Concerning funding for community integration housing, and, in connection therewith, requiring ten percent of federal low-income housing tax credits be set aside and priority for state affordable housing tax credits be given to developments t...
Summary
HB 26-1061 would create a new housing tax credit preference for “community integration housing” for people with intellectual and developmental disabilities. The bill directs the Colorado Housing and Finance Authority (CHFA) to reserve at least 10% of the state’s annual federal low-income housing tax credit ceiling for qualifying developments. To qualify, a project must be located in Colorado, comply with federal home- and community-based services (HCBS) settings rules, reserve at least 20% of its units for people with intellectual and developmental disabilities, and have a formal partnership with a community-centered board or certified case-management agency.
The bill also amends Colorado’s state affordable housing tax credit program to give priority scoring or preference to developments that received the federal set-aside and continue to meet the community integration housing requirements. The preference would be implemented through CHFA’s competitive scoring process, but it would not override other eligibility, underwriting, or feasibility standards, and it would not require CHFA to award credits to projects that fail to meet applicable state or federal requirements. Any unused credits from the set-aside could be reallocated to other eligible projects later in the year.
Impact
If enacted, the bill would alter how Colorado allocates both federal low-income housing tax credits and the state affordable housing tax credit by creating a targeted preference for integrated housing developments serving people with intellectual and developmental disabilities. It would add new statutory definitions and allocation rules in the tax code, require CHFA to consult with the Department of Health Care Policy and Financing when determining whether a project meets the community integration housing standards, and apply the changes to qualified allocation plans adopted on or after the effective date. The bill would not change federal tax law, but it would change the state’s administration of credits and could influence which affordable housing projects are financed in Colorado.
Sentiment
The bill’s stated purpose is strongly supportive of expanding integrated, community-based housing options for people with intellectual and developmental disabilities, and the legislative findings frame the measure as addressing a significant unmet need and helping Colorado meet federal obligations. However, the bill was not advanced in committee and was postponed indefinitely in the House Transportation, Housing & Local Government Committee, indicating that it did not secure enough support to move forward. No vote record or transcript is provided, so the available context suggests policy interest in the concept but insufficient committee backing for passage.
Contention
The main points of contention likely center on whether setting aside 10% of the federal housing tax credit ceiling is the best use of limited affordable housing resources, and whether a mandatory preference for one category of development could reduce flexibility in CHFA’s competitive allocation process. Potential concerns also include the administrative burden of verifying compliance with HCBS settings rules, coordinating with disability-service agencies, and ensuring that reserved units and tenant-selection preferences comply with federal fair housing and tax credit rules. Supporters would likely emphasize the shortage of integrated housing for people with intellectual and developmental disabilities, while skeptics may worry about market impacts, project feasibility, and whether the set-aside could disadvantage other affordable housing applicants.