Funding Fix FAQs

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Littleton Funding Fix logo - squareWhy does Littleton have a revenue shortage and how bad is it?

This revenue shortage is due to several specific factors that add up to an annual estimated shortfall of $6.5 million in the city's Capital Projects Fund -which pays for maintenance, building improvements, technology and equipment that touches residents every day. Without intervention, this fund is projected to be depleted by 2025. Here's a summary of the city's ongoing revenue challenges: 

  1. Increasing Capital and Infrastructure Demands - Littleton's list of unfunded capital and infrastructure projects totals $98 million over the next 15 years. This is due in part to an underfunded street maintenance budget, deferred improvements to ailing public buildings (such as the courthouse, Town Hall Arts Center, Bemis Library, and the Littleton Museum), delayed purchases for fleet vehicles and police equipment, and the need to upgrade technology and connect fiber networks among critical facilities, to name a few. In total, the city's 2021 budget identifies over 70 capital and infrastructure projects that need funding. However, the Capital Projects Fund -which should pay for these projects -only brings in about $6 million each year, half of which is earmarked for street maintenance. And that $3.1 million for street maintenance only meets about 25 percent of all unfunded projects in 2021 alone.

  2. Rising Maintenance and Repair Costs - When critical capital improvement projects are delayed, the materials, labor, and other associated costs keep going up. For example, the cost to regularly maintain one mile of any given city street is $100,000. If maintenance on that same mile is delayed by three to five years, the street needs to be completely rebuilt at a cost of $1 million.

  3. Historically Low Taxes - Littleton's sales tax rate has not been raised in more than 50 years and is now 14% less than the metro-wide average. Additionally, the city gets only a very small percentage of the tax property owners pay. On a home valued at $500,000, the city receives $72 annually compared to $2,119 collected by Littleton Public Schools, $418 directed to Arapahoe County, and $299 to the South Suburban Parks and Recreation District.

  4. Lack of Revenue Diversity - Most of Littleton's neighboring communities have a diverse mix of large-scale retail stores that generate an abundance of sales tax revenue for their cities' budget. However, because Littleton values its small, locally-owned businesses, it doesn't have the benefit of such a revenue base. Additionally, Littleton does not collect lodging or grocery taxes, or other types of fees, as other metro-area cities do.

  5. Volatility of revenue - Two of the three main sources of revenue that directly feed the Capital Projects Fund are problematic.

    1. Building Use Tax - Revenue from taxes that developers and homebuilders pay when new structures are approved is highly volatile, unpredictable, and averages only about $1.5 million per year. Because Littleton is land locked, substantial growth in Building Use Tax is unlikely.  

    2. Highway Users Tax (gas tax) - Littleton's share of this revenue, which comes from federal and state sources, isn't enough to make up for the shortages in other sources of revenue. As more hybrid and electric vehicles hit the road, these funds will become less reliable. 

FAQs - Updated 6/28/2021:

questionWhat is the city doing about it and what role will citizens play in solving this issue?
questionWhat’s the timing for this community engagement initiative?
questionWon’t the $12 million in federal stimulus help solve this issue?
questionIs the Capital Projects Fund revenue shortage in any way caused by the COVID pandemic?
questionWhat are some of the ways the City of Littleton has demonstrated its commitment to finding efficiencies and spending less during the pandemic?
questionDid the city give out raises last year?
questionWere tax dollars used to renovate the city council chamber?
questionDidn't the South Metro Fire Rescue unification provide all the money needed to maintain Littleton's roads?
questionWhat are the potential ways to pay for the $6.5 million annual shortfall?
questionWhere can I learn more about the 70 different capital and infrastructure projects that need funding between now and 2035?
questionHas the city considered increasing enforcement of speeding vehicles as an additional source of revenue?
questionWhy consider a tax increase in an economic slowdown?
questionHas the city considered selling the Town Hall Arts Center?
questionHas the city considered cutting the police budget?
questionHow can the city possibly consider eliminating the library and museum?