HB 1061

                            Second Regular Session
                         Seventy-fifth General Assembly
                           STATE OF COLORADO
                                                                           INTRODUCED
LLS NO. 26-0581.01 Alison Killen x4350  HOUSE BILL 26-1061
                             HOUSE SPONSORSHIP
 Brooks,
                            SENATE SPONSORSHIP
 (None),
House Committees  Senate Committees
Transportation, Housing & Local Government
                                     A BILL FOR AN ACT
101     CONCERNING FUNDING FOR COMMUNITY INTEGRATION HOUSING, AND,
102IN CONNECTION THEREWITH, REQUIRING TEN PERCENT OF
103FEDERAL LOW-INCOME HOUSING TAX CREDITS BE SET ASIDE AND
104PRIORITY FOR STATE AFFORDABLE HOUSING TAX CREDITS BE
105GIVEN TO DEVELOPMENTS THAT QUALIFY AS COMMUNITY
106INTEGRATION HOUSING FOR PERSONS WITH INTELLECTUAL AND
107DEVELOPMENTAL DISABILITIES.
                                           Bill Summary
             (Note: This summary applies to this bill as introduced and does
     not reflect any amendments that may be subsequently adopted. If this bill
     passes third reading in the house of introduction, a bill summary that
     applies to the reengrossed version of this bill will be available at
     http://leg.colorado.gov.)
           Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
        Capital letters or bold & italic numbers indicate new material to be added to existing law.
              Dashes through the words or numbers indicate deletions from existing law.
        The bill creates a targeted allocation priority within Colorado's
administration of federal and state affordable housing tax credits to
support development of integrated, community-based housing for persons
with intellectual and developmental disabilities. The bill requires a set
aside of at least 10% of the state's annual allocation of competitive federal
low-income housing tax credits (federal tax credits) for "community
integration housing". To qualify, a development must comply with federal
tax credit requirements, meet federal home- and community-based
services settings standards, reserve at least 20% of its units for persons
with intellectual and developmental disabilities, and partner with a
community-centered board or certified case-management agency. The bill
authorizes the Colorado housing and finance authority (authority) to
reallocate unused credits from the set aside at the end of a calendar year
for allocation to any eligible project.
        The bill amends the state affordable housing tax credit (state tax
credit) to require the authority to provide priority scoring or preference to
qualified developments that have received a federal tax credit as a
qualified community integration housing development and that continue
to meet all requirements for community integration housing. The
requirement for priority scoring or preference does not waive or otherwise
limit the authority's ability to enforce all applicable eligibility
requirements or to determine the amount of the state tax credit to be
allocated to any qualified development.
1 Be it enacted by the General Assembly of the State of Colorado:
2SECTION 1. In Colorado Revised Statutes, add 39-22-572 as
3 follows:
439-22-572. Federal low-income housing tax credit ceiling set
5 aside for community integration housing - legislative declaration -
6 definitions.
7(1) THE GENERAL ASSEMBLY FINDS AND DECLARES THAT:
