Changeflow GovPing Legislation Colorado Bill on Workforce Housing Tax Credit

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Colorado Bill on Workforce Housing Tax Credit

Detected March 5th, 2026

Summary

Colorado's SB26-001 proposes amendments to workforce housing initiatives and the middle-income housing tax credit. The bill allows counties to appropriate funds for workforce housing and expands eligibility for the tax credit to transferees who do not own an interest in a qualified development. It also clarifies the definition of 'governmental capacity' for construction materials sales tax exemptions.

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What changed

Colorado Senate Bill 26-001, introduced for the 2026 Regular Session, seeks to amend existing laws concerning housing tax credits and public property disposition for affordable housing development. Key changes include authorizing county commissioners to appropriate general fund money for workforce housing and multijurisdictional housing authorities, and allowing governing bodies to sell public property for affordable housing development. Furthermore, the bill modifies the middle-income housing tax credit by enabling transferees who do not hold an ownership interest in a qualified project to claim the credit, and it introduces recapture provisions for such credits.

This bill introduces new opportunities and complexities for entities involved in housing development and tax credit utilization within Colorado. Regulated entities, particularly those in construction and real estate development, should review the bill's provisions regarding property sales, tax credit transfers, and recapture clauses. While the bill is in its draft stage, it signals potential shifts in state housing policy and tax incentives. Compliance officers should monitor its progress through the legislative process and prepare for potential implementation of these changes, particularly concerning the expanded eligibility and recapture rules for the middle-income housing tax credit.

What to do next

Review Colorado SB26-001 for potential impacts on housing development and tax credit claims.
Monitor the bill's legislative progress and potential enactment.
Assess implications of expanded tax credit transferability and recapture provisions for affected entities.

Penalties

The bill includes provisions for recapture of tax credits if the qualified basis decreases during a compliance period, requiring transferees to increase their income tax liability.

Source document (simplified)

SB26-001

Workforce Housing & Housing Tax Credit

| Type | Bill |
| --- | --- |
| Session | 2026 Regular Session |
| Subjects | Fiscal Policy & Taxes |
Concerning housing, and, in connection therewith, authorizing a board of county commissioners to appropriate money to support specified types of housing and making the middle-income housing tax credit available to transferees who do not own an interest in a qualified development.

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

Currently, the governing body of a home rule county or a municipality may not sell or dispose of a county or municipal public building or real property held for government purposes if the sale or disposition is for the development of affordable housing. The bill allows a governing body to sell and dispose of such property if the sale and disposition is to provide property to be used for the development of affordable housing or housing identified in a housing needs assessment conducted pursuant to statute. A municipality is also authorized to enter into a long-term rental or lease agreement for the development of affordable housing.

Currently, the voters in a proposed multijurisdictional housing authority may approve the establishment of the authority only at a general election or any election to be held on the first Tuesday in November of an odd-numbered year. The bill allows for the approval at a biennial local election. The contract establishing the authority may be conditioned upon voter approval. The question of establishing the authority may be combined with a question about a tax, impact fee, multiple-fiscal year debt, or other financial obligation required by statute.

Currently, a board of county commissioners (board) may not appropriate general fund money from ad valorem taxes for multijurisdictional housing authorities or other housing authorities established in statute (housing authorities). The bill allows a board to use revenue generated by ad valorem taxes that is in the county's general fund or in other specified county funds for housing authorities. In addition, the bill allows a board to use county general fund money from ad valorem taxes or money from other county funds for workforce housing.

Currently, a middle-income housing tax credit (credit) may be transferred from a governmental entity or quasi-governmental entity to a qualified taxpayer. A qualified taxpayer must own an interest in a qualified project to claim the credit. The bill entitles an individual, person, firm, corporation, or other entity subject to income tax and transferred a credit by a governmental entity or quasi-governmental entity (transferee) to claim the credit without owning an interest in a qualified project.

The bill provides that a credit allocated to a governmental or quasi-governmental entity or transferee thereof is subject to recapture if, as of the last day of any taxable year occurring during a compliance period, the qualified basis of the governmental or quasi-governmental entity is less than the amount of the qualified basis with respect to such entity as of the last day of the prior taxable year. A transferee whose credit is subject to recapture must increase their income tax liability as provided in statute in the same manner and to the same extent as a partner, shareholder, member, or other qualified taxpayer of an owner allocated a credit must increase their tax liability pursuant to statute.

