House Transportation, Housing & Local Government [Mar 17, 2026 - Upon Adjournment]

Representatives Basenecker. Brooks. Excuse.

Lindsay. Here.

Pascal. Here.

Richardson. Here.

Velasco. Excuse.

Vice Chair Stewart. Here.

Thank you, Madam Chair. Sorry about my frog voice. And members of the committee, I'm here today to present House Bill 261316. Thank you for taking the time to hear this important consumer protection and property rights measure. So the story. I received a communication from the residents of Blackstone Community expressing frustration at the lack of transparency of the mandatory dues that they had to pay to a private for-profit golf club. That concern blossomed into over 200 people petitioning that private club to allow them to opt out for social and golf memberships for residents. These homeowners are legally forced to pay thousands of dollars in mandatory fees to a private country club, but they have absolutely no voice in how the club is run, no representation, and no right to see the club's budget. The more I investigated the situation, the more I realized that this was not just a typical neighborhood dispute. These residents have been caught in a highly unusual predatory legal loophole that strips them of their democratic rights. To understand the loophole, we have to look at how these communities have legally structured. This community is governed by a metro district under Title 32 of our state statutes. A special district or metro district is a quasi-municipal corporation and a political subdivision of the state. It is a local government and taxing authority designed to provide essential public services like fire protection, sanitation, water, parks, and recreation, and street improvements. Because it is a government entity, the law requires a metro district to have elections representation and complete transparency. Title 32 explicitly requires metro districts to post their annual budgets, their audited financial statements, and their board contact information on a public website. But here's the most alarming part of the situation. The private club is not in the metro district. The club property is entirely private, and the metro district does not run it. The Metro District does not mix funds with the club, and the Metro District does not actually provide the club amenities. Therefore, the club should have never been included in the Metro District covenants in the first place. The club is a separate legal entity providing services that are not essential to the district's function. Nothing in Title 32 allows Metro District powers to bind people to a private company like this. This model is so unique and problematic that even the Department of Real Estate is largely unfamiliar with it. If the metro district itself had contracted directly with the country club and paid them using tax dollars the situation would be much better In that scenario the metro district would simply be subcontracting a service The constituents could elect a different board to control the decisions and they would have complete financial transparency over how their money was being spent. But in this community, those democratic protections do not exist. This arrangement operates completely outside of standard Metro District functions. The covenants bypass the Metro District entirely and legally indenture the individual residents to indefinitely pay into a private third-party company. Simply because you live in this piece of land, you must join this for-profit business. There is no membership voting. There is no democracy. There is no financial transparency. Furthermore, because these residents live in a metro district rather than a standard HOA, they are not protected by the Colorado Common Interest Ownership Act, COIA. These types of covenants have no place in metro districts. A public government-sanctioned metro district is a taxing authority. It is not an authority to indent your residents to indefinitely pay into a private company. House Bill 261316 brings these shadow entities into the light. It simply says that if a private corporation is going to use a real estate covenant to force homeowners to pay them, they must open their books. They must provide the same exact basic budget transparency to the consumers that an HOA or a metrojistic would have to provide. Connoisseur homeowners deserve to know where their money is going, and they deserve protection from these types of contracts that tax them without representation. Thank you again for your time today and hearing this bill, and I urge an aye vote on House Bill 26-13-16.

Thank you very much, Rep. Hamrick.

Thank you, Madam Chair. And this might be a question for somebody else, Rep. Hamrick. Thank you for bringing the bill. The problem is obvious. My question is, knowing that in the information that we got from you, knowing that the contract that they have to pay for the social membership, knowing that it's unenforceable as a matter of law. So if somebody decides, hey, it's unenforceable anyway, so I'm not paying, and then if somebody took them to court or collections because they did not pay, then wouldn't it just be moot because it's unenforceable anyway?

Additional questions. Representative Paschal.

Representative Hamrick. So we'd like transparency from the private club that goes into why they increase dues. And by the way, over the last five years, social membership dues have increased by 200 percent. and there's no cap. We want to know why the dues have been increased specifically, not just market forces. We also want to know where the dues have been spent like the last year, right? And we want to know what their plan is to spend them in the future and just have some community involvement in informing the club how to spend the money So we really looking at that And then we that sort of the big part of the bill We're also looking at making sure this doesn't happen in the future for this very weird – we call it almost like a unicorn.

Representative Hamrick. Thank you for that question. So we're really trying to fix the transparency piece. That's a big part of the bill. So those private companies have to be transparent about reasons why they increase the dues and all that. And we're also looking at trying to focus on the specific issue of this very unique development so that it doesn't happen in the future. That said, we've been speaking with the Land Title Association of Colorado, realtors, golf course owners, and things like that. So that's one of the reasons that it will be laid over until a future date so that we can work all that out, because I do not want any unintended consequences.

And thank you. And I certainly appreciate your stakeholding. I just wonder, like, what is the, who are the two parties to the contract at present that would potentially be invalidated under the bill? On the one side, you have the homeowners who signed that contract. Who stands on the other side of that contract?

It would be the private company.

Just for clarification, so this bill says that, okay, so if I buy into this metro district and now I have to pay for the golf course, so this says that, and it's going to be transparent because this bill says it has to be shared when I buy in, but does it also say that, like, I don't have to pay?

So we have some residents that will be testifying today, and I think they can probably answer those finer details.

The private company.

Representative Hamrick.

I do not see any additional. So at the request of the sponsor, we'll start with oppose and amend. so a combination of in person and online please Brian Tanner, Rachel Carter yeah yeah we're getting there oh okay excuse me I misunderstood I thought you said first support panel or just first first alright okay Okay. Let's bring up online Karen Safran for questions only from the Department of Law. I apologize, folks, Brian. We'll get to you next panel. So this will just be by herself from the AG's office, the Department of Law, Karen Safran. Okay. Thank you.

Representative Bazenecker. Thank you, Madam Chair, and thank you for being here. A couple of questions that perhaps you heard from the conversation with Rep. Hamrick on the bill. I guess looking, if you have reviewed at least the documentation that she has shared from Davis-Graham and then what looks like the agreement that perhaps came from the particular case that that document speaks to, Just wondering, and the legislation as it stands, what contracts would be deemed null and void as a result of the legislation? And as you understand it, who stands on both sides of those transactions at present or that contract at present?

covenants. Representative Bazinecker. Thank you, Madam Chair, and thank you for that answer. And then in the issue of non-payment where a homeowner hasn't paid their dues to this private club, is it the Metro District in this instance that would be authorized to place a lien on the home as a result of that action or inaction? Ms. Safran. Thank you, Madam Chair. No, per the covenants,

Representative Bazinecker. Thank you, and I apologize. This is my last question. And then as a result of that relationship between the private club and the Metro District, so let's say the resident does not pay their dues, the private club makes the Metro District, I'm assuming, aware of that situation of non-payment. Is the Metro District obligated under law to place a lien on the property, or do they have that discretion inside of their relationship with the private club?

Representative Phillips. Thank you, Madam Chair. And my question is also for Ms. Safran. Okay, so if I bought into the Metro District and I'm not going to pay for the club, and now under the covenants the club is now going to do a lien on my property, then knowing that the covenants that make that possible are unenforceable as a matter of law, then how would they be able to proceed?

Representative Phillips. Thank you, Madam Chair. Ms. Safran, another question. So keep me in this scenario that I went to court and the judge said it's unenforceable as a matter of law, then can I go to all my neighbors in the Metro District and say,

we will go to opposition so again Mr. Tanner and Rachel Carter Mandy Hamahat Hamahata J. Karen Whitey O'Malley. That's a good name for St. Patrick's Day. And is there anyone in the room who wishes to testify in either amend or oppose position on House Bill 1316? Okay, Mr. Tanner, I see you poised. We are doing three minutes. Please proceed.

Thank you and Ms. Carter please proceed.

Thank you. And we'll go online to Jay Karen.

Thank you very much. And we are in a big debate over whether this is your real name. But Mr. O'Malley, please proceed.

Thank you. Committee, we have two folks online and two folks in front of us for questions. Representative Sucla.

Yes, sir.

Representative Sucla, Rachel Carter.

Thank you, Representative Sucla. I think that's a good question, and I think the intention was that we could work with the sponsor of the bill to find an amicable solution for her constituents. So our desire was to help address the constituents' concerns in a way that would be beneficial.

Representative Bezenegger. Thank you, Madam Chair. And this might be something that one of our online witnesses can speak to. Certainly welcome the panel, too. I think what I'm hearing most concern around is the invalidating of existing contracts and the impacts that has on a neighborhood overall in terms of what amenities are currently being funded, what might not be able to be funded. Hear that concern. I think one of the pieces of the bill, though, that has a good amount of merit is the transparency pieces. And I would say in particular, you do not function like a private business in as much as the folks who fund your business are obligated to do so through contract. And I think that's a very different situation as opposed to me going to Home Depot and saying, now show me your balance sheet. Now show me your projected income expenses, where all the money is going, how you're increasing costs over a year. That is a very different situation than the captive audience I think you have. And admittedly, one where folks have signed a contract. And so one of my concerns would be to push back on those transparency pieces in particular to not justify to residents where there's costs related to maintenance. If you're just increasing costs year over year because of inflation, how that looks. I'm curious how you understand the transparency pieces to be problematic in as much as I think ultimately it does reflect good governance in terms of how we are good stewards with other people's money that ultimately make the neighborhood a better place.

If you don't want to, Mr. Tanner, that's okay. This might be a question for our online folks.

belly whip there. Representative Phillips. Thank you, Madam

we'd be open in terms of that transparency piece out there again I think it's just to be clear this is a separate private club that's separate from the Metro District so again from the legislation last show like this is going to be a separate entity and I think this is where this legislation could impact in that piece representative Philip thank you madam chair but the but when somebody is buying in they're buying into a this specific example is about the golf course and it's in a

Mr. Tanner. Thank you, Philip, for that question there. In terms of how the information, in terms of whatever this ends up in terms of transparency pieces, I think we would be open to that piece. The one thing I do want to flag is when we start seeing about per property owner, I think some of the transparency, there's concern about individual people being listed in terms of the fees that they pay out there. But regarding the covenant, this is a restricted covenant that is purely between the private club and the property owner, and it's recorded as such. So this would come up in what's known as conditions, covenants, and restrictions when a property is under contract out there. And so this is where you would disclose that. And it would very clearly state that it's with this entity. This is the private club owner or operator out there who would then potentially have a lien if you do not pay dues within a certain period of time for this social membership, at least for this particular example out there. So, again, as a property owner, you would see that information during title and then you could object to it and terminate the contract right there. I think it's the next step in terms of, okay, so now you've agreed to purchase that property knowing that in the covenant, you're required to have a social membership out there. And I think that the piece where it sounds like from just the initial sort of that there complications for current property owners in terms of that transparency disclosure and that relationship with the private club So that the piece in terms of the transaction that we looking at in terms of what we would be open to

I do not see any additional questions. Thank you so much for joining us today. Thank you for joining us online. We'll bring up now our proponents, Dan Stone, Brian Matisse, Heather Garbers, and a couple of folks online, Timothy Flanagan, Joshua Riddell. I know it's our St. Patrick's yet another St. Patrick's panel

so please proceed

And we'll proceed with Mr. Stone.

Thank you. Thank you. One to our next witness. Can we call up Ms. Aguero online? And she can tell me how to properly maybe pronounce her name when it's her turn.

Thank you. And we'll go online to Mr. Riddell. And if Dr Deweese is online can you please join us after Mr Riddell Please proceed We doing three minutes Tell us who you are and who you represent if anyone uh good morning chairperson members of the committee my name is josh riddell

Thank you. Committee, we have one person online and three people in front of us for questions.

Mr. Matisse. Thank you, Representative Baysnaker. I'm going to answer the second part of the question first. I think that's easier to answer. The answer is no. Under the way the covenants are written in this case, the Metro District has no ability to sever it right now and go and look for some other corporation to run the amenities. The way it would be set up, the way it's been set up is that this particular entity, which frequently they have sold their rights to other corporations, just like any other business has the right to do. They would have the right as a third party beneficiary to enforce these covenants independent of the Metro District So the Metro District could enforce them or the club could enforce them independently So that answers the second part of the question They can't do it under the law. The first part of the question, could you repeat the first part again, Representative Bezenegger?

Mr. Matisse. Thank you, Madam Chair. Representative Baisnicker, I don't want to, I can't say for sure how that would be interpreted. The way I would interpret it is typically if the club ceases to exist, you would still have the property, you would still have the golf course, you would still have those private facilities. I think the thinking was is that whomever were to acquire that, If the club should fail, for example, and the property would be foreclosed on, there probably would be another owner of those facilities that would take over, and the owner of those facilities would then step into the shoes of the former entity. That being said, you are correct. The covenants are somewhat vague on that, and so I don't know if I can give you a direct answer to that, other than I believe the intent was whomever took over the facilities of the club through foreclosure or otherwise would have the ability to step into the position of the club as third-party beneficiary.

Mr. Matisse. Thank you, Madam Chair. Representative Baisnicker, I'm a bit confused. I mean, you've mentioned a couple times now the ability to invalidate these contracts. Existing current contracts, current covenants would not be invalidated at all. Those current contracts would simply have to follow the transparency requirements. So those contracts aren't being validated at all. In fact, the hypothetical that you suggest where the Metro District would be able to step in and basically ensure that the club comply with certain standards and have the financial threat of terminating it if it doesn't, that would be allowed under Article 2 of this bill because actually what that would allow is it would allow the Metro District, which would be defined in this particular definition section as not being subject to these provisions, they would have the ability to hire a private club to run the facilities in the future. So let's say after January 1, 2027, a new covenant is recorded in a different community, a brand-new community, and it has a golf course just like Blackstone, et cetera, except that in this case, it would be the metro district that would have the ability to collect the fees, that would set the fees pursuant to all the protections of the Special District Act and they then would presumably hire a private company to run the club and that private company then would, in conjunction with the Metro District, determine what are the appropriate fees for the management of it. So I don't believe any of the contracts would be invalidated under this. Instead, I believe the hypothetical you provide would actually be supported under Section 2 of this bill.

Mr. Matisse? Thank you, Madam Chair. Representative Wynn, I'm not sure if there has been any precedent here. Colorado is a bit unique in that our version of the Common Interest Ownership Act, our version of the Special District Act, allowing metro districts, are sort of unique. I do know that there are, in other communities around other states, I do know that there are private clubs. Often, the usual rule is they're under the auspices of some type of a homeowner association of some sort, and that homeowner association more or less sets the dues. But I'm not aware of anything exactly like this one.

Mr. Matisse. Thank you, Madam Chair. Representative Phillips, that is not my understanding at all. If you look at the bill, it provides that covenants that are recorded after January 1, 2027. Those would be new covenants, such as in a new community. You do not, when a person purchases an existing home in a community where the covenants have already been recorded, you don't record new covenants at all. You simply continue, the covenants run with the land, you continue to operate under the old covenants. So, no, it would not affect homeownership if a homeowner purchases an existing community that already has the covenants recorded.

