Rep. Gretchen Rydin

The act:Allows the department of public health and environment (department) to expend money from the community impact cash fund to provide grants for municipal solid waste landfill methane emission reduction projects;Requires the environmental justice advisory board to prioritize a grant request from a local government that owns or operates a municipal solid waste landfill over a grant request from a private entity that owns or operates a municipal solid waste landfill;Requires an entity that receives money from the department to use the money as supplemental funding only; andAmends the definition of 'disproportionately impacted community'.(Note: This summary applies to this bill as enacted.)

The act requires the secretary of state to refer a ballot issue at the November 2026 general election to seek voter approval for the state, beginning in the 2026-27 state fiscal year, to retain and spend an amount of state revenue equal to the amount of state public K-12 education funding in excess of the limitation on state fiscal year spending and to increase state public K-12 education funding by up to 2% per year for 10 years.     The act directs legislative council staff to determine the amount of state public K-12 education funding and describes how legislative council staff will make that determination.     The act creates a positive factor to increase state public K-12 education funding. The amount of the positive factor compounds annually for 10 years. The positive factor for the 2026-27 budget year is 2% of the program foundation calculated for the 2025-26 budget year. For the 2027-28 through 2034-35 budget years, it is the sum of 2% of the prior year's program foundation plus the prior year's positive factor. For the 2035-36 budget year and beyond, it is the sum of 2% of the 2034-35 program foundation plus the 2034-35 positive factor.     A district's share of the positive factor is calculated proportionally based on the district's total program under the new school finance formula relative to the statewide total program.     A district may only use its positive factor funding for increasing teacher pay, improving teacher retention, lowering class sizes, and increasing access to career and technical courses.     For the 2026-27 state fiscal year, the children's account consists of an amount of money equal to the amount of state revenues that the state retains for a given fiscal year pursuant to voter approval of the act. For state fiscal years commencing on or after July 1, 2027, the account consists of that same amount minus an amount equal to the total dollar amount of warrants issued by the state treasurer to reimburse local governments for property tax exemptions. Money in the account must first be spent to pay districts their positive factor, then any remaining funds are appropriated for disability services and school services and to increase annual contact hours, and finally to programs prioritizing child care and full-day preschool.     The act directs the state auditor to conduct and publish a report on excess state revenues for each state fiscal year that the state retains and spends state revenues in excess of the limitation on state fiscal year spending. That report must include descriptions of:The amount of state revenues that the state retained and spent that would otherwise have been in excess of the limitation on state fiscal year spending; andHow the state expended the state revenues that the state retained and spent that would otherwise have been in excess of the limitation on state fiscal year spending.     Beginning August 1, 2027, the act requires each local education provider to post, online for free public access in a format that can be downloaded and sorted, its actual expenditures of any positive factor received.     Lastly, the act updates provisions regarding the expanded earned income tax credit, the family affordability tax credit, and the affordable housing financing fund to ensure that voter approval of the act does not adversely impact those programs.(Note: This summary applies to this bill as enacted.)

The act adds the state board of parole as an entity that may approve an application for early parole for an offender who has successfully completed a specialized program as provided in current law. The offender must have been convicted of a certain predicate felony and committed the felony when they were younger than 21 years old.     The state board of parole can approve or deny the application if the governor has not acted on the application within 60 days after receiving the board's recommendation. If the governor acts on the application within 60 days, the governor's decision is final. If the governor does not act on the application, the state board of parole's decision is final.     Under current law, there is a specialized program for juveniles and young adults convicted as adults that must include components that allow an offender to experience placement with more independence in daily life. The act requires the specialized program to include programming that requires an offender to acknowledge the impact of crime on victims and the ongoing trauma that crime survivors experience, as well as the offender's own trauma.(Note: This summary applies to this bill as enacted.)

