Colorado housing reform wins in Round 2

Last year disappointed pro-housing advocates in Colorado, as Governor Polis’s flagship reform was defeated by the state legislature. But Polis and his legislative allies tried again this year, and yesterday the governor signed into law a package of reforms which cover much of the ground of last year’s ill-fated HB23-213.

HB24-1152 is an ADU bill. It applies to cities with populations over 1000 within metropolitan planning areas (so, the Front Range – home to most of Colorado’s major cities – along with Grand Junction), and CDPs with populations over 10,000 within MPOs. Within those jurisdictions, the law requires the permitting of at least 1 ADU per lot in any zone that permits single-family homes, without public hearings, parking requirements, owner-occupancy requirements, or ‘restrictive’ design or dimensional standards. The law also appropriates funds available for ADU permit fee mitigation, to be made available to ADU-supportive jurisdictions which go beyond compliance with the law to make ADUs easier to build (including jurisdictions not subject to the law’s preemption provisions).

HB24-1304 eliminates parking minimums for multifamily and mixed-use buildings near transit within MPOs (though localities can impose parking minimums up to 1 space per unit for buildings of 20+ units or for buildings with affordable housing, if they issue a fact-based finding showing negative impacts otherwise). This bill was pared down in the Senate and would originally have eliminated parking requirements within MPOs entirely.

HB24-1313 is a TOD and planning obligations bill. The bill:
– Designates certain localities as ‘transit-oriented’ (if they are within MPOs, have a population of 4,000+, and have 75+ acres total either within ¼ mile of a frequent transit route or within ½ mile of a transit station – in effect, 30 or so localities along the Front Range).
– Assigns all transit-oriented communities (TOCs) housing opportunity goals, which are simply 40units x the number of acres within the transit area (except exempt areas: conservation, parks, industrial, federal land, floodplain, cemeteries, unserved by water and sewer or wells, airports, public or railroad right-of-way, and mobile home parks).
– Requires TOCs to zone to accommodate their housing opportunity goals (starting at the end of 2026, and with exemptions for insufficient water resources), and report triennially on their continued compliance with the law. The TOCs have more flexibility to allocate density than was allowed for in last year’s bill, but the ‘transit centers’ towards which they allocate density must allow between 15 and 500 units per acre, and within the transit centers multifamily must be permitted by right on lots greater than 5 acres. The bill also makes clear these requirements apply to PUDs and HOAs within the affected area as well.
– Also requires TOCs to adopt some of a selection of strategies to preserve affordable housing and prevent displacement (one of the possible strategies is inclusionary zoning).
– In its original form, would have conditioned eligibility for grants from the state’s existing Highway Users Tax Fund on compliance; this provision was stripped out in the Senate.
– Creates a $35M TOC infrastructure grant program – so the carrot from the original bill for compliance is preserved, but not the stick.

These join other Colorado housing bills already signed by the governor, including a ban on occupancy restrictions other than for safety (HB24-1007), and bills to require long-range planning and to create a right of first refusal for local governments to buy affordable housing developments. Colorado also made it harder to block home-based businesses in SB24-134. Taken together, the package of bills make Colorado the first state to have a major YIMBY breakthrough in 2024.