Matters Memo

City of Boulder City Council Agenda Item Meeting Date: June 11, 2026 Agenda Title 2026 Legislative Update

Staff Contact • •

Heather Stauffer, Intergovernmental Affairs Officer, City Manager's Office Nuria Rivera-Vandermyde, City Manager, City Manager’s Office

Executive Summary The purpose of this item is to inform and update council on outcomes of the 2026 state legislative session and the city's advocacy efforts. The Colorado General Assembly adjourned sine die on May 13, 2026, sending roughly 450 bills to Governor Polis. This memo provides an update in several key areas: Summary of Defining Issues of the 2026 Legislative Session: As in past sessions, the state's budget deficit was the defining force of 2026. The Joint Budget Committee was tasked with cutting $1 billion from the budget, leaving virtually no room for funding for new bills or programs. K-12 education was largely protected, but deep cuts reached cash funds, grants, and programs across state government, including those serving local governments. To address the deepening budget crisis, the legislature referred a measure to voters to raise the TABOR cap for K-12 expenses and created a Commission on Medicaid to address spending growth that has outpaced allowable revenue.

Several state budget actions will directly affect the city. Most notably, HB26-1409 eliminates the local share of retail marijuana sales tax, removing roughly $150,000 from the city’s General Fund. Reductions to multimodal transportation funding (HB26-1398 and HB26-1399), a transfer from the Affordable Housing Financing Fund (HB26-1360), and cash-fund sweeps (HB26-1405) also carry potential implications for city revenues and programs. A detailed analysis appears in the Anticipated Fiscal and Workplan Impacts section. For the second consecutive year, responding to federal action was a central focus of the democratically controlled legislature, with lawmakers discussing immigration, mail-in voting (HB26-1113), and coal plant emissions (HB26-1226). Underlying much of the session was a widening rift and infighting between the moderate and progressive wings of the Democratic majority. This dynamic is reflective of the many primary challenges underway that will likely shape the makeup of the next General Assembly. Outcomes of City Priority Legislation and Additional Bills of Interest: The City of Boulder took positions on 58 bills during the session. Among its priorities, the city supported successful measures on homelessness prevention (HB26-1202) and automated decision-making technology (SB26-189) while the city initiated on-bill repayment financing program (SB26-148) failed in the Appropriations Committee. On RTD reform (SB26-150), the city secured an amendment lowering the candidate signature threshold but did not secure amendments to expand the elected board. The city also supported successful measures regulating 3D-printed firearms (HB26-1144) and several clean-energy bills. The city opposed bills that would have limited local and state firearm regulation and weakened renewable energy standards, all of which failed. Two competing data-center bills both failed and are expected to return next session. What we anticipate moving forward: The November 2026 election will determine the composition of the General Assembly and bring significant leadership turnover, including a new governor and a new Speaker of the House. The state budget remains a concern, and the June revenue forecast may clarify whether further adjustments are needed to the current budget and sharpen the outlook for FY27-28. A special session remains possible, though uncertain. At least five ballot measures, plus the legislatively referred SB26-135, will appear before voters in November; while the city is prohibited from campaigning on ballot questions, council may wish to take positions by resolution at an upcoming meeting.

Questions for Council

Does Council have any questions or feedback on legislation or the state budget? Does Council have an interest in taking positions at a future meeting on ballot measures ahead of the election in November?

Alignment with City Plans and City Council History Sustainability, Equity and Resilience (SER) Framework and Citywide Strategic Plan Alignment SER Framework Goal Area City of Boulder’s advocacy work is guided by the city’s annual Policy Statement, which is meant to further and align with each of the several SER Framework Goal Areas. Citywide Strategic Plan As with the SER Framework, the city’s advocacy efforts are guided by the annual Policy Statement, which aligns with and furthers several key priorities within the Citywide Strategic Plan.

Alignment with Additional City Plans City advocacy efforts are guided by the annual Policy Statement on Regional, State and Federal issues. The purpose of the policy statement is to inform city advocacy on policy decisions that, while made outside the city’s jurisdictional authority, have potential to significantly impact the city. This includes legislative decisions by the Colorado General Assembly or the U.S. Congress.