Mr. Matisse? Representative Phillips, thank you, Madam Chair. Representative Phillips, once again, I think maybe you're misapprehending, even in that bill, Summary, the definition of a covenant, the covenant that is recorded is the original covenant. It's not one that gets re-recorded every time when there's a new homeowner. It's the same covenant that was previously recorded, and that one is not null and void.

Good afternoon. I'm Christine Dormer, and I'm a homeowner in Blackstone. I'd like to start by thanking Representative Hamrick and her team for all their hard work on this bill. Over the years, a significant number of homeowners in our community have voiced their frustration the country club and how we feel as though the current mandatory membership requirement is unfair we have reached out to the club to question the annual dues increases and express our displeasure in the quality of amenities which were promised but we get met with a too bad type of attitude from the general manager jennifer walker online earlier this year several homeowners requested assistance from the metro district board which only resulted in the club agreeing to do a better job communicating with us but they haven't even kept up there and did a deal with that what's most troubling is in our covenants article 6 discusses the mandatory membership even if 100% of the homeowners want this requirement removed it is still up to the club to approve or deny we all know they would never agree to remove this as it is guaranteed money with little action on their part every homeowner should be concerned that they have the ability to to raise dues by hundreds or even thousands per month and there's nothing the homeowners can do about it some may argue that we moved into this community for the amenities and the lifestyle that may be true but we are not getting what was promised one huge selling point was the promise of a second pool since the current pool cannot support the number of homes not only did they not build a second pool they've continuously been selling memberships to people outside of of our neighborhood so in the summer it is almost impossible to get a seat at the pool we have tried working with the club and the Metro District as most homeowners would like to enjoy the offerings at the club and feel there's some type of community however that's just not the case the general manager has made it clear he only cares about the golf members and if you walk around their so-called state-of-the-art gym that they brag about you will see broken equipment equipment thrown all over the place rips and black tape covering the poor condition of the machines and benches the bottom line is homeowners just want this to be fair when moving into a metro district we understand there are transparency laws metro districts are forced to follow having a forced membership to a private club circumvents the laws homeowners expect quite frankly i have no idea how anyone at the county or state level approved this mandatory membership AND BLACKSTONE COVENANTS WE ARE REQUESTING TRANSPARENCY BECAUSE A SIGNIFICANT AMOUNT OF HOMEOWNERS DUE ARE NOT SPENT IN OUR NEIGHBORHOOD INSTEAD THEY ARE USED TO SUPPORT INVITED CLUBS AROUND Blackstone covenants We are requesting transparency because a significant amount of homeowners dues are not spent in our neighborhood Instead they are used to support invited clubs around the country that do not have a mandatory membership When I moved into Blackstone in December 2020, my dues were $147 a month, and now they're $235 a month with a $10 minimum, which makes it $245 a month, which is a 60% increase over five years. And the only improvements they have shown for this would be a splash pad for the kids and pickleball courts. For this reason, I hope you support and approve HB 2613-16. Thank you.

Thank you. I know a lot of points already were made, and I just want to emphasize a few more. Again, I want to emphasize the point that we have a taxation without any representation whatsoever. We're basically taxed as a club fee without having any rights, any services that we are obligated to receive, and yet we are obligated to pay at the dangers of getting a lien on our house. On the other hand, the club has no responsibility or obligations whatsoever. They are not obligated to spend the money on our club. They can spend it elsewhere. They have no obligation to provide any services whatsoever, zero services. And they will still be responsible for the fees. The second principle that I want to emphasize is just the fair business practices. Most of the businesses, when they provide the services, They want to attract the clients by providing the best services they can provide. Because they don't have to worry about us paying the membership. They don't have to entice us with anything. They don't have to improve the services because they know we're responsible for our payments. With them doing whatever they want or not doing whatever they need to improve the services. I moved to the community in 2008 with three children and parents. Now we have just my wife and I and a 17-year-old. We obviously have different needs. I haven't used the facility truly for 10 years. I don't go to pool. I don't go to gym. I don't use any of that, and yet I'm responsible for payment. That is more than 100% more than I used to pay $110 in 2008. We are now paying $245 for basically services that are not improved, and obviously with the situation changed, we're not really even using the services that they do still provide. The last thing I want to bring up, a lot of people say, well, you signed the contract when you moved in, so you're responsible. I want to emphasize that when you buy a new house or home, you have a lot of things you have to consider, and you have a, I think it was 170 pages covenant that was presented to us in a matter of one week before the closing. We looked at the price of $110. It seemed reasonable for the pool and the gym. And we definitely weren't aware that this price is not fixed or can go without any relationship to inflation at any time with no services provided. And I think they put in the private business with its unpredictability in the contract that should be fair and should be perceived as a government-sponsored or state-sponsored covenant. I think it gives a lot of misrepresentation on what you actually signing up Thank you very much I hope you support the bill Thank you And Mr Martin

Thank you. Representative Wendt, we have three folks in front of us, no one online. My appreciation for coming out and testifying in committee. Forgive me, this is like an ignorant question, but have you canceled your memberships? Who would like to answer that?

Thank you. Additional questions? I don't see any. Thank you very much for joining us. One last call for anyone in the room who wishes to testify on 1316. Seeing none, the witness phase is complete. Bill's sponsor. I believe you have a request for us.

with no unintended consequences. So we'd like to lay it over for a future date. At the request of the sponsor, We will lay this bill over for action only at a later date. We will undertake amendments at that time and then vote on the bill as amended or not. Thank you for your time today, everyone. Do I need to do anything else official like? Okay. We will move right on to our next bill, which I promised. Oh, good. Okay. Thank you very much. We are going to hear oversized overweight permitting from Representative Johnson, House Bill 1248. And we'll just check with the bill's sponsor where they are. No worries. Thank you. Thank you. Energy Environment Committee went paperless. Can you imagine? I would be lost. Paperless. No, no, no, no. I like paperless. I'm the youngest of the legislators. All right. Representative Johnson, when you get situated, please tell us about 1248.

Committee, questions for Representative Johnson. Representative Paschal.

Representative Johnson. Thank you, Madam Chair. Thank you, Representative, for the question. Right now it's going through discretionary funding of CDOT, and so it's very concerning to me when we place fees on something that's not going to what those fees are intended and so this helps to reset and re-level where those funds are going. If we have heavy equipment, heavy freight, traveling on the roads, that fee should go to the roads that they're damaging. They're paying into it, but we need to see the benefits that's coming from them using those roads, not just in the material that they're transporting, but also that they are fixing what they're driving through.

But you're not looking to create an enterprise, are you?

Okay.

Yeah, I'm just curious because that's usually where that model is expressed, where the fees go to the exact thing that they, you know. All right, thank you.

Thank you, Madam Chair, and thank you for bringing this bill. Follow-up question to Representative Pascal as well is, these rescheduled funds from SB 12 to 1260 Can you just describe what these funds were attending for before we were going to earmark them for roads Representative Johnson Thank you, Madam Chair. I waited this time. Thank you, Representative, for the question. So, yeah, so Senate Bill 21-260 that was created, this is going to help break it down. So these fuel distributors have been assessed almost 200 million in what is called the RUF. The RUF is slated to increase by a cent per gallon on gasoline and special fuel by $20 to $22 million each year. Eventually, fuel distributors will be paying $175 million or so to support the HUTF and recipients who will also... So we all know that CDOT's maintenance budget is lacking, and it is only responsible if we go to redirect current OSOW, the oversize overweight dollars, away from the flexible current use that we acknowledge that creates a gap. So we are considering taking a planned future revenue and taking one-sixth, then one-seventh, then one-eighth of that revenue and helping maintenance. So we're not taking it all. We're being very forward-thinking on doing about this. This leads to a continued increase in the HUTF, a continued increase relative to the indexing criteria in the State Highway Maintenance Fund, and still provides an actual nexus between the fees the OSOW people pay and the impact they cause.

Thank you, Madam Chair, and Rep. Johnson, as I read this. Currently some of the monies go into HUTF and may come locally, but part of this bill also is to develop a permitting system that can be used by state and local. So ideally local governments may be able to do some more permitting and address their road damages as well. Is that a proper reading?

He's spot on. Almost presented it better than I did. So thank you.

Thank you, as always, Madam Chair. I agree, Bailey. I'm the Executive Director of Colorado Wyoming Petroleum Marketers. So we're the fuel distributors that pay all of the state excise taxes as well as the Senate Bill 260 fees. But more importantly, I'm also the chair of the Freight Advisory Council. And in my term, which is a national highway freight funded program, in my term, the direction of the board has been to address the impacts that the freight industry has on communities in Colorado. And so while fuel marketers don't particularly run oversize, overweight, we have been waiting and we've been working with the Eastern Plains legislators to try and figure out what we can do. And what we doing here is redirecting OSOW fees from the state highway fund specifically to a newly created cash fund that specifically addresses communities and supports communities that bear the burden of oversize overweight I think it important to note that as our front range partners grow they make design choices on roads with roundabouts lower bridges that make those roads not feasible for oversize overweight. So more and more of this traffic is getting pushed into more rural communities. And so as part of that direction, we thought that this was important. Greg and I, my partner here, we have also done quite a bit on trying to help slow the bleeding on CDOT and road maintenance. You know, through RUF, Bringen Tunnel Enterprise, FIRF, PFAS, we continue to try to find more ways to direct fee-specific funding, mostly paid by petroleum marketers, to highways and to local partners. And nothing in this bill does anything that won't continue to increase the ultimate revenue for both the HUTF and the state highway fund. If you understand, we have to understand the inherent nature of the indexing of the fees that were passed by Senate Bill 260. So in our view, this is freight forward. This is community safety forward. Very much thank Representative Johnson for taking this on. And at the end of the day, we hope that the state highway fund continues to grow. We hope that the HETF continues to grow. And we hope that the communities that are bearing now a disproportionate impact on OSOW get the help that they deserve from the people who are impacting them. Thank you.

Thank you, Madam Chair. My name is Greg Fulton. I'm the president of the Colorado Motor Carriers. And I want to thank Representative Johnson for bringing the bill. I want to note our strong support for this measure. Many of my companies are the ones that are hauling these very large loads. And I will just tell you, as you look at data centers and some of the other elements that come in these very large elements, and frankly, a lot of transformers, because as we move more toward an electric grid, essentially we have a greater demand and need. And as Mr. Bailey noted, in many cases right now, a lot of these loads are actually being moved out toward the east sort of because of the difficulty of maybe moving this through some of the metro area like this. Let me note that our companies actually pay these additional fees, and they appreciate that. They understand that these fees are important because they have a greater impact on the roadways. And so they see this, the fees, as being a natural nexus to the roadways where they're traveling. And as we look at, in the future, potentially asking these same groups to actually pay more fees on this, I can tell you they're a lot more willing to do this if they understand and can appreciate that those funds will be on the same roadways. We also appreciate that in many cases, one of the things that happens on these roadways that we're traveling, And let me say it isn't just this. If you'll notice that a large portion of our wind, a number of our folks are pulling wind turbines as well as the blades out there. All of those are oversized overweight loads. You know, it places some challenges on the other local community. And right now, actually, it's a disproportionate amount, actually, in terms of those communities where they're burying it. because frankly there isn't enough funds on their end of it to even help in terms of maintaining some of this. We would strongly urge you to support this. We think it is a great nexus and that what we look at in our industry in terms of taxation or fees and how those funds are going to be used This isn an increase in fund It actually applying the funds where actually the vehicles are operating and frankly the damage or impact is occurring We believe that other states in the country do this as well in some areas. We would encourage you strongly to support this measure and happy to answer any questions. And Madam Chair, this may be the first time I've ever finished early in my testimony, so I do want to have that recorded there, actually. Terrific work.

Thank you, Madam Chair. My name is Craig Hurst. I'm CDOT's statewide program manager for freight mobility and safety. I think the appropriate questions are kind of what our position is and why, and maybe will this bill bring revenue to the Eastern Plains and just talk through some of those details. I'd be happy to answer that if those questions are appropriate.

saying, Mr. Hurst, will this bring better roads to the eastern plains? Well, I do think there's a lot to be said about that because there's a lack of data set in annual permitting that we were missing to really be able to answer that question thoroughly. Right now, our single trip permits and some of the larger ones, as described in earlier testimony, do prioritize movement on the eastern plains because of the lack of vertical clearance issues and the ability to move freely across those routes. But there is a large amount of truck traffic in the oversized an overweight field that also travels in the Denver Metro corridor on annual permits. And we simply lack data there to show just how much that is. On an annual permit, which we issue about 20,000 of these annual permits on an annual basis, those travel without being routed by my team. And so we lack the trip and route data on those actual trips. And why that's important is if we're trying to equally distribute the funding based off of the impacts of the oversized and overweight traffic, we would want to do so fairly, as noted. But I am not positive that that would lean the balance of funding to go to the eastern plains. I think that would be distributed on very high use corridors, such as 287, which is out in the eastern plains near the Oklahoma border. 287 works its way north onto I-70. And then Highway 85, Interstate 270, Interstate 70, and Interstate 25 north of the Denver Metro are very heavy oversized and overweight lanes as well. And so those all would play into where the money would be distributed into projects if we were to do a kind of equal distribution of the funding that comes in on permit revenue. But we also, you know, really think that there's a lot to study to be able to gain that knowledge and really distribute those funds. One thing I would highlight is that we... We have used the program funding that my team helps manage to do more than 70% of our projects in rural areas around the state. So it is a common practice of ours. We do recognize that rural areas in our state do bear the brunt of some of the larger traffic simply because of the infrastructure demands that the oversized and overweight traffic puts on our system. And so with that, I think there's more to learn and more nuances about the funding before I could really confidently say that this bill would move an additional amount of funding to the eastern plains to improve the roads.

Thank you, Madam Chair, and this is for Mr. Hurst as well. You had invited us to ask what your office's position was. I don't think you have a formal one. I think what you just described might be your position. But when we're talking oversize, we're talking an awful lot of wind generator blades, are we not?

Thank you, Madam Chair, and I appreciate the question. First, I'll address the last one. Yes, we are moving quite a few wind energy components. We have three different manufacturing facilities in Colorado, one in Pueblo, one in Brighton, and one in the Greeley-Windsor area. And those do move by the more than 1,000 wind component moves a year that we're permitting, well over 1,000. but the position that cdot has on this bill was an amend position we see a lot of value in the feasibility study and the sponsors and advocates worked with us to add provisions that we requested to the study we think we can cover those costs with the already aforementioned pfas fee that is that is directed to cdot's freight program we've communicated that we would like to see the results of the study before any mandates set to begin on a centralized permitting process the sponsors changed this section from a shall to may which gets us into a bit more of a comfortable position and then our lastly our biggest concern was the reallocation of oversized and overweight permits from the state highway fund these revenues currently fund our maintenance and operations program which is already stretched thin we understand the sponsors are working on an idea to backfill the loss of this revenue to the maintenance program via the road user fee and we appreciate the sponsors are willing to work with us but we do not have a position on that part yet as we have not run this concept through our internal processes.

