SIGNED! New Laws to Improve Housing Affordability and Short-Term Rental Oversight

DENVER, CO - Governor Polis today signed two bills into law to increase flexibility in the housing affordability programs approved by voters by the passage of Proposition 123 and improve local governments’ ability to hold short-term rentals to local rules and regulations.
 
“Communities throughout Colorado are facing a housing affordability crisis, and these new laws will offer local communities the tools they need to make it easier to call Colorado home,” said Speaker Julie McCluskie, D-Dillon, sponsor of HB23-1304 and HB23-1287. “These laws provide towns and cities, especially those in our rural mountain towns the flexibility they need to implement the affordable housing programs voters created with Proposition 123. We’re also strengthening transparency and compliance with local regulations of short term rentals to help ease some of the impact these properties are having on those living in our rural resort communities year round. I’m proud to deliver legislation that will help alleviate the high cost of housing for Coloradans from the Front Range to the Western Slope.”

“Coloradans were clear when they passed Prop 123 that they want more affordable housing options,” said Tony Exum, D-Colorado Springs, sponsor of HB23-1304. “With this bill, we’re making sure that Prop 123 will be implemented effectively, so that every Coloradan can afford to live in the communities where they work. I’m excited to see HB23-1304 signed into law, and look forward to seeing all the affordable housing options that’ll be created for hardworking people across our state.”

HB23-1304 ensures the housing affordability programs created through Proposition 123, which voters approved in the 2022 election, can be implemented effectively across the state and have the greatest impact by getting dollars out the door as soon as possible.

The law ensures that tribal governments can access Proposition 123 funds in addition to local governments. It also makes it possible for rural resort communities to access the historic funding of Proposition 123 to accommodate the high cost of living in these areas. Local governments across the state will also be able to partner with neighboring communities to reach their targeted growth rate of three percent.

In 2022, voters approved Proposition 123, which created new housing affordability programs funded with surplus state income tax revenue. The proposition dedicated an estimated $300 million to help local governments purchase land for affordable homes, provide financing for low- and middle income multi-family housing and provide direct support to renters, supply debt financing for projects that qualify for housing tax credits, offer grants and loans for nonprofits to help people purchase homes, and fund programs for people experiencing homelessness.

“Short-term rentals play an important role in rural resort economies by attracting visitors to our communities, but they have had unintended impacts on rental markets and housing costs in the high country and across the state,” said Rep. Meghan Lukens, D-Steamboat Springs, sponsor of HB23-1287. “This law will allow counties to partner with digital platforms that host units to remove a listing if the owners’ license is suspended or revoked, protecting owners, renters, and local communities from violations of local rules and regulations.”

“Today’s bill signings signal our continued and multi-faceted commitment to making housing more affordable across Colorado,” said Senator Dylan Roberts, D-Avon, sponsor of HB23-1304 and HB23-1287. "HB23-1304 ensures that the historic funds for affordable housing programs from Proposition 123 are distributed equitably to all corners of the state and delivers increased flexibility for rural and mountain communities to ensure the goals of Prop 123 are met. With HB23-1287, we’re also strengthening protections for local residents in rural resort communities to help curb the unintended impacts of short-term rentals on our communities. I’m proud that these important pieces of legislation passed with bipartisan support and have now become law. And I am even more excited to continue our work to ensure every Colorado family has an affordable place to call home."

A board of county commissioners already has the authority to regulate units that are rented or used for short-term stays. HB23-1287 clarifies the definition of a short-term rental and provides counties with the authority to work with digital platforms to accurately list compliant short-term rentals.

HB23-1287 gives counties the ability to require an owner of a property, or the owner’s agent, to include a rental license or permit in any listing for a short-term rental unit on a digital platform. If a county has regulations on short-term rentals, the county will be able to require a digital platform to remove any rental listing if the owner of the listing:
·        Has their local short-term rental license or permit suspended or revoked,
·        Has received a notice violation, or a similar legal process, for not holding a valid local short-term rental license or permit, or
·        Is not allowed to list their unit as a short-term rental due to county rules.