closely resembles the “carbon tax” originally envisioned by organizers with the group Resilient Denver in 2019, before it was scrapped amid opposition from Xcel Energy, Mayor Michael Hancock and some City Council members.

“This bill is to ensure that polluters pay for their current and historical burdens on BIPOC and low-income communities and that the money raised goes directly back into those communities harmed by pollution,” reads the text of the proposed ordinance — referring to Black, Indigenous and people of color — according to a copy obtained by Newsline.

Activists celebrate passage of Denver sales tax to fund climate action

Last year, Resilient Denver activists participated in a climate-action task force convened by Hancock and other city officials as part of a compromise reached in 2019 to keep an energy tax off the ballot. After six months of meetings, the task force released a report outlining more ambitious greenhouse gas emissions targets for the city, along with a list of clean-energy programs that carried a price tag of roughly $200 million annually.

With only the recently-approved 0.25% sales tax hike to cover those costs, however, those plans are far from becoming a reality. Organizers project that the Polluters Must Pay initiative’s energy tax would raise roughly $130 million annually to help close the gap.

“We’re pleased with the task force report, but it’s a vision without any funding,” Tafoya told Newsline in an interview. “We are intent on fully funding (climate programs), and we’re intent on climate justice, and we’re intent on making the polluters pay.”

Like the original Resilient Denver proposal, the Polluters Must Pay initiative would levy new taxes on electricity and natural gas consumption by Denver homes and businesses, with commercial and industrial customers paying higher rates, beginning in 2022.

But the structure of the reworked tax initiative also features some significant changes — most notably, users would only pay taxes on energy consumed above a certain threshold. Allowances for residential customers, for example, would be set at 1,500 kilowatt-hours of electricity and 50 therms of natural gas consumption during the summer and 500 kWh and 150 therms in the winter, with commercial and industrial users granted much higher allowances.

In another change, the electricity portion of the tax would also automatically expire once Xcel’s grid is powered by at least 80% renewable sources — a target the utility has announced plans to achieve in Colorado by 2030.

“After two years of working with Resilient Denver, we got a lot of feedback from the community,” Tafoya said. “When we decided to pull our energy tax, we made that decision mostly because we felt like there were additions we could make, like the allowance, that would make it easier to exempt regular individuals and to administer it more effectively.”

Xcel Energy spokesperson Michelle Aguayo said the utility is still reviewing the proposal.

“Before any potential energy tax goes on the ballot, it’s important that we fully understand how it would impact the residents and businesses of Denver,” Aguayo wrote in an email. “We look forward to reviewing the proposal and will weigh in at the appropriate time.”

In 2018, Xcel became one of the first major U.S. utility to commit to achieving a 100% carbon-free electric grid by 2050. “As a leader in the clean energy transition, we are focused on providing our customers with increasingly clean energy that is safe, reliable and affordable,” Aguayo added. “We recognize the impact climate change is having in our communities and are seeking equitable and affordable solutions to minimize that impact.”

Revenue raised by the proposed Polluters Must Pay tax would be split between two new climate funds overseen by the city’s Office of Climate Action, Sustainability and Resiliency and by a new, nine-person Climate Justice Board tasked with “combating climate change and ensuring marginalized and low-income populations are not adversely impacted,” the initiative says.

The second proposed initiative, Waste No More, aims to boost Denver’s recycling and composting efforts with a slate of new requirements on residential and commercial property owners, especially apartment buildings. Nearly all multifamily residential properties in Denver would be required to provide access to on-site recycling and composting services by 2024, while “compostable waste producers” like grocery stores, restaurants, hotels and sports venues would also be subject to new waste-diversion rules.

In order to qualify for Denver’s ballot, initiated ordinances must collect signatures from 2% of the city’s registered voters as of the first month of each odd-numbered year. The Colorado Secretary of State’s office has not yet released voter registration statistics for January 2021, but reported 459,152 active registered voters in Denver as of last month, meaning that backers of Polluters Must Pay and Waste No More would need to collect at least 9,183 signatures for each of the two initiatives.

Update, 6:23 p.m.: This story has been updated to include comments from Ean Thomas Tafoya and Xcel spokesperson Michelle Aguayo.

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