Colorado voters will decide on an initiative to create a new State Affordable Housing Fund in November. Proponents submitted 230,748 signatures for the measure on August 4, 2022. On August 19, the Colorado secretary of state’s office announced that the initiative qualified for the ballot. Through random sample verification, 149,072 were projected to be valid. To qualify for the ballot, 124,631 valid signatures were required.
The initiative, sponsored by Coloradans for Affordable Housing Now, would dedicate one-tenth of one percent (0.01%) of state income tax revenue to the State Affordable Housing Fund.
Colorado has a flat income tax rate of 4.55% of federal taxable income. An initiative also on the November 2022 ballot would decrease the rate to 4.40% beginning January 1, 2022.
Under the initiative, affordable housing would be defined as rental housing that is “affordable to a household with an annual income of at or below 60% of the area median income, and that costs the household less than 30% of its monthly income,” and “for-sale housing that could be purchased by a household with an annual income of at or below 100% of the area median income, for which the mortgage payment costs the household less than 30% of its monthly income.”
Funds would be used to:
- provide grants to local governments and loans to nonprofit organizations to acquire and maintain land for the development of affordable housing;
- create an affordable housing equity program to make equity investments in multi-family rental units to ensure that rent is no more than 30% of a household’s income;
- create a concessionary debt program to provide debt financing for low- and middle-income multi-family rental developments and existing affordable housing projects;
- create an affordable home ownership program providing down-payment assistance for homebuyers meeting certain income requirements;
- create a grant program for local governments to increase capacity to process land use, permitting, and zoning applications for housing projects; and
- create a program to provide rental assistance, housing vouchers, and other case management for persons experiencing homelessness.
For fiscal year 2022-23, $135 million was estimated to be allocated to the State Affordable Housing Fund. For the first full fiscal year, FY 2023-24, the Colorado Legislative Council Staff estimated that $270 million would be transferred from the state general fund to the State Affordable Housing Fund. The initiative would authorize the state to retain and spend these funds as a voter-approved revenue change above the state’s TABOR limits, which it would otherwise be required to refund to taxpayers.
The Colorado Taxpayer’s Bill of Rights (TABOR) requires voter approval for all new taxes, tax rate increases, extensions of expiring taxes, mill levy increases, valuation for property assessment increases, or tax policy changes resulting in increased tax revenue. TABOR limits the amount of money the state of Colorado can take in and spend. It limits the annual increase for some state revenue to inflation plus the percentage change in state population. Any money collected above this limit is refunded to taxpayers unless the voters allow the state to spend it.
Coloradans for Affordable Housing Now has raised $2.8 million from donors including Gary Ventures Inc., the National Association of Realtors, Colorado Low Income Housing Campaign, and Habitat for Humanity of Metro Denver.
Brian Rossbert, executive director of Housing Colorado said, “The people of Colorado have spoken, and they want to make Colorado affordable. Too many Coloradans can no longer afford to live in the neighborhoods where they set down roots. That’s forcing families to make difficult relocation decisions, robbing our communities of essential services and intensifying our homelessness crisis. This measure is desperately needed if we want future generations of Coloradans to thrive.”
Natalie Menten, a TABOR Foundation board member, said, “If this passes, the number on that TABOR refund check is going to be smaller. And potentially in some years, there won’t be a check coming to you because this will take all of it. I oppose this on multiple levels. Many of us don’t want to live in downtown. But what this measure is driving us to do is get more high-density housing and that is not what I want to see more of, frankly.”
Seven other measures are currently certified to appear on the November ballot in Colorado. Three initiatives concerning alcohol in grocery and convenience stores, alcohol delivery, and liquor store licenses are in the process of signature verification and could qualify for the ballot.
From 1985 through 2020, an average of nine measures appeared on the statewide ballot during even-numbered years in Colorado. The approval rate for measures on the ballot in even-numbered years was 47.34%.