End of the Line: Colorado 2026 Session Defined by Budget Deficit, Pending Turnover

The second regular session of Colorado’s 75th General Assembly concluded last Wednesday, May 13.

As compared to most sessions, the final days of the 120-day lawmaking period were notably characterized more by a sense of resignation than their normal frenetic pace. This marked tonal shift could have been caused by any number of factors, but in hindsight two reasons emerged above others.

First, lawmakers entered this session with clear eyes that it would be yet another difficult budget year with few dollars left over for new programs and legislative priorities—a sobering reality that only worsened as the session dragged on.  Second, lawmakers and lame-duck Gov. Jared Polis (D)—who over seven previous sessions has earned his reputation as an active participant in the policymaking process—often already knew where the other side stood on the biggest ticket items under consideration.

For example, with the June effective date for Colorado’s first-in-the-nation artificial intelligence (AI) bill looming, both the executive and legislative branches were already deeply familiar with the fault lines among stakeholders and knew that it was now or never to find a compromise on that issue. Similarly, Democrats knew that they would revive their effort to overhaul Colorado’s Labor Peace Act before the session started. Meanwhile, Polis—who had promptly vetoed the proposal last year—signaled very early on that this year’s effort, HB 26-1005 (Worker Protection Collective Bargaining), would likely meet a similar fate. Make no mistake, tensions between the legislature and notoriously hands-on Gov. Polis came to fore at certain points, but those conflicts were seemingly more subdued than in recent years.

The legislature’s attitude of acquiescence (and at times, fatalism) played out in the numbers as well. The 626 bills lawmakers considered this year continued a downward trend in the volume of legislation, decreasing even further than last year’s low water mark of 657 (705 in 2024). As of publication, 405 of the 626 total bills introduced fully passed both chambers and have either been signed by the governor or are otherwise awaiting action. Of the remainder, 141 were postponed indefinitely through official votes and none have yet earned vetoes, leaving dozens of measures that failed for procedural reasons.

How the state’s budget deficit colored the lawmaking period truly cannot be understated. The Joint Budget Committee (JBC) entered the session knowing that they faced at least an $800 million deficit, coming on the heels of a $1.2 billion shortfall in the 2025 session and another $800 million gap closed in a special session back in August. However, by March, this year’s deficit had blown past the $1 billion mark, most notably accelerated by massive upticks in usage of the state’s Medicaid programming. As a result, the JBC agonized on finalizing the “Long Bill” and, when it made its way to the broader legislature well past its usual introduction deadline, it was headlined by some of the most painful budget cuts in recent memory. Those include reduced Medicaid provider reimbursement rates by 2%, implemented new eligibility criteria and caps on the state’s Cover All Coloradans program (designed to provide Medicaid-type coverage to residents without the requisite immigration status) and withholding $300 million in TABOR refunds. The legislature also did not provide any new general fund investment for higher education and temporarily reduced the state’s budget reserve requirement from 15% to 13% to provide additional backfill.

These painful funding decisions had their own downstream impacts as well. With no dollars to support core services, new programs and funding obligations were largely discarded, and those that did advance were often pared down to reduce their fiscal notes to the bare bones. Importantly, it also led some lawmakers to put forward ideas to create new sources of revenue for priority programs or create increased budget flexibility. These proposals ranged from bills like HB 26-1327 (Large Employer Worker Health-Care Support) to create a new fee on large employers with over 500 employees on the state’s Medicaid rolls to SB 26-135 (State Public K-12 Education Funding) to send a referred measure to the voters asking them to remove K-12 spending from the state’s TABOR cap in order for that spending to grow aggressively and provide more room to invest general fund dollars in other priorities.

With that backdrop and all eyes now turning to the June primaries and November general election, please see below for a more detailed analysis on the headline issues debated during Colorado’s 2026 legislative session.

EMPLOYER AND BUSINESS LEGISLATION

Colorado’s business community, citing the departures of high-profile companies and studies showing the Centennial State’s dropping economic competitiveness, made clear at the outset of the session in January that it wanted the legislature to press pause on new regulations and mandates. Candidly, this was a refrain that the state, regional chambers and other business organizations had repeated in prior lawmaking periods, but legislators might have heeded their warnings more in this session than any in the past several years.

A symbol of that potential breakthrough was SB 26-137 (Measures to Reduce Administrative Burdens), which establishes a more structured process for state agencies to review existing regulations. It requires periodic evaluations to identify outdated or duplicative rules and assess the funding adequacy of those decisions—all done in the spirit of reducing unnecessary administrative burdens on businesses and, by extension, consumers. Backers, including the Colorado Chamber of Commerce, framed the measure as a proactive reform focused on transparency and efficiency and aimed at improving regulatory accountability. The bill, which was sponsored by bipartisan caucus leadership in both chambers, advanced with limited opposition and strong vote margins in both the House and the Senate.

