Denver mayor says homelessness program has 'transformed' city, set 'national example'

Exactly a year after taking office, Mayor Mike Johnston lauded his administration's work on homelessness, saying it has "transformed" downtown Denver and "set a national example."

In a 16-page report, Johnston effectively said the city's previous attempts — he didn't name his predecessors or directly allude to them — ended up in failure until he took office on July 17 last year.

"In the four years before I was elected mayor, unsheltered homelessness grew more than 250%," he wrote. "Large encampments spread throughout the city. Businesses and residents alike worried about their safety, while not enough was done to support our unhoused neighbors."

After 12 months, Johnston painted an entirely different picture.

"The sprawling tent encampments are gone. Sidewalks are clean and passable. In converted hotels and new micro-communities, many of our unhoused neighbors have found not just shelter, but renewed hope," he said. "As one of the few major cities to reduce unsheltered homelessness in 2023, Denver has set a national example."

The mayor's campaign to move 2,000 homeless people off of the city's streets between his inauguration last year and the end of 2024 has been expensive.

And while Johnston has insisted that his office has utilized taxpayer money "responsively," his campaign has cost a lot more than anticipated.

A councilmember, doing math on the fly last month, figured out that the city is on track to spend $155 million between July 2023 and December 2024 — $65 million more than Johnston previously said it would cost.

Others on the council have complained about the lack of transparency on spending, and a few have voted against proposed million-dollar contracts with vendors, citing frustration with Johnston's office for not providing a public-facing briefing on the costs of his campaign to curb homelessness.

Other critics argued that Johnston's strategy only temporarily lifts people out of homelessness.

Broadly speaking, Denver’s metro area successfully found permanent housing solutions for only 21% of those exiting homeless programs in 2022, well below the 33% rate that was the average that year for the 48 most populated metro regions, according to federal data.

And a review by The Denver Gazette of homeless provider contracts, invoices, performance outcomes and federal data showed that metro Denver trails many other major metropolitan regions in tackling homelessness with permanent housing. Indeed, just two out of every 10 people exiting homeless programming in Denver in 2023 found long-term permanent housing, a rate far worse than most other areas in the nation, according to the records.

Other metro regions, including Seattle and Houston, have had greater success during that period prioritizing permanent housing rather than the quick fix solutions critics say simply perpetuate homelessness.

In Denver, the spending that flowed through the city’s Department of Housing Stability, known as HOST, has relied disproportionately on emergency shelter beds and temporary transition services, records show. Homeless advocates and federal officials have said the city should instead prioritize an approach that calls for securing long-term permanent housing as the best and most cost-effective way to help those on the streets.

Immediately after taking office, Johnston had declared a state of emergency meant to expedite his response to homelessness, which included building "micro-sites," where people would be temporarily housed, as well as moving residents of homeless encampments into hotel-turned-shelters.

Those hotels have become hotbeds of criminal activity , with hundreds of calls that included reports of shootings, drug use, theft or other acts of violence. The city said it has reinforced security at the hotels.

His 16-page report, released Tuesday, said since then, the city has moved 1,673 people off of the streets, transitioned 583 to "permanent" housing, and shut down 16 encampments.

The latest data shows that 188 have returned to the streets.

Johnston faced critics from his own Democratic base.

Activists protested when Johnston swept an encampment at 22nd and Stout streets , while others criticized his decision to veto a bill that sought to outlaw sweeps when the temperature drops below freezing.

The latter proposal would have contravened the city's camping ban, the mayor's office said.

In both cases, activists accused the mayor of reneging on a campaign promise.

Other critics said he should shift the city's focus toward substance abuse and mental health services, arguing they are the root cases of homelessness. City officials have signaled that they are moving in this direction.

And while the City Council has acquiesced to the mayor's spending requests, some have begun to question the spending.

Councilmembers Amanda Sawyer and Stacie Gilmore voted against a pair of contracts seeking to fund some parts of the mayor's homelessness strategy.

“If they had slowed down and done it right the first time, we could have found the dollars to make this a sustainable program,” Sawyer said at the time, noting that the city wanted to fund the contract with one-time American Rescue Plan Act dollars. “You cannot have sustainable programs without sustainable funding.”

The 16-page report said Johnston "took bold and decisive action" on his first day, arguing it paid dividends.

“These efforts have transformed downtown Denver,” Johnston said in the report.

The work is not done, said Johnston, who unveiled several more goals.

A shorter-term objective is to house 2,000 people and to reach "functional zero" for homeless veterans in Denver by the end of the year. Johnston claimed Denver would become the first major city to accomplish that goal.

Other cities have made similar claims.

By the end of 2025, Johnston also wants to reduce unsheltered homelessness by 50% and by the end of 2026, reach "functional zero" citywide.

In order to house these people, Johnston said the city needs to “expand the pipeline of permanently affordable housing” and add 3,000 units per year for the next four years.

So far, only 12 projects with 534 units have been added since Johnston was elected.

And it won't be cheap.

Early last week, Johnston proposed a new sales tax that would raise Denver's existing sales tax by 0.5 points to generate $100 million to build or preserve affordable housing units citywide. The tax hike proposal awaits approval by the Denver City Council. Voters will have the final say in November.

If approved, it will be one of two sales tax rate increases that would make Denver become one of the highest taxed municipalities in the state, and the highest taxed major city in the metro area and Northern Colorado.

Johnston's sales tax hike likely has enough support on the council, though some have expressed wariness at asking taxpayers to pay more for city services.

When the council last month approved a 0.34-point sales tax rate increase meant to benefit Denver Health, Councilmember Kevin Flynn balked at the proposal.

Flynn earlier said he worries that the city has begun to “reflexively” turn to sales taxes to fund programs and called sales tax increases the most “regressive” form of increasing citywide revenue, arguing it would affect lower-income residents especially hard.

Johnston acknowledged the gravity of the goals he had set for himself and the city.

"This will be a tall order," the report said, "but as we have proven through the first year of the All In Mile High efforts: our problems are solvable, and we are the ones to solve them."