Proposition 123 Implementation

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Several hundred million dollars for affordable housing will become available in the second half of 2023 due to the enactment of Proposition 123 by Colorado’s voters in 2022. This funding will be overseen by the Department of Local Affairs and the Governor's Office of Economic Development and International Trade, and may be granted or loaned to the following types of organizations:

  • Non-profits
  • Community land trusts
  • Private entities
  • Local governments

Organizations are only eligible for this funding if their project or program take place in municipalities, counties, or tribes that have committed to increasing their affordable housing stock above a baseline amount; jurisdictions that have accepted commitment filings can be found at this link . Stakeholders should regularly visit this site to find explanatory articles and resources, and to offer feedback that shapes future materials, policies, and procedures relating to affordable housing commitments, and funding programs overseen by the Department of Local Affairs.

Several hundred million dollars for affordable housing will become available in the second half of 2023 due to the enactment of Proposition 123 by Colorado’s voters in 2022. This funding will be overseen by the Department of Local Affairs and the Governor's Office of Economic Development and International Trade, and may be granted or loaned to the following types of organizations:

  • Non-profits
  • Community land trusts
  • Private entities
  • Local governments

Organizations are only eligible for this funding if their project or program take place in municipalities, counties, or tribes that have committed to increasing their affordable housing stock above a baseline amount; jurisdictions that have accepted commitment filings can be found at this link . Stakeholders should regularly visit this site to find explanatory articles and resources, and to offer feedback that shapes future materials, policies, and procedures relating to affordable housing commitments, and funding programs overseen by the Department of Local Affairs.

  • Homeownership Program Outlines Coming March 29; Join the Stakeholder Forum April 17

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    The Division of Housing (DOH) will post proposed Proposition 123 homeownership program outlines on Engage DOLA on Friday, March 29, 2024. Stakeholders will be able to provide written feedback on the outlines between March 29 and April 26.

    DOH will hold an online Stakeholder Feedback Forum on the outlines on Wednesday, April 17 from 12:30 to 2 p.m. Staff will review the outlines and take questions, comments, and suggestions from stakeholders. To join the forum, use this Zoom link or call +1 719-359-4580 or +1 669-900-6833 and enter the code 87970042641#.

    Staff will post final homeownership program guidelines on May 31 and begin accepting initial applications on July 1.

    If you have any questions, let us know.

  • $2.6 Million Awarded to Support Affordable Housing Planning Efforts by Local Governments

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    Division of Local Governments has awarded $2.6 million in grant awards to 25 projects in the first round of Local Planning Capacity grants, a new grant program established by Proposition 123, the State Affordable Housing Fund. View a list of awardees and project descriptions.

    The next round of applications will be open May 1 - 31, 2024 with an informational webinar for prospective applicants scheduled on April 11 from 12:30 - 2pm. Grant application materials will be posted in early April and interested applicants are encouraged to register for the webinar and book a pre-application meeting with the LPC Program Manager Robyn DiFalco to discuss your proposed project.

    Local Planning Capacity grants support local government efforts to implement systems that fast track or expedite the development review process for affordable housing. These funds can also support local government capacity to achieve local affordable housing goals and local governments’ Prop 123 commitments. Most grantees will be exploring land use code amendments, implementing process improvements to streamline the development review process, or investing in permitting software as part of their strategy. Others will use grant funds to inventory potential properties for future affordable housing projects, designate a liaison to work with developers, implement a housing action plan, or work on other projects such as preservation of mobile home parks.


  • Proposition 123 Homelessness Funding Forum Recap: Insights, Feedback, and Next Steps

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    The Division of Housing was grateful to have over 100 community partners register to attend our Proposition 123 Homelessness Funding Proposal Feedback Forum held on January 24th.


    Throughout the Forum, stakeholders provided thoughtful questions and insights about Division of Housing’s Strategy & Funding Approach for Proposition 123’s Program Serving Persons Experiencing Homelessness.

    The Division encourages stakeholders to review slides from the session and the recording.


    Feedback

    Any additional feedback or ideas about the proposed approach to homelessness funding through Proposition 123, can be submitted through the feedback survey, which will stay open through January 26th.

    The Division will share notes on what was learned from the Forum and the survey when available.

  • Petition by the Town of Frisco to Increase Income Limits for AHFF Programs

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    Introduction

    The Town of Frisco has submitted a petition to the Division of Housing within the Department of Local Affairs to use different percentages of median income than those percentages specified in statute for the following programs: the Land Banking Program (C.R.S. 29-32-105.5 (3)(a)) and the Concessionary Debt Program (C.R.S. 29-32-105.5 (3)(c)). These programs are administered by the Colorado Housing and Finance Authority and overseen by the Governor’s Office of Economic Development and International Trade. Though the Division is not responsible for these programs, it is charged by statute (C.R.S. 29-32-105.5 (2)) to review petitions by localities that eligible projects within them be subjected to different income limits from those explicated in statute.

    Scope of Petition

    The increase of income limits for projects sited in the Town of Frisco receiving funds through the Land Banking Program and applicable activities within the Concessionary Debt Program* to 80% of Area Median Income (AMI), either on a per-unit basis or on average for all units in a project as allowable by statute. This does not include the Affordable Housing Equity Program. If approved, the petition will remain in effect from its approval date through December 31, 2026.

