Editor’s note: Proposition 123 was approved by Colorado voters in 2022, and provided funding to the State of Colorado for housing initiatives, such as improvements in the Chris Mountain subdivision currently underway here in Archuleta County.
The following press release, from Governor Jared Polis’ office and the Office of Economic Development and International Trade (OEDIT), was sent out courtesy Housing Colorado. When I pasted the content into a fresh page, the following text — which had not been visible in the original email — appeared at the beginning of the press release:
AI-generated content may be incorrect.
Dear reader, consider yourself warned.
A challenging budget environment created by the federal H.R.1 [One Big Beautiful Bill] has required the Colorado State Legislature and the Governor to make tough decisions about program funding, including activating the voter-approved Proposition 123’s budget balancing mechanism that allows the state to reallocate dollars to the General Fund when state revenue is below the TABOR cap.
OEDIT is working closely with the Governor’s Office and our partners at Colorado Housing and Finance Authority (CHFA) to ensure that the Affordable Housing Financing Fund continues to support housing Coloradans can afford across the state.
A few clarifications regarding these developments.
Last week, the Polis Administration submitted a budget balancing plan, pursuant to legislation passed in the recent special legislative session to the Joint Budget Committee that activates Proposition 123’s budget balancing mechanism and includes a proposed one-time future reduction of $105 million in OEDIT’s Proposition 123 funds (the Affordable Housing Financing Fund) available for award during fiscal year 2026-2027 (July 1, 2026 through June 30, 2027)
The Proposition 123 statutory ballot language included in the original voter-approved ballot initiative allows the General Assembly to reduce the transfer to the Prop 123 AHFF (OEDIT/CHFA managed programs) in years when state revenues are below the TABOR cap. This critical language helps to ensure the state does not need to cut other key priorities like education during times in which the state is under the TABOR cap.
It is important to note that the budget request does not affect the $190 million in funding that is currently available for awards now through June 2026. Additionally, it will not impact projects that have previously been awarded funds.
The Governor has indicated that remaining FY 26-27 funds would be used to maximize Colorado’s ability to leverage federal dollars to create housing in the state, among other priorities. One area of anticipated focus is gap financing for projects that have already received federal low income housing tax credits (LIHTC).
Ultimately, this proposal will be submitted to the General Assembly for review as part of the Governor’s supplemental budget requests, along with the other proposed cuts due to H.R.1.