City Council History Council received a mid-session update in April. The purpose of this item is to provide updates on the outcomes of legislation previously reported on to Council as well as other legislation and advocacy efforts of interest to the city.

Analysis The Colorado General Assembly adjourned sine die on Wednesday, May 13. In total, approximately 450 bills passed the legislature and will make their way to Governor Polis’ desk for consideration. The Governor will now have 30 days from the date of adjournment to sign, veto or take no action (in which case a bill would go into law without a signature). Defining Issues of the 2026 Legislative Session: Similar to past sessions, the state's budget deficit was a defining force in 2026, and in many cases a bill's fate rested on whether it would cost the state any money. The Joint Budget Committee (JBC) was tasked with cutting $1 billion from the state budget. K-12

education was largely prioritized throughout these decisions, but the strain of the ongoing deficit was felt across state departments and programs, with deep cuts to cash funds, grants, and programs that serve a wide range of Coloradans, including local governments. An analysis of how the FY26–27 state budget will affect the City of Boulder appears in the Anticipated Fiscal and Workplan Impacts section of this memo. The legislature passed SB26-135, which refers a question to voters to raise the TABOR cap for K-12 expenses. The surplus funding—anticipated at roughly $4.6 billion—would go toward educational programs, increasing teacher pay, reducing teacher turnover, limiting class sizes, and preparing students for the workforce. Medicaid costs have consistently grown faster than the state's revenue is allowed to grow, accounting for a sizable portion of the budget deficit. To try to address this, JBC members introduced SB26-187, which creates the Commission on Medicaid to develop recommendations on Medicaid spending, utilization, and administration. The Commission will submit a report with recommendations to the legislature and Governor Polis by December 11, 2026. Response to the Federal Government: For the second consecutive year, a major focus of the Democratically controlled legislature was response to actions taken at the federal level. Responses to federal immigration policies were heavily debated throughout the session, and Democrats struggled to unite their caucus around a single path forward. Lawmakers also responded on other fronts, passing HB26-1113 aimed at protecting the state's universal mail-in voting system, and HB26-1226 (this bill is further described in solar/carbon-free energy bill section) to manage emissions and costs at aging coal plants that federal orders had forced to remain open past their planned retirement. 2026 Election Politics: The deepening rift between the moderate and progressive wings of the Democratic caucus hung over much of the legislative session. The tension was crystallized by a set of ethics complaints filed with the state's Independent Ethics Commission against members of the Opportunity Caucus—a group of more moderate Democrats—alleging they violated the state's constitutional gift ban. Meanwhile, many in the Democratic majority are gearing up for primary battles that will effectively determine whether the next Colorado General Assembly tilts moderate or further left. In the final weeks of the session, the legislature passed HB26-1430, intended to nullify the effects of proposed Initiative 175, State Revenue Supporting Road Transportation, and ultimately dissuade the initiative's proponents from running the measure at all. HB26-1430 sets into motion a series of transportation-related revenue adjustments if,

and only if, Initiative 175 is passed by voters in November. Described by many as a "nuclear option," the bill reduces excise taxes on gasoline and special fuel, certain vehicle registration fees, and road usage fees until 2030. It also establishes the "Support Road Transportation Fund," whose money would be used to replace certain transportation-related General Fund transfers to the State Highway Fund. Finally, the bill clarifies that state revenue collected to support road transportation, as defined in the proposed initiative, does not include enterprise fee revenue. City of Boulder Priority Legislation: The City of Boulder took positions on a total of 58 bills in the 2026 legislative session. The city’s state legislative tracking dashboard, which features the complete list of bills and the city’s positions on those bills, is available here: City of Boulder State Legislative Tracking Dashboard. Below is an update on the outcomes of several pieces of priority legislation. HB26-1202 Strategy to Reduce & Prevent Homelessness Sponsors: Reps Manny Rutinel and Emily Sirota; Sen. Judy Amabile Bill Summary: The bill requires the Department of Local Affairs, as part of its SMART Act hearing in January of 2027, to submit and present a proposal for the development of a statewide strategy on homelessness prevention and resolution. The bill also creates a new type of special district, a multijurisdictional homelessness response authority (authority), which may be created by any combination of local governments through an intergovernmental agreement. An authority has several discretionary powers that relate to its ability to coordinate and plan with departments and organizations to reduce and prevent homelessness, including but not limited to the power to provide for the levy of sales or sales and use taxes by the contracting local governments within the authority area (if allowed by the intergovernmental agreement). The bill also allows a county to designate a portion of documentary filing fees, which are collected for filing documents associated with the grant or conveyance of real property, to be transferred to the county government or a housing authority for the purpose of developing, preserving, or acquiring affordable housing. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. SB26-148 Financing Utility On-Bill Repayment Program Sponsors: Sens. Matt Ball and Kyle Mullica; Reps. Junie Joseph and Sean Camacho Bill Summary:

The bill directed the state treasurer to execute a loan agreement with the Colorado Clean Energy Fund (CCEF) for a low-interest loan of $50 million from the unclaimed property trust fund. The purpose of the loan was to capitalize and expand the CCEF's on-bill repayment program to help finance certain energyrelated upgrades installed at a utility customer's premises that are associated with the utility meter. COB Position: Support Outcome: The bill failed to pass (was postponed indefinitely) in the Senate Appropriations Committee. SB26-189 Automated Decision-Making Technology Sponsors: Sens. Robert Rodriguez and President James Coleman; Reps. Monica Duran and Jennifer Bacon Bill Summary: In May 2024, Governor Polis signed SB24-205, known as the Colorado Artificial Intelligence Act (CAIA). SB26-189 repeals and reenacts CAIA with new requirements regarding the use of automated decision-making technology that is used in consequential decision making. Beginning on January 1, 2027, developers and deployers of artificial intelligence systems must provide certain disclosures about “automated decision-making technology”, which is technology that uses personal information and computation to predict, classify, rank, score, or otherwise assist in making a decision or determination concerning a person in a covered domain (as defined in the bill). Violations of the disclosure requirements in the bill are a deceptive trade practice, enforced by the Attorney General through the Colorado Consumer Protection Act. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. Additional Bills of Interest: Data Centers: This session saw two dueling data-center bills which pitted industry incentives against environmental guardrails. In the end both bills failed to pass the legislature this session. Staff anticipate that the topic will be addressed again next session. HB26-1030 Data Center & Utility Modernization Sponsors: Reps. Alex Valdez and Monica Duran; Sen. Kyle Mullica Bill Summary: The bill created a state sales tax exemption for data centers that meet certain requirements and established a new authority to administer the tax exemption certificates and ensure compliance with requirements for these data centers.

COB Position: Opposed Outcome: The bill failed to pass (was postponed indefinitely) in the House Energy & Environment Committee. SB26-102 Large Load Data Centers Sponsors: Sen. Cathy Kipp and Rep. Kyle Brown Bill Summary: The bill created requirements for large-load data centers regarding development, utilities, environmental impact, operations, and location. It also established requirements for utilities that provide electricity to large-load data centers. COB Position: Support Outcome: The bill failed to pass (was postponed indefinitely) in the Senate Transportation & Energy Committee. RTD Reform: In 2025, the General Assembly passed SB25-161 which established the RTD Accountability Committee within the Colorado Energy Office. The Accountability Committee was charged with examining RTD’s governance, workforce retention, paratransit services, and collaboration with local governments and state agencies. It was further tasked with developing recommendations to improve outcomes for riders, taxpayers, employees, and state and local partners by January 30th, 2026. Following the recommendations made by the Accountability Committee, the legislature introduced SB26-150. While the city was largely supportive of the changes made in the bill, the city did seek amendments to address concerns around adequate elected representation, requesting that the sponsors increase the number of elected board seats from five to seven to better reflect and ensure representation of transportation regions. The city also sought amendments to add language to ensure equity in the governor’s nomination process. The city additionally sought amendments to decrease the signature threshold required for potential candidates from 1,000 eligible electors to 500 eligible electors. In the end, the city was able to secure an amendment to decrease the signature threshold to 500. Unfortunately, sponsors and the governor’s office were not open to increasing the number of elected seats on the board from five to seven. While no specific additional language was added to address equity in the governor’s nomination process, staff in the governor’s office have noted that the office frames general equity, diversity and inclusion as foundational to the appointment process. SB26-150 Modernizing Regional Transportation District Sponsors: Sens. Matt Ball and Iman Jodeh; Reps. Meg Froelich and Jamie Jackson Bill Summary: The bill changes the election, size and composition of the RTD board. Under current law, the board consists of 15 elected board members.