That olive branch did not stop some statehouse Democrats from starting the session with a revival of one of the most contentious bills from 2025. HB 26-1005, the successor to last year’s SB 25-005 (Worker Protection Collective Bargaining), would have eliminated Colorado’s unique second election requirement under the Labor Peace Act. Currently, after a majority vote to unionize, 75% of workers must approve a second vote before union security agreements can be negotiated. Labor groups argue the requirement weakens organizing efforts, while business groups contend its removal would allow a smaller subset of workers to impose dues amongst their colleagues. Gov. Polis has again signaled a veto, which he did in 2025, and sponsors plan to reintroduce the measure under a future administration since this is his last term.

More novel concepts were pursued as well. HB 26-1012 (Consumer Protections to Promote Fair Market Pricing) sought to limit alleged price inflation in “captive audience” settings like airports, hospitals and stadiums by tying prices to local market averages and requiring delivery platforms to disclose delivery pricing versus what might be charged in-store. Framed as an anti-price-gouging and transparency measure amid broader affordability and inflation concerns, the bill had fervent opposition from a broad swathe of the business community who contended the measure would be too onerous to comply with, did not properly account for vendor costs and unfairly couched consumers as captive even though they might have voluntarily entered one of the covered settings. Ultimately, the bill was postponed indefinitely in its first committee hearing.

Lawmakers also had a busy session considering a variety of new worker protections, though many failed to advance. For example, HB 26-1054 (Protections for Worker Safety)  looked to establish workplace safety rules to stand in for existing regulations if federal OSHA standards were to ever be rolled back. Initially introduced with significant implementation costs that included funding for new staff and rulemaking, the bill was delayed as sponsors revised it to eliminate near-term fiscal impacts, instead deferring future funding decisions to the next legislature. Despite early setbacks, the bill started to progress again late in the session and advanced amid continued debate over the necessity and scope of duplicative state authority. The bill was eventually lost on the last day of session in the Senate by a bipartisan 17-18 third reading vote.

Another worker safety bill, HB 26-1272 (Extreme Temperatures Worker Protections)  was resurrected from a failed attempt in 2025. The sponsors, Reps. Elizabeth Velasco and Meg Froelich, initially proposed requiring employers to develop plans for temperature-related injury and illness prevention and authorizing the state to adopt rules to enforce those requirements. The measure was subsequently scaled back to instead focus on data collection, directing the state to track temperature-related workplace injuries and develop a model prevention plan for employers. The bill advanced through committee and continued moving late in the session, finally passing on the last day.

On the anti-discrimination side, HB 26-1319 (Right to Be Out at Work) would have expanded workplace protections related to gender identity and expression, including requirements on pronoun use, records, facilities access and dress codes. Interestingly, the bill was postponed indefinitely after an initial committee hearing, with some advocates contending that enshrining protections statutorily in the way HB-1319 might have resulted in lower protections for the LGBTQ community than recent common law jurisprudence offers.

For health coverage, HB 26-1327 (Large Employer Worker Health Care Support) emerged amid a significant state budget shortfall and pressure on Medicaid. It would have required large employers to pay a fee if workers rely on Medicaid due to unaffordable coverage, shifting some public costs to employers. Sponsors did build in exemptions for employers that provide affordable health care plans or are nonprofits, franchises or public employers. Supporters framed the measure as a way to reduce public subsidy of large employers and address rising Medicaid spending, while opponents raised concerns about legal risks, workforce impacts and the potential for increased costs and reduced hiring. The bill survived the House but died in the Senate Finance committee as four Democrats joined three Republicans in rejecting the measure amid concerns of the bill violating TABOR and controls on enterprises under Proposition 117.

Other measures were successful. SB 26-093 (Workers’ Compensation Insurance Coverage Verification) requires verification that contractors and subcontractors working on projects on behalf of governmental entities maintain workers’ compensation coverage as part of permitting and licensing processes. Aimed at addressing compliance gaps in the construction sector, supporters argued the measure would ensure injured workers are covered, while opponents—including the Colorado Municipal League, construction industry groups and the state Division of Workers’ Compensation—raised concerns that it would shift enforcement responsibilities onto local governments, increase administrative burdens and delay permitting. The bill advanced through the legislature with significant amendments and ultimately passed both chambers.