Representative Sucla. Thank you, Madam Chair. So this question is for Mr. Hurst as well. So I'm on the Western Slope, and you were talking about how the monies would be distributed. What we actually haul a lot of is oversized cattle loads because it costs so much, the freight does, and the cattle actually end up going to Kansas, Nebraska, Iowa. How are you going to be able to separate the funds? Are you going to have a locale if the permits are annual? How will you know how to separate the funds, east slope versus west slope? Mr. Hurst.

That is the biggest challenge for us to be able to answer the question on how to equally distribute funding based off of permit usage Today those 20 annual permits are not tracked by us individually One suggestion that can be made is that there is a program enhancement to our permitting system that would need to be supported by regulatory and statutory requirements for annual permits to get a trip-based approval, meaning they would get into our application, they would put their origin and their destination, and a couple other very baseline levels of information that we require. And basically, our routing system would give them an approved route that considers all vertical clearances, roadway restrictions, construction restrictions, and keeps them on dedicated trucking routes. With that additional information, maybe a year of that type of data, we would be able to better clarify how the permits are distributed using our roadways throughout the state. And then we would have a better idea of how to better accomplish equally distributing the money throughout the state based off of road usage from OSOW permits. But without that, I feel that currently about the $7 million that comes in on permit fees, there's $9.5 million total that came in last year. $2.5 million of that goes to the Bridge and Tunnel Enterprise, and the other $7 million, I think, is what we're talking about here today. To distribute that equally, we would need to understand better how the annual permits are utilizing our routes and how often they're utilizing our routes without that information we'll have a very tough time to equally distribute the impacted roadways from the oversized and overweight industry representative Phillips thank you madam chair my

So the only requirement that the driver has statutorily is to check our restriction report. So my group maintains a freight website that is a subpage of our co-trip page where oversized and overweight annual permit holders come and find where our lane restrictions are due to construction projects. It lists all of our vertical clearance issues. And with the largest permit approved types for annual, that means a load can travel 361 days a year. There are four federal holidays that they cannot travel on. But they can travel 361 days a year. And as long as they're inside of 17 feet wide, 16 feet tall, 200,000 pounds, and 130 feet long, they do not have to contact my office for routing. And they do not have to notify us that they're taking a trip. That is the stipulations of their annual permit They must stay inside of that And that enforcement on those stipulations are completed by our port of entry partners at the Colorado State Patrol as well as the motor carrier safety unit at the Colorado State Patrol And so we're issuing the permits within those parameters. We're putting out the information on the restrictions and then they're self-routing. And so with that self-routing activity, we do not know where they're going or when they're leaving and how many times they're utilizing that permit. It is simply because the way that the permit is set up in statute that we do not have that information. That requirement would be – is already in our permitting system. That capability is in our permitting system, but it's not a required tool. It's a voluntary one.

Thank you, Madam Chair. So this is – you said something there, Mr. Hurst. You talked about your port of entry. So I'm going to give you a scenario. Where I live, 491 connects Interstate 40 to Interstate, I believe it's 70. And so where those two connect is in Denver, and the next place they connect is in Flagstaff. So in the middle of that 400-and-some-mile stretch is Cortez. And I believe that they told me when I was a county commissioner that there was up to 4,000 trips a day in a 24-hour period. so it seems like the port of entries are keeping track of them can you use the port of entries as a tracking system to know how to fairly distribute the money mr hurst thank you madam chair i think that's a great question our port of entries have nine

port of entry system with our CDOT permitting system for better data sharing opportunities. But it does not cover all of the significant freight routes that oversized and overweight trucks travel on. Actually, it only covers nine of the more than 100 routes possible to them. And so that does fill gaps in our data, but it does not completely give us the statewide use of oversized and overweight permits. Representative Richard.

Mr. Hurst, you had mentioned that the statute doesn't require you collect routing data, but you have a system that could. Does statute preclude you from collecting that data? Is there anything that prevents it, or could that be handled as a process within CDOT?

Thank you. Thank you, Madam Chair. the permit itself calls out an annual permit process that, as I was explaining, allows the driver or the dispatcher to self-route and identify their own restrictions. I think with a change in the way that that process is required, where you're required to get a route approval or a route certification, then we would automatically collect that data and use that in a similar way we use our single trip permitting data where we're understanding where trucks are safely routed and we try to invest our National Highway Freight Program funds in those areas so we can improve the infrastructure and ensure that trucks can stay on truck routes and not detour onto routes that are less safe to travel on it and not designed to hold heavy truck traffic. So there would be value, I think, to the state by having that data, but today in the statute it not currently required for the driver to do so so we do not capture that Without that requirement I do not believe we would be able to capture that

Thank you, Madam Chair. So listening to all this testimony, my question is going to be to the representatives for the Carriers Association. I have some concerns that the money is going to be distributed not equally according to truck traffic. And so the question that I want to address to you is how can you assure me – you represent all the trucks all throughout the state, not just the eastern plains. But how could you assure me that my constituents over on the western slope are going to be treated – because right now the way CDOT is set up after our smart hearings is the majority of the money of CDOT funding is coming on the east slope. So can you address that question?

Thank you, Madam Chair. Thank you, Representative Sikola. And let me say a few things here. First, when we're talking about particularly one of the things that there's some differences when we're talking even about some of the urbanized areas versus some of the rural areas, in many cases I have a freight rod, okay? And so when that freight rod actually is really beat up and damaged for that area or that corridor, I may have a 50-mile in terms of detour to go around this. In many cases, when allocations of funds get done in terms of these levels, people look at freight volumes. And the fact, not freight volumes, but overall traffic volumes. And it's always going to be much lower out there. The fact is, is those routes are just as important on these ends of it. The other thing I would just note is, you know, in terms of, like, at different times, especially years ago when we had a lot of the natural gas boom and things in the West Slope. We were moving those loads out there, and those roads were getting beat up. And I would just say the reality here that happens is, one, you know, the allocation mechanism right now kind of is slanted against us. I mean, when we talk about oversized, overweight loads, we also end up having that they're not all equal in that end of it. We have what we call super loads. Superloads are going to have a greater impact on that. And, yes, they should, those roadways, where they have a greater volume of those, should get more funding because they are going to beat up the roads more. And so I think where it comes down to, Representative Stigler, is this is just saying maybe a point in time. You know, I would just say that funding would not maybe go into certain areas on that end of it. but the goal here is to say like where to direct it to where actually it should be needed. And let me say I worked at CDOT many, many years ago, and I would just say one thing people don't quite appreciate is in terms of pavement, actually the base and all this. Once we've had the base go so far, we've had that road, we're not talking about resurfacing at this point. We're talking reconstruction, which is millions and millions of dollars. So I think, you know, there is a – I think we're talking about getting far too much into sort of like the thing of saying whether how it's going to work out or how many in terms of the loads. I can assure you, you have a probably – relative to that end of it, you have a significant amount of those super loads in some of the rural areas. And that's because they really can't easily travel. We're not going to run something like that through I-25 in downtown Denver. I can pretty much assure you that. Thank you. Mr. Bailey, did you want to say something? Yeah, I just,

Okay. We have spent quite some time on this panel, so we will let you get back to your St. Patrick's Day. Thank you for joining us online. Is there last call for anyone who wishes to testify on 1248? Seeing none, the witness phase is complete. Representative Johnson, we have several amendments in front of us. Yes, Madam Chair. Thank you.

We will have Vice Chair Stewart move your amendment.

Seconded by Rep. Sukla.

Yeah, so L5 was the collaborative effort with the freight office that was mentioned and the legislative office at CDOT who were kind enough to provide us with all the maps that were handed out. It changes the study date deadline by sometimes they have more time to look at it. We also wanted to make sure there was enough time to have this conversation with all the counties and all the cities who want to participate to make sure we're not leaving out any of our rules because that's huge. So this allows for that study to take place to make sure that we're looking at eastern plains, west slope. It also, let's see, we wanted to see the freight dollars that CDOT receives that were not already allocated, so this allows some financial flexibility. And finally, we changed the requirements to implement a statewide permitting system from shall to may. I think this is important that everyone agree that we should do something before we set the legislative direction that the department has to do. This allows for more stakeholding. Our roads are important. They are complicated. we need to move this forward and this allows for that conversation to go forward in good faith and I urge you to guess vote.

Representative Richardson. Yep. Actually, I appreciate what you're doing here. For Roman numeral two, it's a study, so I'm assuming there's some flexibility. We had testimony that drivers are doing self-routing. so modifying permits to get an approved route for every trip could I would hope turn into you can also just self a self route just so the data is there and perhaps relieve the approval portion of it administratively

Thank you, Madam Chair, and it would be great to have self-reporting. It would be great, you know, for the permitting to get some structure to allow for more of the local governance. I think that's down. I think it's coming. I think it's not as down the road as we think, and I think we need to look at more studies and funding because there are data missing. And how do we make sure we allocate correctly? So correct. Okay. Thank you.

Thank you, Madam Chair. Thank you, Rep. Johnson. My question is also about number two on this amendment. So I heard, when I was asking CDOT about data, because you heard like, oh, we need the data, you know, first. And so when I said, okay, how do we get the data? Is that a study? How much does it cost? And then he responded that there needed to be a requirement so that they knew who was driving where. Does number two get to that requirement that CDOT talked about?

Thank you, Madam Chair. Question number two, we're looking at L005. I'm confused. Yeah, so it says modifying annual permits to get an approved route for every trip. So CDOT said that in order to get the data that they needed, they would have to change the requirement for when drivers are going somewhere so they know where the drivers are going. So does that match that or not?

Yeah, this is the amendment we were doing with them. Sorry, the number threw me off with two because, as you know, we're on five. we scrapped. Oh sorry I meant yeah I meant Roman numeral number two sorry. Yeah that's where okay thank you. Okay numbers are confusing. Um yeah no no this was definitely that you know the collaborative effort that uh this amendment came with working with CDOT with the freight to make sure we're getting the numbers uh when the question was asked I know you all asked where are the numbers well how do we make better roads without numbers we need a study um this helps it and it makes it you know from the shall to may so we can get there together without some folks feeling enforced over others.

Thank you, Madam Chair. So I wanted to follow up on that point. So if it says an approved route, which implies somebody has to approve it, and I was just curious if that CDOT was on board to cover that within the funding they had already or if that was going to drive a fiscal note.

Thank you, Madam Chair. And, yeah, and approved roads, I mean, we work a lot with local governance. When you have these giant freights, to our good colleague who mentioned, you know, the wind turbines, when they're going through certain roads, they do have to have that understanding, that agreement going through different counties. So that's what we're meaning by, you know, approved roads is to making sure as we go through counties and look at what roads are used for freight, what aren't used for freight, that we're not stepping on local governance for that. I did ask with this amendment for a revision of the fiscal note. Still waiting. I know that will be coming. I think it is my understanding this goes to appropriations committee. So we will have a harder set on that fiscal note on what this goes. And I am committed to continuing to work with CDOTs, making sure that we're putting the best use of our dollars that are coming forth, that we get the numbers we need because without getting the study, how do we move forward in making sure our roads get the repair they need? we going to have this conversation endless times until we can get that data Additional questions about amendment number five Are there objections to amendment number five

Thank you. I would love for someone to move L-003.

Thank you, Madam Chair. I move L-3 to House Bill 1248.

Yes, Madam Chair.

Thank you, Madam Chair. Rebecca Bayetti with the Office of Legislative Legal Services. THE DECISION IS THE CHAIR'S DECISION AS TO WHETHER OR NOT WHEN THERE'S A TITLE CHALLENGE THAT OUR OFFICE DOESN'T ADVISE ON THE MERITS OF THAT. I CAN TELL YOU THAT THE TITLE OF THIS BILL IS CONCERNING FREIGHT TRANSPORT. AND I CAN DESCRIBE TO YOU WHAT L-004 DOES IF ANYONE HAS QUESTIONS ABOUT THAT.

Yes, so L004 changes where, as you can see, kind of an incrementally increasing portion of the road usage fee, which is paid by fuel distributors, goes to. So that says, you can see 1 6th, 1 7th, 1 8th goes to the state highway fund. And those increase because those are currently set to increase by a certain amount of cents each year. So that kind of tracks what's in statute.

The entire bill is concerning freight transportation and connection there with modifying permitting processes for oversized and overweight vehicles, which we are doing with the 1 7th, 1 6th, 1 8th. So because the title does allow for that to deal with the modifying the permitting processes, I would like the committee to take that into consideration.

and how that relates to a title challenge in this instance? The commas matter is what I would say.

Thank you, Madam Chair. Thank you, Rep. Beesenecker, for the question. So the legal title of the bill, which is controlling, is kind of the broader one, which is concerning freight transport. and then after the anything you see after that first comma which is the and in connection there with is what we say is a trailer so that provides kind of informative information that helps describe a little bit more about what's in the bill but the legal title is kind of that first part before the comma so concerning free transport i will entertain a motion to move

Respectfully no

Jackson is excused

Wynn no

Phillips

Richardson

Sukla

No.

Additional amendments committee seeing none the amendment phase is complete wrap up bill sponsor. Thank you, Miss. Thank you, Madam Chair and thank you committee members. Um, as we mentioned, you know, roads are complex. We are in a tough budget year. Uh, I will admit this is not the, uh, the whole solution, but it is a part of the solution that is direly needed for many of our roads that our freight utilizes. and without going through a study, we're going to always face that same burden, that same bump in the road when we're looking at road repairs, that we don't have the information, so how do we move forward? This bill starts that dialogue. It starts moving forward. You have my commitment. I'm going to continue working with the Colorado CDOT freight, with the proponents who came forth and added information on this bill to our local counties to make sure that we are doing what's best for the state while also understanding that when it's called a fee, that money should go back to what's being utilized, which is the roads these freight are driving upon, instead of being overused everywhere else, but failing to address where the fees actually were supposed to be directed. So would love to continue this conversation. I am, if you have concerns after this as well, I am dedicated to trying to fix our roads any way we can and making sure that even if they have small steps in the way, but the study is crucial to get that information and to make sure that we are looking at Colorado, all 64 counties as a whole. I would strongly urge a yes vote today and would love to continue. You have my ear anytime as we work forward to make sure that this does get to the spot it needs for Colorado.

Oh, I apologize. Moved and seconded. I move House Bill 1248. 48 as amended to the Committee on Appropriations.

Committee, comments before voting? Brooks.

Representative Sucla. Thank you, Madam Chair. So, boy, there was a lot of interesting testimony. and one thing that was said at the very end was it was talking about counties. And so I come from a county that has the world's largest known CO2 field, and we had Kinder Morgan, which Kinder Morgan owns, came, and they hauled two drilling rigs in there, and they did it just at the wrong time of year when the freezing and thawed it, and it completely destroyed the road. Kinder Morgan came in there and paid the county $1.5 million and restructured the road. But I believe that we can get all the data that we need on these roads through your counties. Your counties knows what's going through them, and I'm going to be a yes on your bill today.

