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Committee votes 6‑0 to introduce Proposition 123 bill making portions of housing funds subject to appropriation
Summary
The committee approved introduction of a bill (LOS 25‑9‑11) to clarify maintenance‑of‑effort rules for Proposition 123, make certain administrative and state‑facility uses subject to appropriation beginning fiscal 2026‑27, and preserve flexibility over allocations; motion passed 6‑0 and sponsors were named.
The Joint Budget Committee voted to introduce a bill (LOS 25‑9‑11) that would clarify how Proposition 123 funds are treated, make certain uses subject to appropriation, and set a 5 percent administrative allowance.
Ms. Bickel presented the draft and reminded the committee that Proposition 123 currently yields roughly $130 million to $140 million a year, of which 60 percent is routed through the governor’s office to the Colorado Housing and Finance Authority (CHFA). The draft bill makes a portion of the Department of Local Affairs (DOLA) allocation subject to appropriation effective fiscal 2026‑27; it also would make funds allocated for administration subject to appropriation while statutorily allowing administration equal to 5 percent of total receipts. The draft permits the committee, through the appropriation process, to set caps for spending on state homeless campuses (Fort Lyon and Ridgeview) for operating or capital uses if the committee chooses to do so.
Committee members discussed whether the bill should allow capital construction uses for Fort Lyon and Ridgeview; the draft could make capital uses allowable but would not require such spending. Members also discussed maintenance‑of‑effort language intended to ensure Proposition 123 supplements rather than supplants existing affordable housing funding. Staff and the governor’s office had worked to produce language the JBC considered viable, staff said.
Representative Taggart asked how the 5 percent administrative allowance would be treated across years; staff said appropriations set the actual cap each year and that unspent administrative allowance could be appropriated in later years only by action of the General Assembly. Multiple members said they did not want a statutory set‑aside guaranteeing money to nonprofits and that appropriations should allow discretion given limited funds.
Representative motioned to introduce the bill; the motion passed 6‑0. Senate sponsors were identified as Senator Mabile and Senator Bridges with Senator Kirkmeyer cosponsoring; House sponsors were Representative Byrd and Representative Serota with Representative Taggart cosponsoring. The committee directed staff to proceed with introduction.