SB 26-121 (Overtime Threshold for Agricultural Employees) raises the overtime threshold for agricultural workers from 48 to 56 hours per week. Supporters, including agricultural producers, argued the prior threshold dangerously increased costs and incentivized employers to cut hours and avoid overtime to maintain operations, reducing overall earnings for workers. Opponents, including labor advocates, contended the measure weakens recently enacted worker protections and shifts the balance in favor of farmer-employers. The bill passed the House after a 6-hour debate by a narrow 33–32 vote, 19 of which were cast by Democrats, before advancing in the Senate and being signed into law on May 4, 2026. It has an effective date of Jan. 1, 2027.

In a business-versus-business battle, SB 26-134 (Payment Card Networks’ Fees) prohibits credit card companies from charging transaction fees on the sales tax portion of a purchase. A scaled-back version of a 2025 proposal, this bill was amended to require businesses that save money from reduced swipe fees to pass those savings on to consumers or use them to support employee wages and benefits. After sitting for weeks following its March introduction, the measure passed the Senate by a narrow 18–17 vote on May 1 before advancing more easily in the House with support from leadership, receiving a 44-20 vote. Supporters, including local retailers and restaurant groups, framed the bill as a fairness measure, noting businesses are charged fees on taxes they do not retain, while opponents—including banks, credit unions, payment networks and airlines—warned it could reduce credit-card rewards programs, complicate their nationwide payment systems and set concerning precedent regarding state impairment of contracts. They also argued that a similar law in Illinois, the Interchange Fee and Prohibition Act, is now being heavily litigated—a scenario that might repeat itself in Colorado if this bill is enacted. One of the most heavily lobbied measures of the session, the bill was sent to the governor, who continues to face pressure from competing industry groups to act in their favor.

ARTIFICIAL INTELLIGENCE AND DATA CENTERS

In the months following the 2025 extraordinary session, in which multiple proposals and negotiations on a repeal-and-replace bill for the contentious AI legislation SB 24-205 failed to spark meaningful changes to the law, Gov. Polis convened a workgroup of stakeholders to revisit the issue. The group, tasked with bringing a compromise bill to the table during the 2026 legislative session, was the third attempt to negotiate a compromise on the law among stakeholders.

The first, a taskforce convened under statutory direction from HB 24-1468, resulted in a short memo delivered to the legislature outlining the points of agreement and disagreement on the issue. The second was an informal “subgroup” of stakeholders convened by SB 24-205 prime sponsor and Majority Leader Robert Rodriguez that met twice weekly throughout the 2025 legislative session to work on a compromise, ultimately to no avail.

The governor’s work group—managed by a facilitator with agreed-upon operating terms and a tightly held negotiation process—talked through 11 iterative draft policy frameworks, ultimately voting to support what would become SB 26-189. The bill, sponsored by Majority Leader Rodriguez (along with Senate President James Coleman as well as House Majority Leader Monica Duran and Assistant Majority Leader Jennifer Bacon), was introduced in the last weeks of session.

The business community and the majority of tech industry voices ultimately landed in passive support, viewing the bill as a workable improvement to the current law. Among many other differences, SB 26-189 removes the concept of algorithmic discrimination, mandatory impact assessments and discrimination reporting to the attorney general, and the risk management policy and program requirement. It also narrows the consumer notice obligations. Stakeholder concerns still remain around liability, the right to cure and the bill’s interplay with already existing requirements under federal law. SB26-189 passed in the final days of session and is awaiting the governor’s signature. It is anticipated that stakeholders will weigh in heavily during rulemaking, and it remains to be seen if there will be any efforts to make even more changes in 2027.

In addition to SB 26-189, there were several other standalone AI bills. Rep. Sean Camacho (D) from Denver introduced HB 26-1263, which requires AI developers to provide disclosures to minors, prohibits the use of rewards or loyalty programs, requires the ability for parent or guardian account management, and prohibits explicit interactions with minors. Notably, the bill was amended to carve out commerce-related AI tools. The bill passed and is awaiting signature from the governor. 

Two other notable AI bills that passed this session were HB 26-1195 and HB 26-1139, both focused on health care and coming in response to growing concern from policymakers around the use of AI determining consumer health insurance coverage (a primary issue that SB 26-189 seeks to address) and the sharp increase since the COVID-19 pandemic in mental health telehealth companies. 

Sponsored by mental health provider Rep. Gretchen Rydin from Arapahoe County, HB 26-1195 prohibits lawfully permitted psychotherapy providers from allowing an AI system to solely interact with patients without human oversight or generating treatment plans without review and approval by the provider. It also requires patient disclosure of the use of AI systems in treatment. HB26-1139 establishes requirements for the use of an AI system in health care utilization and prohibits insurers from covering psychotherapy services conducted by AI. 

