Colorado Boosts Affordable Housing Tax Credits to $20M Annually

The Colorado General Assembly passed HB24-1434, signed into law by the governor on May 30, 2024, dramatically expanding the Affordable Housing Tax Credit administered by the Colorado Housing and Finance Authority (CHFA).[2] The bill increases annual allocations starting with $20 million in 2024, peaking at $20 million through 2031, and introduces an accelerated claiming schedule: 70% in the first year and 6% annually over the next five years.[2] It also creates a new refundable tax credit for low-income housing in certified transit-oriented communities, offering $2 million annually from 2025 to 2027, then jumping to $11 million in 2028 and $13 million in 2029.[2] This builds on prior expansions like HB22-1051, which extended the original $10 million annual cap through 2031, addressing Colorado's acute shortage where credits have leveraged federal 4% tax credits to produce about $146,000 per affordable unit from 2015-2020.[1][4] CHFA caps awards at $1 million per taxpayer per year over six years, totaling $6 million per project, and evaluations confirm the program subsidizes developments in high-demand metro areas like Denver, Aurora, and Colorado Springs.[4] The expansion reduces transfers to the housing development grant fund by $35 million annually from fiscal year 2024-25 through 2031-32 to fund these incentives.[2] Local leaders hailed the measure amid Colorado's housing crunch, where median rents in Denver exceed $2,000 monthly. Speaker Pro Tempore Andy Boesenecker, D-Fort Collins, called it a 'breakthrough' alongside related bills like SB26-001, which empowers counties and cities to sell or lease public land for workforce housing.[5] The credits target projects making units feasible for low- and middle-income families, leveraging Proposition 123 funds approved by voters in 2022.[5]