Bill Summary
HB26-1036 authorizes counties and municipalities, with voter approval, to create new local taxes on “vacant residential” homes and use the revenue for affordable, attainable, or workforce housing. It also allows multiple local governments to form a new “local housing tax authority” to levy, collect, and enforce those taxes across a combined area.
- Allows a county or municipality to impose an excise tax on “vacant residential units,” with the vacancy time period defined locally.
- Allows the excise tax to be flat or based on unit type, number of bedrooms, or square footage.
- Allows a county or municipality to create a new “vacant residential” property classification and levy an additional ad valorem property tax on top of existing property taxes.
- Requires voter approval under TABOR (Colorado’s taxpayer bill of rights) before a county or municipality can levy either tax.
- Creates “local housing tax authorities” so multiple counties and cities can coordinate elections and then levy, collect, and enforce these taxes.
- Says county assessors have no duty to implement the tax, but may optionally provide data and enter agreements for compensation.
Position: Oppose
Housing affordability is a real concern. But HB26-1036 answers it with a new layer of taxation and a brand-new regional bureaucracy. That is the wrong direction for Colorado.
Even with TABOR elections required, this bill turns “vacancy” into a taxable offense and invites local governments to micromanage lawful private property use. It also creates new administrative and enforcement costs that do not build a single home.
Why I Am Taking This Position
1) It weakens property rights by turning a locally defined “vacancy” into a tax target. The bill lets counties, municipalities, or a housing tax authority decide how long a home is “unoccupied and not used as a residence” before it is taxed. When government can redefine the trigger, taxpayers are the ones who take the risk.
2) It adds a new layer of government with taxing and enforcement powers. HB26-1036 creates local housing tax authorities that can adopt bylaws, coordinate elections, levy and enforce taxes, and issue bonds or other financial obligations payable from authority revenues. That is more bureaucracy, more distance from voters, and more diluted accountability.
3) It pushes collection and enforcement work onto local government. The bill states the Department of Revenue will not collect, administer, or enforce the excise tax. That work falls on counties, municipalities, or the new authority. Those costs are real, and they are ongoing.
4) The definitions invite disputes and confusion. “Vacant” depends on a “specified amount of time” determined locally. Short-term rentals are excluded, but the bill’s definitions and real-world enforcement questions are exactly where taxpayers get stuck in paperwork and appeals.
5) It treats housing as a revenue problem instead of a supply problem. The bill restricts revenue use to affordable, attainable, or workforce housing, as defined by the local government. That may sound tidy, but it still does not address why housing is scarce and expensive in the first place. Taxing behavior is not a substitute for getting serious about approvals, timelines, and buildable supply.
One quip, because this is Colorado: if a new tax and a new authority were the cure, we would be the healthiest state in the union by now.
Call to Action – What You Should Do!
Contact your state representative and senator and ask them to vote no on HB26-1036.
Ask a simple question: why is the answer to a housing shortage a new tax, a new enforcement system, and a new authority, instead of fewer barriers to building and clearer rules for everyone?
Thank you for opposing this horrific bill.