8(a) THERE IS A SIGNIFICANT UNMET NEED IN COLORADO FOR
9 INTEGRATED, AFFORDABLE HOUSING FOR PERSONS WITH INTELLECTUAL
10 AND DEVELOPMENTAL DISABILITIES;
11(b) THE DEVELOPMENT OF COMMUNITY-BASED HOUSING THAT
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1 COMPLIES WITH FEDERAL HOME- AND COMMUNITY-BASED SERVICES
2 SETTINGS REQUIREMENTS (COMMUNITY INTEGRATION HOUSING) IS VITAL
3 TO MEETING THIS NEED AS WELL AS THE STATE'S OBLIGATIONS UNDER
4 FEDERAL LAW; AND
5(c) ESTABLISHING AN ALLOCATION PRIORITY FOR COMMUNITY
6 INTEGRATION HOUSING TO RECEIVE FEDERAL LOW-INCOME HOUSING TAX
7 CREDITS THROUGH A QUALIFIED ALLOCATION PLAN WILL ENCOURAGE AND
8 SUPPORT DEVELOPMENTS TO ADDRESS THIS SPECIFIC HOUSING NEED.
9(2) AS USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE
10 REQUIRES:
11(a) "AUTHORITY" MEANS THE COLORADO HOUSING AND FINANCE
12 AUTHORITY CREATED IN SECTION 29-4-704.
13(b) "CASE MANAGEMENT AGENCY" HAS THE MEANING SET FORTH
14 IN SECTION 25.5-6-1702 (2).
15(c) "COMMUNITY-CENTERED BOARD" HAS THE MEANING SET
16 FORTH IN SECTION 25.5-6-1702 (5).
17(d) "DEPARTMENT" MEANS THE DEPARTMENT OF HEALTH CARE
18 POLICY AND FINANCING.
19(e) "FEDERAL TAX CREDIT" MEANS THE FEDERAL LOW-INCOME
20 HOUSING TAX CREDIT PROVIDED BY SECTION 42 OF THE INTERNAL
21 REVENUE CODE THAT IS ALLOCATED BY THE AUTHORITY PURSUANT TO A
22 COMPETITIVE PROCESS ESTABLISHED IN THE QUALIFIED ALLOCATION PLAN.
23(f) "FEDERAL TAX CREDIT CEILING" MEANS THE AGGREGATE
24 DOLLAR AMOUNT OF FEDERAL TAX CREDITS THAT THE AUTHORITY MAY
25 ALLOCATE FOR ANY CALENDAR YEAR IN ACCORDANCE WITH SECTION 42
26 (h)(3)(C) OF THE INTERNAL REVENUE CODE.
27(g) "HCBS SETTINGS RULE" MEANS THE FEDERAL REGULATORY
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1 REQUIREMENTS FOR ANY HOME- AND COMMUNITY-BASED SERVICES
2 SETTING SET FORTH IN 42 CFR 441.301(c)(4).
3(h)    "HCBS WAIVER SERVICES" MEANS THE HOME- AND
4 COMMUNITY-BASED SERVICES FOR PERSONS WITH INTELLECTUAL AND
5 DEVELOPMENTAL      DISABILITIES   ALLOWED    TO   BE   FURNISHED    IN
6 NON-INSTITUTIONAL, COMMUNITY SETTINGS AS AN ALTERNATIVE TO
7 INSTITUTIONAL CARE PURSUANT TO 42 U.S.C. SEC. 1396n(c).
8(i)   "PERSON WITH AN INTELLECTUAL AND DEVELOPMENTAL
9 DISABILITY" HAS THE MEANING SET FORTH IN SECTION 25.5-10-202 (26).
10(j)   "QUALIFIED ALLOCATION PLAN" MEANS THE QUALIFIED
11 ALLOCATION PLAN ADOPTED BY THE AUTHORITY PURSUANT TO SECTION
12 42 (m) OF THE INTERNAL REVENUE CODE.
13(k)     "QUALIFIED     COMMUNITY       INTEGRATION    HOUSING
14 DEVELOPMENT" MEANS A "QUALIFIED LOW-INCOME HOUSING PROJECT", AS
15 THAT TERM IS DEFINED IN SECTION 42 OF THE INTERNAL REVENUE CODE,
16 THAT IS:
17(I) LOCATED IN COLORADO; AND
18(II) DETERMINED BY THE AUTHORITY TO MEET THE REQUIREMENTS
19 FOR COMMUNITY INTEGRATION HOUSING SET FORTH IN SUBSECTION (4)(b)
20 OF THIS SECTION.
21(3) THE AUTHORITY SHALL SET ASIDE NOT LESS THAN TEN PERCENT
22 OF THE ANNUAL FEDERAL TAX CREDIT CEILING FOR ALLOCATION TO
23 QUALIFIED COMMUNITY INTEGRATION HOUSING DEVELOPMENTS, AS
24 DEFINED IN SUBSECTION (2)(k) OF THIS SECTION; EXCEPT THAT, ANY
25 AMOUNT OF CREDIT SET ASIDE FOR QUALIFIED COMMUNITY INTEGRATION
26 HOUSING DEVELOPMENTS REMAINING AFTER THE RANKING OF PROJECTS
27 BUT PRIOR TO THE FINAL ALLOCATION CYCLE OF ANY CALENDAR YEAR
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1 SHALL BE AVAILABLE FOR ALLOCATION TO ANY ELIGIBLE PROJECT.
