A bill that’s expected to be introduced by state Rep. Elizabeth Velasco when the Colorado Legislature convenes for the 2024 session next week aims to provide another tool in the effort to create more affordable housing locally.
Velasco, D-Glenwood Springs, who represents House District 57, will be joined by state Sen. Dylan Roberts, D-Eagle (Senate District 8), in putting forward a bill authorizing municipalities and counties to use a real estate transfer fee for funding affordable housing projects.
“This is something local governments have been working on for many years, and I am excited to bring it forward,” Velasco said this week.
The bill, if passed by the Legislature and signed by the governor, would allow local governments to add a real estate transfer fee of up to 4% as a funding mechanism for their affordable housing programs.
Some local jurisdictions, including Aspen and Snowmass Village, have a real estate transfer tax that predated the 1992 Taxpayers Bill of Rights (TABOR). That law prohibited taxes on real estate sales, but a local fee on such sales is possible with legislation.
The fee would have to apply the rational nexus provision that it be used to address a specifically defined need.
“Affordable housing is a need in many parts of the state, and there have been many studies done to show that need exists,” Velasco said.
Among them is the Greater Roaring Fork Regional Housing Study that identified a shortfall of 4,000 housing units between Aspen and Parachute that’s considered affordable for households making between 60% and 160% of the Area Median Income.
Under the legislation, local municipalities and counties could tailor their own programs to create more deed-restricted housing using funding from the transfer fee.
It would be up to the local jurisdiction to determine how to impose that fee, and whether to exclude certain types of property transactions or set a specific price point for the fee to apply, Velasco said.
“We want it to be about local control,” she said. “They’re all working with this patchwork of funding from the federal government and the state, and this just gives them another tool to be able to fund these projects.”
The bill could also garner bipartisan support from state Sen. Perry Will, R-New Castle, who represents Senate District 5.
“We’ve got to do something for affordable housing, no question,” Will said ahead of the Jan. 10 start to the new legislative session.
“For a lot of the communities I represent, we know people are being priced out and there is a need for affordable housing to maintain our workforce and avoid some of these long commutes.”
Instead of a statewide mandate, which Will said he opposes, the fee provision allows local communities to choose for themselves if it’s something they want to utilize.
The bill is expected to be one of several related to affordable housing to come before the Legislature this year, as Gov. Jared Polis is also expected to bring a packet of bills addressing the issue.
On other fronts
Velasco and Will also spoke to some other bills they plan to sponsor this coming session.
As Chair of the Wildfire Matters Committee, Velasco said she intends to introduce several bills related to community resiliency, healthy forests and “firewise” provisions. Likewise, Will expects to introduce bills related to forest management and providing greater firefighter health benefits.
In addition, Velasco is working on a bill with the state’s New Americans Office to streamline the process for funding local communities’ and nonprofit organizations’ migrant arrival response; a gun violence measure related to safe storage of firearms in vehicles; and a followup to her 2023 legislation aimed at protecting students who want to wear cultural regalia at high school graduations.
For Will’s part, he plans to introduce bills related to: providing more resources for rural mental health services, especially for farmers and ranchers; increasing the land conservation easement tax credit from $45 million to $75 million; strengthening laws related to motorists who refuse to provide proper identification during traffic stops; and one related to dental hygiene.
A likely controversial bill the former longtime state wildlife officer is considering has to do with directing Colorado Parks and Wildlife to reintroduce the wolverine in parts of the state.
“The intent in doing this is to show that there is a right and correct way to reintroduce a species, where you let the wildlife professionals do their job and keep these matters out of the ballot box,” Will said, referencing the highly controversial voter-directed reintroduction of the gray wolf in Colorado.