Compliance Information

In order to remain eligible for the next three (3) year Proposition 123 funding cycle, jurisdictions who filed a commitment with the Division of Housing (DOH) must meet the following criteria by December 31, 2026:  

• Meet the appropriate commitment (9%, 6%, or 3%) increase of affordable housing units from the submitted baseline
• Demonstrate/codify an expedited (90-day) review process on affordable housing development projects, as applicable to statute 

Proposition 123 Definition of Affordable Housing

Affordable housing is defined in Proposition 123 as:

• Rental housing at or below 60% AMI, or
• For-sale housing at or below 100% AMI, and
• Which costs the household less than 30% of its monthly income.

Note: Proposition 123 allows housing units at higher AMIs to be counted as affordable housing in the following instances:

• Rural Resort jurisdictions that have successfully petitioned the Division of Housing to use alternate AMI levels, and
• Housing projects funded by OEDIT’s Affordable Housing Financing Fund (Land Banking, Equity, and Concessionary Debt), where AMI averaging is allowed and complies with the terms of the program.

Counting of Units

By December 31, 2026 jurisdictions must be able to show the combined number of newly constructed affordable housing units and existing units converted to affordable housing within its territorial boundaries has increased by their committed amount (3%, 6%, or 9%) over their submitted baseline of affordable housing units.

The unit count must be completed by December 31, 2026 in order to remain eligible for the next three (3) year cycle of Proposition 123 funds starting in 2027.

Regional collaboration and partnerships are encouraged. Local governments may enter into written agreements with other local governments that allow each jurisdiction to receive partial credit towards the local government's growth requirement. The sum of the total units credited to the local governments cannot exceed the total number of units produced through the collaboration.

Further guidance on the counting of units will be available in the future. DOH will send out notification when updated guidance becomes available. 

Statutory Basis for the Counting of Units

C.R.S. 29-32-105.5 outlines the following regarding the counting of units:

• A new residential housing unit is to be counted at the time it is permitted rather than the time it is constructed. 
• An existing housing unit newly qualifying as affordable housing is to be counted at the time it is permitted and fully funded rather than at the time the conversion is completed.
• Any new deed restricted affordable housing, newly constructed or converted to affordable, within a local government's or tribal government's territorial boundaries.
• All units funded through OEDIT/CHFA’s Proposition 123 programs (Land Banking, Equity, and Concessionary Debt)
• Regional collaboration and partnership is encouraged. Local governments and tribal governments may enter into written agreements with other local governments and tribal governments that allow each jurisdiction to receive partial credit towards the local government's or tribal government's growth requirement. The sum of the total units credited to the local governments and tribal governments shall not exceed the total number of units produced through the collaboration.

Expedited Review

In order to remain eligible for Proposition 123 funds in the next 3-year cycle (2027-2029), local governments must demonstrate they have implemented an expedited review process for housing projects where at least half of the units are affordable. While the law states that expedited review must take place within 90 calendar days of a complete application submission, there are many additional details to consider. DOLA’s guidance does not prescribe an approach but instead provides a list of strategies and approaches. Each community will need to determine which strategies are most effective for their local processes. Grant funding is available to support local governments with the implementation process.

For further information, refer to the guidance on expedited review (fast track) requirements.