Sustainable Affordable Housing Assistance

Housing needs assessments. The bill requires the executive director of the department of local affairs (director), no later than December 31, 2024, to develop reasonable methodologies for conducting statewide, regional, and local housing needs assessments and reasonable guidance for a local government to identify areas at elevated risk of displacement.

The bill requires the director, no later than November 30, 2027, and every 6 years thereafter, to conduct a statewide housing needs assessment that analyzes existing and future statewide housing needs and to publish a report identifying current housing stock and estimating statewide housing needs.

The bill requires each local government, beginning December 31, 2026, and every 6 years thereafter, to conduct and publish a local housing needs assessment. The bill outlines the process for a local government conducting a local housing needs assessment and for determining when a local government is exempt from conducting a local housing needs assessment. The bill requires local governments to submit local housing needs assessments to the department of local affairs (department), which shall publish those assessments on the department's website.

Relatedly, the bill allows a regional entity to conduct a regional housing needs assessment. If a regional entity conducts a regional housing needs assessment, the bill requires the regional entity to submit the assessment both to each local government in the region and to the department, which shall publish those assessments on the department's website.

Housing action plans. A housing action plan is an advisory document that demonstrates a local government's commitment to address housing needs and that guides a local government in developing legislative actions, promoting regional coordination, and informing the public of the local government's efforts to address housing needs in the local government's jurisdiction. The bill requires a local government with a population of 1,000 or more to make a housing action plan no later than January 1, 2028, and every 6 years thereafter. The bill identifies the specific elements that a housing action plan must include, explains how a local government may update a housing action plan, requires a local government to report its progress in implementing the plan to the department, and requires a local government to submit a housing action plan to the department, which shall publish those assessments on the department's website. Publishing of reports. The bill requires the director to publish reports on the following no later than December 31, 2024:

• A directory of housing and land use strategies to guide local governments in encouraging the development of a range of housing types with a primary focus on increasing housing affordability; and
• A directory of housing and land use strategies to guide local governments in avoiding, reducing, and mitigating the impact of displacement.

The bill establishes the minimum required elements for both types of directories of housing and land use strategies. The bill also requires the director to develop and publish:

• No later than June 30, 2025, in consultation with the Colorado water conservation board, a joint report concerning water supply; and
• No later than December 31, 2025, in coordination with relevant state agencies, a natural land and agricultural interjurisdictional opportunities report.

Technical assistance. The bill requires the division of local government (division) to provide technical assistance and guidance through a grant program, the provision of consultant services, or both to aid local governments in:

• Establishing regional entities;
• Creating local and regional housing needs assessments;
• Making a housing action plan;
• Enacting laws and policies that encourage the development of a range of housing types or mitigate the impact of displacement; and
• Creating strategic growth elements in master plans.

The bill creates the continuously appropriated housing needs planning technical assistance fund to contain the money necessary for the division to provide this technical assistance and guidance. The bill requires the state treasurer to transfer $15 million from the general fund to this fund.

Further, the bill directs the division to serve as a clearing house for the benefit of local governments and regional entities in accomplishing the goals of the bill. The division shall report on the assistance requested and provided under the bill.

Grant program prioritization criteria. On and after December 1, 2027, for any grant program conducted by the department, the Colorado energy office, the office of economic development the department of transportation, the department of natural resources, the department of public health and environment, and the department of personnel and administration that awards grants to local governments for the primary purpose of supporting land use planning or housing, the bill requires the awarding entity to prioritize awarding grants to a local government that:

• Is the subject of a completed and filed housing needs assessment;
• Has adopted a housing action plan that has been accepted by the department;
• Has reported progress to the department regarding the adoption of any strategies or changes to local laws identified in the housing action plan; and
• Is the subject of a master plan that includes a water element and a strategic growth element.

In the case of a local government that is not required to do any of the above, the department is required to prioritize that local government in the same way that it prioritizes a local government that has done all of the above.

Master plans. The bill modifies the requirements of both county and municipal master plans so that those master plans must include:

• A narrative description of the procedure used for the development and adoption of the master plan;
• No later than December 31, 2026, a water supply element; and
• No later than December 31, 2026, a strategic growth element, so long as the county or municipality meets certain requirements.

The water element in a county or municipal master plan must identify the general location and extent of an adequate and suitable supply of water, identify supplies and facilities sufficient to meet the needs of local infrastructure, and include water conservation policies.

The strategic growth element in a master plan must include:

• A buildable sites analysis that identifies vacant, partially vacant, and underutilized land that can accommodate infill development, redevelopment, and new development without the development of previously undeveloped land;
• An identification of areas within a reasonable distance of rail transit and frequent bus service that can accommodate the development of housing to address the housing needs of current and future residents at all income levels; and
• A description of existing and needed infrastructure, transportation, and public facilities and services to serve these sites.

The bill requires both counties and municipalities to submit their master plan and any separately approved water or strategic growth element to the division for the division's review.

Prohibition contrary to public policy. The bill prohibits a unit owners' association of a common interest community from, through any declaration or bylaw, rules, or regulation adopted or amended by an association on or after July 1, 2024, prohibiting or restricting the construction of accessory dwelling units or middle housing, if the zoning laws of the association's local jurisdiction would otherwise allow such construction.
(Note: This summary applies to this bill as introduced.)