State lawmakers will again juggle a pair of competing bills aimed at boosting protections for homebuyers or spurring more condo construction — while trying to avert the impasses that killed the parallel efforts last year.
The two measures aren’t explicitly at odds, but their competing aims could put them on a collision course.
House Bill 1272, introduced in the legislature this week, looks to restrict when homeowners can sue over shoddy construction by offering less-expensive avenues to address problems. It would lead to lower risks for builders and their insurers, proponents argue, making it a safer economic bet to build condos.
But sponsors this year added a new twist to the bill: Builders would have to provide a warranty and check other boxes to reap all the protections from it.
Also new: The proposed changes would apply only to homes at or below a certain price point that varies based on local conditions. More expensive condos would still be subject to current — and stricter — defects regulations. Supporters argue that would incentivize builders to develop more-affordable units, though that provision has also drawn criticism from reform skeptics.
“Last year, the principal criticism we heard about our bill is that it focused only on the reduction of litigation,” Rep. Shannon Bird, a Westminster Democrat, said. “There was no focus on making sure that homes were just built right in the first place. That was feedback I took to heart.”
The new bill, as introduced, has won solid bipartisan support. In the House, it has more Republican sponsors than Democratic, though members of the latter party are its chief proponents.
Gov. Jared Polis, a Democrat, also cheered Bird’s bill at a news conference Wednesday as a proposal that “balances homeowner protections, de-risks the market and allows more condos to be built and sold.”
Representatives from the Hispanic Restaurant Association, an early learning center and the Colorado Black Women for Political Action also cheered the measure for its far-reaching potential for increased homeownership.
Meanwhile, lawmakers will also weigh House Bill 1261. That measure is aimed squarely at lowering the threshold for when homeowners can sue for construction defects.
It would give homeowners more time to discover problems before shutting off the courts to them, and it would add other requirements that supporters hope would speed up lawsuits against builders.
Rep. Jennifer Bacon, the Denver Democrat sponsoring the bill, said she understood why Bird — who has pushed for construction defects changes over the past two years — was eager for reforms: Colorado is short of housing, and the legislature has pushed broadly to incentivize more building in recent years.
But Bacon said she was concerned about giving too much leeway to builders at the potential expense of homeowners — particularly since the changes would apply only to condos of a certain price.
“These are people that, when they buy (these condos), will likely be the most leveraged they are ever going to be for a couple of years,” Bacon said Wednesday. “You probably just put down all the cash that you have, and so for your house — especially because these are new builds — to fall apart is devastating. You can’t recover.”
It’s unclear how the two bills — Bird’s and Bacon’s — will be reconciled, or if one will die or absorb the other. Similar bills last year, also led by Bacon and Bird in the House, died in the final days of the legislative session.
Sen. Paul Lundeen, a Monument Republican and the Senate minority leader, signed on to back Bird’s bill this year. But it’s starting in the House, where Democrats killed the measure last year.
He’ll be watching how it emerges from that chamber — and if it receives amendments that change its thrust. Lundeen is also running his own construction defects bill, Senate Bill 131, which he characterized as “a little more aggressive” in reining in lawsuits.
“We need to change the way the laws are written so they don’t invite lawsuits that prevent developers and insurers from building for-sale multi-family housing,” Lundeen said. “If that’s the type of policy that comes out of the House, great — I’m all in.”
He also highlighted opposition from the Colorado Trial Lawyers Association — a traditional backer of Democrats. It has signaled early opposition to Bird’s bill.
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