Beginning January 1, 2029, the bill requires that the current members’ terms expire and the terms of nine new board members begin, with five of these members being elected and four being appointed by the Governor. The bill also redraws RTD voting districts to reflect the new board structure. The bill increases the requirements for signatures a candidate must obtain to qualify for the ballot to 500. The act further requires RTD to conduct an analysis of, and create a plan for, serving riders with disabilities. Finally, the act creates new requirements for RTD to increase support for subregional service councils, and tasks the subregional service councils with making specific recommendations to the Board. The responses to these recommendations will be reported annually by the RTD Board to the Transportation Legislation Review Committee and the Housing and Local Governments Committees in the House and Senate. COB Position: Amend Outcome: The bill passed the legislature and was signed into law by Governor Polis Housing: While the legislature considered many bills this session aimed at addressing affordable housing, many failed to pass the legislature due to funding issues. The city was in support of HB26-1066 Tax Exemptions Low Income Rental Property Development, and HB26-1204, Senior Cooperative Housing Authority Projects, which both died in Appropriations Committees. The city also supported several housing bills that passed the legislature; they are described below. SB26-040 Affordable Homeownership Program Sponsors: Sens. Judy Amabile and Cleave Simpson; Reps. Katie Stewart and Lesley Smith Bill Summary: The act updates the Affordable Home Ownership Program created by voter-approved Proposition 123, which makes grants through the Division of Housing to help finance for-sale affordable housing. It raises the income-eligibility threshold to at or below 120 percent of statewide or local Area Median Income to let more buyers qualify, particularly in rural areas. It creates a process allowing some homeowners to exceed the 35-percent-of-income housing-cost limit when a qualified buyer is not found after six months of advertising and gives eligible organizations flexibility to temporarily rent units that cannot be sold in a timely manner. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. HB26-1224 Protections for Mobile Home Park Residents

Sponsors: Reps. Elizabeth Velasco and Andrew Boesenecker; Sens. Lisa Cutter and Dylan Roberts Bill Summary: The bill establishes and clarifies financial protections for mobile home park residents under the Mobile Home Park Act. It requires a landlord to notify residents when temporarily prohibited from raising rent, and clarifies the financial, maintenance, and buyer-offer information a landlord must include in the notice sent when intending to sell a park. It requires the landlord and any potential buyer to conduct a park sale in good faith, building on residents' existing right of first refusal. It also sets parameters for the park registration fee and caps at $17 the amount a landlord may charge each resident to cover it. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. HB26-1065 Transit and Housing Investment Zones Sponsors: Reps. Julie McCluskie and Steven Woodrow; Sens. Dylan Roberts and Tony Exum Bill Summary: The act, known as the “Transit Investment Area Act”, creates a new financing tool allowing local governments, in partnership with transit agencies, to apply to the state to create transit and housing investment zones. The zones use state sales tax increment financing to fund eligible transit infrastructure projects within two miles of a transportation facility, such as safety improvements and centering transit stops to increase ridership, with local governments suggesting an annual cap on revenue allocated. The act also establishes a new state income tax credit to support the development of affordable housing for low- and middle-income households within those zones and makes an appropriation. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. Several bills this year addressed local zoning and land use policy. Beyond HB26-1001, the HOME Act discussed in past meetings, the legislature took up two bills targeting local lot-size rules. HB26-1114 would have set requirements for municipal minimum lot sizes and HB26-1308 would have allowed property owners to split lots under certain circumstances. The city opposed HB26-1114 and took an "oppose unless amended" position on HB26-1308. Both bills failed in the Senate Local Government Committee and were postponed indefinitely. Regulation of Firearms: The city opposed three bills that would have reduced the ability for cities and the state to regulate firearms: HB26-1021 Second Amendment

