Adjust Requirements Statewide Affordable Housing Fund

Detected April 1st, 2026

Summary

Colorado legislation HB26-1313 modifies requirements for governments to receive funding from the Statewide Affordable Housing Fund. The bill replaces the mandatory 3% annual increase in affordable housing units with a new target increase number calculated using a formula based on average annual permits for new housing, job growth rates, and multipliers of 0.10, 0.15, or 0.20. It also creates waiver provisions for governments unable to meet current or new requirements.

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What changed

The bill fundamentally changes how local and tribal governments demonstrate progress on affordable housing to access Statewide Affordable Housing Fund money. Currently, governments must increase affordable housing units by 3% annually over a baseline number. The bill replaces this with a target increase number calculated as: average annual permits for new housing units multiplied by 3 years, multiplied by a factor (0.10, 0.15, or 0.20) determined by the county's job growth rate relative to the statewide median. The bill provides a good faith effort waiver for the 2024-2026 cycle (filing deadline June 15 to November 1, 2026) and an adjustment waiver for the 2027-2029 cycle.

Local and tribal governments seeking Statewide Affordable Housing Fund money should review the new calculation formula and determine their multiplier based on county job growth rates. The transition begins with good faith effort waivers for the current cycle available through November 2026, while the new system takes effect January 1, 2027 with adjustment waiver options. Governments must track their permit issuance data and prepare documentation to demonstrate compliance with either the old 3% requirement or the new target-based system depending on the cycle.

What to do next

Review the new target increase number formula and determine applicable multiplier based on county job growth rates
File good faith effort waiver if unable to meet the 3% annual increase for the 2024-2026 cycle before November 1, 2026
Track average annual permits for new housing units to calculate target increase numbers for the 2027-2029 cycle

Source document (simplified)

HB26-1313

Adjust Requirements Statewide Affordable Housing Fund

| Type | Bill |
| --- | --- |
| Session | 2026 Regular Session |
| Subjects | Housing Local Government |
Concerning the adjustment of requirements for governments to receive funding from the statewide affordable housing fund.

Recent Bill (PDF) Recent Fiscal Note (PDF) Bill Summary:

Current law requires a local government or a tribal government (government) desiring to receive funding from the statewide affordable housing fund to have filed with the division of housing of the department of local affairs (division) a commitment specifying how, within a 3-year cycle, affordable housing units within the government's territorial boundaries will be increased by 3% each year over the baseline number of affordable housing units (baseline number). The baseline number resets every 3 years for the next cycle. To be eligible for funding from the statewide affordable housing fund, a government is required to file a commitment with the division and achieve the 3% increase over the baseline number each year during the 3-year cycle.

The bill changes the requirements for the 3-year cycle beginning on January 1, 2027, and each 3-year cycle thereafter, so that a government desiring to receive funding from the statewide affordable housing fund is no longer required to increase affordable housing units by 3% above the baseline each year, but is instead required to meet the target increase number of affordable housing units (target increase number). The target increase number equals the average annual number of permits for new housing units or functional equivalents of permits for new housing units that have been issued over the past 3 years within the jurisdiction of the government, multiplied by the number of years of the upcoming 3-year cycle to which the government is committing, multiplied by:

0.10 if the average annual job growth rate in the county in which the government is located is significantly lower than the statewide median annual job growth rate over the past 3 years, as determined by the division;
0.15 if the average annual job growth rate in the county in which the government is located is close to the statewide median annual job growth rate over the past 3 years, as determined by the division; or
0.20 if the average annual job growth rate in the county in which the government is located is significantly higher than the statewide median annual job growth rate over the past 3 years, as determined by the division. The bill permits a government that desires to be eligible for funding from the statewide affordable housing fund but is unable to achieve the 3% annual increase in affordable housing units for the 3-year cycle beginning on January 1, 2024 to file a good faith effort waiver with the division. The division may, in its discretion, grant a good faith effort waiver to a government that filed for a waiver on or after June 15, 2026 but before November 1, 2026 and complied with other requirements of the bill.

The bill permits a government that desires to be eligible for funding from the statewide affordable housing fund but is unable to meet the target increase number in affordable housing units for the 3-year cycle beginning on January 1, 2027 to file an adjustment waiver with the division. The division may, in its discretion, grant an adjustment waiver to a government that filed for a waiver and complied with other requirements of the bill.

For the purposes of determining whether a government has achieved the target increase number for the 3-year cycle beginning on January 1, 2027, and for each 3-year cycle thereafter, an affordable housing unit that satisfies the following criteria counts for one affordable housing unit plus the following corresponding additional unit amount:

A unit that is developed on land donated by the local government or tribal government qualifies for an additional 0.10 of a unit;
A unit that is developed to be sold qualifies for an additional 0.20 of a unit; and
A unit that is restricted to be rented or sold to a household with an annual income of at or below 30% of the area median income qualifies for an additional 0.20 of a unit. If affordable housing is developed and qualifies for a property tax exemption, thereby reducing property tax revenue to the county in which the affordable housing is located, and the county did not provide any money to develop the affordable housing, the division may, in its discretion, allow each such affordable housing unit to count as up to 1.15 affordable housing units for the county at the time of vertical construction. If a county's property tax revenue will be reduced due to the development of affordable housing, the county shall submit, at the time of the project underwriting for the affordable housing, documentation to the division of anticipated reduced property tax revenue.

(Note: This summary applies to this bill as introduced.)