Representative Phillips. Thank you, Madam Chair, and thank you, Rep. Johnson, for bringing the bill. I am still stuck on getting the data through the requirement that CDOT talked about, So I won't be supporting today, but I appreciate your work, and I hope it continues for next session.

Representative Richardson. Thank you, Madam Chair, and thank you for bringing this. It's actually awesome to talk about roads in this committee. So I do think the concept behind the bill of applying, ensuring that the fees we're collecting are actually going to what the fees were levied for. I think the addition of the study to get more clarity is absolutely essential. I am a yes today. I think it's long overdue.

I SIMILARLY INCLINED BUT I DO APPRECIATE THIS conversation We had it every summer in TLRC and there no more money for TLRC so we won't be having that conversation. So we need to find a home for that data and some oversight of CDOT and how they're making decisions. So I wish the budget was different. So I'll be a respectful no today. Mr. Gravey, please call the roll.

Brooks.

Jackson is excused.

Respectfully, no.

Respectfully, no.

Respectfully, no.

Respectfully, no. Richardson. Yes. Sucla. Yes. Velasco is excused. Weinberg. Respectfully, yes.

Madam Chair. No. That fails on a 6-7-4. Why am I always missing? Is it me that I'm missing my own hashtag?

Any seconded any objection? Seeing none, that bill is postponed indefinitely on a reverse roll call. We will go to our third bill of the day, which is Senate Bill 21 with our own Representative Paschal. I'm trying to get my program over here. Just walk very slowly. And I promised him I would tell him, and I forgot as well. The committee will stand in a brief recess. Thank you. Thank you. Thank you Thank you Thank you. . Representatives Barone and Paschal, please tell us about Senate Bill 21.

Representative Paschal. Thank you, Madam Chair. So as my co-prime mentioned, one of the issues with the Clean Fleet Program has been that for trucks that are over 26,000 pounds, the market really isn't there yet. The product really isn't there yet for EVs and hydrogen. There's beginning entries into the market, but it really hasn't picked up yet. And so we find our clean fleet underutilized. So the proposal here is that we, for five years only, we allocate up to 20% of the clean fleet funds to be used to swap out diesel trucks that are older than 2009 for ones that are newer than 2018.

So what the clean fleet does is that it authorizes the, it's an enterprise, the enterprise to provide grants, rebates, loans, and other financing tools to help small businesses replace their old trucks with newer trucks. And one thing to bear in mind is that trucks from 2006 and earlier, while they are only represent 25% of that class of vehicles on the road, they are admitting 75% of the emissions. So that's why we want to remove those vehicles off the road with cleaner vehicles, and the older vehicles are prioritized, the older and stinkier they are, the more they're prioritized to be replaced with newer, cleaner vehicles. And that is the gist of the policy, and it's a great bill. I urge an aye vote, and my co-prime has stuff to say.

Thank you. Committee, questions for the bill sponsors? Representative? What? Okay. I do not see questions, actually. Would you prefer the amend folks go first or the proponents? Thank you, sir. Amend. Okay. At the request of the sponsor, we'll bring up a panel of amend people. Travis Madsen, Renee Larrate, Emily Baer, and Megan Kemp. and the other three are remote. Is there anyone else who is in an amend or oppose position on Senate Bill 21? Okay, great. Let's go with Mr. Madsen. We're doing three minutes. We probably should do two, but we're doing three. So any brevity is appreciated. Please introduce yourself and tell us who you represent, if anyone.

Thank you, chair members of the committee.

the state's largest environmental advocacy organization. And I'm here today in a friendly amend position on SB21. And I want to note that we're grateful for the ongoing conversations we've been having with bill sponsors. From a climate and cleaner perspective, heavy-duty trucks, especially diesel trucks, are a major part of the problem. Transportation, as you know, is the largest source of GHG emissions in Colorado, and diesel trucks are a significant contributor to climate pollution and harmful air pollution that impacts public health, especially in disproportionately impacted communities located near highways, freight corridors and warehouses. As drafted, we feel that this bill creates ambiguity about whether the Clean Fleet Enterprise could use funds to purchase new diesel trucks. The definition of a new heavy-duty truck is widely and broadly written, allowing vehicles powered by any fuel type to qualify for funding, including new diesel trucks. However, the intent of the Clean Fleet enterprise is to prioritize vehicle electrification or as Travis stated, compressed natural gas where electric technologies are not yet viable. So I'm asking for your support to help reduce transportation pollution, ensuring that working class households living near high transportation corridors have equitable access to clean air while also mitigating one of the underlying causes contributing to climate pollution. We ask for your support in clarifying the bill's current ambiguity by supporting amendments to ensure the bill continues advancing reductions in transportation emissions that also align with our state's climate goals. These include clarifying that new diesel trucks are only eligible if comparable electric models are not commercially available, consistent with the enterprise's statutory priority to electrify fleets, and also prioritizing projects that deliver the greatest return on investment by removing the most polluting vehicles from our roadways and requiring replacement trucks to meet model year 2027 or later that significantly reduce climate and air pollution. We feel that clear statutory direction will help prevent unintended consequences and ensure that public funds remain aligned with Colorado's clean transportation goals. With these changes, SB 21 can more effectively reduce GHGs, ensure that public dollars drive meaningful climate progress and result in cleaner air, especially for DICs impacted by transportation pollution. Thank you very much. Thank you. Ms. Kemp. Thank you, Madam Chair, members of the committee. My name is Megan Kemp, and I'm the Earth Justice Colorado Policy Representative here today to advocate for amendments similar to my colleagues that just spoke to Senate Bill 21 so that we're preserving the intent of the clean fleet enterprise, which is to prioritize emissions reductions through providing support primarily to through electrifying business and governmental fleets. Diesel engines, even those that are lower emitting and newer, still emit NOx and other harmful coal pollutants. Diesel trucks, especially newer models, can operate for decades, which locks in those pollutants and sets us back in our ability to curb ozone pollution and the health impacts it causes, like respiratory illness, cancer, premature death. At a time when the federal government is threatening and continues to attempt to revoke critical pathways to vehicle electrification our state should continue to prioritize the Clean Fleet Enterprise limited funding for zero electric vehicles We submitted amendment requests initially in the Senate committee, and once we heard that this House committee hearing was moved up to this week rather than next week, we submitted to House sponsors some recommendations for amendments last week. These common sense amendments, described in part by my colleague Renee from Conservation Colorado, aim to clarify new diesel truck eligibility, more appropriately cap the amount of enterprise funds available to new diesel trucks, and prioritize projects with the most air quality benefits. First, we believe it is critical to clarify that new diesel trucks are not eligible for the bill's proposed scrap and replace program unless a suitable electric vehicle model is not commercially available. This would help align with existing statute to prioritize electric vehicles where possible. Second, to minimize the potential of Senate Bill 21 to divert the focus of the Clean Fleet Enterprise from its original statutory priority of electrification in order to support the sustainability of Colorado's transportation system, we requested the percentage of funds available to new heavy-duty diesel trucks be capped at 10% rather than 20% of available funds. Last, we find it important to add language that sufficiently ensures the potential emissions reductions of vehicle scrappage will benefit air quality, climate and health, and prioritize those projects over others with fewer benefits. Earthjustice thanks to sponsors for their continued collaboration and consideration of these important amendments, and we hope that these changes will be reflected in a future version of the bill. Thanks. Thank you. And Ms. Baer. Good afternoon, Chair and committee members. Thank you for the opportunity to provide testimony. My name is Emily Baer, and I serve on the Erie Town Council. Erie is a member of Colorado Communities for Climate Action, a coalition of 48 diverse local governments that have come together to work for stronger state climate policy. Collectively, our members represent roughly one-third of the state's population. The size and diversity of our membership represents the scale and enormity of vulnerabilities local governments realize in the face of climate change. As a coalition, CC4CA is supportive of the goals of Senate Bill 21. However, we are testifying in an amend position. Transportation is the largest source of greenhouse gas in our state. Medium and heavy-duty trucks are an outsized source of pollution. While they make up less than 10% of the vehicles on the road, they account for almost a quarter of the greenhouse gas emissions from the sector. These trucks also contribute to air pollution including NOx emissions and particulate pollution, both of which are known to negatively impact human health. This is a major concern for communities adjacent to heavily trafficked roads. Erie is hemmed in on all sides by highways, I-25 to the east and 287 to the west, highway 52 on the north and Colorado 7 on the south, from which trucks spew their emissions as they roar past our community. Trucks older than 2018 are significantly more polluting than earlier models due to enhanced emission standards that passed in 2016. Unfortunately, old trucks stay on our roads for a long time, on average 30 years. getting old trucks off the road can meaningfully improve emissions we seek the following amendments to ensure that if the clean fleet enterprise is expanded to allow replacement of diesel trucks with diesel trucks the funds used definitively result in cleaner air Require applications to quantify the emissions reductions anticipated if the application is awarded. Two, the enterprise should prioritize applications with the greatest air pollution and carbon emissions reduction. And three, require the enterprise to report on the results of the aging diesel truck replacement program. We feel our amendments significantly improve the bill by ensuring a path to reduced GHG emissions and air pollution from trucking. We're hopeful that proponents of the bill will consider these proposed amendments and I thank you for letting me address you today. Thank you. Committee, three folks online, one person in front of us for questions of people in the amend position. I do not see any questions. We thank you very much. One panel of proponents will bring up Steve McKannon, Greer Bailey, Tammy Munoz, and James Mora. Is there anyone else in the room who wishes to testify? Come forward, Mr. Fulton. and we will begin with mr morrow morrow no mr mccannon sorry about that please proceed thank you madam chair members of the committee my name is steve mccannon i'm the mobile sources program director at for the air pollution control division at the colorado department of public health and environment. We're here today to support this bill. We thank the sponsors for their leadership on this bill and for working with us to adopt the amendments in the Senate. The heavy-duty trucking sector is a primary source of nitrogen oxide and particulate matter emissions in Colorado. While many fleets are beginning the transition to new technologies, a significant number of older diesel trucks, specifically those manufactured before 2009, remain on our roads. These emissions directly impact the health of Coloradans, particularly those living near major freight corridors and disproportionately impacted communities. Removing these specific vehicles from the road is one of the most cost-effective ways to reduce ozone precursors. This bill provides a bridge for small business owners who are ready to reduce their carbon footprint but who cannot go electric. Even with this grant program and other financial incentives, some small businesses cannot afford installing the EV charging infrastructure or pay the vehicle maintenance, or in some instances, the electric vehicle technology simply doesn't exist. We should be taking advantage of every opportunity to clean up our air where we can. The department respectfully asks for a yes vote. Thank you. Thank you. And Ms. Munoz. Thank you, Madam Chair and members of the committee. Thank you for the opportunity to speak today. My name is Tammy Munoz, and I am here on behalf of Teamsters Local 455, representing drivers who keep Colorado moving every single day. And I'd like to note that we do represent Cisco. That has been brought up several times. We love our Cisco members. Our members spend more hours on the road than almost anyone. They see firsthand what works and what doesn't and puts them at risk. SB 2621 is a win for drivers and a win for our environment. And we are proud to stand in support. The spill strengthens the very things our drivers depend on, safe and as predictable as possible roadways by reducing the amount of aging semi-trucks on the road. When roads are safer, our drivers can do their jobs without unnecessary hazards, delays, or close calls. Every improvement to roadway safety is an abstract for us. It's personal. It means a driver gets to go home to their families at the end of their shift. At the same time, SB 2621 helps reduce harmful emissions, and that matters to the Teamsters. Our drivers breathe in air along the Colorado's busiest corridors every day. Cleaner air isn't just for an environmental priority. It's a health and safety priority for the people behind the wheel. Reducing emissions always means modernizing our transportation systems and ensuring Colorado stays competitive, resilient, and responsible. On behalf of Teamsters Local 455, I urge you to support SB 2621. It provides safer roads, protects our workforce, and improves the quality of life for everyone who lives and drives in Colorado. Thank you. Mr. Fulton, are you pinch hitting for Mr. Bailey, or are you both going to talk? Yeah. Mr. Fulton. Thank you, Madam Chair. My name is Greg Fulton. I'm the president of the Colorado Motor Carriers. I'm here in strong support of Senate Bill 21 on behalf of our board of directors. Let me note a few things. One is the fact is my companies do not own these vehicles. I'm just going to be very clear. So there is no real benefit to them, actually. These are mostly owned by very small operators, many of them minority business enterprises, enterprises who frankly do not have the resources in that to get a newer vehicle. In many cases, these vehicles have serious safety issues as well as actually emitting. I think it best if we're looking at a 2009 or older, we're looking at the best case scenario of them emitting about 10 times as much or it's up to 60 times as much. The fact is, these are not going to be traded in to get new vehicles, nor do we want them traded in. They're not going to be retired. They will be sold to another party. And the fact is that we will end up having that same very old, high-emitting, unsafe vehicle in years to come. This provides a pathway for those folks. Let me say, we are not the first to be looking at this. California had a program, you know, the Karl Rove program for a number of years. It's proved to be one of the most successful programs in doing this. No, these folks are not buying new diesels. For God's sakes, they bought the vehicle they could afford. So I think when I look at this, the other item that I would just note to you is, as mentioned earlier, we have 25% of these vehicles generating 75% of the emissions. You know, one of the things is when we talk about the clean fleet enterprise, the fact is it provides a path for clean air for people in rural areas, to be honest with you. We don't have the electric grid there. We don't have those ends of it. Effectively, they care about actually cleaning up their quality in those communities as well as within the metro area. This would allow a path for them to get rid of some of the oldest least safe. Let me note that the natural gas end of it in terms of in the bill provides a very clean and effective source that out there today It has actually been one of the greatest reasons why actually emissions have been reduced in California along with renewable natural gas Essentially, what it ends up having is a greater reduction in greenhouse gases than actually what it generates because, essentially, it's recovered methane. I would just say we have over 1,000 vehicles a day out there on this. It's a proven, reliable, safe end of it. Plus, once again, I would say throughout the state, we don't need as much electric grid. We support EVs. We want to end up having to move there, but we want to get actually the air quality improved as great as possible. I'll do five more seconds, I would just ask. Let me say the major reason that we look at this is, by and large, the majority of our companies are in Adams County. and I will tell you those companies in many cases that are actually very clean operating but our people work there, our people live there we want to improve the air quality not only for them but others in that area. Thank you very much Madam Chair Mr. Bailey Thank you Madam Chair and thank you to TLRC and all the time that was afforded to our associations over the summer on this topic. The bill was extensively amended in the Senate Part of the provisions I really liked actually got taken out, but I understood that. We're super supportive of this as fuel distributors relative to the $800 million that we pay every year to support the highway system, mainly because when you replace a diesel vehicle with a diesel vehicle, the HUTF doesn't take a hit, right? So utilizing these dollars at $120,000 per tractor versus $350,000 for an EV tractor is actually a better use of existing fee-paying dollars that already exist. And so while it's probably true that the technical emissions benefit is better for a straight EV or a hydrogen truck or something like that, you're not taking the HUTF funding penalty. and then you're also utilizing fee payer dollars more effectively. I also think it's really important to highlight the refrigerated trailer aspect that was amended in the Senate. I think that's really important from a food storage thing. And then I think it's also really important to note that the CFE, as it was currently construed, they've spent the better part of $35, $36 million, and there's actually 43 trucks that have actually been delivered. And I know that they've funded a whole bunch of them, and a lot of those grants are ongoing, but they've also had to pull a bunch back for non-deliverable trucks, which is, I think, why the Senate almost unanimously passed this bill. So thank you for your time today. Super supportive of this, because I think this idea doesn't hurt the transportation system. Thank you. And Mr. Mora. Yeah, good afternoon. Madam Chair and members of the committee. My name is James Mora. I represent the Freedom AFI. I've spent the last decade in compressed and renewable natural gas industry in Colorado. And I'm here in strong support of Senate Bill 21. This removes a December 31st, 2026 funding restriction that would otherwise cut off clean fleet enterprise support for trucks running on renewable natural gas. And that restriction needs to go. Heavy-duty transportation is one of the hardest sectors to clean up. Electric vehicles and its solutions are advancing but they haven scaled to meet the full range of duty cycles High utilization freight routes rural operations fleet facing long infrastructure timelines or interconnection constraints For those fleets, waiting isn't a strategy, it's a delay. Renewable natural gas is ready now. Under current statute, eligible CNG trucks must use at least 90% recovered methane. At Freedom FI, we run 100% RNG across our forest locations. Methane captured from wastewater facilities, agricultural operations, and landfills. Fuel that would otherwise enter the atmosphere is instead powering trucks and reducing life cycle emissions significantly, while also cutting NOx and particulate matter compared to aging diesel. And because RNG works with existing natural gas infrastructure and commercially available vehicles, Fleets can move forward without years of build-out or major grid upgrades. Through our mobile fueling solution, we can deploy pure RNG directly to a fleet site quickly, cost-effectively, and with immediate emissions impact. SB21 also accelerates retirement of pre-2010 2009 diesel trucks, highest emitters on the roads, delivering real air quality gains in communities and corridors that need it most. The bill doesn't sideline electrification. It keeps Colorado's approach results-driven and technology-inclusive. If the goal is a cleaner air today, we should use every proven tool available. Thank you for the opportunity to share these comments. Thank you. Committee, one person online, four folks in front of us. Representative Sucla. Thank you, Madam Chair. This is for anybody sitting at the dais. So kind of fits right into the last bill. So I have independent truckers, and they would be the ones that would be hardest hit when they have to replace their truck. So how would it be divvied out, the 400 trucks per year, on who gets to purchase them? It wouldn't be Xcel Energy, would it, because they're already making $10 billion a year. Mr. McKinnon, are you able to answer that the Clean Fleet Enterprise lives in CDOT or CDPHE? Thank you, Representative. Thank you, Madam Chair. The Clean Fleet Enterprise lives in CDPHE. So I was instrumental in setting that whole program up when this was passed back in 2021. The way the program works, Representative, is it is a grant application-based program. And so if you were to come in and apply for that grant program, we would work directly with that fleet as opposed to any other third party within this kind of atmosphere of the program. So if you applied for a million dollars, that million dollars would go to you as the fleet. Additional question, Representative Sukla. So, but would one of the big companies like XL have preferential treatment? If they're one of the first ones that apply, can they gobble up all the money? Or what about, you know, the guys that has one truck or two trucks? That's what I'm trying to figure out here. Mr. McKinnon. Thank you, Representative. Thank you, Madam Chair. I'm sorry. Yeah, it would not. We do it on a competitive basis, and we don't want single fleets eating up all the money. So we would not allow that. Madam Chair? Again? Oh, Mr. Fulton. Thank you, Madam Chair. Thank you, Representative Sikul. Let me say that very honestly we don know of many newer fleets I mean like larger fleets that have this sort of vehicles okay The fact is, let me just say, they're very much owner-operators, one-off people, very small companies. When we look at the people who are out there actually in that, it's aggregate transporters. It's agricultural transporters. Frankly, they bought the truck they could buy. I would just say the reason why fleets, fleets are usually, when we're talking about people buying new trucks, the people buying the new trucks out there are folks who are large fleets. They have actually a purchase program where they're turning that every seven years or so because they want to stay within the warranty windows on this end of it. The fact is we're talking about, in many cases, a third vehicle owner. And, you know, the problem that happens, the good thing about diesels and the bad thing about diesels, diesels can last 30 years. Now, we would just tell you that 30-year-old diesel is going to be a lot of emissions in this end of it. So what I would just say is I frankly don't even have – I mean, we have several hundred companies, mostly of our larger companies in that end of it. We don't have companies. This is really not going to do anything for our own. But also people realize that if we want to end up moving down the emissions in our state, we've got to go out there and help on this end of it. And realistically, we're looking at most cases, this is going to be somebody taking a 2002, which has a value of about maybe $6,000, and end up turning that in, scrapping it, and getting something like a 2018 and getting maybe a $30,000 grant for a $60,000 vehicle. These people cannot even afford are getting the credit. We want to set the peg, the grant amount, so that those little folks who, frankly, are the heart of this, all of our companies started with one person, with one truck, and we want to preserve that dream. And so I would just encourage you to do it. It isn't something that we're doing for, you know, the large companies or any of my members, actually. I don't even know if I have anyone who could qualify anything because they don't have those vehicles. So this is an important item, though. Thank you. Representative Wynn. Thank you, Madam Chair. This is my question as to the – Mr. McKenna, my apologies, about air pollution aspects of this bill. And from what I understand right now, a lot of efforts have been made to reduce emissions. I just want to ask, where are we in terms of the grants, the plan for having electrification of our vehicles? Are we on track? And would this bill continue the progress that we've made so far? Mr. McKinnon. Thank you, Madam Chair. Thank you, Representative. up. I would say we are on track with clean air. We have done everything in our toolbox that we can do, especially in the mobile sources sector. There have been pullbacks under the Trump administration now with electric vehicles. We have manufacturers that are struggling to keep up with demand. So this would allow us another avenue to continue pushing forward with clean vehicles out there on the road. So when we look at the emissions factors, generally between an 06 vehicle and a 2010, it's approximately 90% emissions reduction. So it's a very significant significant amount of emissions that have been reduced in a small amount of time. Representative Wynn. Thank you, Madam Chair. And a follow-up question is, what happens to the older vehicles, vehicles that are processed out? Are they still on the roads, or are they no longer, you know, like, what happens to these vehicles? Just out of curiosity. Mr. McKinnon. Thank you, Madam Chair. Representative. They will move down the food chain and end up in our rural communities, working on farms and ranches where they are hauling corn and sugar beets and that sort of thing. So they're still on the road. Okie dokie. I'm sorry. Okay, Mr. McKenna. Representative, could you repeat your question? Yes, what happens to the older vehicles? The ones we take in through the grant. Sorry. No, that's right. That's okay. Thank you, Madam Chair. Thank you, Representative. Those will be crushed. Those are cut up in a scrapyard. We document all that, and they go away. Okay, we need to wrap up this panel. So we thank you very much for being with us. Thank you for joining us online. Last call for witnesses on Senate Bill 21. Seeing none, the witness phase is complete. Bill sponsor, do you have any amendments? We do not have any amendments at this time. Committee, any amendments? Seeing none, the amendment phase is complete. Wrap up, bill sponsor. Thank you, Madam Chair. So just to summarize what this bill does, it is targeting towards the Clean Fleet Enterprise Grants. You did hear some language about this deprioritizing electric vehicles. That is not correct. We still will be allocating at least 80% of the funds in the Clean Fleet to vehicles that already qualify, electric and other sources of fuels, such as hydrogen, that already qualify. This is only 20% of the funds for five years. So it automatically repeals. We can go and look back at it. So this is in the understanding that the technology just really isn't quite there yet for people to be able to adopt it. And, you know, it's great that there's going to be some better level of emissions coming out with diesel trucks in 2027. And I know some of the amenders wanted to require a 2027 truck. But I think the reality is that's out of range for most folks driving fleet vehicles. Plus, they're not out yet. so that is one of the amendments and a new vehicle in general is out of reach for folks so that's why those amendments were rejected I am willing to keep talking about amendments if we can find something that will maximize the emissions take taken off the road in a way that is implementable and and clear haven't found that yet but willing to keep working on it In the meantime, I think this is a bill that doesn't let the perfect be the enemy of the good. This helps us get some of the most noxious vehicles off the road and replace them with much cleaner burning vehicles and to help continue to make progress towards cleaner air. It's a good bill. Vote yes. A proper motion would send this to the cow. I move SB 26021 to the cow Second Seconded comments before voting Representative Wynn Thank you Madam Chair I recognize that this is not enough to address emissions but I recognize this is a step And I really appreciate the testimony from the supporters because I recognize that this is a step in the right direction. And when I was a state employee, one of the first vehicles I ever drove was an EV. And so I want to say that I'm a yes today, and I just hope we get more in the future. So thank you so much for bringing this bill. I do not see any other comments. My yes vote today is also contingent upon I would like to see an amendment on seconds that answers some of the concerns from the folks in the amend position. And I think we can get there, and I know you're open to that. And so on that, Mr. Gravy, please call the roll. Representatives Basenecker. Yes. Brooks. Pass. Jackson is excused. Lindsey. Yes. Wynn. Yes. Pascal. Yes. Phillips. Yes. Richardson. Yes. Sucla. No. Velasco is excused.