An inmate who is serving a sentence to the department of corrections (DOC) for certain lower level criminal offenses, has not incurred a penal discipline violation within a specified time period, and is program compliant is currently eligible to earn 12 days of earned time per month. The act increases eligibility to 14 days per month.     An inmate who is serving a sentence for, or who has been previously convicted of, certain higher level criminal offenses, including a felony offense listed in the 'Victim Rights Act', is currently eligible to earn 10 days of earned time per month. The act increases eligibility to 12 days per month.     An inmate who completes a milestone or phase of a behavioral health program in an area related to recovery from a condition that contributed to the inmate's underlying offense may be awarded up to 150 days of earned time.     The DOC is directed to enact policy changes to incentivize inmates to pursue activities that award earned time.     The act creates a working group to make recommendations for a capacity management plan (plan) for the DOC with input from impacted groups. The plan must be informed by strategies to assess prison programming and clinical care, inmate release processes, services for successful release outcomes, prison population management, and prison capacity changes. Members of the house of representatives judiciary committee, the senate judiciary committee, and the joint budget committee may submit in writing to the chair of the working group a request to prioritize specific issues or provide other relevant information. The working group shall submit an interim and a final report to the general assembly, the DOC's certified employee organization, and the governor's office.(Note: This summary applies to this bill as enacted.)

Current law requires each principal department of the state (department) to establish a schedule to review all of its rules. The act requires the review to occur at least every 5 years. Current law directs each department to make certain determinations when conducting the review of the rules. The act requires the following additional determinations:Whether the department has rules with the same or similar purpose, intent, or goal and, if so, how those are coordinated and whether redundant rules can be eliminated;Whether the rule is outdated or obsolete;Whether funding levels to support the program or function subject to the rule are appropriate; andWhether there are opportunities to improve the effectiveness of the rule in meeting its purpose, intent, or goal.     Current law requires each department to present a report at its 'SMART Act' hearing regarding its mandatory review of all rules. The act permits the committee of reference presiding over the 'SMART Act' hearing to make a recommendation whether a program or function subject to the rules should be subject to a sunset review or may make a recommendation to the legislative audit committee for an audit by the office of the state auditor.     The act clarifies the attorney general's responsibility regarding litigation discovery on behalf of the state of Colorado or on behalf of the people of the state of Colorado.(Note: This summary applies to this bill as enacted.)

The bill grants the energy and carbon management commission (commission) authority over class I, class IV, and class V injection wells and allows the commission to seek and adopt rules related to primacy from the United States environmental protection agency (EPA) for these classes of injection wells. The rules adopted by the commission may only be more stringent than corresponding federal requirements if certain findings are made at a public hearing. The commission may assess and collect fees related to the regulation of class I, class IV, and class V injection wells. A person that willfully violates a rule, permit, authorization, or order of the commission related to these classes of injection wells commits a misdemeanor and is subject to certain penalties. The executive director of the department of resources (executive director) is required to propose initial spending authority in the amount necessary to enforce rules for the permitting, authorization, and regulation of class I, class IV, and class V injection wells. The office of state planning and budgeting (OSPB) is also required to submit a proposal to eliminate or minimize the impact of associated fee revenue for the first state fiscal year that the fee revenue is assessed on the state fiscal year spending limitation in the state constitution.     The bill also grants the mined land reclamation board (board) authority over class III injection wells and allows the board to seek and adopt rules related to primacy from the EPA for class III injection wells. The board may assess and collect fees related to the regulation of class III injection wells. The rules adopted by the board may only be more stringent than corresponding federal requirements if certain findings are made at a public hearing. A person that violates a rule, permit, authorization, or order of the board related to class III injection wells or that operates a class III injection well without a permit from the board is subject to certain penalties. The bill also provides that a class III injection well is not eligible for an exemption from designated mining operation status, which status subjects the operator to certain rules adopted by the board. The executive director is required to propose initial spending authority in the amount necessary to enforce rules for the permitting, authorization, and regulation of class III injection wells. OSPB is also required to submit a proposal to eliminate or minimize the impact of associated fee revenue for the first state fiscal year that the fee revenue is assessed on the state fiscal year spending limitation in the state constitution.