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Tim Hansford, left, and Nolan Kemp share a laugh while eating lunch Modnay at the South Side Walnut Cafe in Boulder. Eateries are one of three retail categories that generated 55% of the city’s sales tax revenue in 2018, according to a study Boulder City Council members discussed Tuesday.
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Although Boulder has strong retail, the city’s leaders are examining how to improve sales tax revenues and create affordable spaces for retailers.

Sales tax revenues are important: They make up about 30 percent of the city’s total revenue. In recent years, the trend has been modestly upward, but it is not keeping pace with inflation. Boulder City Council in a study session Tuesday discussed the results of a citywide retail study and the steps they could take to make improvements in light of its findings.

Boulder has 6.6 million square feet of commercial space, or 60.3 square feet per capita. The U.S. average, by comparison, is 23.4. The creation of more retail space is likely unnecessary, according to the study.

Three industries generated 55 percent of total retail sales tax revenues last year: general retail, eateries and food stores. Some areas in the city have fared better than others. For example, between 2015 and 2018, the Basemar shopping center sales tax revenues decreased 15.6%, while Table Mesa shopping center’s increased 12.7%.

The study also found that one-quarter of Boulder’s population lives outside the walkable three-quarter-mile radius of existing retail nodes with grocery stores. Many respondents to a survey also called for more access to affordable goods and groceries.

Boulder is also reliant of out-of-town shoppers. An estimated 30 to 40 precent of sales tax revenue comes from people who live outside the city — a dynamic that the city will need to monitor as the population ages, staff said.

The study outlined five objectives: to address retail deserts, as well as affordability issues; to monitor retail trends, including declines in food stores and evolving online shopping habits; to optimize existing retail space; to address challenges to healthy retail, including the permitting process; and to maintain affordable commercial space.

Council members highlighted issues that they’d like to see emphasized, particularly smoothing the permitting process.

“It’s not just the fees that we impose to get people started up,” Councilman Bob Yates said. “It’s the regulatory burdens. I don’t think there’s a week that’s gone by in my three-and-a-half years on council that I haven’t had somebody call me up and say, ‘You know how hard it is to start a business in Boulder.’”

The process needs to be streamlined, he said, and it should by the No. 1 priority.

“If we make it really, really hard for people to start a business here, they’re going to go someplace else,” he said. “That’s exactly what’s happening.”

Councilwoman Cindy Carlisle went further in stating the urgency.

“There has got to be some reason why this has been so difficult decade after decade after decade,” Carlisle said. “I’m not exaggerating with that. It really is daunting. It’s another method of torture in this community.”

City Manager Jane Brautigam said staff is reevaluating processes in the planning and development services department, with the aim of having made significant progress by the end of 2020.

“We know that it’s an issue,” Brautigam said. “We’re trying really hard to make progress, and make it be lasting progress.”

Various council members also expressed a priority for allowing food carts, restaurants near east Boulder offices and bodegas on street corners to increase access for workers and residents.

“I can walk one mile in any direction from my house and not be able to spend money at all — groceries, drugs, liquor,” Yates said, to laughter from the audience. “… There’s physically no place to open a shop. We need to be looking at corners. I’m a big fan of bodegas.”

Councilman Sam Weaver pointed to Flatiron Park, where he said it was clear the city should address worker needs for service and restaurants.

“The needs of the workers aren’t rocket science,” he said.

Councilwoman Mary Young said she hears from constituents who drive to north Longmont to shop at the Walmart there because they need more inexpensive options.

“What we need to do is put the equity lens on this and focus on the things that will serve people with lesser means,” she said.

In general, council supported the proposed objectives, and staff will now return with a strategy and action items by the end of the year.

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