Proposition 123 Fast Track

• Disclaimer: This document is not intended to serve as legal advice. Any interested person is encouraged to consult with an attorney with respect to any particular legal matter.
• This information pertains specifically to the expedited review requirements of Prop. 123. For other Prop. 123 requirements, please visit the DOLA website. 
• The expedited review requirements of Prop. 123 do not apply to all housing projects or applications, only those housing projects with affordable housing constituting 50% or more of the units. Refer to the Prop. 123 Expedited Review Analysis section below for information on project applicability and application types.
• A developer can opt out of the local government’s expedited review process for any reason.
• The statutory definition of affordable housing is considered a minimum standard, i.e., a floor. Local governments may establish a policy with a different definition of affordable housing that casts a wider net than the standard set in statute, but it cannot create a more restrictive definition. For example, a local policy may expedite review for projects with higher AMIs or with a smaller percent of units being affordable. In other words, a local government’s policies or procedures could exceed the Prop. 123 requirements, as long as the policy meets the minimum standard established in Prop. 123. See the definition of affordable included in the Prop. 123 statute in the Analysis section.
• During the first Prop. 123 Commitment Cycle (2023-2026), the expedited review process is not required for local governments that have filed or plan to file a commitment. The law allows time for local governments to explore, adopt, and implement an expedited review process.
• For the Second Commitment Cycle, local government commitments are due November 1, 2026, with an expedited review process required to be in place by January 1, 2027. When local governments submit their next Prop. 123 commitment in 2026, they will need to confirm they have implemented a system to expedite the development review process for affordable housing projects.
• Local governments may seek funding from the Local Planning Capacity grant program to support local policy adoption and implementation of an expedited review process.
• DOLA interprets Prop. 123 expedited review requirements to apply to individual development applications, some may have their own 90-day timeline (i.e., the expectation is not that every project must be approved or denied and receive a building permit within a total of 90-calendar days). See a more detailed explanation in the Prop. 123 Analysis and FAQs section.
• DOLA acknowledges that good planning and process improvement work take time to complete. Local governments are encouraged to begin analyzing and implementing an expedited review process. Process improvement efforts should be tested and continually refined to meet the local government’s intended goals.
• DOLA recognizes that some communities may already have a process in place that meets or exceeds the 90-day time frame requirements of Prop. 123 without having a formally adopted process. These communities need only document their local process aligning with Prop. 123 criteria.
• Even those local governments that already comply with the Prop. 123 expedited review requirements should review their processes, consider potential improvements, and adopt language that aligns with Prop. 123. DOLA has provided a downloadable template resolution as a resource.

Efforts to develop these guidelines began in November 2023 and extended into April 2024. Outreach efforts included the following:

• 16 partner agencies were invited to participate.
• 3 targeted stakeholder meetings were held, composed of:
  • Over 65 planners from every region of the state.
  • Over 30 developers and builder groups with affordable housing expertise, including housing authorities.
• 1 state-wide survey distributed by DOLA, partner agencies, and stakeholders.
• 2 educational webinars presenting the final guidelines.

During initial listening sessions with partner agencies and stakeholders, it became apparent that there are misunderstandings surrounding the language of Prop. 123 expedited review requirements. This process also uncovered insights into the barriers and opportunities within local government processes, potential avenues to explore for expediting review processes, and feedback on what information would be most helpful  to include in these guidelines.

The process also involved reviewing nationwide studies, reports, and best practices from nonprofits, development professionals, other states and municipalities, including communities within Colorado, and drawing from recommendations and lessons learned.

The statutory language that makes up the expedited review requirement includes details and requirements for local governments. The statements below are not intended to change any provision of any statute. In the event of any conflict between these statements and the statute, the statute trumps. The following key takeaways are summarized from the detailed analysis provided in the next section.

• Beginning on January 1, 2027, expedited review is required for projects with 50% or more affordable housing units, as per statute. Local governments will need to demonstrate they have implemented a system to expedite the development approval process for affordable housing projects when filing their Prop. 123 commitments by November 1, 2026.
• The 90-calendar day time frame starts upon submission of a complete application (defined by the local government) and ends with a final decision.
• A final decision includes either approval or denial, and does not include a recommendation from a recommending body or post approval steps.
• The 90-calendar day clock runs continuously for each application; no pauses or resets.
• Each local government has the autonomy to establish local policies and procedures that meet the minimum criteria set by Prop. 123. A local government may adopt policies and procedures that either meet or exceed this minimum criteria. 
• A local government’s expedited review process may include a one-time extension request from the developer for up to 90-calendar days. The request may allow time for a developer to comply with a state law or court order, or to address comments from an agency that has approval authority over the project. It is meant to avoid a “rush” mentality that may penalize a developer by leading to a decision of denial rather than working towards approval.
• Local governments can implement one or more 30-calendar day extension(s) to work with a developer on addressing comments on the application.

Through stakeholder engagement, shared challenges were identified across various phases of the review process. A range of strategies were proposed to mitigate these challenges and streamline the overall review time frame. Such strategies include the development of application checklists and guides, pre-application meetings, dedicated staff or a staff liaison, contracted planning support, process improvement, code analysis and updates, administrative processing, among others.

Community examples for both urban and small/rural sized communities are provided for reference sorted by the three topic areas resulting from the challenges and strategies analysis. These topic areas include quality of submission materials, review timelines, and staff capacity.