(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Recent changes to the federal income tax code significantly increased the amount of business-related expenses that may be deducted for federal income tax purposes as follows:Expanded the business interest deduction limitation pursuant to section 163 (j) of the internal revenue code (IRC) by adding back depreciation, amortization, and depletion for calculation of adjusted taxable income and determination of the deduction base, resulting in many taxpayers, especially capital intensive businesses, being able to deduct a larger portion of their business interest expense; Expanded the bonus depreciation deduction pursuant to section 168 (k) of the IRC by permanently restoring the 100% first-year bonus depreciation deduction for 'qualified property' acquired and placed in service on or after January 20, 2025;Created an elective 100% depreciation deduction in section 168 (n) of the IRC for 'qualified production property', which is property largely tied to manufacturing, production, or refining facilities and that would not otherwise qualify for section 168 (k) bonus depreciation; andCreated a new section 174A of the IRC that allows taxpayers to immediately deduct domestic research and experimental expenditures paid or incurred during the taxable year, rather than requiring such costs to be capitalized and amortized over time.     Because the state income tax is imposed on federal taxable income, these changes to the definition of federal income also exclude these business-related expenses from state income taxation. The bill reverses these changes to the federal tax code for purposes of the state income tax code and creates a new tax credit using the resulting revenue.      Sections 2 and 4 of the bill provide, for income tax years commencing on or after January 1, 2027, that individual and corporate state income taxpayers must add the following to their federal taxable income for purposes of applying the state income tax: An amount equal to the federal deduction claimed by the taxpayer for business interest pursuant to the limitation in section 163 (j) of the IRC to the extent the amount exceeds the amount the taxpayer would have been allowed to claim before the limitation was changed as described above;An amount equal to the federal deduction claimed by the taxpayer for qualified property depreciation pursuant to section 168 (k) of the IRC to the extent the amount claimed exceeds the amount the taxpayer would have been allowed to claim under section 168 (k) prior to the change described above; except that, the taxpayer may reduce the amount required to be added back by the amount of depreciation the taxpayer would have been allowed to claim for the taxable year with respect to the same property pursuant to any section other than section 168 (k) of the IRC prior to the recent federal changes;An amount equal to the federal deduction claimed by the taxpayer for qualified production property depreciation pursuant to section 168 (n) of the IRC; except that, the taxpayer may reduce the amount required to be added back by the amount of depreciation the taxpayer would have been allowed to claim for the taxable year with respect to the same property pursuant to any section other than section 168 (k) of the IRC prior to the recent federal change; andAn amount equal to the federal deduction claimed by the taxpayer for the income tax year for domestic research and experimental expenditures pursuant to section 174A of the IRC; except that, the taxpayer may reduce the amount required to be added back by the amount of the deduction the taxpayer would have been allowed to claim for the taxable year with respect to the same research and experimental expenditures pursuant to section 174 of the IRC prior to the recent federal changes.      Sections 2 and 4 allow taxpayers who are required to make additions to their federal taxable income pursuant to the new provisions to subtract the amounts of their disallowed federal deductions over time, starting in income tax years commencing on or after January 1, 2028, using time periods that reflect how the property or expense would have been treated prior to the recent changes to the federal tax code. If the amount of the allowed subtraction exceeds the taxpayer's federal taxable income, the excess amount not subtracted may be carried forward for up to 10 years.      Section 3 creates a new tax credit. The new tax credit allows taxpayers to claim a refundable tax credit, in addition to the child tax credit and the family affordability tax credit, in an amount determined by the amount and age of the taxpayer's children and the taxpayer's income. The total amount of the new tax credit is adjusted annually based on legislative council staff projections, such that the total amount of the new tax credit claimed in an income tax year is projected to be the same as the amount of revenue raised in sections 2 and 4.(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Provides for the payment of expenses of the executive, legislative, and judicial departments of the state of Colorado, and of its agencies and institutions, for and during the fiscal year beginning July 1, 2026, except as otherwise noted.(Note: This summary applies to this bill as enacted.)