The infrastructure to support AI proliferation was subject to much debate in the Colorado General Assembly as well. This took the form of two competing data center bills, HB 26-1030 (Data Center & Utility Modernization) and SB 26-102 (Large-Load Data Centers), emblematic of both growing concern about the rapid expansion of data centers but balancing their positive impact in terms of technological innovation and massive tax base increases. As demand accelerates nationwide, Colorado lawmakers grappled with whether to position the state as a destination for data center investment or to impose strict guardrails on the industry. The result was a clear policy divide, with competing proposals embodying fundamentally different visions: one focused on economic development and incentives and the other on environmental standards and consumer protections.

On the incentives side, HB 26-1030 specifically  would have created a state program offering substantial sales tax exemptions to qualifying data centers that committed to major capital investments, job creation and compliance with labor, water stewardship and energy efficiency standards. It also required coordination with utilities to address the substantial electrical demand these facilities would create and included provisions aimed at minimizing impacts on other ratepayers and modernizing the grid.  Supporters argued that this approach would position Colorado to compete with other states for high-tech investment while still imposing meaningful environmental and workforce requirements, but critics warned the tax incentives were costly and raised concerns about long-term resource use and infrastructure strain.

In contrast, SB 26-102 sought to establish strict statewide requirements for large-load data centers, particularly around energy sourcing, cost responsibility and environmental reporting. The bill would have required major facilities to procure 100% of their electricity from renewable sources by 2031, meet evolving hourly clean energy matching standards and fully cover the costs of the grid infrastructure required to support their operations through long-term contracts or upfront payments. It also imposed ongoing reporting requirements for energy and water use and added certain protections for communities, especially those disproportionately impacted by development. Proponents framed the bill as necessary to prevent cost-shifting to ratepayers and to safeguard Colorado’s climate and water resources, while opponents argued it would deter investment and effectively push data center development to other states. 

Ultimately, neither vision prevailed with both bills failing in their first committee of reference after significant changes and attempts to reach some sort of compromise. This leaves Colorado without a comprehensive statewide framework for data centers and sets the stage for the debate to continue in future sessions as well as at the local and county levels.

HOUSING

Building upon the previous several sessions, the 2026 legislative session featured a strong, coordinated push by Colorado policymakers to address the state’s ongoing housing shortage through both structural reform and targeted investments.

Lawmakers prioritized increasing housing supply by streamlining development processes, reducing regulatory barriers and shifting more land use authority toward standardized, statewide approaches. A central theme was the move toward “by‑right” development, limiting discretionary local review and enabling certain housing projects to move forward more quickly and predictably. At the same time, the legislature advanced policies designed to concentrate growth near transit and leverage new financing mechanisms to support infrastructure and housing together.

Alongside supply-side reforms, the session also reflected growing attention to tenant protections and housing equity, though efforts in this area were more mixed. Some proposals sought to expand procedural safeguards for renters, increase transparency in leasing and eviction processes, and reduce barriers that can have long-term impacts on housing stability, while others focused on modernizing how tenant information is handled and improving access to credit.

In parallel, a range of measures aimed to refine and expand public funding tools for affordable housing and to better target resources toward specific populations, including seniors, workers and individuals with specialized needs. Collectively, the session demonstrated a comprehensive but evolving approach with land use changes, transit-focused financial incentives, and tenant protections policies.

HB 26-1001 (Housing Developments on Qualifying Properties) known as the “Housing Opportunities Made Easier (HOME) Act,” was the governor and legislature’s headlining piece of housing legislation. This was a revamp of last session’s “Yes in God’s Back Yard” (YIGBY) bill, which sought to increase housing supply by requiring local governments to allow residential development on certain small (up to five acres) properties owned by religious establishments, nonprofits, schools, housing authorities and transit agencies. Last year’s bill died in the Senate, and the same bill was brought back this session but without the focus on religious institutions.

The bill sponsors included solutions to many of the objections that opponents made on the YIGBY bill, and the HOME act sailed through the legislature. Beginning Dec. 31, 2027, projects that meet the criteria must be approved through an administrative (by‑right) process rather than discretionary public hearings, and local governments are limited in their ability to deny or restrict them based on factors like height, density or zoning standards, as long as basic objective criteria are met. 

HB 1065 (Transit and Housing Investment Zones) creates a new “Transit Investment Area Act” that allows local governments, in partnership with transit agencies and with state approval, to designate transit and housing investment zones where they can use a portion of future state sales tax revenue growth (via tax‑increment financing) to fund transit infrastructure and related improvements for up to 30 years. It also creates a new state tax credit to incentivize affordable housing development within these zones, aiming to encourage transit‑oriented communities, expand housing supply (especially for low‑ and middle‑income residents), and improve transportation access.