Protection Act, HB26-1072 Right to Firearm Possession & Elimination of Extreme Risk Protection Orders, and HB26-1212 Constitutional Carry of Handgun. All three bills were postponed indefinitely in House committees. The city also supported HB26-1144, requiring greater regulations around the creation and sale of firearms via three-dimensional printing. HB26-1144 Prohibit Three-Dimensional Printing Firearms & Components Sponsors: Reps. Andrew Boesenecker and Lindsay Gilchrist; Sens. Tom Sullivan and Katie Wallace Bill Summary: The act defines three-dimensional printing to include both additive and subtractive manufacturing (such as CNC milling) and prohibits knowingly manufacturing a potentially functional firearm, unfinished frame or receiver, large-capacity magazine, or rapid-fire device by 3D printing. It also restricts possessing or distributing digital instructions for such manufacturing under circumstances indicating intent to violate the law. Federally licensed firearm manufacturers and accredited gunsmithing programs are exempted. An unlawful violation is a class 1 misdemeanor, with a second or subsequent offense a class 5 felony. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. Solar/ Carbon Free Energy: The city supported five bills, described below, aimed at promoting renewable energy sources and lowering cost and emissions from traditional energy sources. The city opposed SB26-028 that would have removed wind energy as an eligible energy resource under Colorado’s renewable energy standard and the state’s clean energy targets. That bill failed to pass the Senate Transportation & Energy Committee and was postponed indefinitely. HB26-1007 Improve Customer Use Distributed Energy Resources Sponsors: Reps. Lesley Smith and Rebekah Stewart; Sens. Cathy Kipp and Matt Ball Bill Summary: The act prohibits retail and wholesale energy providers from requiring approval before a customer installs or uses a portable-scale solar generation device (often called "plug-in" or "balcony" solar), and bars unreasonable restrictions on those devices. It requires all utilities—including cooperative electric associations and municipally owned utilities—to accommodate meter collar adapters and directs the Public Utilities Commission to revise rules by December 31, 2026. It also limits when separate production meters can be required where net consumption can be measured at the billing meter.

COB Position: Support Outcome: Passed the legislature and was signed into law by Governor Polis. HB26-1051 Continue Microgrid Resilience Grant Program Sponsors: Reps. Larry Don Suckla and Katie Stewart; Sens. Dylan Roberts and Cleave Simpson Bill Summary: The bill continues the Microgrids for Community Resilience Grant Program in the Department of Local Affairs indefinitely by removing its September 1, 2026, repeal date. The program (created by HB22-1013) lets cooperative electric associations and municipally owned utilities apply for grants to purchase microgrid resources for rural communities at significant risk of severe weather or natural disaster events. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. HB26-1081 Optimize Colorado Electric Transmission System Sponsors: Reps. Sean Camacho and Monica Duran; Sen. Dylan Roberts Bill Summary: Known as the “Colorado Grid Optimization Act”, the bill directs the Public Utilities Commission to adopt rules requiring large utilities (Public Service Co./Xcel, Black Hills Energy, and Tri-State) to include an analysis of advanced transmission technologies in the 10-year transmission plans they file every two years. The analysis must assess how grid-enhancing technologies— such as dynamic line ratings, topology optimization software, advanced conductors, and storage—could increase import/export capacity, speed grid interconnection of new generation or load, and reduce wildfire risk. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. HB26-1226 Manage Emissions from Electric Generating Units Sponsors: Reps. Meg Froelich and Jenny Willford; Sens. Lisa Cutter and Mike Weissman Bill Summary: The bill responds to federal orders forcing aging coal plants to stay open past their planned retirement. It requires the Air Quality Control Commission to adopt a rule limiting nitrogen oxide and sulfur dioxide emissions from covered electric generating units (those emitting 200+ tons of NOx and/or SO2 in 2024), with compliance and pollution-control installation required by December 31, 2034. Units that have ceased operations or burn only natural gas/fuel oil are excluded. Owners must file quarterly emission reports, and investor-owned utilities subject to a federal order must file periodic reports with

