This public domain photo isn’t from Boulder, but it sort of looks possible? If a home is actually vacant for half the year, not owner-occupied or rented to real people, it might be subject to a $4,000 vacancy tax if 2J passes.

At its simplest, Ballot Issue 2J would impose a new “vacancy tax” on homes that are vacant for more than half of the year. For a few key starter points:

  • It proposes a $4,000 annual excise tax on vacant homes, defined as being occupied for fewer than 183 days per year.
  • The tax could increase according to inflation, and could go up to $7,000 per year, but never below $4,000.
  • The tax revenue would be available to the City of Boulder for General Fund uses. The ballot title specifically mentions “police and fire protection; parks and recreation; transportation and maintenance; and other general services important to the quality of life in the City.”
  • The tax would begin January 1, 2028
  • The proposal includes a “de-Brucing” statement to remove this revenue from Taxpayer Bill of Rights (TABOR) revenue and spending limits.

The measure would pass with a simple majority of 50% (plus one) of the vote. If it passes, city Ordinance 8759 – which put 2J on the ballot – says the “City Council will adopt a new chapter in the Boulder Revised Code 1981 to implement this tax by its January 1, 2028, commencement date.”

Why a Vacancy Tax?

Probably the biggest reason to impose a vacancy tax is to incentivize property owners with vacant dwelling units to allow people to live in them. There are people who believe Boulder has a housing availability crisis, and opening vacant homes up to residency would in theory increase available housing supply.

In early 2026, there was a proposal to run a citizen initiative that would have imposed a vacancy tax on both vacant residential properties and vacant commercial properties. This proposal did not move forward, but Boulder City Council drafted an ordinance for the current ballot measure, which would only impose the tax on qualifying vacant residential property.

Other cities in North America have imposed vacancy taxes, though their structures are not necessarily the same as what’s proposed in Boulder. This includes but is not limited to New York City, San Francisco, Washington D.C., Detroit, Honolulu, Vancouver, and Toronto. For a few very basic differences from Boulder’s proposal – New York City’s increases a tax rate, as opposed to a flat excise tax like Boulder’s; Washington D.C. targets vacant properties but also blighted properties; and Vancouver charges a percentage of the home value.

A second reason to impose a vacancy tax could be additional revenue for a city. While Boulder’s revenue would depend on how many property owners pay the tax and the actual charge, some estimates have suggested the city might collect around $4 million in its first year, though others say differently. Per a Daily Camera story, “City staffers analyzed the water usage data and estimated there are between 500 and 1,000 homes in Boulder that sit vacant for more than six months in a year.”

However, it’s not certain what homeowners would choose to do if the tax passes – would they rent or sell, or just pay the tax? And if the tax accomplishes a primary goal of having fewer vacant properties in Boulder, it makes sense that revenue collection would probably decline.

Studies and Alternative Viewpoints

Readers might be interested in checking out a report from Institute on Taxation and Policy called “Local Vacancy Taxes: A Tool But Not A Panacea.” As the title suggests, the report isn’t really saying “don’t pass a vacancy tax,” just perhaps urging not having unrealistic expectations.

It’s not feasible in this space to do a comprehensive analysis of all vacancy taxes, but for a few simple points from this report:

  • “It’s difficult to attribute increases in (Vancouver) rental units and declines in vacancy to this tax alone, but the city’s calculations show a slight uptick in available housing units, particularly among condominiums and single-family homes.”
  • “The city (Vancouver) has collected over $202 million (Canadian dollars) in vacancy tax revenues since 2018…However, it is a small fraction of the total city budget…about 1 percent of total revenues.” (This is not meant to be “science,” but if Boulder collected $6 million, it would be very close to 1 percent of the city’s yearly budget.)

However, supporters of 2J point to a vacancy tax program in Vancouver in which “vacant homes (are) down 67% since launch” in 2017.

A local realtor, Zach Zeldner, drafted a report partially called “Could Boulder be Next?” In it, he spoke along some of the basic lines like what’s found in the Institute on Taxation and Policy report, such as modest increases possible in both housing supply and revenue, but noted a few possible negative impacts:

  • Discourage investment
  • Reduce demand for second homes (Editor’s note: of course, some supporters of vacancy taxes might call this a positive impact)
  • Create uncertainty for buyers and homeowners
  • Add costly reporting and compliance requirements

Zeldner also noted that owners of vacant homes still contribute a great deal of property tax revenue to local governments. The City of Boulder currently relies more on sales tax than property tax, but property tax funds local amenities like county Open Space programs, the Library District, public schools, and more. Meanwhile, since there are no people in vacant homes, they generally won’t provide the day-to-day sales tax revenue as do the people in occupied homes.

It should be noted that San Francisco voters passed a vacancy tax measure, but it was stricken down by the courts and an appeals court just upheld the earlier decision (linked here). It’s not always easy to say any one measure might get taken to court just because another measure did get challenged, especially since measures are often different. According to the story linked here, the San Francisco tax could have gone up to $20,000 for a home larger than 2,000 square feet that was vacant for a third consecutive year, for one large difference from Boulder’s proposal.