HB 1047 (Protections for Residential Tenants) and HB 1106 (Eviction Protections for Tenants) were attempts at implementing stringent tenant protections. They sought to expand tenant protections in eviction proceedings by increasing procedural safeguards, transparency, and access for renters, though neither ultimately passed. HB 1106 focused on court processes by limiting how many eviction cases can be heard per day, requiring hearings before judgments when tenants intend to cure nonpayment, allowing tenants to reopen or delay cases due to barriers like illness or improper service, extending the timeline for physical evictions, and prohibiting evictions during severe weather.  Meanwhile, HB 1047 emphasized documentation and privacy by requiring landlords to include detailed evidence (such as leases and rent ledgers) in eviction filings, mandating redaction of personal information, keeping most eviction records permanently suppressed unless involving serious lease violations, and ensuring tenants have at least one fee‑free, non‑online rent payment option. Both were killed in their first committee of reference.

HB 1196 (Tenant Data Information) was a key piece of tenant legislation this session. It focuses on tenant protections and transparency in the rental process by requiring landlords to disclose upfront what information they will use in tenant screenings and the specific criteria that could lead to an application denial.  It also requires larger landlords (those with five or more units or receiving certain assistance) to offer tenants the option of free “positive rent reporting,” meaning on‑time rent payments can be reported to credit bureaus to help build credit, with tenants able to opt in or out at any time and landlords barred from passing on costs.  Additionally, the bill strengthens data privacy protections in eviction filings and treats noncompliance with the rent‑reporting requirement as an unfair and deceptive trade practice, aiming to improve fairness, transparency, and credit access for renters.

HB 1114 (Allowed Minimum Lot Size for Subject Jurisdictions) and HB 1308 (Lot Splitting Approval by Subject Jurisdictions) were two of the most ambitious pieces of housing legislation introduced this year and working in tandem would have drastically changed the way zoning and local control impact housing in the state. HB 1114 proposed to disallow local governments from mandating that any lot in a single family zoned residential area to be 2000 square feet at minimum. HB 1308 proposed to add lot splitting as a use-by-right for any residential property so long as it did not create a new lot of less than 1200 square feet. Taken together, these bills could have rewritten the face of single-family zoning in the state by massively increasing the number of available lots. The bills faced stiff opposition from municipalities and many others. Both bills passed the House and then, ultimately, failed in the Senate.

The legislature also introduced and passed numerous affordable housing including: SB 40 (Affordable Home Ownership Program), HB 1313 (Adjust Requirements Statewide Affordable Housing Fund), HB 1204 (Senior Cooperative Housing Authority Projects), Sente Bill 139 (Local Education Provider Workforce Housing), HB 1061 (Community Integration Housing Tax Credits), and HB 1300 (Health Service District Affordable Housing Service). Taken together, these bills represent a broad, multi‑pronged effort by Colorado policymakers to expand housing supply, target affordability for specific populations, and improve how public funding and institutions support housing development. SB 40 strengthens the state’s affordable homeownership program by clarifying income eligibility (generally up to 120% of area median income), requiring homes to remain affordable relative to income, and giving the state more flexibility to finance projects and adjust affordability thresholds when needed.  HB 1313 complements this by reforming how local governments qualify for statewide affordable housing funds, replacing a rigid 3% annual growth requirement with a more flexible, data‑driven target tied to local development activity and job growth, making funding more accessible and realistic.  The remainder of the bills ultimately failed but focused on specific populations or delivery mechanisms: HB 1204 would have expanded property tax exemptions to encourage cooperative housing developments for low‑ and middle‑income seniors,  SB 139 proposed a financing framework for school districts to build workforce housing for teachers and staff,  and HB 1061 prioritized tax credits for developments that integrate housing for people with intellectual and developmental disabilities into community settings.  Finally, HB 1300 would have broadened the role of health service districts by allowing them to develop and manage affordable housing without extensive approval processes, recognizing housing as a social determinant of health.  Collectively, these measures aimed to increase housing production, tailor solutions to underserved groups, and leverage a wider range of public entities and financing tools to address Colorado’s housing shortage.

ENERGY AND ENVIRONMENT

This session, lawmakers focused on affordability, reliability, utility oversight and implementation of the state’s existing clean-energy transition. 

