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Aspen residents may be able to apply for $132 in food tax refunds in 2025 after Aspen City Council members signaled their informal support for an increase in the annual city disbursements.
“I know that this would be money well spent because it would be going directly back to our community and they can spend it however they want,” Councilman Sam Rose said during a council work session on Monday.
Three of five council members stated clearly that they supported increasing the refund up to $132 in 2025. Council is already scheduled to vote on an ordinance on Tuesday increasing the refund to $65 for 2024. The current refund is $55.
Aspen residents who have lived within city limits for at least a year are eligible for the refunds, which the city awards in April.
The city first created the refund in 1970 as a way to shield locals’ food purchases from the impacts of its first-ever sales tax, which was approved in the same year. At the time, the refund was $7 per person. In the following five decades, the city has increased the refund five times, finally raising it to $55 in 2018.
According to the city Finance Director Pete Strecker, the $55 refund represents the original $7 refund when adjusted for inflation. However, Strecker said the current refund does not account for increases in the city’s sales tax, which has gone up from 1% in 1970 to 2.4% in 2024. If that tax increase were included, the refund would be about $132.
Strecker said this number would account for an individual’s yearly sales taxes paid on roughly $106 in groceries per week.
“We’ve been behind. … The jump to $132 is actually getting back onto the scientific method of where it should be, or where it was when it was first implemented,” Rose said.
Rose was the only council member who supported adjusting the ordinance under consideration on Tuesday to reflect the full increase. Other council members said they wanted to factor the increase into budget considerations for 2025 and implement the increase then.
“Councilman John Doyle said he was interested in a more gradual rise that could extend even beyond 2025.
“When this amount gets doubled, there will be more desire to cash in on this,” Doyle said. “That is going to cost us staff time. Just thinking about that.”
City staff had warned council members that increasing the refund would make it more desirable and potentially intensify conflicts between staff members and rejected applicants. Strecker said city staff already struggle to explain to some ineligible applicants why they cannot receive a refund and that a higher refund amount could make those tough conversations more common.
More than 1,000 individuals have taken advantage of the program each year since 2020. In 2023, the city distributed just over $200,000 in refunds.
Councilman Bill Guth said he had applied for the refund before himself.
In the future, Councilman Ward Hauenstein said he wants the city to establish a formula that increases the refund automatically and keeps up with tax rates and inflation. That way, he said council members would not have to revisit the issue and catch up when the refund starts to fall below where it should be.
Council members did not decide whether to keep existing special refunds for applicants over 65 years of age and those who are legally blind, agreeing that they would discuss the issue at a future point.
The application window for refunds in 2024 will close on Apr. 15 by 5 p.m. Aspen residents can apply online at the following link aspen.gov/382/Food-Sales-Tax-Refunds.