No.

Yes.

No. Madam Chair. Yes. That passes 8 to 3. Congratulations. You're on your way to the Committee of the Whole. We will go straight into our next bill and turn things over to Vice Chair Stewart.

Thank you. Madam the Gavel. You will move into the position. Can I just... What? Can I get you to sign this real quick? Huh? Oh, yeah. I'll be back. I have to vote. I know, but they might want this sooner than that. Well, because sometimes you have to talk to Mr. Gravy. Would you like my burrito, or should I just take it with you? I'm just kidding. I have this rice that I've been, like, picking out. Now, Woodrow was worried that he has to be out by 6, and I promised him he would be. Ha, ha. Ha, ha. What a torture that would be. That would be like judicial.

We are now on to hearing House Bill 1308. Who would like to start us off? Representative Batesnecker.

Yes.

Representative Woodrow. Thank you, Madam Chair. Thank you, committee members. This bill seeks to address a tremendous affordability problem in Colorado that starts with the question, where did the starter home go? A severe lack of modestly priced starter homes is shutting Coloradans out of opportunities for home ownership. As the New York Times stated a couple years back, nationwide, the small detached house has all but vanished from new construction. Why is that? Well, there are often zoning regulations that require houses to have larger size lots. I believe you might have heard about this on a prior bill that Rep. Stewart and I are still running. When there's a shortage of homes, land prices go up, and large lot requirements themselves restrict the supply of homes, creating a cycle of spiraling prices. This bill aims to alleviate some of that pressure. It's all about deregulation. This bill creates a common-sense, straightforward administrative process for homeowners to divide a single lot into two, unlocking small-scale infill, expanding homeownership, and creating new paths to affordability. Allowing lot splitting would provide a second major benefit. Aside from creating more starter homes, it would create options for homeowners who want to downsize but also stay in their neighborhoods and communities. This bill allows aging homeowners to age in place, families to build wealth through multigenerational housing, and it offers first-time buyers access to starter homes. It also promotes compact development, which encourages efficient use of infrastructure like water, sewer, roads, and encourages sustainable growth and protection of our precious resources and land. It also allows for building diverse housing types, like urban cottages, accessory dwelling units, or even duplexes. Let's build the type of housing that welcomes the young, protects the elderly, and allows Colorado to grow in a way that values Colorado's open space. Let's legalize smaller, more affordable homes. We ask for an aye vote.

THANK YOU. SPONSORS, ARE THERE ANY QUESTIONS FROM THE COMMITTEE FOR OUR BILL SPONSORS?

Representative Bezeneker.

Any other questions for our bill sponsors?

Thank you, Madam Chair.

Representative Basenek.

