3-2-1 Capitol Connection – February 28, 2025
3 Things to Know
FAIR Plan Prepares to Issue Policies in Colorado. In May 2023, House Bill 1288: Fair Access to Insurance Requirements Plan, was signed into law, establishing a FAIR Plan in Colorado. Designed to offer basic homeowners’ insurance to those in high-risk areas where private insurers may be unwilling to provide coverage—think states like California, Florida, and Hawaii—the FAIR Plan steps in only after an applicant has been denied coverage by private insurers at least three times. Coverage is capped at $750,000. By April 1, 2025, the board of the FAIR Plan is required to submit a comprehensive report to the Commissioner of Insurance for the FAIR Plan during the preceding calendar year. While we know the FAIR plan has not issued any policies, and therefore no claims filed, this annual report is required to provide important details, including the financial health of the plan, the number of policies issued, the claims filed, and an assessment of whether the coverage offered is sufficient to meet the needs of policyholders.
But the updates don’t stop there. Just recently, House Bill 1205: Implement Fair Access to Insurance Requirements Plans was introduced and passed its first committee hearing with a 10-1 vote. This bill introduces two key objectives: First, it clarifies that the FAIR Plan operates as a standalone entity, independent from the state. Second, it provides the association with immunity from legal action by policyholders, except for claims related to breach of contract or failure to act in good faith – which a policyholder would have to prove.
Those looking for more information on the FAIR Plan and what it might look like for Colorado homeowners can also visit the Division of Insurance’s page.
Unsustainable Path for the State Budget. That was the “take-home” message from Joint Budget Committee (JBC) nonpartisan staff to JBC legislators in a memo dated February 12, 2025. The state of Colorado’s General Fund is experiencing a budget shortfall of $1.2 billion and if current obligations are held constant, only $303 million is leftover to spend in the next fiscal year (FY 25-26). The top state expenses are K-12 education, healthcare, human services, and corrections. Medicaid expenditure increases alone are expected to deplete remaining funds. JBC staff recommend structural change to limit cost obligations because continuing as-is would deplete the 15% required reserve without factoring in a recession scenario. Many legislative proposals that require state expenditures without raising revenue are anticipated to go nowhere, or if they pass, will be unfunded measures at best.
508 Bills Introduced (so far). We are not halfway through the 2025 Legislative Session in Colorado (day 51 of 120) and 508 bills or resolutions have been introduced so far. Of those 508, CAR’s Legislative Policy Committee (LPC) is tracking 69 bills, which are publicly available on our CAR Bill Sheet. This Bill Sheet is also located on our CAR website under Political Advocacy. For reference, we tracked 97 bills over the course of the 2024 session. We have more than 50 REALTORS® from nearly 20 different Local Associations who serve on the LPC and will review more than 100 bills during the legislative session that ends on May 7th. The LPC is the official body to take Association positions on legislation impacting REALTORS® and/or real estate. If you know someone who serves on the LPC, please thank them for their time, service and dedication in helping shape public policy that affects you and your business.
2 Things to Share
CAR Advocacy. CAR Government Affairs staff testified in support of Senate Bill 15 “Wildfire Information & Resource Center Website” because it requires the state agency and county governments to collaborate by posting emergency information and wildfire updates on the Wildfire Information Resource Center’s website in the form of hyperlinks. The bill centralizes critical, life-saving information to residents who might be in the path of destructive wildfires.
On February 24th, CAR Government Affairs staff testified in strong support of House Bill 1156 “Make Senior Home Tax Valuation Reduction Permanent”, which seeks to continue the property tax reductions from Senate Bill 24-111 indefinitely. This bill would ensure lasting relief by removing the uncertainty that it would expire every two years. We are pleased to share that this measure passed unanimously in committee with a 12-0 vote.
1 Thing to Do
Mark Your Calendars. House Bill 1272 “Construction Defects & Middle Market Housing” is an important step forward in addressing Colorado’s housing challenges. The bill proposes reforms to construction litigation, aiming to make housing more attainable by encouraging the development of homes that have long been attainable options for buyers entering the market – and even those looking to downsize. House Bill 1272 is currently scheduled for a hearing on Tuesday, March 11 in the House Transportation, Housing & Local Government committee (though, as always, the schedule may change during this busy legislative session). Be sure to tune in online or share your story with us! Many of you and your clients have felt the pinch of the housing shortage in the middle market, and if you have, we want to hear about it! Your experiences not only make a real impact on the members who will be hearing it, but also, the individuals in our community who are waiting for the solutions this bill seeks to deliver. Click here to share that story!
NAR
Existing-home sales retreated in January, according to the National Association of REALTORS®. Sales slipped in three major U.S. regions and held steady in the Midwest. Year-over-year, sales rose in three regions and were unchanged in the South.
Will Lower Mortgage Rates Make Home Buyers More Confident?
Mortgage rates are easing slightly and expected to hover in the mid-6% range in the coming weeks, says Jessica Lautz, deputy chief economist at the National Association of REALTORS®. It may bode well for the spring homebuying season: “Buyers can plan and search for homes without the uncertainty of fluctuating mortgage rates,” Lautz says.
NAR Supports Jonathan McKernan to Lead the CFPB
The letter highlights Mr. McKernan’s experience and highlights many of the vital roles the CFPB plays in protecting consumers and enforcing financial services regulations, such as those overseeing the mortgage markets and rules prohibiting discrimination.