Colorado House Bill 24-1152 was passed on May 13th, 2024, and it aims to address multiple housing related issues from housing shortages and costs to housing requirement changes due to changing demographics. The bill intends to make an impact by loosening regulation on construction and renting of Accessory Dwelling Units (ADUs) across Colorado.
In the introduction to the Bill, the General Assembly determined the 3 following things (among many others):
- ADUs generate rental income to help homeowners with mortgage or other costs
- ADUs keep elderly family close to relatives at little to no cost
- ADUs offer affordable and attainable housing options to live in high-opportunity neighborhoods
The General Assembly also made the 3 following observations:
- Local government regulation of accessory dwelling units varies significantly within regions and statewide in Colorado in terms of where they are allowed and this inconsistency inhibits the development of a robust ADU market.
- More permissive regulation by local governments of ADUs provides a reasonable change for homeowners to construct or convert an ADU and thereby increase housing supply, stabilize housing costs, and contribute to affordable and equitable home ownership to adequately meet
- Housing supply impacts housing affordability, and housing prices are typically higher when housing supply is restricted by local land use regulations in metropolitan region, according to the national bureau of economic research in working papers such as “Regulation And Housing Supply”, “The Impact Of Zoning On Housing Affordability”, and “The Impact Of Local Residential Land Use Restrictions On Land Values Across And Within Single Family Housing Markets”
These assessments ultimately led the General Assembly to the conclusion that increasing the housing supply through the construction or conversion of Accessory Dwelling Units is a matter of mixed statewide and local concern.
Therefore,
On or after June 30, 2025, a subject jurisdiction shall not:
- Require an additional parking space, where there is already space.
- Require an ADU to be owner-occupied
- Apply a restrictive design or dimension standard to an ADU
Our team has heard from Colorado Springs City Planning that the new bill will change the Colorado Springs code to allow Detached ADUs in R-1 / single-family zoned properties, whereas currently only attached units are permitted. There is also talk that this bill will potentially lessen the restrictions on building ADUs on other types of properties here in town. As of yet, we have no clear answer as to how the bill will impact property owners inside of El Paso County but outside of City limits.
While the 3 above rules apply only to any “Subject Jurisdiction”, defined as “A municipality that has a population of 1,000 or more and that is within the area of a metropolitan planning organization; or The portion of a county that is both within a census designated place with a population of forty thousand or more, as reported in the most recent decennial census, and within the area of a metropolitan planning organization.”, in an effort to help promote the creation and conversion of ADUs this bill has created what is called an Accessory Dwelling Unit “Supportive Jurisdiction”. This type of jurisdiction is an area that abides by the regulations laid out in section 29-35-104 and has submitted to the department the proper evidence for showing this. These special jurisdictions are eligible to receive grant funding, though there are stipulations to the funding, and those stipulations may benefit you if you live within this special jurisdiction. Here’s what the bill says:
(2) Grant recipients may use the money received through the grant program to offset both eligible costs and the cost of waiving, reducing, or providing financial assistance for reasonable and necessary accessory dwelling unit fees and other required costs for:
- Low- and Moderate-income households;
- Affordable accessory dwelling units;
- Accessible or visitable accessory dwelling units
- Accessory dwelling units used as long-term rentals for members of the local workforce; or
- Accessory dwelling units used to support other demonstrated housing needs in the community.
The bill lays out the disbursement of funds through application and states that the grant funding will have an initial deposit by June 30th, 2024 of 5 million dollars. a deposit on July 1st, 2024 of 8 million dollars. Though funding to your current jurisdiction isn’t guaranteed there is great incentive for local governments to apply and be part of this program. We are waiting to see what, if any of this grant money will be available to those looking to build ADUs in Colorado Springs and El Paso County and will keep updates coming as the situation develops and more information becomes available.
Overall, the bill is designed to provide more housing options, reduce regulatory hurdles, and promote economic and environmental efficiencies, thereby addressing some of the critical challenges facing many urban and suburban areas.
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