Concerning adjustments to transportation funding.
HB 26-1430, titled the “Colorado Budget Protection Act,” makes a series of transportation-funding changes that are contingent on voter approval of a separate 2026 ballot initiative amending the state constitution to dedicate more state revenue to road transportation. If that initiative passes, the bill lowers the gasoline excise tax from 22 cents to 14 cents per gallon and the special fuel excise tax from 21.5 cents to 13 cents per gallon for a limited period beginning January 1, 2027. It also reduces several vehicle-related charges, including road usage fees, late registration fees, electric vehicle registration fees, electric vehicle road usage equalization fees, passenger vehicle registration fees, and road safety surcharges, with many of the reductions scheduled to sunset by July 1, 2030 or July 1, 2031.
The bill creates a new Support Road Transportation Fund and directs revenue collected to support road transportation into that fund beginning in 2027. Money in the fund is used first to replace certain general fund transfers and payments tied to financed purchases of assets or certificate of participation agreements, and then the remaining money is split 60% to the state highway fund, 23% to counties, and 17% to cities and incorporated towns for transportation purposes. The bill also clarifies that enterprise fee revenue is not included in the constitutional category of state revenue collected to support road transportation.
In addition to the tax and fee changes, the bill revises how certain transportation-related state transfers and obligations are funded over time. It adjusts general fund transfers to the state highway fund, shifts some payments for transportation lease and capital obligations to the new support fund, and requires the Department of Transportation to spend a portion of certain transfers on projects that mitigate air pollution and reduce vehicle miles traveled in nonattainment areas. It also directs the Legislative Council Staff and the Office of State Planning and Budgeting to forecast future road usage fee rates in 2027, 2028, and 2029 so those fees can be adjusted to offset the revenue diverted to transportation.
The general sentiment reflected in the bill text is supportive of transportation investment but cautious about the effect on the state budget. The legislative declaration says the General Assembly supports sustainable transportation funding, but not at the expense of K-12 education, health care, higher education, and other critical general fund services. Because there were no committee transcripts or recorded votes provided, there is no additional evidence of debate beyond the bill’s own framing.
The main point of contention is the tradeoff between increased transportation dedication and reduced flexibility in the general fund. Supporters appear to view the bill as a budget-protection measure that offsets a voter-approved transportation revenue shift by lowering taxes and fees, while critics would likely focus on the complexity of the contingent structure, the temporary nature of the reductions, and the possibility that the state must still absorb revenue losses or reallocate funds among competing priorities. The bill’s many contingent effective dates and sunset provisions suggest it was designed to respond directly to the outcome of the related ballot initiative rather than to make permanent standalone changes.
HB 26-1430 amends multiple sections of Colorado law governing fuel taxes, vehicle registration fees, road usage fees, highway fund transfers, and transportation-related financing. If triggered by voter approval of the related constitutional initiative, it lowers several tax and fee rates, creates the Support Road Transportation Fund in the state treasury, and redirects specified transportation revenue into a new distribution formula for the state highway fund, counties, and municipalities. It also modifies transfer provisions in the state budget statutes and clarifies that enterprise fee revenue is excluded from the constitutional transportation revenue category.
The bill is framed positively toward transportation investment but defensively toward the state budget. Its declaration says the General Assembly supports transportation funding, yet wants to avoid reducing appropriations for education, health care, and higher education. With no committee transcript or vote record provided, the available context suggests a generally pro-transportation, budget-protection posture rather than a clearly divided recorded debate.
The central contention is whether dedicating more state revenue to transportation would undermine the general fund and force cuts to core services. The bill itself identifies potential reductions in K-12 education, health care, and higher education as the reason for its response. Another likely point of dispute is the bill’s contingent structure: it only takes effect depending on the outcome of a separate constitutional initiative, and it uses temporary reductions in fuel taxes and vehicle fees to offset the new transportation dedication. Stakeholders most likely to care include motorists, trucking and fuel users, local governments, transit and highway interests, and advocates for state-funded public services.