the PUC on operating costs and electricity generated. The bill also lets investorowned utilities apply for financing orders (low-interest, state-backed bonds) to recover compliance costs. COB Position: Support Outcome: Passed the legislature, awaiting Governor’s signature. HB26-1268 Renewable Energy Development on Disturbed Lands Sponsors: Reps. Karen McCormick and Lesley Smith; Sen. William Lindstedt Bill Summary: The bill authorizes local governments with land-use permitting authority to designate "renewable energy reinvestment areas" on previously disturbed land—such as decommissioned oil and gas sites, closed landfills, industrial sites, and former mines—for siting solar and energy storage projects. Designation requires at least one public hearing, outreach to disproportionately impacted communities, and an administrative approval process based on objective standards. Urban renewal and county revitalization authorities may use existing tax increment financing to fund supporting infrastructure, and utilities must provide grid-capacity information within 30 days of a request. The Colorado Energy Office must publish and update siting and permitting guidance. COB Position: Support Outcome: The bill passed the legislature and was signed into law by Governor Polis. Looking Ahead: Staff anticipate several developments will shape state politics through the remainder of the year. Most notably, the November 2026 general election will determine control and composition of the General Assembly. While the balance of power is not anticipated to shift too dramatically as Democratic control of the legislature is all but guaranteed, election results could meaningfully shift the balance between the moderate and far left sides of the party. Changes in legislative leadership with a new Speaker of the House (Rep. McCluskie is term-limited), and a new House majority leader will potentially lead to new legislative priorities, and potentially new House committee leadership heading into the 2027 session. The state will also have a new governor, as Governor Polis is term-limited, marking a significant leadership transition at the Capitol. The state budget continues to be an area of concern, and the state revenue forecast in June will hopefully clarify whether further adjustments to the current budget may be needed and sharpen the budget outlook for FY27-28. A special session remains a possibility, but at this point it is uncertain. If a special session were called, it would most likely center on budget adjustments like last year, though it is worth noting the Governor now holds more specific authority to adjust the budget without the General Assembly. A

special session held post-November could also focus on response to ballot initiatives if they pass. At the time this memo was written, there were five measures approved for the ballot in November. Those measures can be reviewed on the Secretary of State’s website here. Additionally, a legislatively referred measure (SB26-135), which would increase the TABOR revenue cap for K-12 education expenses, will also appear on the 2026 ballot. While the city is prohibited by law from spending resources to campaign on any ballot questions, Council does have the ability to take positions on behalf of the city via resolution to either support or oppose them, an action council may wish to take up at an upcoming regular meeting.

Anticipated Fiscal and Workplan Impacts In this section, staff provide information about the state’s adopted 2026-2027 budget and anticipated impacts to the city’s budget as a result. Staff detail direct and indirect impacts to revenues collected by the city, potential impacts related to elimination or reduction of grant programs at the state level, and future issues related to 2026 ballot items. Anticipated Direct Revenue Impacts HB26-1409 – Marijuana Tax Cash Fund Distributions: This bill eliminates the existing 3.5% revenue share for local governments from the state’s 15% retail marijuana sales tax for the upcoming fiscal year. This will result in a direct revenue impact to the city’s budget, as it will remove approximately $150K from the city’s General Fund. While city staff were successful in securing an amendment in the Senate to limit the reduction to FY26-27, the House did not concur due to opposition from JBC members, and the amendment was ultimately lost. The city retains the ability to increase local recreational marijuana sales tax under the bill and could consider increasing local tax to address the lost revenue. Indirect Impacts HB26-1396 – Disaster Emergency Fund Changes: This bill makes several changes to the state’s disaster emergency fund. It changes the disaster close out timeline and reporting process and limits the annual maximum unencumbered balance of the fund to $200 million. Any money in excess of that will be transferred to the General Fund. This is a substantial change, as the current statute does not have a cap on the amount of dollars in the fund. The intent of this change is fiscal efficiency in moving “dead allocated funds” back into line items of the budget where the funding can be utilized. Boulder ODM staff are monitoring this bill for anticipated cleanup language that will clarify disaster closeout timelines and deadlines for spending state allocated disaster funding.

