Committee advances bill to pilot Transit and Housing Investment Zones with state sales-tax increment financing

The House Finance Committee voted to advance HB 10-65 as amended to the Committee on Appropriations, endorsing a pilot program that uses state sales tax increment financing to support transit infrastructure and transit-oriented affordable housing.

Sponsors described the bill as a novel financing tool administered by the Office of Economic Development and International Trade (OEDIT) that would allow local governments and transit partners to form transit investment authorities and capture a share of the state sales tax increment inside a defined Transit and Housing Investment Zone. Initially proposed as a 1.5-mile radius around transit hubs, sponsors moved an amendment to allow up to a 2‑mile radius (and up to 3 miles in constrained mountain topography) and inserted language encouraging geographic diversity of awards.

The housing component creates a dedicated state housing tax credit, to be administered by the Colorado Housing and Finance Authority (CHFA), modeled on Colorado’s existing state affordable housing tax credit and designed to make development near transit financially feasible. Witnesses from CHFA, local governments, transportation districts and regional economic groups testified in support, citing benefits ranging from first/last mile improvements and multimodal connections to climate and economic development co-benefits.

Committee members pressed sponsors on accountability, TABOR compliance, projected caps and the selection process. Sponsors and witnesses pointed to several safeguards: mandatory third-party feasibility analyses as part of applications, annual audits and reporting requirements (page references cited in the bill), bond-market discipline on financing entities, and statutory limits on the number of pilot zones. Sponsors said they expected an initial pilot of 2–3 projects per year up to a small number overall (six projects in the statutory pilot) and that the bill includes both cumulative and annual caps.

The committee adopted a package of sponsor amendments (L001–L012) addressing radius and geographic distribution, clarifying definitions of base-year revenue and state sales tax increment, specifying applicant-paid third-party analysts (with hardship exceptions), and delineating interactions with existing regional tools (e.g., Regional Tourism Act). Representative Marshall offered, then withdrew, an amendment linking issuance of housing credits to TABOR surplus forecasts after discussion with sponsors.

After amendment, the committee moved HB 10-65 to Appropriations with a favorable recommendation; the committee vote recorded in the hearing was in favor (audio indicates an 8–4 vote). Supporters emphasized local control and solvency; opponents and skeptical members highlighted budget risk, project feasibility, permitting delays and the need to protect the general fund in downturns.

What happens next: HB 10-65, as amended, will proceed to Appropriations where fiscal staff and sponsors will be asked to detail caps, projected uptake, and the interplay with TABOR and other state revenue constraints.