Proposition 123 Commitment Filing Now Open (2-Year 6%)

The State Division of Housing / Department of Local Affairs is excited to announce that the Proposition 123 commitment filings are now open. Municipalities, counties, and tribes may submit a commitment to annual increases in affordable housing using our online form.

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). Local governments, non-profits, community land trusts, private entities, 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.

Programs from the Office of Homeless Initiatives are the only programs that can award funding to jurisdictions, or entities operating within them, that do not require a commitment on file.

Local governments that made an accepted commitment in 2023, do not need to submit an additional commitment until 2026. A list of jurisdictions that have previously made commitments is available online.

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 DOLA and 60% to the Affordable Housing Financing Fund overseen by OEDIT to fund housing programs.

The three Affordable Housing Support administered by 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

Due Date: November 1, 2024

DOH and its partners will be working with any interested local government to file its commitment no later than the deadline established in Proposition 123, which is November 1, 2024. Funding programs may be available sooner than the November 1st deadline, so DOH encourages local governments to commit as soon as possible.

Eligibility

If your jurisdiction previously filed a commitment for the 3-year (9%) cycle in 2023, a new commitment is not needed at this time. Only authorized officials of county and municipal governments and tribes, or persons acting on their behalf, may submit a filing.

Filing Process

Once an interested local government has determined its baseline amount of affordable housing units, it can then plan its commitment to increase that number by 3% each year for a 2-year period ending on December 31, 2026. The dissemination of baseline data for a local government’s consideration is the first step toward achieving this important goal. The Baseline Assistance Tool can be used by any interested stakeholder to develop a baseline amount of affordable housing, so that it can be incorporated into a commitment to annual increases in affordable housing. Local governments may submit a commitment using our online form.

Compliance

Proposition 123 requires a local government to file a commitment specifying how it will increase a combination of its newly constructed affordable housing units and its existing units converted to affordable housing over its determined baseline number of affordable housing units by 3% each year. DOH interprets this to mean that ultimately a demonstration of a 6% increase over the baseline at the end of the 2-year commitment period ending on December 31, 2026, satisfies this requirement even if a 3% increase may not be accounted for in a particular year during that time frame.

If a commitment is not filed by November 1, 2024, then a local government and any development project in its jurisdiction are ineligible to receive any funding established by Proposition 123 during the 2025 calendar year. If this is to occur, a local government may file a commitment by November 1, 2025, for a 1-year commitment to increase its affordable housing stock by a total of 3% by December 31, 2026.

If a local government is unable to meet its 6% total commitment by December 31, 2026, then it and any development project in its jurisdiction are ineligible to receive any funding established by Proposition 123 for calendar year 2027. The good news is it may file a new commitment by November 1, 2027, for a 2-year commitment to increase its affordable housing stock by a total of 6% by December 31, 2029.

Beginning on January 1, 2027, expedited review (fast-track) is required for projects with 50% or more affordable housing units, as per statute. Local governments will need to demonstrate they have implemented a system to expedite the development approval process for affordable housing projects when filing their Proposition 123 commitments by November 1, 2026.

Detailed guidance on the expedited review (fast-track) requirements is available to provide strategies and examples on how local governments can create an expedited review process that takes into account their unique local context. Grant funding is available to support local governments with the implementation process.

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