All right any other questions for our bill sponsors Seeing none thank you both so much We go ahead and bring up our first panel of witnesses which is Samuel Hooper Carla Blanc Paul Major and Shannon Johnson who is online Looks like Carla and Samuel are also online. Looks like most of our witnesses are online on this first panel. All right. I'm going to say it one more time. Samuel Hooper, Paul Major, Shannon Johnson. Great. Ms. Blanc, since I see you up there, we'll go ahead and get started. go ahead and state your name, who you represent. You've got three minutes. Good afternoon, Madam Chair and members of the committee. My name is Carla Blanc. I am a Government Affairs Director with the Colorado Association of Realtors, and I'm here to testify in support of House Bill 1308. House Bill 1308 represents a practical step toward addressing one of Colorado's most pressing challenges, our housing shortage. Colorado continues to face a significant gap between supply and demand, with current estimates placing our statewide shortage at more than 100,000 homes. Addressing that gap will require thoughtful incremental steps to increase home building. This bill helps accomplish that by allowing property owners through an administrative process to split qualifying residential lots into two parcels when certain conditions are met. The realtors also appreciate the thoughtful parameters of sponsors included in this bill. The policy is carefully targeted to communities within metropolitan planning organizations and maintains important protections including lender consent requirements and existing common interest communities. Just as importantly, it preserves the ability of local governments to enforce important health, safety, and infrastructure standards. While the concept is simple, the impact can be meaningful. Enabling lot splits allows homeowners to make better use of the land they already own, creating opportunities for additional housing units, including smaller homes that can serve as starter homes or attainable homeownership opportunities. For us realtors, this legislation aligns closely with two principles we strongly support. First, the need to expand housing supply. Increasing supply is essential if we want to stabilize prices and create pathways to homeownership for more Coloradans. And second, the importance of protecting and promoting private property rights. Property owners should really have reasonable flexibility to use their land in ways that reflect changing family needs, economic realities, and community demand. This bill does not attempt to solve Colorado's housing shortage on its own, but it does create an additional pathway for Coloradans to realize their goals of home ownership. For those reasons, the Colorado Association of Realtors respectfully urges your yes vote on House Bill 1308. Thank you for your time. Thank you very much. We'll go ahead and go to Sam Hooper. Go ahead and introduce yourself, who you represent. You've got three minutes. Thank you, Madam Chair, members of the committee. Thanks for the opportunity to testify in support of this great bill today. My name is Samuel Hooper. I'm legislative counsel at the Institute for Justice. We are a nonprofit public interest law firm that works nationwide to defend property rights and remove unnecessary barriers to new housing. And we believe this bill is a thoughtful and pragmatic reform that restores a basic property right. And that's the ability of homeowners to divide a residential lot into two homes where housing is already allowed. Across Colorado and much of the country, as the bill sponsors so eloquently said, minimum lot sizes and various subdivision rules often prevent even the simplest form of incremental housing, which is doing that basic lot split. And unfortunately, we see this all the time when approvals depend on discretionary hearings. Projects that meet all the rules can still be delayed or denied So having administrative approval ensures that if an applicant meets the statutory criteria the lot split can move forward That very important The bill also contains important guardrails, just allowing that single one lot split by the administrative process, requiring the smaller lot to be a certain size so you don't have those postage stamp size lots that can be a concern sometimes, and making it apply only where residential use is already permitted. These are important elements that make the bill quite measured in its impact, we believe. And thirdly, it preserves important local control over infrastructure and safety protection. So municipalities retain that important control over building code, utilities, stormwater systems, and other elements like that. And finally, the bill respects private covenants and agreements as well. So homeowners that have chosen to live in neighborhoods up to a certain time governed by those private covenants will see those agreements on it. And I'd like to just mention some really useful data that kind of backs up the purpose of this bill. So the American Enterprise Institute has crunched terabytes of data showing exactly which zoning and housing reforms will be the most beneficial in terms of yielding new housing. Lot split flexibilities are one of their top three reforms you can make to have the single biggest impact. They combined in their study lot splitting with also allowing more kinds of homes on smaller lots. So things like townhomes, ADUs, duplexes, and so on. Overall combined, they estimated that within a year, that could, on year to year, that could net 16,000 new homes. Now, obviously, that's not just talking about lot splits. That's including other reforms as well. But even taking into that account, that's still a significant number of new homes for Colorado. This is a really significant reform, one of the biggest bang for bucks you can make in terms of addressing the housing crisis in Colorado. So for these reasons, I'd certainly commend the bill, thank the sponsors for their work on this, and very happy to answer any questions. The Institute for Justice is very strongly in support of this bill. Thank you very much. Thank you very much. We'll go to our last person on this panel, who is Shannon Johnson. Go ahead and let us know who you represent. You've got three minutes. Thank you, Chair and Committee members, and I would like to thank the sponsors for bringing this bill. My name is Shannon Johnson. I am representing myself, and I am a resident of Colorado. This is a wonderful bill, and in addition to allowing for new houses to be built, it also can help alleviate the tax burden for people who have properties that are very large, who have retired and are now struggling with making the property tax payments in Colorado. So that is one thing to also consider when voting upon this bill. There is one thing I would like to see an amendment for, and that has to do with large properties. Requiring a 70-30 split would make it to where if somebody has an acre, they're going to have to be able to split off a minimum of 10,000 square feet. If it is 10 acres, it's 100,000 square feet. So it's just an idea to help people who might have agricultural property and they cannot give up that much land if they did need to split it but regardless with how it's written right now this bill should still pass because it alleviates the housing crisis to a small degree and it also helps alleviate property tax issues and sorry today's been a really stressful day happy saint patrick's days y'all drink responsibly make sure you have a dd and thank you for your time Thank you so much All right committee we got three folks online Are there any questions for our first panel Representative Wynne Thank you ma Chair My question is to Mr Hopper for the Institute of Justice I just want to ask what other states similarly has implemented lot sharing legislation and how successful has this been Mr. Hooper. Thank you, Madam Chair, members of the committee. Yes, Representative. So California passed a bill, SB 9, a few years ago that would allow lot splits, which together in partnership with various other legislation that they've passed around ADUs, much similar to Colorado, is already starting to have an impact. In terms of lot splits specifically, I believe we've seen more work happening at the city level here. So I'm actually based in Austin, Texas. Austin passed a series of initiatives called the home initiatives over the past couple of years. And already, by allowing exactly the same kind of lot splits that this bill considers, we are seeing excellent new construction of single-family attached and detached homes here in the city limits and in some other cities as well. So at the moment, this specific reform we've seen more engaged up by city councils, but it's certainly excellent to do it statewide. That's, you'll yield a much bigger result for that, as we've seen in the data. Any other questions for this panel? All right, seeing none, we'll go ahead and bring up our next set of panelists who I believe are mostly in person. We've got Matt Frommer, Robert Greer, Tim Pegg, and Kate Connelly. If you are online, I see you might be unavailable right now. I will call you up later if you are not available to join us on this panel. Okie dokie. Mr. Frommer, would you like to start us off? Sure. Thanks. Good afternoon, committee members. My name is Matt Frommer, and I work on land use, transportation, and climate policy with the Southwest Energy Efficiency Project, or SWEEP. I urge you to support House Bill 1308, allowing homeowners to split their lots so we can build more homes on less land is a key strategy for reducing housing costs and adding supply in existing walkable neighborhoods, which is a win for affordability, a win for the economy, and a win for the environment. I also want to commend the legislature for staying focused on housing affordability. Recent polling shows that three of the top four issues facing Coloradans are the cost of living, the cost of housing, and homelessness. House Bill 1308 is a missing piece of the housing puzzle. While the state has passed strong housing and land use legislation in recent years, most of these laws have focused on larger multifamily projects, which are primarily rentals. The legislature has done relatively little to expand homeownership opportunities, especially in lower density residential areas. So this lot split bill fills a major gap. Roughly three quarters of residential land in our cities is restricted to single family zoning, often with excessive minimum lot sizes that dictate how much land each home requires. In many cases, the only redevelopment option on the menu is to replace older homes with much larger, more expensive ones. For example, in 2024, the average scrape in Denver replaced a 1,300 square foot home with a 4,400 square foot home, and 80% of those homes were priced at over $1.4 million. This is also out of step with the changing demographics. Today, 61% of Colorado households have only one or two people living in them, including many empty nesters and seniors living in larger homes with unused space. Many would like to downsize without leaving their communities, but can't find a smaller missing middle option nearby. At the same time, growing families often can't find affordable homes with enough bedrooms in urban areas. So they're pushed to the far-flung suburbs, away from their communities, school, and support networks. From a broader growth perspective, we need to unlock more infill opportunities to reduce sprawl on undeveloped land far from jobs and amenities. Under current trends, about half of the homes built in Colorado by 2050 will be greenfield development outside of our metro areas. Instead, we should allow more housing in existing communities where people can drive less, produce fewer emissions, support local businesses, and make use of the infrastructure we've already built, including the roads, utilities, parks, and schools. Communities across the state are already embracing more flexible housing options. By our latest count, 61 local governments have legalized accessory dwelling units, or ADUs, in recent years to comply with the state law, House Bill 24-1152, with many of those local governments going beyond the minimum requirements to encourage their use in their communities. ADUs are a great tool, but they are typically limited to rentals, and this bill builds on that progress by opening the door for more homeownership opportunities. With that, I urge your support. Thank you. Thank you. We'll go ahead on to Mr. Pegg. Introduce yourself, who you represent. You've got three minutes. Sure. I'm Tim Pegg. I'm a resident of Westminster, and I am here on behalf of EMB North Metro. That's yes in my backyard, North Metro. I am asking you to vote yes on this bill because it will help with the high cost of housing first and foremost. A lot of research shows that new market rate housing has down market effects, relieving high prices. We have recently seen a lot of dramatic examples of this in Denver. I don't know if you follow the headlines about falling rents here, but that's great news. And while this bill will not be as dramatic as that, we still expect that it will help the neediest people attain homes that they need. Additionally, on a personal note, after my partner and I own our home, and after thinking about all the factors that are important for us, like being close to work and that kind of thing, we ended up in a neighborhood where there simply were not any other options with smaller yards. Yes, we would have preferred a smaller yard. And while this bill ultimately won't apply to our neighborhood, you know, if folks want to have less backyard and sell that off for someone else to have the opportunity to own a home, I think that's a right that they should have. And so given the way that this enables property owners to get more out of their property and also helps with the affordability of housing, I hope that you will vote yes. Thank you so much, Robert Greer. Go ahead and introduce yourself, who you represent. You've got three minutes. Thank you, Madam Chair. My name is Rob Greer. I am here on behalf of EMB Denver, yes, in my backyard Denver. I'm also an eviction defense attorney who works in each one of your districts, so I'm very familiar with the housing crisis as it applies to your specific jurisdictions. And, yeah, I'm here to ask that you support this. This bill really builds on work that was done in prior sessions. To me, it's also a bit of a matter of property rights. If people have the ability to build literally their backyard or somewhere else on their own property, it makes perfect sense that they should be able to sell that off to somebody else if that's what they so choose. This is really about choice. And Mr. Farmer's point about avoiding tax burden is, I think, a really salient one. I do deal with a lot of people who are on fixed incomes. They are trying to deal with paying their state taxes, et cetera. and being able to sell a part of the property is a really kind of elegant way for them to deal with that problem. And I really don think it makes sense for local governments to be getting in the way of people who want to solve their issues in that way The other issue as this relates to fiscal sustainability relates to Mr Farmer points about the provision of infrastructure, resources, etc. We do know that when you build housing in places that already has roads and transportation infrastructure, water infrastructure, etc., utilities that you have less government outlay per residence, but you're also still getting that tax revenue. So this is a way that we can kind of reduce the overall tax burden as well. And that has beneficial effects throughout the entire economy, not just for people who are facing housing affordability issues or transportation affordability issues, which just also frankly helps out with, but also just with the general size of government. So I would encourage people from across the aisle to vote for this. It really is a matter of property rights, and I think that's pretty straightforward. So thank you all for considering this bill. Thank you. Thanks so much to our panel committee. Do we have questions for this panel? All right. Seeing none, I'm going to bring up our amend panel, which is Jeff Holwell, Bev Stable, Oh, sorry, this is against Jeff Holwell, Bev Stables and Mark Browning, who is online. And then I also would ask if anyone else is here to testify in an against position. You are welcome to come up and join us right now as well. Okie dokie, Miss Stables, why don't you get us started? Thank you so much, Madam Chair and members of the committee. My name is Bev Stables. I'm here on behalf of the Colorado Municipal League and our 271 member municipalities. CML does not have an official position yet on House Bill 1308, approved by our board, but I do want to take the opportunity to highlight some of our concerns. This bill does undermine a fundamental principle that has long-guided land use in Colorado, where decisions about local development are made locally. By allowing residential lots splitting through this administrative approval process, the bill removes the ability of municipalities to apply context-sensitive judgment and elected oversight it replaces deliberation with a one-size-fits-all directive that does not reflect the diversity of communities across our state equally concerning is the elimination of meaningful community input land use decisions shape neighborhoods for generations affecting infrastructure traffic water demand public safety and of course neighborhood character an administrative process that bypasses public hearings effectively silences residents and and neighbors, eroding trust in local government and diminishing transparency. Coloradans expect and deserve a voice in decisions that directly impact where they live. Finally, the bill, generally speaking, disregards sound land use planning. Municipalities invest years developing comprehensive plans, zoning codes, and infrastructure strategies tailored to their unique needs and constraints. House Bill 1308 risks creating unintended consequences, overburdening these utilities, incompatible density patterns and fragmented development that conflicts with carefully crafted plans good planning is not an obstacle to housing solutions it is the framework that ensures these those solutions are sustainable and equitable we all share the goal of addressing housing challenges but this bill unfortunately moves in the wrong direction by stripping local authority and limiting public engagement thank you for your time and consideration thank you so much mr. Holwell go ahead and introduce yourself who you represent you've got three minutes Thank you, Madam Chair and members of the committee. My name is Jeff Hallwell. I'm with the city of Lone Tree in Douglas County. We are proud members of Colorado Municipal League and here today in opposition of this bill primarily as it is a violation of our local home rule land use authority And we believe, along with many other pieces of legislation, that this type of work has been counter to what many of our own local elected officials feel like is their right and duty to support the voices of citizens that represent their city. Public hearings are part of a democratic process. We spend many city council meetings, planning commission meetings, till late at night hearing from our community about various things and their role. They welcome hearing from their residents. They don't need an administrative process to protect them from it. And it's our view that this is another jab at that ability for them to be part of the democratic process. Counter to all that, we are building lots of housing in Lone Tree. If you drive up I-25, I know Representative Brooks sees a lot of this. Housing is the only thing under construction in the city from multifamily, condominiums, affordable single-family homes. And on April 23rd, we'll be opening our next affordable product in the city, adding additional product to our community, to Douglas County. And we're partners with you on all of this. So thank you for your time and happy to answer questions. Thank you so much. We'll go ahead and go online to Mark Browning. Go ahead and introduce yourself, who you represent, and you've got three minutes. Thank you. Good afternoon, Chair and members of the committee. I appreciate the opportunity to testify today. My name is Mark Browning, and I'm an elected member of the Lions Board of Trustees and would like to relay some of our actual real-world experience with lot splitting. We have approximately 12 what we call double lots in our small, mostly built out town. Last year, we received an application from the owner of one of those lots to split it into two in an older neighborhood and add an additional dwelling unit. That brought a lot of concern from neighbors. We addressed the issues by creating a public process that allowed citizen input as well as respected the property owner's rights and to review this proposed lot splitting. The process worked. The applicant communicated with the neighbors who were ultimately satisfied that the proposed new dwelling unit was compatible with their neighborhood. There still needed to be an adjustment of the minimum lot size specified in our town code. so it went to the board of trustees and being supportive as we are of additional middle attainable housing in Lyons we decreased the minimum lot size for these double lots enough to accommodate the requested new dwelling unit our local process worked and we'd like to use it for the additional lots in town that fit this description for a small town these are really neighborhood by neighborhood and even street by street issues we can work them out with our citizens and with our property owners and don't believe that a statewide one one size fits all mandate is either necessary or appropriate to achieve good results for everyone and i would add that we've done had a very successful uh incentives program for adus and lions that has worked quite well um without lot splitting we don't think it's necessary to that process our local control process has worked and we'd like to retain it so we oppose House Bill 26-1308 thank you thank you so much committee we have a panel of folks against are there any questions alright seeing none thank you all so much Now we will bring up folks in an amend position So bringing up Brian Rospert here in person and anyone else who wishes to testify in an amend position in the room, as well as Michael Flynn, Allison Morgan, and Natalie Menton all online. Mr. Rospert, you get to start us off. Thank you, Madam Chair and members of the committee. My name is Brian Rospert. I'm the Executive Director of Housing Colorado. We represent various affordable housing organizations around the state, including affordable homeownership developers. I am here in an amend position today on 1308. We had really good conversations with sponsors about the possibilities for ensuring we do not lose existing affordable housing to the market. and I think one of the amendments you will consider today makes headway in that direction. Overall, though, we see this bill as a strong tool in the toolbox for creating new housing opportunities for those who seek to enter the homeownership market, making it easier to split a large lot and develop new, denser housing will do two things on