Colorado Boosts Affordable Housing Tax Credits by $1.17B Through 2031

The Colorado General Assembly passed HB24-1434 in 2024, signed into law by the governor on May 30, dramatically expanding the Affordable Housing Tax Credit administered by the Colorado Housing and Finance Authority (CHFA). The bill increases annual credit allocations starting with $20 million in 2024, peaking at $20 million through 2031, on top of the existing $10 million cap extended previously by HB22-1051 to 2031.[1][2] This expansion, coupled with new credits, represents a $1.17 billion investment in affordable rental housing from 2024 to 2031, building on the program's track record of delivering 10,782 units since 2014.[6] Key innovations include a new refundable tax credit for affordable housing in certified transit-oriented communities, such as those near RTD lines in Denver and along the Front Range. Allocations begin at $2 million in 2025, surging to $13 million by 2029, with an accelerated claiming schedule: 70% in year one, followed by 8% in years two and three, and 7% in years four and five.[2] Credits cap at $1 million per project annually over six years, requiring developers to maintain affordability for 30 years, delivering an average $7,632 annual rent discount per unit at 50-60% of area median income (AMI)—for instance, $25,000 income in a $50,000 AMI area.[4] The measure addresses Colorado's acute shortage, where Front Range cities like Denver, Aurora, and Colorado Springs face median rents exceeding $1,800 amid population growth. By reducing transfers to the housing development grant fund by $35 million annually through 2031-32, it redirects resources to tax incentives, spurring projects in high-demand zones.[2] CHFA awards credits only as needed for financial feasibility, targeting 20% of units at 50% AMI or 40% at 60% AMI.[4] Supporters, including CHFA advocates, hail the package as historic, aligning with Proposition 123's housing funds from 2022 voter approval. While HB26-1061 proposes reserving 10% of federal low-income credits for community integration housing, HB24-1434 stands as the primary driver for immediate expansion.[3][6]