Staff are also monitoring for any impacts to Boulder County as a result of any of these changes. At this time, no direct impacts to Boulder County are anticipated. Impacts from Elimination or Reduction of Grant Programs HB26-1360 – Affordable Housing Financing Fund: For 2026-2027 only, this bill transfers $130 million from the Affordable Housing Financing Fund to the General Fund. The fiscal note specifies that the Proposition 123 allocation to the Affordable Housing Support Fund, which is administered by the Department of Local Affairs, will be held harmless. The transfer will impact the Affordable Housing Financing Fund, which is administered by the Governor’s Office of Economic Development and International Trade (OEDIT). The bill reduces the overall balance available for the concessionary debt, land banking, and equity programs administered by OEDIT, thereby reducing opportunities for grant funding for local and tribal governments, housing authorities, and nonprofit/private affordable housing developers. HB26-1398 - Retail Delivery Fee Revenue Allocation: This bill decreases Multimodal Transportation and Mitigation Options Fund (MMOF) expenditures for local multimodal projects by $1.7MM in FY26-27 and $3.1MM in FY27-28 and increases expenditures for state multimodal projects by the same amount each respective year. The fiscal note states that there will be similar decreases for MMOF expenditures for local multimodal projects in future years as well. HB26-1399 – Eliminate General Fund Transfer to Multimodal Transportation Fund: This bill eliminates the annual $10.5 million transfer from the General Fund to the MMOF. Staff were successful in lobbying for an amendment that eliminates the transfer in 2026-2027 and retains the infrastructure for transfers in future years when funding is more readily available. The city is a recipient of MMOF funds directly and indirectly through the DRCOG Transportation Improvement Program (TIP), so decreases to MMOF expenditures (in both this bill and the previous bill, HB26-1398) will impact transportation funding sources available to the city. The city has been quite successful in competing for and receiving grant funds, and we rely on this funding source for major, capitalintensive corridor safety projects. Additionally, local municipalities are often better equipped to transform MMOF funding into projects that move the needle on safety and multimodal outcomes. These major MMOF changes could hamstring local governments from enhancing our systems in the ways that best meet our transportation system goals and the needs of our community. HB26-1401 – Transfers from Unclaimed Property Trust Fund: The bill adds, modifies, and repeals transfers from the Unclaimed Property Trust Fund. The most relevant change for local governments is a one-time net reduction in

transfers of $27.8 million to the Housing Development Grant Fund in fiscal year 2025-2026. HB26-1405 – Cash Fund Transfers to General Fund: This bill sweeps cash balances from several cash funds into the General Fund to help with the structural deficit in this year’s budget. Of note, the bill sweeps $400k from the Peace Officers Mental Health Grant Program into the General Fund for FY 26-27. The city currently has a $30k Peace Officers Mental Health Grant that ends on June 30, 2026. This grant pays for wellness events, peer support training, and assistance for officers who may be struggling with mental health/substance abuse issues. Given the city’s success in previous years with this grant program, future funding reductions may impact the city’s ability to offer similar wellness programming for police officers.

Equity Analysis The first policy principle listed in the city’s Policy Statement on Regional, State and Federal issues is Equity, Racial Justice and Social Resilience. When using the policy statement as a guide for intergovernmental affairs efforts, city staff consider equity implications as described in the Policy Statement.

Climate, Resilience, and Sustainability Considerations Climate, resilience, and sustainability are woven throughout the Policy Statement and comprise 13 distinct policy positions under “Climate Change and Community Resilience.” As staff use the Policy Statement throughout the year, climate and sustainability considerations are a key factor in policy analysis and recommendations.

Community Engagement In alignment with past practice, staff do not conduct community engagement when taking positions on legislation on behalf of the city.

Next Steps for City Council There are no formal actions that need to be taken by Council on this item.

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