the newly available land simultaneously. First, it will help with the production and supply-demand economics to help close the 106,000-unit shortfall we have in this state. By unlocking new opportunities for home building in already developed neighborhoods and mitigating one of the biggest costs for new development, which is land, families will be able to afford to transition from renting to homeownership more readily. Secondly, the bill will help existing homeowners to stay in their homes longer. Many homeowners, especially those on low and fixed incomes, are finding it difficult to stay in their homes long-term. Numerous pressures, including increased property taxes and insurance rates, are making it harder and harder for residents to remain in the home that they have lived in and raised families of their own in for decades. Allowing them to split their lot will help alleviate some of this financial pressure. We believe that the bill's sponsors have taken a prudent approach to this effort and have created the necessary guardrails to ensure that the move to administrative review from these types of lot splits will ensure both efficacy of the policy and input from local governments. I thank you for your time today, and I'm ready for any questions you might have. Thank you very much. We'll go online to Allison Morgan. Go ahead and introduce yourself, who you represent. You've got three minutes. Thank you, Madam Chair. I'm Allison Morgan with the Colorado Bankers Association. I would like to thank the bill sponsors for a very robust stakeholder process. Colorado Bankers is in an amend position on this bill. We are part of the technical amendments that will be presented, and I believe the amendments were already handed out. With that amendment, Colorado Bankers really has no issues with the bill at that point because of the robust stakeholding that has taken place, the notifications that will be made to the lien holder and the opportunity for the lien holders to be able to review the process prior to the application. we appreciate the opportunity to have input and we ask for a yes vote on the amendment so thank you very much thank you very much we'll go on to Natalie Menton and Michael Flynn, we called you up. You need to accept the invitation to be a panelist. Ms. Menton, go ahead and introduce yourself, who you represent. You've got three minutes. Thank you, Natalie Menton. And I have mainly questions. So I chose amend as the best category for that. My first question is, right now it's appearing that there would be only one split and that there would be no others allowed in the future so this is perhaps a clarification on that even though i realize this is not a q a session but i'm presenting it once one split and who would be tracking that split and if it's years later is that the responsibility of an assessor or is it the jurisdiction local jurisdictions say a city that would apply under this with the population requirement that's in it so that's one question and then with setbacks I think I heard that the front setback is adjusted to apply to both of the properties in that split but I do I do want to clarify I think what's most important setback in our world of trying to have a little extra room around ourselves would be the side setbacks and the rear setback. So I want to just clarify that those are not tightened up or lessened. Then with stake holding, while I realize big groups have been brought into the stake holding, I am curious whether this has been presented in the neighborhood type of a stake holding. Next is is there any interaction with proposition 123 where this would also be relevant in subsidized housing? So is there any interaction in funding with these properties or is it just part of that blanket subsidized housing that that's potentially what the result is? is those are the questions that i have um considering i just heard verbally the amendments have not seen them on paper and thank you that's all thank you so much and i see mr flynn has joined us uh so go ahead and introduce yourself who you represent you've got three minutes thank you very much uh madam chairman um thank you the committee members and thanks to the two sponsors representative Bayes Necker and representative Woodrow. My name is Michael Flynn. I am a retired attorney and I'm a member of the advocacy committee of the Colorado Mortgage Lenders Association. The CMLA is a trade association which has approximately 145 businesses which are members in the state of Colorado and 1700 member individual members. It contains mortgage brokers, mortgage lenders, credit unions, banks, and others who engage in the mortgage lending area. The members of this organization provide well over half of the residential mortgages to homebuyers in the state of Colorado I here today on behalf of the CMLA to support the bill with amendments Some of the amendments have been picked up already by the sponsor staff and we appreciate that very much. They include notarization of the lender's signature that is to be recorded. We wanted it to be notarized as well, and that has been thought of as a good idea. to add protections to the process. If the process is not done properly, the whole division is null and void. This should create incentives to make sure that the whole process is done properly. And then finally, while the amendments provide that easements and encumbrances are to be listed in the recorded consent of the lender, along with the recorded consent of the lender, we believe that the bill should state specifically that any existing easements and encumbrances on the property should be defined as to whether they go to one of the divided lots, both divided lots, or the other divided lot by process so that all the easements that have been agreed to long before by various parties carry forward with the two subdivided lots. And with those changes in mind, with those changes on the table, CMLA is very supportive of this bill. We believe strongly in the goal of affordable housing in the state of Colorado. Thank you very much. Thank you so much, committee. We've got a couple folks online, one in person and an amend position. Are there any questions? All right. Seeing none, thank you all again. We are going to go ahead and bring up our last panel. We've got Zach Martinez, Laura Reinsch. We've got Chase Stillman in person. We've got Scott Cox online. If Kate Conley is back, you are welcome to join us online as well. And then I know we've got one chair here. So if anyone else is wanting to testify in support, please come on up. Okay. Mr. Martinez, go ahead and start us off. Thank you, Vice Chair and committee members. Thank you for the opportunity to testify in support of House Bill 1308. My name is Zach Martinez. I'm the director of policy and advocacy at Gary advocacy a Colorado based policy organization committing to make it committed to making Colorado the best place to raise a family To accomplish that goal. We desperately need more housing today more than half of renters and a quarter of homeowners are cost burden spending more than 30% of their income on their home This pain is even more stark families with young children who must also commit as much as 30% more of their income on child care So what do we do? Great question. Let's create an environment that allows and even encourages more affordable homeownership opportunities. Colorado currently has the seventh most expensive land in the country. Because of this, on average, 40% of the value of a home comes from the ground that it sits on. The number is even higher in the areas this bill focuses on. An acre of land in Boulder costs on average $1.69 million. In Denver, it's $1.2 million. As a result, it is essentially impossible to build affordable single-family homes and duplexes in Colorado without significant state subsidy. And this problem is getting worse and quickly. In the last 10 years, the value of land has increased by 174% in Colorado. That's about seven times higher than just inflation in that same period. If you can build on half as much land we can reduce the cost of housing by as much as 20 just with that one change This is a small policy that will help make huge impacts on the number of units families can afford that are brought to the market This policy makes sense That why 79% of Colorado voters agree with the statement that individuals should have the right to split their own property into two lots so that they can build additional housing. After all, this land belongs to the member of the community and they should have the right to build on their own land. This bill empowers homeowners to be a part of the solution to the affordability crisis and helps create communities where the workforce that supports Colorado can also afford to live. For what it's worth, I just learned yesterday that the lot north of my house was split before I lived there. It is a duplex that houses two families, and I just learned this after four years of living there, and I found out because I was doing research in preparation for today. This is an excellent way to increase housing, increase affordability, and all in a way where I can live in my home for four years and not even realize it's happening. I urge a yes vote on House Bill 1308. Thank you and happy to answer any questions. Thank you so much. We'll go on to Mr. Stillman. Go ahead and introduce yourself, who you represent. You've got three minutes. oh you've got a little gray button on the bottom of the microphone thank you sorry about that thank you my name is chase stillman i'm a colorado housing developer and a guest lecturer at the university of denver where i focus on on how lot splitting regulations shape our neighborhoods my goal is to create attainable housing for first-time buyers in places that people already live work and play many neighborhoods across the front range contain homes built from the 50s to the 70s that are often 900 to 1200 square feet they represent some of the more naturally attainable housing stock in our communities unfortunately current regulations often create an incentive to demolish those homes across many jurisdictions subdivisions and zoning rules effectively require one home on one lot even when the land could reasonably support additional smaller homes So when a builder evaluates a property with a modest older home on it, the planning process is straightforward. Often, the only viable redevelopment option under current rules is to demolish that home and replace it with a much larger one, often 4,000 to 5,000 square feet. That outcome is not driven by demand, but by the regulatory framework. In my research and guest lecturing at the University of Denver, I study and teach the redevelopment scenarios that small local builders and developers face when evaluating a typical infill lot. When we model the options under current regulations, the incentives often push towards the demolition and replacement with luxury homes. But when we model that same lot under the scenario where lot splitting is allowed, the economics change dramatically. Instead of demolishing the existing home, the builder often has a strong incentive to preserve the existing structure and add additional modest homes on the remaining land. That approach produces more attainable housing, preserves existing housing stock, and allows incremental infill that fits the scale of the neighborhoods they reside in. This type of housing is often referred to as missing middle housing, modest homes built on smaller lots that provide more attainable paths to ownership. This bill simply allows jurisdictions to administratively approve the splitting of residential lots into two lots when certain basic conditions are met. That one policy change helps correct the unintended incentive that currently pushes redevelopment towards larger and more expensive homes. It allows builders to preserve existing homes and add smaller starter homes alongside them. I believe Colorado needs more housing options between large single-family homes and large apartment buildings. Policies like this help make that kind of incremental infill housing possible. Thank you for your time Thank you so much All right Ms Ranch THANK YOU CHAIR and members of the committee My name is Laura Reinch and I the Executive Director of Centennial State Prosperity Our organization works to grow our economy by raising Coloradans' incomes and lowering costs so that hardworking people can have the opportunity to build a good life. And I'm here today to ask you to vote yes on House Bill 1308. A big part of lowering costs, which you all have heard, for hardworking Coloradans is making sure that our state addresses our growing housing shortage and affordability crisis. House Bill 1308 helps address this crisis by allowing homeowners to sell a part of the lot their home is on for the construction of another home. This creates new homes that are smaller and less expensive, increases homeownership opportunities at lower price points, and gives longtime homeowners a way to stay in their homes and communities instead of being priced out. But today I'd actually like to focus on how this legislation will increase homeownership for people like me. I have lived in Denver for 20 years and have been a renter that entire time. I want to own a smaller home that meets my needs, but there are limited options. And when I finally was making enough money to consider homeownership, it is too expensive. I pretty much resign myself to the fact that I'm probably going to be renting here for the rest of my life, unless something changes with the types of homes that are built. I deeply appreciate the efforts that the legislature has made in recent years to build more housing of all different kinds. But I think the reason that this bill stands out is that it's focused on building starter and smaller homes that are often referred to as missing middle housing that someone like me can live in where I don't need a big house and I don't necessarily want to live in a condo or a townhome. I'm excited honestly about the opportunity this bill represents for so many Coloradans for me it means it could be possible in the next couple of years to own a small home in the city I plan on living in for the rest of my life while someone else will have the opportunity to rent the apartment that I currently live in the possibility this bill represents that every Coloradan will finally have the opportunity to have an affordable place to live that meets their needs is why I encourage you all to vote yes on House Bill 1308 today. It is one of the many ways that we can address our affordable housing crisis and shortage. Thank you. Thank you so much. We'll go online to Mr. Cox. Go ahead and introduce yourself, who you represent. You've got three minutes. Thank you. Scott Cox, here's an individual. As we've heard today, Colorado has over 100,000 unit housing shortage. Every subsidized unit we build today costs $150,000 to $250,000 or more in layered government subsidies, land donations, tax credits, gap grants, etc. Multiply that by 100,000 units and you're looking at $15 to $25 billion. Even if we could write those checks, it wouldn't work unless we also entitle more units than we do today. If we subsidize units without increasing total supply were simply converting market rate units to subsidized ones and driving up the price of every remaining market rate unit. You can't fix a supply problem without more supply than you're already producing. Lot splits are part of that additional supply, hiding in plain sight, already connected to existing streets, water, and sewer. And that $15 to $25 billion is just to eliminate the backlog we've already accumulated. It does nothing about next year and the year after. with the state needing roughly 22,000 ownership units per year to maintain a 64% home ownership rate, falling several thousand units short annually. Subsidizing just that annual gap conservatively would cost a billion dollars. a year. Our entire dedicated housing fund, Prop 123, generates $300 million annually. We are not going to subsidize our way out of this. Colorado's average household size is 2.4 persons and falling. Over the last decade, Colorado added roughly 410,000 new households, while population grew by about 677,000 people. That's an incremental household size of 1.65 persons. Colorado's two-person median household income of about $100,000 can afford a home price to around $370,000. The median home in Colorado sells for $600,000. It's a $230,000 gap. We need smaller homes on smaller lots, and this bill makes that possible. We don't have a construction defect fix this session. We don't have a condo pipeline. What we do have is an opportunity to unlock the most cost-effective, affordable ownership product available. Detached homes on small lots. They're modest homes that working Coloradans can actually buy. No other housing fix would produce more supply as fast as this. Lot splits let the market do the work, and no one has to write a $200,000 subsidy check to make it happen. Subsidies are rationed. Supply does not have to be. This bill creates supply. Thank you. Thanks so much to the panel committee. Do we have any questions? Rep. Lindsay. Thank you, Madam Chair. Mr. Stillman, I just have a question about how this would look in a community like mine. I represent Aurora, which is like home of the mid-century brick ranch on a giant lot. So it wouldn't work so much like side-by-side splitting. How does it work if you have a situation with like a really large backyard? Is that something that this can be dumb in? Specifically a front back split is what you're asking about? It can actually work quite well, especially if the area is serviced by an alley. If there's not an alley and there is a sufficiently wide cross section on the street, you can have an access easement or even a split that gets you to the backyard so that there's a drive access and a walking path. With an alley, it's better to think in terms of almost a court product. So the rear home would be facing the rear of the lot. The front door would be towards the alley. It would have its own space around it and parking that comes off the alley, where guests and foot traffic could still approach from the front on the street and walk back to it. We've done some studies specifically in Denver and Englewood and a little bit in Aurora, but I haven't gotten as deep there that look specifically at lot fitments in areas that are a little older and do have alleyways. It's in the tens of thousands of lots that would work specifically in Denver alone and could, it can bring upwards of 30,000 housing units just in the city of Denver. The rear access is something that you would see very often in new greenfield construction. And that's frankly where we're building the smallest homes because you're starting with a fresh slate. They're very, very difficult to get done more infill, and I think a lot of the panelists prior to us had some great points on the fiscal debt that those greenfield developments cause to the jurisdictions. We have the infrastructure, and we have the jobs and the schools and the third places outside of the home and the job in our cities already, and that's where people want to be. Any additional questions for this panel All right seeing none and with a last call already done three times the witness phase is closed Thank you all so much on to amendments representative do you want to move them thank you madam chair I move L1 to house bill 1308 alright that's a proper motion in a second tell us about your amendment amendment L zero zero one is a technical amendment clarifying the part of the bill that holders of debt with an interest in the lot are notified of a lot split prior to approval it makes conforming changes to align with standard real estate instrument recording practices we asked for ESO are there any questions about this amendment Any opposition? All right. Seeing none, Amendment L1 is passed. Representative Woodrow. Thank you, Madam Chair. L002 adds the definition of lot split. It defines a lot split as the process of subdividing one lot into two lots. This adds clarity to the part of the bill that states property that has already gone through a lot split cannot be split again. Representative Batesenecker. Thank you, Madam Chair. I move L2 to House Bill 1308. Second. That's proper motion. And a second. Any questions from the committee about L2? Representative Paschal. Thank you, Madam Chair. So did you say the lot can never be split again, or was it that it can't be split through the administrative process again? Okay, latter. Okay, thank you. Any other questions about this amendment? Seeing any objection. Seeing none, amendment L2 is adopted. Representative Basenecker. Thank you, Madam Chair. I move L3 to House Bill 1308. Proper motion in a second. Explain the amendment. Thank you, Madam Chair. This amendment ensures that prior to a lot split being approved, a subject jurisdiction verifies that both of the lots have street access, utility easements are able to serve both lots, and that Platte and statutory land survey requirements have been met. The amendment also revises the maximum lots proportion lot split proportion so that a new lock could be 30% of the original lot to offer additional flexibility. Yes, sir. Yes, so Any questions about amendment all three Any objections seeing none all three is passed Representative I'll move it madam chair l4 to House bill 1308 second. Okay representative Woodrow Thank you, Madam Chair. L-004, this clarifies the typical subject jurisdiction review requirements. This amendment provides additional clarity that subject jurisdictions may establish processes to review lot splits and require typical information for the subdivision of real property, including ownership, physical site information, lot lines, adequacy of utility service, land dedication requirements, and necessary public improvements. We ask for an aye vote. Any questions about L-4? Any objections? Seeing none, L4 is adopted. Representative Batesenecker. Thank you, Madam Chair. I move L5 to House Bill 1308. Second. All right. Proper motion in a second. Tell us about L5. Thank you, Madam Chair. L5 simply clarifies some of the setback requirements. This amendment ensures that reasonable setback standards can be applied along the shared lot lines of newly created lots that can allow housing to be built It also clarifies that the bill does not invalidate or alter private covenants conditions or restrictions such as affordable deed restrictions and covenants recorded against the original lot. This is the testimony you heard from Housing Colorado as well, stating that it's important to maintain those deed restrictions for affordability in these processes So those interests would be consulted before a lot split. I should say as well in relation to a question that came up in testimony, other setback standards can be applied to these lots as they currently are. You just can't apply a unique standard specifically for a lot split any more than you could an ADU or another project. That's existing practice. So those health and safety standards stay in place. Any questions about L5? Any objection to L5? Seeing none, L5 is adopted. Sponsors, any additional amendments? Any amendments from the committee? Seeing none, the amendments phase is closed. Wrap up, bill sponsors. Who wants to go first? Brett Baznicker.