2(4) (a) EXCEPT AS PROVIDED IN SUBSECTION (4)(b) OF THIS
3 SECTION, THE AUTHORITY SHALL DETERMINE ELIGIBILITY FOR A CREDIT
4 AND ALLOCATE CREDITS SET ASIDE PURSUANT TO SUBSECTION (3) OF THIS
5 SECTION IN ACCORDANCE WITH THE QUALIFIED ALLOCATION PLAN.
6(b)     THE AUTHORITY SHALL ALLOCATE A CREDIT SET ASIDE
7 PURSUANT TO THIS SECTION ONLY TO PROPOSED DEVELOPMENTS
8 DETERMINED BY THE AUTHORITY, IN CONSULTATION WITH THE
9 DEPARTMENT, TO HAVE MET THE FOLLOWING REQUIREMENTS FOR
10 COMMUNITY INTEGRATION HOUSING:
11(I) DESIGN, DEVELOPMENT, AND OPERATION IN COMPLIANCE WITH
12 THE HCBS SETTINGS RULE, AND ANY SUCCESSOR PROVISIONS, AS WELL AS
13 ANY RELATED STATE STATUTES OR REGULATIONS;
14(II)    RESERVATION OF AT LEAST TWENTY PERCENT OF THE
15 RESIDENTIAL DWELLING UNITS FOR OCCUPANCY BY PERSONS WITH
16 INTELLECTUAL AND DEVELOPMENTAL DISABILITIES, WITH TENANT
17 SELECTION POLICIES FOR SUCH RESERVED UNITS THAT PROVIDE PRIORITY,
18 TO THE EXTENT PERMITTED BY FEDERAL LAW, TO PERSONS WITH
19 INTELLECTUAL AND DEVELOPMENTAL DISABILITIES WHO ARE ELIGIBLE FOR
20 HCBS WAIVER SERVICES ADMINISTERED BY THE DEPARTMENT; AND
21(III)     FORMAL   PARTNERSHIP, EVIDENCED BY A WRITTEN
22 AGREEMENT, WITH A COMMUNITY-CENTERED BOARD OR A CASE
23 MANAGEMENT AGENCY CERTIFIED BY THE DEPARTMENT.
24(5) NOTHING IN THIS SECTION SHALL BE CONSTRUED TO:
25(a) REQUIRE THE ALLOCATION OF A FEDERAL TAX CREDIT TO A
26 DEVELOPMENT THAT DOES NOT COMPLY WITH SECTION 42 OF THE
27 INTERNAL REVENUE CODE OR THE ELIGIBILITY REQUIREMENTS IN THE
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1 QUALIFIED ALLOCATION PLAN; OR
2(b) PROHIBIT A COMMUNITY INTEGRATION HOUSING DEVELOPMENT
3 FROM COMPETING FOR FEDERAL TAX CREDITS OUTSIDE THE SET ASIDE
4 ESTABLISHED BY SUBSECTION (3) OF THIS SECTION.
5SECTION 2. In Colorado Revised Statutes, 39-22-2102, add
6 (8.5) as follows:
739-22-2102.    Credit against tax - affordable housing
8 developments - legislative declaration.
9(8.5) (a) IN ADMINISTERING THE CREDIT ALLOWED BY SUBSECTION
10 (1) OF THIS SECTION, THE AUTHORITY SHALL PROVIDE PRIORITY SCORING
11 OR PREFERENCE IN THE COMPETITIVE EVALUATION OF APPLICATIONS FOR
12 THE CREDIT TO A QUALIFIED DEVELOPMENT THAT:
13(I) HAS BEEN ALLOCATED A FEDERAL TAX CREDIT SET ASIDE
14 PURSUANT TO SECTION      39-22-572    AS A QUALIFIED COMMUNITY
15 INTEGRATION HOUSING DEVELOPMENT; AND
16(II) CONTINUES TO MEET THE REQUIREMENTS FOR COMMUNITY
17 INTEGRATION HOUSING SET FORTH IN SECTION 39-22-572 (4)(b).
18(b)   THE PRIORITY SCORING OR PREFERENCE REQUIRED BY
19 SUBSECTION (8.5)(a) OF THIS SECTION MUST BE IMPLEMENTED THROUGH
20 THE AUTHORITY'S APPLICATION SCORING CRITERIA OR SELECTION
21 PRIORITIES AND DOES NOT REQUIRE THE ALLOCATION OF A CREDIT TO A
22 QUALIFIED DEVELOPMENT THAT FAILS TO MEET ALL OTHER ELIGIBILITY,
23 UNDERWRITING, OR FEASIBILITY REQUIREMENTS.
24(c) NOTHING IN THIS SUBSECTION (8.5) LIMITS THE AUTHORITY OF
25 THE AUTHORITY TO DETERMINE THE AMOUNT OF THE CREDIT ALLOCATED
26 TO ANY OWNER OF QUALIFIED DEVELOPMENT OR TO ENSURE COMPLIANCE
27 WITH APPLICABLE STATE AND FEDERAL LAWS.
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1SECTION 3.  Act subject to petition - effective date -
2 applicability. (1) This act takes effect at 12:01 a.m. on the day following
3 the expiration of the ninety-day period after final adjournment of the
4 general assembly (August 12, 2026, if adjournment sine die is on May 13,
5 2026); except that, if a referendum petition is filed pursuant to section 1
6 (3) of article V of the state constitution against this act or an item, section,
7 or part of this act within such period, then the act, item, section, or part
8 will not take effect unless approved by the people at the general election
9 to be held in November 2026 and, in such case, will take effect on the
10 date of the official declaration of the vote thereon by the governor.
11(2) This act applies to any qualified application plan for federal
12 tax credits adopted by the authority on or after the applicable effective
13 date of this act.
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