Sales tax revenue in Aurora has remained flat over the last two years as the city heads toward a budget deficit in 2026, raising concerns from lawmakers and budget officials.

Robert Oliva with Aurora’s Finance and Budget Department presented numbers in sales tax revenue over several years to City Council members during a planning and economic development committee meeting last week, saying the numbers have rounded out in recent years.

The rounding out is “concerning,” Oliva said, and his team is working on a plan to address it. 

While not the only factor at play in Aurora’s expected budget shortfall next year, the low sales tax numbers contribute to the $11.5 million in funding the city needs to meet its demands in 2026.

Overall, the city’s sales tax revenue has been up every year that Oliva’s team has tracked it, he said. While the numbers are “very north” of pre-COVID levels, they flattened out between 2023 and 2024.

Between 2020 and 2021, there was an almost 15% increase in sales tax revenue, from about $210,000 to about $250,000. There was then a 9.4% increase between 2021 and 2022, an almost 5% increase to 2023 and a less than 4% increase between 2023 and 2024, according to data from Oliva’s team. 

“This is the first time since I’ve been here that we’ve rounded off and are looking at flat numbers,” Oliva said. “It is concerning and I think we’re going to have to get aggressive in our retail strategy.”

The Finance and Budget Department is working on putting together a plan to address the concern, he said, and several ideas have surfaced they’re looking at to try to draw in more business and sales tax revenue —  including proposing some incentives for businesses. 

Sales tax from eating and drinking rounded off between 2023 and 2024, hovering just above $40,000 both years, which is an increase from 2020, when it dipped to about $26,000 due to government-ordered pandemic closures. 

Sales tax from building materials leveled off between 2023 and 2024, hovering just below $30,000 both years, and sales tax from auto dealers and parts increased less than half a percent between the same years, sitting just below $20,000. 

A “good surprise” in sales tax revenue came from electronics and computers, Oliva said and, on the flip side, a bad one came from grocery stores, which dropped between 2023 and 2024. 

Councilmember Danielle Jurinsky said she is “concerned,” adding that she has seen a lot of vacant stores near her businesses that draw crime and make the areas less desirable for new ones.

“It seems like we’re kind of at a stalemate and that’s very concerning to me,” Jurinsky said. “I’m growing increasingly concerned about the lack of business we’re drawing to this city as well as retaining these businesses.”

The concerns add to the bigger issue of Aurora’s $11.5 million budget shortfall, officials have said. 

In a February workshop, officials discussed various options to consider for filling the gap in the estimated 2026 budget, which included raising taxes, “de-Brucing” and eliminating tax exemptions. 

While low sales tax revenue is part of the issue, others include inflation, new expenses and the elimination of the occupational privilege tax, finance officials told councilmembers in the February workshop.

Aurora Budget Officer Greg Hayes told councilmembers the city might have to cut services to solve the issue.

Hayes’ proposals to the council included raising the city’s sales tax, getting rid of tax exemptions on things like household groceries and prescription drugs, and increasing the city’s lodging tax.

Another option, Hayes said, is to “de-Bruce” — or eliminate the revenue limit of the Taxpayer’s Bill of Rights (TABOR) — on property tax. Aurora is one of only a few cities that has not done so, he said.

The question would need to go to voters in November. If passed, it could add around $17 million depending on the year, he said.

Aurora City Councilmember Curtis Gardner was critical of the proposals to raise taxes, pointing to the council decision in November to eliminate the occupational privilege tax that taxed businesses for each employee.

Late last year, the council decided to keep a promise made to businesses that it would repeal the tax, which collected $4 monthly from companies for each employee. Employers and employees split the dues, paying $2, respectively. The tax began in 1986 to support street maintenance, police and firefighting services.

Jurinsky countered that the operational privilege tax “was worth roughly $6 million,” while the deficit is much more.

“Clearly, we were already in big trouble and overspending in different places,” she said.