Committee Passes Bills to Save Families Money on Childcare, Create More Good-Paying Jobs
HB26-1004 and HB26-1014 would extend tax credits that make life more affordable for working Coloradans
DENVER, CO – The Senate Finance Committee yesterday passed two pieces of legislation that would spur the creation of more high-quality and affordable childcare facilities in our communities and help create more jobs by incentivizing businesses to expand or relocate to Colorado.
HB26-1004, sponsored by Senate President James Coleman, D-Denver, would continue the Child Care Contribution Tax Credit, which allows taxpayers who donate money to a licensed childcare facility in Colorado to receive an income tax credit of 50 percent of their contribution, until 2037.
“Colorado’s families, communities, and economy are all stronger when we have a vibrant childcare ecosystem,” said Coleman. “This bill drives donations toward childcare facilities, which means more good jobs and more options for hardworking families at all price points. For many Colorado families, childcare is their number one expense every month. This bill is about taking action to make childcare more available and affordable.”
These childcare facilities could include qualifying childcare centers, homeless youth shelters and residential treatment centers. These donations can be used to create or maintain a childcare facility, fund childcare financial assistance programs for families and train childcare providers. In tax year 2023, around $33 million in credits were claimed by almost 16,000 taxpayers, generating a total of $66 million for the childcare ecosystem.
In January, the Trump administration attempted to freeze over $300 million of funding for childcare and social services that thousands of Colorado families rely on. As a result, Colorado Democrats are stepping up to create more avenues to fund affordable care.
The committee also approved HB26-1014, sponsored by Senator Matt Ball, D-Denver, and cosponsored by Senator Lisa Frizell, R-Castle Rock, that would extend the Job Growth Incentive Tax Credit through tax year 2034. The Job Growth Incentive Tax Credit was created in 2009 to help create new jobs by offering a state income tax credit of 50 percent of the Federal Insurance Contributions Act (Social Security and Medicare payroll taxes) contributions paid by the business for each new job.
“The Job Growth Incentive Tax Credit has been hugely successful in creating opportunities for workers to thrive and grow in good-paying careers,” Ball said. “This legislation would continue to create good new local jobs and opportunities for Colorado families across our state.”
To qualify for this state income tax credit, businesses must create at least 20 new jobs during the credit period, or at least five new jobs if the project is within an Enhanced Rural Enterprise Zone. These jobs must pay at least 100 percent of the county’s average annual wage and be maintained for at least one year.
The following projects were announced as recent recipients of the Job Growth Incentive Tax Credit:
Neon, a company in the quantum industry, that is expected to create 150 new jobs at 172-percent of the average annual wage in Boulder County,
Project Elevate, a real estate investment and modular home manufacturing company, which is expected to create nearly 100 jobs at 135-percent of the average annual wage in Mesa County, and
Frontera, a construction company, which is expected to create 40 new jobs at 104-percent of the average annual wage in Montrose County.
Both HB26-1004 and HB26-1014 now move to the Senate Appropriations Committee for further consideration.