Ballot Title Text

The title that will appear on ballots is short enough to publish in full here:

Shall the City of Boulder taxes be increased by $6,000,000 in the first full fiscal year annually commencing January 1, 2028, and by such amounts raised annually thereafter, by imposing a $4,000 annual tax on vacant homes that are occupied for fewer than 183 days per year, with such amount never falling below $4,000, but increasing annually in accordance with the Denver-Aurora-Lakewood consumer price index, up to, but not above, $7,000, with the revenue from such tax to be used for the purpose of providing city services, including police and fire protection; parks and recreation; transportation and maintenance; and other general services important to the quality of life in the City; and shall the revenues from such taxes and earnings be collected, retained, and spent as a voter-approved revenue change without limitation and an exception to the revenue and spending limits of Article X, Section 20 of the Colorado constitution?

NOTE: I’ve seen several different estimates for first-year revenue, but TABOR requires all ballot measures proposing tax increases to start the measure by saying how much revenue could be collected. Actual collection could be less than the $6 million stated in this ballot measure.

Issue 2J Pro:

  • The tax might encourage some owners of vacant property to allow people to live in these properties, potentially increasing housing supply in Boulder.
  • This tax would provide the City of Boulder with more revenue for key services.
  • This tax would not directly affect most people in the city, only those who have qualifying vacant homes
  • Vacancy taxes in other cities across North America have reported various levels of success in either finding occupancy for vacant properties or generating tax revenue.

Issue 2J Con:

  • The tax could be a new financial burden on some homeowners
  • It might not be easy for the city or the property owner to precisely figure out whether a home is vacant for 183 days or not, and the city might experience some administrative expense or workload increases
  • The tax might not generate enough revenue to make a real difference in services.
  • It’s not certain that a tax of this size would be enough of a disincentive for very wealthy property owners to open units up to renters or sell to a potential new resident.
  • There could be litigation.

Links to More Information

  • Vacancy to Vitality (proponent) website: https://www.bouldervacancytax.org/
  • Institute on Taxation and Economic Policy report on vacancy taxes in general: https://itep.org/vacancy-tax-blight-tax-property-tax-tools/
  • DAWGS site on vacancy taxes in North America: https://www.dawgsinc.com/vacancy-taxes-across-the-u-s/
  • A local realtor’s perspective: https://zachzeldner.com/blog/taxes-on-second-homes-are-popping-up-across-america-could-boulder-be-next
  • Story on a State of Colorado proposed statewide vacancy tax bill that did not pass: https://www.rentresponsibly.org/colorado-vacancy-tax-bill-nixed-in-committee-after-advocacy-effort/
  • Might vacancy taxes be considered “takings”? https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=6403&context=uclrev

Richard’s Take

I’ll vote for this measure, but probably won’t shout it from the rooftop. I was sort of impressed with the report I read about experiences elsewhere, in part called “Not a Panacea,” which basically pointed towards modest successes in providing housing and public revenue – hopefully good things – but I feel like it’s worth considering what it will actually accomplish in Boulder.

First, I believe it’s fair to assume that this might not impact affordability (not a made-up word) by that much in the grand scheme of things. Some people who own second homes in Boulder probably own expensive second homes, and they would probably choose to charge high rent if they wanted to rent or sell for high prices if they wanted to sell.

Second-home owners might have various reasons to have a second home here, including wanting a place to stay in town for short visits or part of a year. Incidentally, several City Council candidates I interviewed this year suggested that the Sundance Film Festival might lead to people wanting to buy a second housing unit here. Some of these folks might not want longer-term renters because they’d like to stay in the property whenever they want to be here, including time that might happen to be right in the middle of a lease. They might want a place to stay that doesn’t look or feel like renters just moved out.

I’ve been thinking of Taylor Swift lately and using her in economic analyses. If she and Travis bought a property in Boulder, chances are great that it would not be a run-down University Hill rental. They would probably buy an expensive house with vistas and privacy, and would probably expect a beautiful, well-maintained home when they stop by for Sundance or dinner with Prime or whatever. They’d pay the tax with change from their couch cushions, and in this microeconomic case the tax might not increase housing supply, although the money might replace a few windows at city facilities. And while Taylor and Travis would probably be an extreme example, this basic description might apply to other wealthy-ish second home owners.

But at some economic point below Tay and Trav, there would come property owners who will have to make choices between paying the tax or finding ways to put people in the units. This seems to be the area in which the measure might contribute to housing supply, and that could be a good development though I’m sticking to my assumption that some of the housing won’t necessarily be affordable for “ordinary” folks who are housing-challenged.

Still, I’d probably applaud taxing a second-home owner who’s basically sitting on a property and waiting for it to appreciate. That would be microeconomic social engineering at its finest.

On another front, I’ve been around the block a few times. Where there is money or property involved, there could be litigation. This is not enough for me to say “no” to 2J, because the tax could be repealed if litigation makes the whole thing prohibitive. Lawsuits win, lose, or lead to out-of-court settlements. Litigation is a very common part of the political game, and just because it might exist doesn’t always mean new things shouldn’t be attempted.

The revenue from 2J would go to the city’s General Fund, and while I think it would have been logical to devote all of it to the city’s affordable housing program, I understand the city has plenty of other needs, so General Fund isn’t a deal-breaker for me.

I’m not a crystal ball owner or even user, but my educated guess suggests Boulder will get a small-ish number of new housing unit availability and an unexciting amount of new revenue if this measure passes. Lots of modern political hipsters shun “incrementalism,” but small advances are actual advances that actually do something in the hopefully brief time before we reach utopia.