    Current Area Median Income limits for these programs are as follows:

    • Land Banking Program - 60% max AMI for Rental, 100% max AMI for Homeownership
    • Affordable Housing Equity Program - 90% average AMI or below
    • Concessionary Debt Programs - 60% average AMI or below

    *In cases where debt financing is provided to low and middle-income multi-family housing rental developments, existing affordable housing projects, or preserving existing affordable multi-family rental units.

    Process

    The Division of Housing must follow the following process required by statute (C.R.S. 29-32-105.5 (5)):

    The Division may approve the petition to use different percentages of area median income, but only if:

    • The submitted housing needs assessment:
      • Is published by the state or is a local housing needs assessment that utilizes data from the state demographer or other publicly accessible sources, which in either case may be supported by other relevant and verifiable community data;
      • Has been completed within the past three years of the petition date; and
      • Is accompanied by a narrative description of why other funding sources cannot be utilized, are not sufficient, or are not accessible to meet the housing needs described within the petition; and
    • The Division determines that the current eligibility standards would cause implementation of this article in a manner inconsistent with demonstrated housing and workforce needs within the jurisdiction, taking into consideration regional workforce commuting trends.

    In the event that the petition is approved, the new income limits will be based on the average needs identified in the housing needs assessment (C.R.S. 29-32-105.5 (6)), and public comments will be considered in the review of the petition (C.R.S. 29-32-105.5 (4)). No recommendation will be made on approval or denial of the petition until the public comment period is complete and the comments are considered in the recommendation. If Division of Housing staff recommend the denial of the petition, then the petitioner may appeal the staff recommendation to the Division Director of the Division of Housing.

    Implications

    If the petition is approved then eligible affordable housing projects can make units available to households with higher incomes than would otherwise be possible.

    If the petition is denied, then affordable housing projects currently under consideration may become financially infeasible in the event that they require higher revenues generated by higher income households. If demand for affordable housing is still present at lower income levels, they may be unable to afford the higher rents of these higher income units, potentially making less affordable housing units available for lower income households than would otherwise be required.

    Basis of Petition

    A housing needs assessment of Summit County, produced in 2023, that utilizes data from the state demographer, other publicly accessible sources, and is supported by other relevant and verifiable community data. In describing why other funding sources cannot be utilized, are not sufficient, or are not accessible to meet the housing needs described within the petition, the petitioner wrote: “[a]ll available funding sources accessible to the project, which meet individual DOLA/CHFA program guidelines are being requested. Due to the project's economic proforma, to meet the community's AMI need a higher AMI exception is requested.”

    Public Comments

    Public comments will be accepted at this link for 30 days, starting on the date that the Division of Housing posts notice that a petition has been filed on its website. The petition and relevant attachments will be included in the notice, and available at this link.

  • Share your thoughts on the Division of Housing's approach to addressing homelessness through Proposition 123.

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    The Division of Housing’s Office of Homeless Initiatives has prepared a new document detailing the proposed allocation and distribution of Proposition 123 funding to address homelessness.

    The document draws from Proposition 123, stakeholder input, Governor Polis’ priority, and Colorado’s Making Homelessness History Playbook. It aims to adhere to Affordable Housing Support Fund guidelines, focusing on Coloradans facing homelessness.

    It covers the strategy, application methods, funding allocations for the present year, and plans for the second year.

    Provide Feedback

    Feedback Survey

    Stakeholders are encouraged to share input and feedback on the proposed plan through this survey by January 12, 2024.

    Feedback Forum

    This meeting will provide an opportunity for participants to preview the Colorado Department of Local Affairs, Division of Housing (DOLA/DOH) strategy for the utilization of Proposition 123 resources for persons experiencing homelessness. Community partners and stakeholders are encouraged to attend and share their feedback on the proposal.

    Register to participate in our upcoming meeting on January 24, 2024, at 3:00 p.m.

    Questions

    If you have any questions please let us know.

  • Proposition 123: What does filing a commitment mean?

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    As part of Proposition 123, local and tribal governments must first file a commitment to the Department of Local Affairs to increase their affordable housing by 3% per year over three years, for a total of 9%.

    Filing a commitment makes a local government or tribe, along with entities operating within their jurisdiction, eligible to apply for funding through the programs implemented by the Colorado Department of Local Affairs (DOLA), the Office of Economic Development & International Trade (OEDIT), and/or the Colorado Housing and Finance Authority (CHFA). Organizations and developers are only eligible for this funding if their project or program takes place in a municipality, county, or tribe that has successfully filed a commitment to increasing their affordable housing stock above a baseline amount.

    Filing a commitment does not immediately designate funding to a local government or tribe. Once a jurisdiction becomes eligible for funding through the filing of a commitment, they must submit an application for the respective program to OEDIT/CHFA and/or DOLA.

    The commitment filing period for 2023 expired on November 1, 2023. New commitments will be accepted in summer 2024.