note to say thank you so much to the witnesses who came and testified and colleagues. Thank you for your time this afternoon to hear us out on this, dare I say, magically delicious policy. I am lucky, charmed actually, to have gotten to work on this bill with Rep Basinecker. Like a pot of gold at the end of the rainbow, this policy will lead to such riches as increased home ownership and generational wealth. We're in a real housing pinch, and I'm tickled green to ask for your aye vote. Thank you.

Now I can't vote for it.

Chair, thank you. I believe Bill sponsors, you know, that I am deeply appreciative, truly, of the work that you're doing in this space. And I don't take it as a personal affront or attack about the statistics around Douglas County, because I'm well aware that that is something that in the county that we do have an issue that we're looking at trying to get at and solve. also because just with everything wrapped around that, from metro districts and taxes, just everything else that's going on, it's making it to the point where you've got folks that have lived there for a while. We're not talking about just people that are trying to move into the area, but people that have moved there for a while, grandparents there to visit their grandbabies that are being priced out of being able to even stay in that area. And so workforce, attainable, all of those things are very, very important. I'm not going to be able to support the bill today just because it's still as written. There are deep concerns that my own municipality, of which I have one, and then also I don't always agree with groups like CML. But then there are times that I do believe that they're on point and that their concerns are particularly profound for my immediate area. That resonated with me today. I still want to just impress that I believe that this is work that we need to continue to do. And it's not necessarily just a policy. No, it's just a particular issue. how we're getting at it this time is just not quite there for me yet.

Thank you, Madam Chair. I'll be very brief. This bill is going to affect my generation. You know, young people like me, people under 35, we are just not able to afford any homes. There are no homes. And I like to say that I'm a Boulder refugee. I grew up in Boulder and was born and raised there. And when you graduate from college, you can't afford a house there. So I'm a resounding yes for this bill. Thank you.

Thank you, Madam Chair. I move House Bill 1308 as amended to the committee of the whole with a favorable recommendation.

Yes. Brooks.

Yes. Lindsey.

Yes. Pascal.

Yes. Richardson.

No. Velasco is excused. Weinberg.

No.

Yes.

Madam Chair, thank you. Thanks to my co-prime as well. Colorado's real estate market touches, I think we know, nearly every single family in the state, whether it's a homeowner, a renter, a small business owner, division of real estate, and the real estate commission are right there. There is our front line for consumer protection in that market. Licensing and overseeing brokers, subdivision developers, appraisers, mortgage loan originators, handling complaints when something goes wrong, the bill that you have before you right now continues those core functions for 11 years through 2037 so that Colorado's can continue on in a fair, protected, transparent real estate marketplace. And so I ask first for your support. Thank you. Any questions from the committee for

Mike Chambers, you are pulled up, so you are up first. Go ahead and introduce yourself, who you represent, and you've got three minutes. Madam Chair, members of the committee, thank you for the opportunity to speak today. My name is Michael Chambers. I'm a Boulder resident and the founder and CEO of Ridley, a real estate technology company focused on giving consumers more transparency and control when buying or selling a home. I should start by noting I'm generally skeptical of excessive regulation. I think in most industries, competition produces better outcomes for consumers. In fact, I've been openly critical of certain real estate regulations in Colorado that limit consumer choice. The minimum service law is one example. In most states, a homeowner can pay a small fee to have their home listed on the MLS. In Colorado, that option doesn't exist. And homeowners are required to pay for additional brokerage services they may not want or need. I ran into that law when I tried to sell my own home in Boulder last year. But what I experienced also made clear why strong consumer protections are necessary in this industry. There was documented evidence of steering. Access to information was limited. And I saw how industry rules can make it incredibly difficult for consumers to pursue alternatives. My experience received national attention, but the important thing to understand is that my story isn't unusual. Since founding Ridley, I hear from consumers across Colorado every day who have encountered conduct that should not occur in a properly regulated market. That's the backdrop for why this bill matters. I'm here today to support 1287 as introduced and to respectfully urge this committee to resist amendments that would weaken its consumer protections. The bill addresses several clear gaps in the current consumer protection framework. First is the restitution provision. Today if a broker harms a consumer the commission can find that broker or revoke their license but it cannot require the broker to repay the consumer who is harmed That forces consumers to pursue civil litigation even after the state has determined wrongdoing If an offense is serious enough to warrant a fine or the loss of a license, it should also require making the consumer whole. The Mortgage Loan Originator Board already has this authority and there is little reason the Division of Real Estate should not have the same tool. Second, the bill strengthens accountability by extending the cooling off period before someone whose license was revoked can return to the profession. Professional licenses aren't revoked lightly. When someone loses a license because they harmed consumers, there should be real consequences before they are allowed back into the market. Finally, amendments should not reintroduce conflicts of interest into Colorado's real estate forms process. Colorado has long been a leader in standardized contracts, but that system only works if oversight remains independent. When industry participants influence that process, there is a real risk that proposed changes prioritize limiting broker liability rather than strengthening protections for consumers. I want to end by acknowledging that the vast majority of real estate brokers in Colorado are ethical professionals who work incredibly hard for their clients. Strong consumer protections support them as well by ensuring bad actors don't undermine trust in the profession. At its core, this bill is about making sure that when consumers are harmed, the regulatory system actually protects them. This bill gives regulators the tools to do that. And as an owner of a real estate company that operates a brokerage, I would be held to the same standards this bill reinforces,

Well, thank you so much, Madam Chair, members of the committee. My name is Andrea Kuik, and I'm the Director of Policy and Research with the Bell Policy Center. We're a policy advocacy research organization that ensures economic mobility for every Coloradan. And we're here this afternoon in support of House Bill 1287, which continues the division of real estate and the Real Estate Commission and implements recommendations from the recent Sunset Report. As an organization committed to advancing economic mobility for every Coloradan, we know that homeownership is a crucial building block to long-term wealth building and financial stability. On average, the net worth of a homeowner is 400% higher than for a renter of a similar demographic and earning group. Homeownership protects against price hikes in the rental market, provides collateral when a family needs a loan to meet an unexpected expense, and creates an asset which can be used to cede the wealth of future generations. Unfortunately, however, as many know all too well, homeownership has become increasingly difficult to achieve, particularly for many low and middle income Coloradans. The dual realities laid out above highlight the need for continuing the division of real estate. This important body is charged with protecting consumers as they navigate the real estate environment. The protections provided by the division are particularly important for first-time homebuyers and those from marginalized communities who are more likely to face barriers throughout the home buying process. Additionally, we are appreciative of House Bill 1287's adoption of the recommendations in the recent Sunset Report, particularly the authorization of the Real Estate Commission to order restitution when a broker directly misappropriates client funds. While the vast majority of brokers are doing good work, we believe that when a broker directly misappropriates funds, they should be held accountable as their actions can make a difference in whether a Coloradan is able to become a homeowner or not. Currently, agreed Coloradans are able to use the courts when wronged by their broker. However, we also know that doing so can be costly and complex and these factors can create barriers for Coloradans who are often swamped with everyday home work and family responsibilities Giving the commission the ability to order restitution will make it more likely that harmed Coloradans can recoup their losses Concerningly, the Sunset Report notes that consumer complaints regarding the mishandling of trust accounts are both relatively prevalent and on the rise. We believe this underscores the need to adopt this recommendation from the Sunset Report. Homeownership remains one of the strongest paths to economic security and mobility. The Division of Real Estate, Real Estate Commission, and Sunset Review recommendations are important components to ensuring this pathway remains open to every Coloradan. As such, we strongly encourage the committee to adopt House Bill 26-1287, and thank you again so much for your time.

It helps doesn't it? House bill 1287. Amendment L005 addresses a conflict that has put Colorado brokers in an impossible position. State law requires supervising brokers to oversee the licensees working under them. The supervision requirement that exists is to protect consumers. It ensures that licensed professionals are accountable and that someone with experience is watching over the transaction. The Division of Real Estate has interpreted a separate provision of this same law to prohibit brokers from sharing confidential information with their supervisors absent an ambiguous informed consent standard. L-005 resolves this conflict with a narrow, sensible exception. A broker may share confidential information with their supervisor solely for the purposes of oversight, and the supervisor may not use that information to the client's detriment. It also strengthens the consumer protection across the board by requiring express written consent for any other disclosure of confidential information. This approach is entirely consistent with how the Commission's own standard form listing agreements were written for more than 30 years, language that was notably removed from the forms as of January 1, 2026, creating the very problem this amendment seeks to correct. L-003 fixes an unintended consequences that, as far as we can determine, exist in no other state in the country. Current Colorado law requires a real estate licensee to hold any money belonging to others for any reason in a highly specialized real estate trust account. Not just money from a client's real estate transaction, any money from anyone for any purpose. L-003 simply limits the trust account requirement to money received in connection with the actual licensed activities on behalf of clients. That is what the law has always been meant to do, and that is what this amendment does. L-004 simply aligns Colorado with federal law. When a real estate licensee or their firm has an affiliated business relationship, meaning they have an ownership interest in a related service provider like a title or mortgage company, they are required to disclose that relationship and avoid conflicts of interest. That requirement exists to protect consumers and CAR fully supports it. But current Colorado statute goes well beyond what federal RESPA law requires. It obligates a licensee to obtain a signed acknowledgement of the disclosure from every party in the transaction, including the buyer or seller on the other side of the transaction. who is represented by a completely different agent and has no relationship with the disclosing licensee whatsoever. There's no policy justification for requiring a licensee to chase down a signature from someone they do not represent. The division itself has recognized this as unworkable and has stopped enforcing the signature requirement on unrepresented third parties, which means the agency is already applying the law as L-004 would write it. The amendment simply makes the statute consistent with federal law and the division's own practice. L-001 finally restitution the underlying bill would give the commission authority to order restitution from licensees we respectfully oppose that provision and support L-001 which removes it restitution is a judicial remedy it requires an adversarial proceeding findings of fact credibility determinations in the full due process protection that a court of law provides these are not tools of a regulatory commission they are tools of a court giving the commission authority to order one party to pay money to another fundamentally changes the character of what the commission does and raises serious constitutional due process concerns. Colorado consumers who are harmed by a licensee have a meaningful, well-established path to relief through civil litigation. I'm so sorry.

Please wrap up. I will. Well, we urge you to adopt all four amendments, and I would be very happy to take any questions, and I apologize for my extra time.

Madam Chair, my name is Marsha Waters. I'm the Director of Dora's Division of Real Estate.

Please introduce yourself and what questions we might ask you. Hi, Madam Chair. I'm Saheb Singh with the Colorado Office of Policy Research Regulatory Reform, and we wrote the Sunset Report.

My question is for anybody. So I'm wondering about liability insurance. And so do – I just don't know if – as an attorney, I have liability insurance, you know, for malpractice. Do real estate brokers have liability insurance? And the reason why I'm asking is if they do have liability insurance, then is that restitution covered under their liability insurance?

Thank you, Madam Chair. Yes, they are. Colorado is one of, I think, 14 or 15 states in the country that obligates a real estate licensee to obtain what we call errors and omissions insurance in certain minimum amounts Every active licensee has to provide proof of that annually And that is one of our concerns and challenges with restitution Restitution would not be covered by a broker errors and emissions insurance And errors and emissions insurance certainly is something that helps protect a broker from personal liability for activities like this. But the reason the state has it in place is because it protects consumers and it provides them a pool or pot of money to the point that a broker who has harmed a consumer and has been determined to have civil liability for that harm that they've created for a consumer is able to tap into regardless of the personal financial situation that a broker may or may not be in. And that's one of the problems here with restitution is that if a restitution award were given by – awarded by the commission, it would be enforceable essentially by the commission. It would not be covered by errors and emissions insurance. And to the extent that for some reason, let's say that a broker were – had their license revoked, their incentive to pay back any restitution order that was given is none. because the only way that enforcement could be would be in connection with receiving the return of their license. And in a situation where a license, as an example, was permanently revoked, that person would not have any incentive to even pay the restitution order because the commission would have no sort of control over them at that point, and it would, to your point, not be covered at all by the E&O insurance policy.

Rep Zucla. Thank you. So thank you, Madam Chair. So with the four amendments, are you then in support of the bill or against?

Thank you, Madam Chair. Yes, absolutely. We would support the bill with the four amendments included.

Representative Brooks. I move L003 to 1237. And I'm proud to second that.

Thank you, Madam Chair. L3 resolves that I think unintended consequences of commingled funds and trust accounts, and it just makes clear what types of funds are subject to that requirement and what types of funds are not. So we'd ask for your support.

Madam Chair, thank you. I move 005 to 1287. Sadly, I know that we had expected probably another six amendments, but this will be our last.

Thank you, Madam Chair. I'm with you now. This amendment does two things that expressly permits a broker to share clients confidential transaction information with their supervising broker but only for the purposes of proper supervision And only so long as the supervisor does not use that information to the client detriment It also clarifies and strengthens the consent standard for all their disclosures of confidential information requiring express written consent rather than just informed consent. We think this is best practice to protect folks on both sides of a transaction. We'd ask for a yes.

No, Madam Chair.

Thank you. Madam Chair, thank you. 1287 is simply about continuity and accountability in the sector, specifically that's central to Colorado families and their financial lives. It keeps the Division of Real Estate and Real Estate Commission going through 2037. I believe that this bill, as you heard, especially through the amendment process, strikes a good balance between supporting a healthy real estate industry, safeguarding the public. I respectfully ask for a favorable vote on House Bill 26-1287.

Ditto.

I move 1287 as amended to the Committee on Finance.

Yes.

Yes.

Yes.

Yes.

Yes.

Yes.

Yes.

Yes.

Yes.

Weinberg.