From the Field: Colorado Gains Historic New Investments in Affordable Housing

Republican and Democratic state senators and representatives convened rural and urban affordable housing stakeholders in the fall of 2018 to identify policy solutions to Colorado’s affordable housing crisis. Three of the group’s identified solutions passed in the 2019 legislative session, creating a level of investment in affordable housing the state has never seen before. These three bills were signed into law by Governor Jared Polis on May 17.

Colorado has been one of only ten states without a dedicated mechanism to sustainably fund affordable housing, contributing to the shortage of more than 114,000 affordable and available rental homes for extremely low-income families. In October 2018, State Representatives KC Becker and Jim Wilson and State Senators Don Coram and Dominick Moreno brought together a diverse group of more than 80 affordable housing stakeholders, including NLIHC state partners Colorado Coalition for the Homeless (CCH) and Housing Colorado. Together they identified funding solutions that were later passed as HB 19-1228 and HB 19-1322. Another state representative, Mike Weissman, was also working on a funding mechanism for housing with advocates which resulted in HB 19-1245, rounding out the housing bill package with long-term funding.

HB 19-1228 doubled the cap on the total 2020-2024 state tax credits allowed under the state’s Affordable Housing Tax Credit (AHTC) from $5 million to $10 million. Between 2015 and 2018, four developments financed with direct support from AHTCs and 19 developments supported with either state or federal credits will include permanent supportive housing for individuals and families experiencing homelessness. Twenty-seven percent of homes developed during this period are for affordable housing for seniors. And the state AHTC has facilitated more affordable housing developments outside of the seven-county Denver metro area. The increase in credits from $5 million to $10 million will raise additional private-sector equity to develop and preserve affordable housing in Colorado. HB 19-1228 was championed by State Representatives Shannon Bird and Brianna Titone and State Senators Rachel Zenzinger and Jack Tate.

Photo credit: Colorado Coalition for the Homeless

Photo credit: Colorado Coalition for the Homeless

The passage of HB 19-1245 was also historic. While the law creates a minor change in the way the state’s vendor fee allowance is administered, it is expected to generate roughly $8 million in the first two years for investments in affordable housing across Colorado and $45-50 million per year after that. One-third of the funds will be dedicated to housing for extremely low-income households living at 30% of area median incomes (AMIs) or below. HB 19-1245 is revenue-neutral, meaning it does not impact the state’s budget.  It will only affect retailers with annual revenue over $12 million and will provide tax breaks to smaller retailers and local businesses.

Photo credit: Colorado Coalition for the Homeless

Photo credit: Colorado Coalition for the Homeless

The last bill, HB 19-1322, sets out to expand the supply of affordable housing in Colorado by appropriating $30 million of unused funds in the state’s Unclaimed Property Trust Fund for three years. Eligible uses of these funds include grants and loans for mobile home repair, covering land and infrastructure costs to support affordable rental housing development, and the development, acquisition, and rehabilitation of affordable rental housing. Rental assistance programs will also be made available for low-income households, homeless or disabled veterans, domestic violence survivors, family-unification participants, Medicaid recipients seeking to transition out of nursing homes, and homeless families with children in school. The law protects existing uses of the funds. The first transfer will occur at the end of FY2020-21.

“This bill package is historic for Colorado,” said Cathy Alderman, vice president of communications and public policy for the Colorado Coalition for the Homeless. “This type of housing investment is long overdue in the state and will help to address the critical housing needs for thousands of families that are cost-burdened, suffering from housing instability, and currently experiencing homelessness. Approximately 7 in 10 voters in Colorado believe that the state needs a dedicated funding source for housing and these bills reflect a response to that need, a commitment to stronger communities, and investment in the health and well-being of all Coloradans. We were proud to be part of the broad stakeholder group that advocated for, supported, and got these bills across the finish line.”

For more information about the Colorado Coalition for the Homeless and its 2019 legislative efforts, contact Cathy Alderman at: calderman@coloradocoalition.org

Learn more about Colorado Coalition for the Homeless at: https://www.coloradocoalition.org/

Learn more about Housing Colorado at: https://www.housingcolorado.org