Among the most high-profile energy and environment measures was SB 26-002, creating a percentage-of-income payment plan for qualifying residential utility customers. SB 26-022, a proposal allowing municipal utilities—namely Colorado Springs Utilities (CSU)—flexibility from existing clean-energy deadlines, died unanimously in Senate Transportation and Energy Committee. However, as compromise to that issue resurfaced through SB26-182, allowing CSU to operate its Nixon coal plant for an additional three years in exchange for increased oversight and reporting obligations to the state.

HB 26-1326, the PUC Sunset bill, became one of the session’s largest energy fights. Introduced as a routine reauthorization of the Public Utilities Commission, the bill drew immediate opposition from utilities, business groups, consumer advocates, labor, environmental organizations and local governments over sweeping provisions related to commissioner authority, transparency and utility regulation. Among the most controversial provisions were proposals allowing nonpublic commissioner deliberations, expanding the PUC from three to five commissioners, and broadening state authority over transmission siting disputes. Sponsors ultimately stripped several controversial provisions, created a provision to study the number of sitting commissioners and otherwise significantly narrowing the bill before passage. 

Just as notable were the major energy proposals that never fully materialized. Stakeholders spent much of the session discussing a broader Clean Energy Plan proposal for utilities that reportedly underwent multiple draft iterations but ultimately failed to secure enough support. Similarly, conversations continued around a potential statewide compromise on renewable energy siting and permitting as a follow-up to SB 24-212. At one point, SB 26-082 (Local Government Renewable Energy Development Fee) was viewed as a possible vehicle for those negotiations, but no compromise ultimately emerged and the bill later died on the calendar. Stakeholders are expected to continue those discussions during the interim. 

Several one-off energy measures also attracted attention throughout the session. HB 26-1121 (Public Accessibility of Emissions Records) revisited the emissions-transparency debate from 2025 but again failed to advance after significant opposition. SB 26-142, a geothermal-development bill, passed and signaled that geothermal policy conversations are likely to continue in future sessions.

The session ended with another notable non-event surrounding natural gas policy and Initiative 177, the proposed constitutional ballot measure creating a right to purchase and use natural gas appliances. Late in session, Speaker Julie McCluskie and other Democrats reportedly discussed introducing a response bill focused on the dangers and public-health impacts of natural gas. However, after multiple draft iterations and late-session disagreements, the proposal was ultimately never introduced, shifting the broader fight over natural gas policy from the legislature to the ballot process for the near term. 

TRANSPORTATION

Transportation policy occupied a central place in Gov. Polis’s 2026 legislative agenda, reflecting both fiscal and strategic tensions within Colorado’s mobility system. The administration advanced a dual-pronged approach: accelerating investment in public transit, most notably the Front Range Passenger Rail project, and RTD reform as part of a longer-term mode-shift strategy, while maintaining baseline commitments to roadway funding to address congestion, safety and system preservation needs. This framing underscored an inherent policy tradeoff between expanding multimodal capacity and sustaining an auto-dependent network.

Legislative deliberations throughout the session reflected this tension, as policymakers weighed competing priorities related to capital allocation, regional equity, and long-term emissions goals. Legislators also took up the mantle of addressing predatory systems both in the public and private sector (see more on this in HB 1424 and SB 152 below). The resulting legislation from this session produced a set of significant measures that will shape funding structures, project delivery, and travel behavior across Colorado in the coming years.

HB 26-1269 (Transit Access) established new requirements for transit agencies serving more than one million annual riders. The introduced bill included a swath of policies including improving equity and accessibility by requiring larger providers to implement low-income fare discounts and partner pass programs for individuals experiencing homelessness and households receiving public housing assistance, while also directing agencies to improve rider information, expand language access, address restroom amenities and provide annual public reporting. This drew significant opposition from smaller transit authorities who could not fiscally meet the requirements. The bill was heavily amended and in its final state only retained the data collection portions. It ultimately advanced and passed on the final day of session.

HB 26-1286 (Automated Driving System Commercial Vehicles) prohibits heavy-duty trucks over 26,000 pounds from operating with an automated driving system unless a CDL-licensed driver is physically present in the cab. The bill is a second attempt by the legislature to regulate autonomous driving of commercial vehicles. A nearly identical attempt was vetoed by the governor out of innovation concerns, and time will tell if this effort contains sufficient changes to see this measure avoid the veto pen.

HB 26-1424 (Transportation Network Company Consumer Protection) revived a rideshare safety proposal following Gov. Polis’ 2025 veto of similar legislation. The bill establishes new requirements for large transportation network companies (TNCs), including background checks on drivers at least every six months, company-paid screening and policies to prevent account sharing and impersonation, along with clear disqualifications for drivers with certain criminal histories such as assault, harassment, kidnapping, stalking and domestic violence. It also strengthens oversight by requiring companies to respond to law enforcement requests within 72 hours.

