Brandon Leuallen, The Business Times

As the City of Grand Junction grapples with flattening sales tax revenue that came in lower than expected in 2025, it has started its 2026 budget deliberations.

During an Oct. 6 City Council workshop City Manager Mike Bennett said the process will continue through November and December, when the final budget is expected to be approved.

Throughout the workshop, an overview of each department was presented to explain how its proposals align with the council’s strategic plan.

Bennett said although revenue is expected to increase, the recommended $314.8 million budget represents a 12.3 percent decrease from the 2025 adopted budget, largely because the recreation center and wastewater treatment plant are nearing completion.

He said staff spent more than 3,000 hours preparing the proposal.

“Healthy Life Cycle” approach

Bennett described what he called a “healthy life cycle” for communities, explaining Grand Junction has made large investments in recent years, but it must now focus on maintaining what it already has, especially as sales tax revenue is not increasing as quickly as prior years.

“Communities have a healthy life cycle,” he said. “We invest heavily and do these large projects, and then we hone in on maintaining what we have and make sure we are focusing on those core services.”

Bennett said the budget strikes a balance between long-term investments and day-to-day operational needs.

“We have to make sure we are not outpacing ourselves, so that we can stay balanced each year,” he told the city council. “At the same time, we want to invest in a way that allows us to continue to progress as an organization and as a community.”

Police: 

More officers, a new annex and upgrades

The Grand Junction Police Department will see a net increase of five officers next year, part of 29 new city positions overall. Public Safety Chief Matt Smith told council members the department now has 130 sworn officers and is targeting 165.

“We really struggled to get over that 110 or 115 mark, but we’ve found a good recipe,” Smith said. “We’re attracting people now. We’re retaining people.”

The budget also includes funding for a BearCat armored vehicle to replace the 17-year-old model shared with the Mesa County Sheriff’s Office. Smith said the city uses the vehicle “two to three times a month, if not weekly,” and the new one will be purchased using impact fees.

Later in the workshop, during a discussion about the strategic plan, Smith said increased patrol numbers caused a decrease in traffic accidents. 

Certificates of Participation: 

Capital investment outside TABOR

During the police annex discussion, City Attorney John Shaver explained the city may use certificates of participation, or COPs, to finance construction. He told council members this form of borrowing is not subject to TABOR limits, because it is structured as a lease-purchase rather than voter-approved debt.

“It is a nontraditional debt,” Shaver said. “It doesn’t require voter approval, because it is an indenture of properties. It’s in essence a lease structure.”

Bennett added COPs have been used before for the police headquarters, city hall and the stadium project. Under Colorado’s Taxpayer’s Bill of Rights, local governments must seek voter approval for multi-year debt, but COPs are legally defined as annual lease-purchase agreements.

The proposed $2 million feasibility study for the police annex in 2026 would be followed by an estimated $33 million COP-financed construction phase in 2027. Bennett told council that staff “ran the models to make sure we can afford those payments for the long run.”

The budget includes funds to continue upgrading the 911 regional communications center and replacing radios, consoles and tower equipment.

“We’re at the end of the useful life for many of these systems,” Smith said. “Some of our equipment is no longer supported by the manufacturer, so this is really about keeping the system reliable.”

Fire: 

Station 7, paramedic program, staffing gaps

The Grand Junction Fire Department is adding eight positions: three community paramedics, three firefighter emergency medical technicians, one fire inspector, and one battalion chief. Smith said the additions are designed to strengthen response and administrative capacity.

The community paramedic program will handle low-acuity calls that do not require a full engine and ambulance response.

“It won’t solve all our problems, but it’s a really good start,” Smith said. “It will have a significant impact on call demand.”

Smith said the program is modeled after the city’s co-responder mental health initiative and is expected to reduce unnecessary emergency transports and emergency-room visits.

“We’re reducing some of the calls for service at our really busy stations,” he said.

Smith said Station 7, which is across from Appleton Elementary School, is scheduled to be completed without traditional fire station staff and will initially house the community paramedic team. He said that at the time the bond was passed in 2018 to fund fire station 7, there were more single-family homes being built in that area, but the city instead changed its focus and began building more apartment complexes around the city core, which caused increased demand in those parts of town.

“We haven’t seen the growth that we anticipated back when we planned the station,” Smith said. “This gets people in the building and provides a presence in that area until demand increases.”

Recreation: 

Renewal, upkeep and deferred parks

After several years dominated by large capital projects, Parks and Recreation staff are finishing the Grand Junction Community Recreation Center and shifting focus to more of what the presentation listed as “renewal and upkeep.” The 2026 budget dedicates $4.1 million to trails, playgrounds, irrigation systems and repairs at Canyon View and Lincoln Park.

One project that did not make the list for 2025 was Whitman Park. The proposed 10-year capital plan shows no funds allocated for Whitman Park until 2031.

Housing: 

Task force and regulatory streamlining

The city’s Housing Task Force has met three times since forming in September. It is working with staff to streamline regulations and reduce permitting delays.

“We’re reducing costs with red tape,” Council member Ben Van Dyke said during the workshop.

Bennett said the city is pursuing the same artificial intelligence tools Mesa County uses to speed up development reviews. He added the housing budget funds the buildout of infrastructure at the Salt Flats Project.

Bennet said incentives for Capital A affordable housing at or below 100 percent Area Median Income will continue through impact-fee waivers for qualifying projects. 

Fiscal policy and tourism revenue

One proposal is the elimination of the vendor fee, a change that would cost small businesses an average of $53 per month, and when eliminating large storefront retailers the average is $30 per month. 

Bennett said the move is a way to save the city money on a fee that used to pay for actions that most businesses automate now anyways.

Ordinance No. 4749 explains the fee: “The Grand Junction Municipal Code regulates the taxation, collection, reporting and remittance of sales and use taxes in the City. To alleviate some of the burden of those requirements the City has for many years provided to retailers that collect and remit the tax a credit of three and one-third percent of the sum of the sales tax collected to offset the expense to the retailers for the collection and remittance effort, provided that no credit is allowed for any sales tax that is not properly and timely reported and paid by the due date.

“The credit is a vendor’s compensation expense to the City and is known as a ‘vendor’s fee,’ (hereinafter “Fee”) and was established prior to the introduction of automated systems and accordingly the Fee was then more aligned with the cost of collecting, preparing and filing the tax returns and remitting the tax.”

The presentation noted approximately 30 percent of Grand Junction’s sales tax revenue comes from what the city classifies as tourism, with most of it generated by visitors who drive into town rather than fly. That pattern has made the city’s revenue base more stable than Colorado’s mountain resort communities, which rely heavily on seasonal air travel and lodging.

According to a recent Business Times article, “Where the sales tax revenue comes from,” the City of Grand Junction does not collect sales tax on grocery food items, and roughly 21 percent of its revenue comes from online and commercial energy sales. Most of the remaining revenue is generated by brick-and-mortar retail stores, auto dealers and restaurants. The 24 Road (Mesa Mall) and U.S. Highway 50 (Rimrock) retail corridors together account for nearly 39 percent of the city’s total sales tax revenue.

Unfunded requests and reserve balances

The council also discussed several unfunded items that can be added to the budget upon approval, including $350,000 for a homelessness Request For Proposal that went out to service providers in the wake of the shut down of the Homeless Resource Center, and $535,000 for Homeward Bound for operational expenses, which was not listed in the Request for Proposal process. 

Bennett said that the city maintains a healthy fund balance, and the budget continues to meet or exceed the minimum reserve target established by council policy.