Mitigate Impacts of Tax Increment Financing

Second Regular Session Seventy-fifth General Assembly STATE OF COLORADO INTRODUCED SENATE BILL 26-129 LLS NO. 26-0077.02 Caroline Martin x5902 SENATE SPONSORSHIP Marchman, HOUSE SPONSORSHIP Boesenecker, Senate Committees House Committees Local Government & Housing A BILL FOR AN ACT CONCERNING MITIGATION OF THE IMPACTS OF TAX INCREMENT FINANCING ON LOCAL GOVERNMENTS, AND, IN CONNECTION THEREWITH, REQUIRING LOCAL CERTIFICATION OF IMPACT REPORTS AND A REPORT ON THE IMPACT OF TAX INCREMENT FINANCING ON EDUCATION FUNDING.

Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.) Current law requires county revitalization authorities and urban renewal authorities to, in certain instances, submit impact reports that Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.

Capital letters or bold & italic numbers indicate new material to be added to existing law. Dashes through the words or numbers indicate deletions from existing law.

detail the potential impacts of a proposed urban renewal or county revitalization plan on local services and infrastructure. The bill requires taxing entities that would be subject to tax increment financing pursuant to a proposed urban renewal or county revitalization plan to file either a certification of or a technical rebuttal to an impact report. If a taxing entity does not file either a certification or a technical rebuttal within 45 days after a county revitalization authority or urban renewal authority's submission of an urban renewal or county revitalization impact report, the impact report is presumed certified. The bill also requires taxing entities that would be subject to tax increment financing pursuant to a downtown development authority's proposed plan of development to file either a certification of or a technical rebuttal to a downtown development authority's impact report. On or before October 1, 2027, and on or before October 1 of each year thereafter, the legislative council staff is required to prepare a report or issue brief on the impact of tax increment financing on the state and local shares of education funding.

Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, 30-31-103, add (14.5) as follows:

30-31-103. Definitions.

As used in this article 31, unless the context otherwise requires:

(14.5) "TAXING ENTITY" MEANS A PUBLIC BODY THAT LEVIES SALES OR PROPERTY TAXES AND WHOSE TAX REVENUE IS ALLOCATED AS PART OF A PROPOSED OR FINALIZED COUNTY REVITALIZATION PLAN PURSUANT TO SECTION 30-31-109 (13).

SECTION 2. In Colorado Revised Statutes, 30-31-109, add (3)(d) as follows: 30-31-109. Approval of county revitalization plans by local governing body - definitions.

(3) (d) WITHIN FORTY-FIVE DAYS OF A COUNTY OR AUTHORITY SUBMITTING A COUNTY REVITALIZATION IMPACT REPORT IN CONNECTION WITH A COUNTY REVITALIZATION PLAN IN ACCORDANCE WITH THIS SUBSECTION (3), EACH TAXING ENTITY IMPACTED BY THAT PLAN SHALL FILE EITHER A CERTIFICATION OF OR A TECHNICAL REBUTTAL TO THE COUNTY REVITALIZATION IMPACT REPORT. IF A TAXING ENTITY DOES NOT FILE EITHER A CERTIFICATION OR A TECHNICAL REBUTTAL, THE COUNTY REVITALIZATION IMPACT REPORT IS PRESUMED CERTIFIED.

SECTION 3. In Colorado Revised Statutes, 31-25-103, add (7.3) as follows:

31-25-103. Definitions.

As used in this part 1, unless the context otherwise requires:

(7.3) "TAXING ENTITY" MEANS A PUBLIC BODY THAT LEVIES SALES OR PROPERTY TAXES AND WHOSE TAX REVENUE INCREMENT IS ALLOCATED AS PART OF A PROPOSED OR FINALIZED URBAN RENEWAL PLAN PURSUANT TO SECTION 31-25-107 (9)(a).

SECTION 4. In Colorado Revised Statutes, 31-25-107, add (3.5)(d) and (14) as follows:

Approval of urban renewal plans by local governing body - definitions.

(3.5) (d) WITHIN FORTY-FIVE DAYS OF AN AUTHORITY SUBMITTING AN URBAN RENEWAL IMPACT REPORT IN CONNECTION WITH AN URBAN RENEWAL PLAN IN ACCORDANCE WITH THIS SUBSECTION (3.5), EACH TAXING ENTITY IMPACTED BY THAT PLAN SHALL FILE EITHER A CERTIFICATION OF OR A TECHNICAL REBUTTAL TO THE URBAN RENEWAL IMPACT REPORT.

CERTIFICATION OR A TECHNICAL REBUTTAL, THE URBAN RENEWAL IMPACT REPORT IS PRESUMED CERTIFIED.

IF A TAXING ENTITY DOES NOT FILE EITHER A

(14) ON OR BEFORE OCTOBER 1, 2027, AND ON OR BEFORE OCTOBER 1 OF EACH YEAR THEREAFTER, THE LEGISLATIVE COUNCIL STAFF SHALL PREPARE A REPORT OR ISSUE BRIEF ON THE IMPACT OF TAX INCREMENT FINANCING ON THE STATE AND LOCAL SHARES OF EDUCATION FUNDING. THE REPORT OR ISSUE BRIEF MUST QUANTIFY THE TOTAL AMOUNT OF PROPERTY TAX REVENUE COLLECTED IN THE STATE IN THE PREVIOUS FISCAL YEAR THAT WOULD HAVE BEEN DIRECTED TO FUNDING EDUCATION IF NOT FOR TAX INCREMENT FINANCING.

SECTION 5. In Colorado Revised Statutes, 31-25-807, add (5) as follows:

31-25-807. Powers - duties.

(5) WITHIN FORTY-FIVE DAYS AFTER A BOARD OR GOVERNING BODY HAS SUBMITTED AN IMPACT REPORT RELATED TO TAX INCREMENT FINANCING, EACH TAXING ENTITY THAT IS PROPOSED TO BE INCLUDED IN THE TAX INCREMENT FINANCING PLAN SHALL FILE EITHER A CERTIFICATION OF OR A TECHNICAL REBUTTAL TO THE IMPACT REPORT. IF A TAXING ENTITY DOES NOT FILE EITHER A CERTIFICATION OR A TECHNICAL REBUTTAL, THE IMPACT REPORT IS PRESUMED CERTIFIED.

SECTION 6. Act subject to petition - effective date. This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 12, 2026, if adjournment sine die is on May 13, 2026); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2026 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.