  • Proposition 123 Commitment Updates

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    The Division of Housing (DOH) saw a tremendous response from local governments and received Prop 123 commitments from more than 202 of the 336 jurisdictions throughout Colorado. These jurisdictions account for 87.7% of the state’s population. A list of jurisdictions that have made this commitment can be found here. For a project to be eligible for Proposition 123 funding, the county, municipality or tribal government was required to file a commitment by November 1, 2023, to increase affordable housing within each jurisdiction by 3% per year, for three years, for a total of a 9% increase.

    Passed by Colorado voters in 2022, Proposition 123 created the State Affordable Housing Fund, dedicating 40% of funds to the Affordable Housing Support Fund administered by the Department of Local Affairs (DOLA) and 60% to the Affordable Housing Financing Fund overseen by the Office of Economic Development & International Trade (OEDIT) to fund housing programs.

    The three Affordable Housing Support administered by the Department of Local Affairs (DOLA) are:

    • Affordable Home Ownership - up to 50% of the Support Fund and administered by DOH
      • $32 million in Year 1 and estimated to be $63.6 million in Year 2
    • Program Servicing Persons Experiencing Homelessness - up to 45% of the Support Fund and administered by DOH
      • $28.8 million in Year 1 and estimated to be $57.24 in Year 2
    • Local Planning Capacity Development Program - up to 5% of the Support Fund and administered by the Division of Local Government (DLG)
      • $3.2 million in Year 1 and estimated to be $6.36 million in Year 2


  • Rural Resort Petition Process:

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    Organizations applying for funding through the Proposition 123 - Affordable Housing Financing Funding, administered by the Colorado Housing and Finance Authority (CHFA), may be eligible for policy flexibilities if their project is located in a county or municipality that is classified as a Rural Resort Community.

    By filing a petition, these projects may serve households with higher incomes than would otherwise be allowable -- assuming the petition is approved by the Division of Housing within the Department of Local Affairs.

    Only petitions submitted by a local government will be accepted, other interested entities such as developers or non-profits must have a local government submit a petition on their behalf.

    This petition can only increase income limits for projects that are awarded funding through the Land Banking Program, Equity Program, and Concessionary Debt programs administered by CHFA. Projects that have not been awarded funding from these programs cannot benefit from this petition.

    A petition submitted by a local government and accepted by DOH is considered valid for the entire jurisdiction for the duration of the current 3-year funding cycle.

    An informational handout on the petition process is available here.

    Access the online Rural Resort Petition Form through your AccessGov.com account.

  • Local Planning Capacity Grant Program Launch

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    DOLA is pleased to announce the Local Planning Capacity (LPC) grant program, made possible by Proposition 123 with funding from the Statewide Affordable Housing Support Fund. This grant program will be managed by the Community Development Office (CDO) within DOLA’s Division of Local Government (DLG).

    October 19th Informational Webinar for Local Government Input:

    Local government representatives are invited to participate in an informational webinar outlining the requirements and allowable activities under the Local Planning Capacity Grant Program. This interactive session will give local governments an opportunity to ask questions and give input on the final program guidelines. Comments may also be submitted via phone or email.

    Estimated Program Timeline for Year 1 (2023-2024):

    • Thursday, October 19 – Informational Webinar
    • Monday, October 23 – deadline to submit stakeholder input on grant program guidelines through 5pm.
    • November 1 – Letter of Interest (LOI) opens; accepted through December 4
    • Mid-December – Notification of invitations to apply
    • January 3 - February 15, 2024 – Full Application is open, through the DLG Online Grants Portal per the Notice of Funding Availability (NOFA).
    • March 2024 – Estimated Grant Award notification.


    More information about this grant program is available on the Program website.

    The intent of the program is to increase the capacity of local government planning departments responsible for processing land use, permitting, and zoning applications for housing projects. The program supports local governments’ capacity to address affordable housing, especially by expediting review, permitting, zoning, and development for which 50% or more of the residential units constitute affordable housing. Grant funds could support new staff wages, hiring consultants, implementing new systems and technologies, revising land use development codes, regional collaborations, developing future commitments, or other efforts that achieve fast track goals by 2026, as required by Proposition 123.

  • Rural Resort Community Petition Process Launched

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    Organizations applying for funding from the Affordable Housing Financing Funding, administered by the Colorado Housing and Finance Authority (CHFA) and overseen by the Governor's Office of Economic Development and International Trade, may be eligible for policy flexibilities if their project is located in a county or municipality that is classified as a Rural Resort Community.


    By filing a petition, these projects may serve households with higher incomes than would otherwise be allowable -- assuming the petition is approved by the Division of Housing within the Department of Local Affairs.


    Staff of local governments may submit a Petition to Increase Income Limits in Rural Resort Communities at this link.


    Only petitions submitted by a local government will be accepted, other interested entities such as developers or non-profits must have a local government submit a petition on their behalf.


    This petition can only increase income limits for projects that are awarded funding through the Land Banking Program, Equity Program, and Concessionary Debt programs administered by CHFA. Projects that have not been awarded funding from these programs cannot benefit from this petition.


    Instructions on how to complete the petition, as well as other context and restrictions, are available at the link above.

Page last updated: 22 Mar 2024, 03:43 PM