Denver City Council votes 11-0 to tighten oversight of Caring for Denver funding

Denver City Council unanimously approved an ordinance Monday, Oct. 5, 2026, that increases oversight of Caring for Denver, the nonprofit that distributes more than $40 million a year in city tax money for mental health and drug treatment. The 11-0 vote also applies new rules to two other city-funded nonprofits, the Denver Preschool Program and the Prosperity Denver Fund.

The ordinance covers organizations that spend tax dollars on behalf of the city but operate outside city departments.

It sets aside up to 1% of the tax revenue designated for those nonprofits to pay for oversight and additional monitoring. It makes Caring for Denver subject to public records laws and prohibits administrative funds from being used to buy alcohol.

“I think these make for just incredibly strong, good governance and our partnership with sales tax nonprofits that are external to the city,” said Councilperson Jamie Torres, one of the sponsors.

A 2024 investigation found Caring for Denver believed it was not subject to open records laws and released some records only after a board member intervened. The investigation also found that millions of dollars went to providers with criminal records and that some applicants misled Caring for Denver about the nature of their work and their relationships with city and state agencies.

The Denver Auditor’s office reported earlier this year that Caring for Denver lacked transparency and did limited due diligence on grantees. The auditor also found the nonprofit reimbursed executives and staff for alcohol purchases.

Councilmember Amanda Sandoval, another sponsor, said city rules on alcohol should apply to organizations spending taxpayer money.

“Similar to me, when I go on a trip, I can't buy alcoholic beverages,” Sandoval said. “When we have a city council holiday party, I can't buy alcoholic beverages. When I take money from the citizens and run for city council, and I get citizen money to help run my campaign, I can't buy alcohol with it.”

The auditor’s office also found Caring for Denver could not verify that its grant-funded programs were serving only Denver residents or prove that funded organizations were effective at helping people as voters intended.

Denver voters approved the Caring for Denver Fund in 2018, directing tax revenue to behavioral health services. The nonprofit Caring for Denver Foundation was created the following year to administer the money.

Councilmembers praised the nonprofit leaders for working on the ordinances together. The changes bring the outside nonprofits into alignment on oversight issues. The Prosperity Denver Fund funds programs such as college scholarships.

“So you think about preschool, you think college, and then you think about the spectrum in between mental health and other substance abuse,” Sandoval said. “So that actually serves everyone from three to probably death. I don't know any other city that has such three important ballot initiatives such as these that intertwine so importantly together.”

Under the ordinance, Caring for Denver must develop a strategic plan that includes goals, measurable objectives, a timeline for implementation and performance metrics. The ordinance also increases the amount Caring for Denver can spend on administration, from 5% of tax revenues to 7%.