HB 26-1430 (Transportation Funding Adjustments) was easily one of the most partisanly contested bills of the session. It is a contingent measure tied to Initiative 175, a proposed constitutional amendment that would require the state to dedicate more than $500 million annually in existing revenue to road construction and maintenance. HB 1430 seeks to offset funding impacts by temporarily reducing gasoline taxes and transportation-related fees if the initiative passes, effectively limiting the net increase in road funding. If the initiative is withdrawn, the bill instead establishes a stakeholder working group to develop longer-term transportation funding solutions within the state’s constrained fiscal framework.

SB 26-150 (Modernizing Regional Transportation District) is a policy avenue that has been a priority for the governor for several years. SB 150 restructures RTD’s governing board to improve performance and accountability within the state’s largest transit system. The bill reduces board membership from 15 to nine to streamline decision-making while maintaining a majority of elected members by preserving five district-based seats and adding four at-large gubernatorial appointments subject to Senate confirmation. It also requires one appointment to be made in consultation with organized labor to ensure workforce representation. To attract more qualified candidates and strengthen governance, the bill increases compensation for board members and the chair and directs the board to adopt clearer roles and responsibilities for its members. In addition, the bill addresses ongoing concerns about accessibility by requiring RTD to study and develop a plan to improve paratransit services by the end of 2027, including a comprehensive assessment of rider needs, service gaps and performance benchmarks.

SB 26-152 (Changes Automated Vehicle Identification System Usage) stemmed from perceived misuse of these automated systems by small towns in northeast Colorado. The bill modifies how automated speed enforcement systems are used and how violations are penalized, reflecting ongoing concerns about fairness and consistency in camera-based enforcement. The bill generally prohibits issuing fines for drivers traveling less than 6 mph over the speed limit in most cases, including repeat violations, while still allowing fines for a first offense in school and construction zones. Beginning in 2035, the bill increases fines across categories, including raising penalties for traffic signal violations and passing a stopped school bus.

SB 26-172 (Front Range Passenger Rail District) was in many ways a legacy bill for the Polis administration. The legislation narrowed the geographic scope of Colorado’s Front Range Passenger Rail District by redefining its boundaries to include a smaller set of municipalities most directly served by the planned rail corridor, reducing the district from roughly 4.4 million residents to about 2.6 million and limiting it to around 30 communities. The reconfiguration of the district’s parameters – as well as a provision allowing the implicated jurisdictions to form subdistricts – sought to improve the prospects for future ballot measures tied to funding the project. The bill also allows additional municipalities and metropolitan districts to join the district with consent and authorizes the creation of subdistricts to support localized funding for rail infrastructure, while maintaining the district’s authority to refer a sales tax measure to voters to finance the proposed “Colorado Connector” service.

HEALTH CARE

Health care remained a prominent issue during the 2026 legislative session. Rising Medicaid costs shaped much of the state budget deficit and required the Joint Budget Committee to enact difficult reductions, including both targeted and across-the-board cuts to provide reimbursement rates as well as operational limits on certain programs.  Medicaid was top of mind for budget writers as the largest cost driver in the state, and debates focused less on expanding access to care and more on maintaining existing coverage and services within tighter fiscal limits. Lawmakers also considered a range of policy proposals aimed at overall system costs, enacting antitrust regulation and addressing affordability.

Lawmakers revisited antitrust and competition-related issues in the health care sector. SB 26-041 (Consumer Protections Medical Care Entities) sought to expand state oversight of mergers and acquisitions involving health care providers by requiring advance notice to the attorney general and allowing additional review of deals that could affect competition. The bill did not advance, but its introduction reflects continued legislative scrutiny around consolidation in the health care system and business practices employed by certain health care providers.

Patient costs remained a focus during the session. HB 26-1267 (Limitations on Collection Actions for Medical Debt) aimed to build on prior efforts by setting additional expectations around notice, financial assistance screening and payment plans before certain collection actions could occur. Although the bill did not advance, it reflects continued concern from progressives about the financial pressures facing patients and the role medical debt plays in the broader system.

While several high-profile proposals were unsuccessful, lawmakers did move forward with more targeted reforms. SB 26-138 (Concerning Measures to Reduce the Administrative Burden on the Health-Care System) makes a series of changes aimed at streamlining reporting requirements, licensing processes and regulatory review to reduce administrative workload. HB 16-1425 (Applied Behavioral Analysis Services) establishes licensure requirements and creates a new oversight board for applied behavioral analysis providers aimed at addressing concerns articulated by the Department of Human Services around practices by certain providers.

