Updated 4/26/24

Could a compromise finally be on the way for the significant housing bill of the 2024 session?

It’s not there yet, but amendments under consideration by the Senate sponsor of House Bill 1313, the transit-oriented housing bill, could move the needle in that direction.

The Senate Local Government and Housing Committee worked until 1:30 a.m. Wednesday on the measure but laid it over until Thursday afternoon while sponsors work out amendments, with the most significant amendments to remove language that has drawn the most opposition from local governments.

Sen. Faith Winter, D-Westminster, asked for more time on Thursday to continue working on amendments; the bill’s next hearing will be next week. 

HB 1313 requires affordable housing to be constructed adjacent to transit. That means supported by public subsidies, “inclusionary” zoning ordinances, and deed restrictions, which restrict or limit maximum rental or sale price. The bill also requires a period when only low- or moderate-income households can qualify. The measure requires housing density in these transit-oriented communities at about 40 units per acre.

The measure applies to about 31 municipalities that are part of a metropolitan planning organization (MPO). There are five MPOs in Colorado: the Denver Regional Council of Governments, the North Front Range MPO, the Pikes Peak Area Council of Governments, the Pueblo Area Council of Governments and the Grand Valley MPO. That limits the impact of HB 1313 to the state’s largest metro areas, mainly along the Front Range, and excludes mountain and rural communities that don’t have transit centers.

Opponents have noted that even within the MPOs, some communities lack access to transit—either light rail or bus service—and lack the infrastructure to meet the bill’s mandates.

Winter told the committee at the hearing’s conclusion Wednesday morning that she heard repeatedly the importance of partnership, not preemption, with local governments. Winter, a former Westminster City Council member, said the bill was written with an intent toward partnership.

It might have started that way, but a long list of municipalities that would be impacted by the bill in its current form opposes it.

Chief among those objections is the bill’s attempt to use a big stick to force local governments into compliance with the bill’s mandates.

That includes language that would strip away state transportation funding from local governments that don’t meet the bill’s objectives. Second, is an injunction the state could seek against those municipalities for failure to comply.

Third, the bill requires a density of 40 units per acre, which local government representatives and developers say isn’t feasible.

Fourth —and the bill’s most significant sticking point that may never be resolved —is that it is a mandate to local governments. This points out that the state constitution grants many municipalities home rule authority and that state government mandates imposed on those local governments are unconstitutional.

But the conversation around affordable housing is dramatically different than a year ago. Conversations are taking place that might not have been possible with the 2023 major housing bill that died on the session’s last day.

Winter told Colorado Politics Wednesday that she intends to offer amendments on Thursday to take out the transportation and injunction language and strip out the bill’s tax credits.

During the bill’s final passage in the House on Sunday, several House Democrats who voted for it promised they wouldn’t vote again if HB 1313 returned to the House in its current form. Chief among their concerns is the transportation penalty. Rep. Marc Snyder, D-Manitou Springs, said he would do everything he could to see the bill killed without significant changes.

The tax credits proposed for HB 1313 total $35 million, to be paid out of the TABOR surplus. Taking out those credits could help the bill avoid a trip to the Senate Finance Committee and a potential defeat. However, that raises a new concern: without the tax credits, the bill could become an unfunded mandate for the local communities required to participate.

The issue of density will take a little more work. Winter acknowledged she’s heard the concerns over 40 units per acre as not feasible. Twenty is too few, she said, so the final number is still in negotiation.

That concerns Arapahoe County, which has seven transit centers within its borders. Commission Chair Carrie Warren-Gully said Tuesday night that her county has 90,000 units planned under local zoning laws. But the density goals in HB 1313 are not realistic, she explained. The county, in an amended position on HB 1313, would like amendments that provide achievable goals.

She said, “We support statewide housing plan with clear goals and consistent data. When it comes to how we achieve it, local governments are best able to leverage the expertise” that will produce more housing. 

Warren-Gully later told Colorado Politics the 90,000 units have not been moved to the development stage because  labor shortages, infrastructure costs, building supply issues, and the current cost of borrowing.

Losing transportation funding would cost the county $9 million, 47% of the county’s total road and bridge budget. 

But there’s another problem: a half-mile buffer in the bill around transit stations. For Arapahoe County, that does not take into account access barriers such as the I-25 corridor or the Highline Canal, Warren-Gully said. “Some of the proposed transit areas in Arapahoe County, such as the Dry Creek station, are already developed with office and multi-family to the point that rezoning to allow more housing would have little effect in that area.  

Utility infrastructure is also an issue; while the bill considers water utilities, it does not take into account power, sanitary sewer/treatment facilities and storm water run-off. “This level of infrastructure would be difficult given the County’s funding challenges. “

 In Broomfield, a recent presentation to its city council pointed out the problems with preemption as designated in HB 1313. The bill requires local governments to rezone property to meet the bill’s “housing opportunity goals” as dictated by the state and within an established timeframe. 

If the compromise materializes, it could deliver a major win to Gov. Jared Polis, who has been working on the housing issue for the past two sessions.

The most notable support for HB 1313 comes from Denver Mayor Mike Johnston and City Council President Jamie Torres. “HB-1313 is a balanced approach to land use that pushes local governments in the right direction,” he said. “With policies like HB-1313, we can change the status quo to create a more affordable Colorado.”

Denver Gazette reporter Alex Edwards contributed to this report.