JOINT RELEASE: Gov. Polis and Democratic Lawmakers Introduce Legislation to Reduce Housing Costs
DENVER, CO - Governor Jared Polis and Colorado Democratic lawmakers today unveiled three bills that would drive down housing costs and save Coloradans money.
These bills would streamline the process for many non-profits, schools and transit districts to be part of the housing solution by building housing on their land (HOME Act), fund transit infrastructure improvements and transit-oriented housing (Transit/Housing Investment Zones) and expand tax exemptions to include non-profit housing developers that build affordable rental properties.
“This session, Colorado Democrats are focused on lowering costs, and these three bills will spur more housing now that Coloradans can afford,” said Speaker Julie McCluskie, D-Dillon, sponsor of HB26-1065. “We’re looking to create an innovative funding mechanism for affordable housing near transit hubs, remove barriers to building housing on underutilized land, and encourage more affordable rental housing. These bills will help drive down housing prices, especially in communities like mine in the high country, and bolster Colorado’s transit infrastructure. I’m especially excited that we will be creating housing and transit investment zones that will help local communities finance more housing for every budget.”
“Housing costs are one of the biggest pain points for Coloradans and we are doing everything possible to drive down costs. Everyone deserves to find a home that fits their budget. From the HOME Act, to TIF and lifting up our community land trusts, these efforts will build on our work from years past, and I appreciate the legislators for their work to lead on this important issue,” said Governor Jared Polis.
“We’re taking a big swing at Colorado’s housing shortage to drive down the cost of housing,” said Speaker Pro Tempore Andy Boesenecker, D-Fort Collins, sponsor of HB26-1001. “The HOME Act would remove barriers for public schools, non-profits with a history of building affordable housing, public housing authorities and transit agencies that are willing to build housing on their underutilized land. This bill is one of many that Colorado Democrats are bringing forward this year to save Coloradans money on housing."
“Too many Coloradans are priced out of their homes and communities because of outdated housing restrictions,” said Sen. Julie Gonzales, D-Denver, sponsor of HB26-1001. “The HOME act allows schools, organizations, and local governments to use land that they already own to build the housing our communities need. These groups know what works and should have the freedom to put their land to good use.”
“Colorado Democrats are making it easier to build more housing now to reduce housing costs for Coloradans,” said Rep. Javier Mabrey, D-Denver, sponsor of HB26-1001. “In Denver, we’re already seeing rent rates drop due to an increase in the housing supply. Our bill would give communities throughout Colorado another tool to get affordable housing projects approved and built and deliver more affordable housing.”
Beginning December 31, 2027, HB26-1001 would streamline the process for building affordable housing by allowing non-profit organizations, housing authorities, school districts, state colleges or universities and transit districts to build housing and other community services on their land.
Under the bill, local governments could not reject the construction of a residential development due to height, as long as the development is no taller than three stories or 45 feet or adheres to the height standards of the zoning district. These residential developments could also include childcare centers and facilities that provide recreational, social, or educational services to residents.
A 2022 report found that removing bureaucratic barriers in the permitting process can expedite the approval process by 28-percent.
Lawmakers also unveiled new legislation that will be introduced later today to improve transportation infrastructure, increase transit-oriented housing options that hardworking Coloradans can afford and expand property tax exemptions to include affordable housing non-profits.
"The mountain and rural communities that I represent have some of the most severe affordable housing shortages in the state, and so I’m proud to be sponsoring multiple pieces of legislation this session that will help finance and build housing developments that working families need and can afford,” said Sen. Dylan Roberts, D-Frisco, sponsor of HB26-1065 and SB26-001. “The bills we’re highlighting today will unlock doors for local governments to create new transit infrastructure and housing options, and engage with their communities to invest in innovative housing solutions.”
“Colorado is making great progress on our housing, transit and environmental goals, and this bill combines all of these priorities into one effort to save Coloradans money,” said Rep. Steven Woodrow, D-Denver, sponsor of HB26-1065. “Coloradans want transit options where they actually live. This bill would unlock new tools for communities to harmonize affordable housing and mass transit ridership goals to keep hardworking Coloradans from being priced out of the place they call home.”
“I’m proud to sponsor two bills to tackle the most common concern I hear from my constituents: the cost of housing,” said Sen. Tony Exum, Sr., D-Colorado Springs, sponsor of HB26-1001 and HB26-1065. “By making it possible to build more homes near reliable transit and make better use of underutilized land, we are taking action to address Colorado’s housing shortage. At the end of the day, these bills are about making sure the kids who grow up in Colorado can afford to stay here, that seniors can age in place, and that working families are not forced to leave the communities they love.”
HB26-1065, The Transit Investment Area Act, would create a new financing tool to improve transportation infrastructure and establish a tax credit to build more transit-oriented affordable housing.
The bill would use tax-increment financing to allow local governments to invest state sales tax revenue into transportation infrastructure. Local governments, in partnership with transit agencies, would be able to apply to create a transit and housing investment zone to fund transportation infrastructure projects, like safety improvements and centering transit stops within the community to increase ridership. The bill would allow up to three transit investment projects to be approved in a calendar year, with no more than six projects funded through the bill in total.
HB26-1065 would also create the Colorado Affordable Housing in Transit Investment Zones Tax Credit. This tax credit is reserved for projects that serve low- and middle-income housing within transit and housing zones. The bill would allow up to $50 million in these tax credits per calendar year from 2027 to 2033.
HB26-1066 would expand property tax exemptions for affordable housing developers to include non-profit organizations that build affordable rental properties.
“Colorado Democrats are here to deliver housing options that Coloradans can afford, which is why we’re bringing this bill to create more affordable rental opportunities,” said Rep. Rebekah Stewart, D-Lakewood, sponsor of HB26-1066. “The Community Land Trust and other nonprofit housing developers have been important partners in building more homes that Coloradans can afford, and now it will be easier and less expensive for them to develop properties for rent. Our legislation would provide a tax break to non-profits that build affordable rental properties so we can provide more low-cost housing options to hardworking Coloradans.”
“From my district in the heart of Denver to the furthest corners of our state, Colorado faces a massive crisis in our lack of affordable housing,” said Sen. Matt Ball, D-Denver, sponsor of HB26-1066. “In this environment, every dollar allocated for affordable housing should go to building affordable housing, not paying taxes on vacant land. I’m proud to sponsor this legislation that will reduce cost burdens on everyday Coloradans and the organizations that build necessary affordable housing.”
“This bill would save Colorado renters money by removing barriers to affordable rental housing development,” said Rep. Katie Stewart, D-Durango, sponsor of HB26-1066. “Land is expensive in my corner of Colorado, and it is stifling rental opportunities that hardworking people can actually afford. With our legislation being introduced today, we’re one step closer to opening up more opportunities for Coloradans to afford rental housing, especially in expensive mountain communities on the Western Slope.”
In 2023, Colorado Democrats passed a law to expand property tax exemptions to include more non-profit organizations that build and sell affordable housing. The law also extended the exemption period from 5 to ten years to better reflect the development timeline for larger affordable housing projects. It also created a new property tax exemption for land owned by community land trusts and other non-profit affordable homeownership providers that develop permanently affordable for-sale homes. HB26-1066 would expand this exemption to include affordable rental properties as well as for-sale homes.