PUBLIC SAFETY AND CRIMINAL JUSTICE

Public safety and criminal justice legislation continued to be amongst the most watched bills under the Gold Dome this session. While Democrats again pursued a slate of gun control bills, ranging from a prohibition on 3D printed firearms and components (HB 26-1114) to creating a new state level permit for firearms dealers (HB 26-1126), firearms were not the most hotly debated public safety topic this session.

Instead, the legislature made a foray into the increasingly sensitive and fraught discourse related to the use of law enforcement surveillance technologies, with Flock cameras and automated license plate readers (ALPRs) being the predominant example. To that point, SB 26-070 (Ban Government Access Historical Location Information Database)—brought in the upper chamber by Sens. Judy Amabile (D-Boulder) and Lynda Zamora Wilson (D-Colorado Springs)—would have required a law enforcement agency to secure a warrant or make a showing of exigency if the ALPR data the agency was seeking to access was over 72 hours old. In a similar vein, SB 26-071 (Use of Surveillance Technology by Law Enforcement)— also brought by Zamora Wilson—would have further constrained law enforcement’s use of other surveillance technologies such as facial recognition systems and drones while prescribing how agencies retained and shared that data. Ultimately, neither bill advanced. SB-70 was laid over until after session at the request of the sponsors on the Senate floor and SB-71 was postponed indefinitely in its first committee, but both are likely harbingers of policy proposals to come in this space.

Meanwhile, other legislation seeking to create new criminal offenses or modify penalties for existing crimes were again hotly contested. One such example was HB 1281 (Homicide Criminal Offenses), a bill that in major part would have lowered the criminal penalty for “extreme indifference” murder (e.g., conduct so malicious it demonstrates an extreme indifference toward the value of human life) from its traditional classification of first-degree to second-degree murder. The bill passed the House by one vote before being defeated in the Senate but served as a prime example of the strong competing opinions on public safety and criminal justice policy at the capitol.

One of the most press-worthy bills in this area of policy was SB 26-097 (Decriminalize Adult Commercial Sexual Activity), a bill seeking to decriminalize prostitution in the state. Legislators reported being inundated with thousands of emails and other outreach from both the law enforcement but also the religious and faith communities asking them to oppose, which ultimately led to the Senate sponsor Nick Hinrichsen (D-Pueblo) to request that the bill be postponed indefinitely in its first committee without testimony a month after it was introduced.

ALCOHOL, CANNABIS, TOBACCO AND GAMING

An ever-present policy conversation in the General Assembly, industries regulated by Colorado’s Department of Revenue generated their share of attention during the 2026 legislative session. Notably in the alcohol space, SB 26-114 (Spirituous Liquor Manufacturer Sales Rooms & Other Alcohol) expanded distillery tasting room offerings to include spirits not made on the premises. The legislature once again rejected two proposals to place additional fees on alcohol to fund programs in the Behavioral Health Administration and the creation of a mental health hospital: HB 26-1271 (Alcohol Impact & Recovery Enterprises), and HB 26-1301 (Hospital Funding) respectively. Both died in their first committee hearing in the House.

Cannabis enjoyed a relatively quiet year in the legislature, although efforts to realign regulatory responsibility among state agencies and to allow for the sale of hemp-infused beverages were introduced. SB 26-161 (Modernize Regulation of Cannabis-Related Products) and SB 26-164 (Regulation of Lawful Tetrahydrocannabinol Beverages) both died in their first committee hearing.

A significant regulatory policy was introduced with respect to the sports betting industry. SB 26-131, (Sports Betting Protections) outlined a sweeping set of regulations on licensed sports books, initially including an outright ban on bets on individual player statistics and a prohibition on advertising between the hours of 8 a.m. and 10 p.m. or during a live sporting event. After intense negotiations between sponsors, proponents and opponents, the bill was scaled back to include a ban on the use of credits cards, a prohibition on marketing-related push notifications on electronic devices, a limit on the number of deposits made by players in the course of a day, and a reporting requirement for licensed operators.

Finally, a late breaking policy emerged in the final days of session related to tobacco tax. Rumors swirled that legislation to refer a measure to the 2026 ballot to increase excise tax on tobacco products and lower the state income tax by a corresponding amount was being drafted by the speaker of the House. Ultimately, and largely due to threats by House Republicans to slow down work on unrelated legislation, Speaker McCluskie backed away from this proposal.

Contact a member of Brownstein’s Colorado State Government Relations team to answer any questions related to the 2026 legislative session and to help navigate the many new opportunities and challenges that will present themselves during the 2026 interim, the June primary and November general elections, and the lead-up to the state’s 2027 legislative session.

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