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May 30, 2024

Laws to Save Coloradans Money on Housing, Plan for Growth Signed Into Law

New laws aim to address Colorado’s housing crisis, save Coloradans money on housing

ARVADA / BROOMFIELD, CO - Governor Jared Polis today signed three bills into law that will save Coloradans money by making housing more affordable, identifying state housing needs and strategically planning for future growth in Colorado.

HB24-1434 is a bipartisan law that will increase Colorado’s Affordable Housing Tax Credit (AHTC) by $816 million over the next eight years. The state AHTC is paired with federal incentives to create a greater statewide impact.

“These impactful bills will help steer Colorado into an environment where people can more easily afford their homes,” said Senator Rachel Zenzinger, D-Arvada, sponsor of HB24-1435 and SB24-174.  “Colorado’s Affordable Housing Tax Credit in its previous form was so successful;, we had three applicants for every one that we could satisfy. So now we are building on that success. Additionally, partnerships between the state and local governments will push communities to identify their unique housing needs and plan for growth in a strategic and inclusive way. Together, these new bipartisan laws will make planning resources available to our communities, spurring long-term, affordable housing growth.”

“The Affordable Housing Tax Credit has been the most successful affordable housing program in our state, and I’m proud this bill is now law so we can expand on the relief that this tax credit provides to hardworking Coloradans,” Rep. Shannon Bird, D-Westminster, sponsor of HB24-1434 and SB24-174. “SB24-174 was also signed into law today, which allows us to leverage Colorado’s resources to work in partnership with local governments to help them build in a smart, strategic way as our population continues to grow. These bipartisan efforts will continue to boost affordable housing projects and provide strategic growth planning resources for our communities so more Coloradans can access housing that works for their budget.”

The AHTC Program became permanent in 2014 to support affordable housing developments across the state and has been renewed numerous times since then. From 2015 to 2021, the program aided the development of over 10,700 housing units, supported more than 36,000 jobs, and had an economic impact of $5.5 billion.

Also sponsored by Representative Ron Weinberg, R-Loveland, and Senator Cleave Simpson, R-Alamosa, the law invests $150 million in new tax credits to incentivize the development of affordable housing in transit-oriented communities. This incentive would ensure Colorado communities can plan for the future and increase the housing supply near existing, new, or expanded public transit, jobs and job centers, and safe biking and walking corridors.

SB24-174, also sponsored by Senator Barbara Kirkmeyer, R-Weld County, and Minority Leader Rose Pugliese, R-Colorado Springs, requires the Department of Local Affairs (DOLA) to conduct a statewide housing needs assessment and provide grants and technical assistance to local governments to conduct their own local or regional housing needs assessments, followed by housing action plans to address the identified needs.

Under the law, most local governments with a population of at least 1,000 residents are required to either conduct and publish a local housing needs assessment by December 31, 2026 or participate in a regional housing needs assessment. By November 30, 2027, DOLA must conduct an analysis and publish a report analyzing existing and future statewide housing needs. The law requires new housing assessments to be published every six years.

SB24-174 also requires most local governments with a population of at least 1,000 to create a housing action plan that details their commitment to address their specific housing needs by January 1, 2028, and to update the plan every six years thereafter. Additionally, the law: 

  • Requires local governments who submit a Housing Action Plan to DOLA to submit a progress report to DOLA three years after publication,

  • Requires DOLA to publish a statewide strategic growth report which will analyze land use scenarios and their impacts, including housing, infrastructure, and environmental effects; and assess state policies on development and sprawl,

  • Requires county and municipal master plans to include new water supply and strategic growth elements that compare the long-term costs of infill and greenfield development, and

  • Prioritizes state agency grant funding for housing or land use programs for local governments who have complied with the requirements in this bill.

HB24-1316 creates the first Middle-Income Housing Tax Credit Pilot Program in the nation to boost the development of rental housing for middle-income Coloradans. This pilot program would direct the Colorado Housing and Finance Authority (CHFA) to award up to $10 million per year in five-year state income tax credits for tax years 2025 through 2029. A total of $200 million in tax credits may be allocated through this program.

“Housing affordability is a top priority for Colorado Democrats, and this legislation will increase our housing stock for middle-income Coloradans,” Rep. William Lindstedt, D-Broomfield, sponsor of HB24-1316. “The middle class is not immune to the rising cost of housing. Our new law will save Coloradans money on housing by building more homes for our teachers, first responders, and other essential workers so they can afford to live in the communities where they work.”

“Every Coloradan should have the opportunity to live where they work, but our housing market is completely broken,” Senator Jeff Bridges, D-Arapahoe County, sponsor of HB24-1316, said. “We’ve had low-income housing tax credits for a very long time, but this is the first middle-income housing tax credit in the country. We need this right now because even people with good-paying jobs like nurses, teachers, and firefighters can’t afford to live here. This bill will help to fix that by providing tax credits for housing that’s affordable for folks earning an average wage—80 to 120 AMI in technical terms.”

“Colorado Democrats have passed a variety of laws that encourage the development and preservation of affordable housing options, but we also need more housing for middle-income Coloradans that don’t qualify for housing support,” Rep. Mandy Lindsay, D-Aurora, sponsor of HB24-1316. “Coloradans need more housing options that work for their budget and allow them to live in the community where they work and raise their kids. With this law, we can add more middle-income housing opportunities throughout Colorado to support our workforce and address the housing crisis.”

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