The bill creates the large employer health-care support enterprise (enterprise) to impose, assess, and collect the large employer health-care support fee (enterprise fee) in the amount of $2,300 for each supported worker for the calendar year in an amount determined by the enterprise board (enterprise board) that reflects the costs of the services provided by the enterprise . A worker who is receiving medical assistance benefits under the state medical assistance program, except for a worker eligible for medical assistance benefits based on disability, is a supported worker (supported worker).     An employer is subject to the enterprise fee if the employer is a large employer, which is defined in the bill as an employer that has 500 or more supported workers (large employer). An employer is exempted from paying the enterprise fee if the employer:Provides affordable health coverage to all workers working 20 or more hours per week or 80 or more hours per month;Is a franchisee of the employer;Is a nonprofit employer;Is a public employer; orHas a collective bargaining agreement with its employees that includes health-care coverage.     The business purpose s of the enterprise are to use enterprise fee revenue to help large employers retain supported workers who are not provided employer-sponsored affordable health coverage by using enterprise fee revenue to:Help finance the costs for medical assistance benefits for large employers' supported workers ; and Provide reimbursement grants to large employers for some or all of an employer's costs incurred for allowing a worker to buy into an employer-sponsored health benefit plan, should the employer choose to participate in the worker buy-in program created in the bill.This These business service s reduce s lost productivity due to worker illness and training costs to replace workers who may otherwise seek employment that provides affordable health coverage.     Starting with a review of the 2027 calendar year, the department of health care policy and financing (HCPF) every employer that employed 500 or more workers in the state shall prepare an annual employer report on or before January 31, 2028, and on or before the same date each year thereafter, that includes information about the employer's employees, including the employee's name, date of birth, hours worked, and dates of employment for the preceding calendar year. An employer may seek an exemption from the requirement to file the annual employer report by demonstrating that it provides affordable health coverage to all workers working 20 or more hours per week or 80 or more hours per month. Upon receipt of the annual employer report, the enterprise shall determine whether an employer is a large employer and shall issue a report by March of the following same calendar year that identifies large employers by their number of supported workers for the preceding calendar year and impose the enterprise fee on each large employer . An employer may contest the employer's identification as a large employer. Once identified, a large employer shall either pay the enterprise fee for each of the large employer's supported workers or demonstrate that it provides will offer affordable health coverage to all workers working 20 or more hours per week or 80 or more hours per month. The enterprise may adjust the amount of the enterprise fee to reflect the cost of the services, for inflation, or for other reasons. A large employer commits a petty offense and is subject to a civil penalty for      The enterprise shall contract with the department of revenue to collect and enforce the payment of the enterprise fee on behalf of the enterprise, including the failure to provide information necessary to calculate the enterprise fee or to either timely pay the enterprise fee or demonstrate that the large employer offers affordable health coverage as specified in the bill. The department of revenue may collect interest and penalties and institute collection actions on behalf of the enterprise.     Enterprise revenue is used to support the pay for payment of medical assistance benefits for working-age adults under the state medical assistance program, and to increase reimbursement rates for ensure access to health-care providers providing medical assistance program services, to ensure worker access to medical services and to pay for large employer reimbursement grants under the worker buy-in program for large employers that pay the enterprise fee.     The enterprise is governed by the enterprise board, and the enterprise board shall report annually to the general assembly on the enterprise revenue and the enterprise's use of the enterprise revenue in support of large employers.     If the enterprise determines that the enterprise to would receive more than $100 million dollars in its first 5 fiscal years, the state treasurer shall credit the additional fee revenue to the large employer fee cash fund created in the state treasury for administration by HCPF, and that fee revenue is subject to the state fiscal year spending limit imposed by section 20 of article X of the state constitution and the excess revenues cap. The money in the large employer fee cash fund shall be used by HCPF to pay for costs for medical assistance benefits to support large employers' supported workers enterprise shall reduce the amount of the enterprise fee.(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