Currently, all sales of construction and building materials to contractors and subcontractors for use in the building, erection, alteration, or repair of structures, highways, roads, streets and other public works (construction) owned and used by the state in the state's governmental capacity only. The bill provides that "governmental capacity" includes the construction of workforce housing projects undertaken by counties.

(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Prime Sponsors

Senator

Dylan Roberts
Senator

Jeff Bridges
Representative

Andrew Boesenecker
Representative

Chris Richardson

Committees

Senate

Local Government & Housing

House

Transportation, Housing & Local Government

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Status

Under Consideration

Introduced

Under Consideration

Upcoming Schedule

1 meeting

Wed

Mar 4

House Transportation, Housing & Local Government

1:30 PM LSB A

Related Documents & Information

| Date | Version | Documents |
| --- | --- | --- |
| 02/04/2026 | Reengrossed | PDF |
| 02/03/2026 | Engrossed | PDF |
| 01/14/2026 | Introduced | PDF |

| Date | Version | Documents |
| --- | --- | --- |
| 01/30/2026 | PA1 | PDF |

| Date | Version | Documents |
| --- | --- | --- |
| 02/24/2026 | FN2 | PDF |
| 01/26/2026 | FN1 | PDF |

| Activity | Vote | Documents |
| --- | --- | --- |
| Refer Senate Bill 26-001 to the Committee of the Whole. | The motion passed on a vote of 12-0. | Vote summary |

| Activity | Vote | Documents |
| --- | --- | --- |
| Adopt amendment L.001 | The motion passed on a vote of 4-3. | Vote summary |
| Adopt amendment L.002 | The motion passed on a vote of 4-3. | Vote summary |
| Adopt amendment L.003 | The motion passed without objection. | Vote summary |
| Adopt amendment L.004 | The motion passed without objection. | Vote summary |
| Refer Senate Bill 26-001, as amended, to the Committee of the Whole. | The motion passed on a vote of 4-3. | Vote summary |
Hearing Summary | Committee Report: PDF
| Date | Calendar | Motion | Vote | Vote Document |
| --- | --- | --- | --- | --- |
| 02/04/2026 | Third Reading | BILL | 26 AYE 7 NO 2 OTHER | Vote record |

| Date | Amendment Number | Committee/ Floor Hearing | Status | Documents |
| --- | --- | --- | --- | --- |
| 02/03/2026 | L.013 | Second Reading | Lost [] | PDF |
| 02/03/2026 | L.014 | Second Reading | Passed [] | PDF |
| 02/03/2026 | L.012 | Second Reading | Passed [*] | PDF |
| 01/29/2026 | L.004 | SEN Local Government & Housing | Passed [] | PDF |
| 01/29/2026 | L.003 | SEN Local Government & Housing | Passed [] | PDF |
| 01/29/2026 | L.002 | SEN Local Government & Housing | Passed [] | PDF |
| 01/29/2026 | L.001 | SEN Local Government & Housing | Passed [*] | PDF |
* Amendments passed in committee are not incorporated into the measure unless adopted by the full House or Senate.

** The status of Second Reading amendments may be subsequently affected by the adoption of an amendment to the Committee of the Whole Report. Refer to the House or Senate Journal for additional information.

| Date | Location | Action |
| --- | --- | --- |
| 03/04/2026 | House | House Committee on Transportation, Housing & Local Government Refer Unamended to House Committee of the Whole |
| 02/04/2026 | House | Introduced In House - Assigned to Transportation, Housing & Local Government |
| 02/04/2026 | Senate | Senate Third Reading Passed - No Amendments |
| 02/03/2026 | Senate | Senate Second Reading Passed with Amendments - Committee, Floor |
| 01/29/2026 | Senate | Senate Committee on Local Government & Housing Refer Amended to Senate Committee of the Whole |
| 01/14/2026 | Senate | Introduced In Senate - Assigned to Local Government & Housing |
Prime Sponsor

Sen. J. Bridges | Sen. D. Roberts

Rep. A. Boesenecker | Rep. C. Richardson

Sponsor

(None) Co-Sponsor