The division of housing in the department of local affairs (division) administers an affordable home ownership program (program) that makes grants to nonprofit organizations, local governments, community development financial institutions, and community land trusts (eligible organizations) and tribal governments to support affordable home ownership, including the development of residential housing units that are described in an eligible organization's funding request (project). Current law specifies that only a household with an income less than or equal to 120% of the area median income is eligible for assistance through the program, but it is unclear whether this requirement applies to housing units constructed by an eligible organization through one of its projects. The act clarifies that only a household with an income less than or equal to either 120% of the area median income of households of that size in the jurisdiction of a local government in which the households are located, or 120% of the statewide area median income of households of that size, is eligible for housing constructed by an eligible organization through one of its projects.     In addition, the act requires the program to offer housing that costs not more than 38% of a household's monthly income unless the ownership program is providing a homeowner with assistance for home rehabilitation.     The act also requires the program to offer grants and loans to groups or associations of mobile home owners and their assignees to support affordable homeownership for households with income less than or equal to 120% of the area median income of households of that size in the territory or jurisdiction of the local government in which the households are located, and specifies that the monthly housing payment must not cost more than 35% of the monthly household income. The act allows the division to modify the maximum percentage of income that a household may allocate pursuant to the program as applied to a residential unit constructed by an eligible organization as part of an affordable housing project pursuant to a waiver process initiated by an eligible organization if a substantial need for housing the project's target population exists, the unit has been adequately marketed to eligible buyers for purchase for at least 6 months after final completion of the unit, and the unit has not been purchased by an eligible buyer within that 6-month period.     For grants from the program to support tribal government programs, the tribe is responsible for establishing limitations on household income and maximum percentage of income that a household may allocate for monthly housing costs and a tribal affordability mechanism in lieu of any state-prescribed use covenant. The tribe shall submit evidence to the division that it has satisfied these requirements but is not required to disclose confidential tribal data, including the specific limitations or mechanisms it sets.     The division also administers a land banking program (land banking program) that makes grants to local and tribal governments and loans to nonprofits to acquire and preserve land for the development of affordable housing. For grants made to local governments or loans to nonprofits, the development of affordable housing includes rental housing projects with an imputed income limit by household size not to exceed 60% of area median income. Regulated units in the project must have a gross rent limit that does not exceed 30% of the imputed income limitation applicable to the units. Current law requires that a project provide for-sale housing that may be purchased by a household with an annual income of 100% of area median income. The act changes the income limit to 120% of area median income. For land banking program grants to support tribal government programs, the tribe is required to establish income limits by household size and gross rent limits and is not required to use the limits otherwise required for eligible organizations. The tribal government is required to submit evidence that it has established income and gross rent limits but is not required to disclose confidential tribal data, including what the specific limitations are.     The division may issue a waiver with housing cost limits that are different from those requested by an eligible organization if different housing cost limits would better serve needs identified in the community, the project remains financially feasible, and there are eligible buyers that meet the division's requirements. Alternatively, the division may modify the total amount of funding to account for an increase in the sales price of the unit. In lieu of this process, the division may approve an eligible organization's process for determining when to exceed the maximum monthly household income for a unit funded by the program, which shall not require a 6-month marketing period.     The division may allow an eligible organization to rent residential units constructed as part of the project. On or before December 31, 2026, the division is required to issue guidance for when units within a project may be rented and develop a process by which rented units may return to the for-sale market. A homeowner may rent a unit funded by the ownership program as long as the unit remains their primary residence.(Note: This summary applies to this bill as enacted.)