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Second Regular Session
Seventy-fifth General Assembly
STATE OF COLORADO
REENGROSSED
This Version Includes All Amendments
Adopted in the House of Introduction
LLS NO. 26-0985.01 Rebecca Bayetti x4348 HOUSE BILL 26-1362
House Committees Senate Committees
Appropriations
A BILL FOR AN ACT
CONCERNING THE REPEAL OF THE DECARBONIZATION TAX CREDITS101
ADMINISTRATION CASH FUND.102
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov/.)
Joint Budget Committee. On July 1, 2027, the bill repeals the
decarbonization tax credits administration cash fund (fund), which is
subject to annual appropriation to the department of revenue and the
Colorado energy office to pay for the direct and indirect costs associated
with the implementation and administration of various decarbonization
tax credits. The bill also makes conforming amendments.
HOUSE
3rd Reading Unamended
April 11, 2026
HOUSE
2nd Reading Unamended
April 9, 2026
HOUSE SPONSORSHIP
Sirota and Taggart, Brown, Ricks
SENATE SPONSORSHIP
Bridges and Kirkmeyer, Amabile
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law.
The bill takes effect only if House Bill 26-1405 becomes law,
which transfers the unexpended and unencumbered balance of the fund
to the general fund on June 30, 2027.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 24-38.5-120, amend2
(3); and repeal (1)(c), (2), (3.5), (4), and (5) as follows:3
24-38.5-120. Decarbonization tax credits administration cash4
fund - definitions - repeal.5
(1) As used in this section, unless the context otherwise requires:6
(c) "Fund" means the decarbonization tax credits administration7
cash fund created in subsection (2) of this section.8
(2) The decarbonization tax credits administration cash fund is9
hereby created in the state treasury. The fund consists of money credited10
to the fund pursuant to section 39-29-108 (2)(e)(I) and any other money11
that the general assembly may appropriate or transfer to the fund.12
(3) (a) Subject to annual appropriation by the general assembly,13
For state fiscal years 2023-24 2027-2028 through 2034-35, THE GENERAL14
ASSEMBLY MAY APPROPRIATE MONEY TO the office and the department15
may expend money from the fund for THE direct and indirect costs16
associated with the implementation and administration of the17
decarbonization tax credits.18
(b) (I) Money in the fund may also be used to repay administrative19
costs to the respective cash funds. The state treasurer shall transfer money20
from the fund in the amount attributable to administrative costs to the21
respective cash funds so that all administrative costs are repaid to the22
respective cash funds on or before June 29, 2024.23
(II) As used in this subsection (3)(b), unless the context otherwise24
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requires:1
(A) "Administrative costs" means the amount of money expended2
from the respective cash funds by the office and the department for the3
administration and implementation of certain income tax credits, as4
provided for in sections 24-38.5-116 (6)(b)(II), 24-38.5-118 (7)(d),5
24-38.5-506 (2)(b), and of the temporary specific ownership tax rate6
reduction for electric medium-duty and heavy-duty trucks that are part of7
a fleet as provided for in section 25-7-1405 (2)(b).8
(B) "Respective cash funds" means the industrial and9
manufacturing operations clean air grant program cash fund created in10
section 24-38.5-116 (6), the geotherm al energy gran t fund cr eated in11
section 24-38.5-118 (7), the community access to electric bicycles cash12
fund created in section 24-38.5-506, and the electrifying school buses13
grant program cash fund created in section 25-7-1405.14
(3.5) (a) On January 1, 2026, the state treasurer shall transfer two15
million five hundred thousand dollars from the fund to the energy and16
carbon management cash fund created in section 34-60-122 (5).17
(b) This subsection (3.5) is repealed, effective July 1, 2026.18
(4) The state treasurer shall transfer all unexpended and19
unencumbered money in the fund on June 30, 2024, June 30, 2025, and20
June 30, 2026, to the general fund; except that the balance of money21
remaining in the fund not including expended and encumbered money22
shall not be less than three hundred thousand dollars.23
(5) Notwithstanding subsection (4) of this section, on July 1,24
2036, the state treasurer shall transfer all money in the fund to the general25
fund.26
SECTION 2. In Colorado Revised Statutes, 24-38.5-116, amend27
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(6)(b)(II) as follows:1
24-38.5-116. Industrial and manufacturing operations clean2
air grant program - creation - eligibility - fund created - gifts, grants,3
or donations - transfer - legislative declaration - definitions -4
reporting - repeal.5
(6) Fund.6
(b) (II) For state fiscal years 2023-24 and 2024-25, the office and,7
subject to annual appropriation, the department of revenue may expend8
money from the fund for the administration and implementation of the9
industrial clean energy tax credit created in section 39-22-551 and the tax10
credit for sustainable aviation fuel production facility created in section11
39-22-556. The office shall keep an accounting of all money expended12
from the fund pursuant to this subsection (6)(b)(II). for purposes of13
calculating the repayment of the administrative costs required by section14
24-38.5-120 (3)15
SECTION 3. In Colorado Revised Statutes, 24-38.5-118, amend16
(7)(d) as follows:17
24-38.5-118. Geothermal energy grant program - creation -18
procedures - fund - report - definitions - legislative declaration -19
repeal.20
(7) Fund.21
(d) For state fiscal years 2023-24 and 2024-25, the office and,22
subject to annual appropriation, the department of revenue may expend23
money in the fund for the administration and implementation of the tax24
credit for expenditures made in connection with a geothermal energy25
project created in section 39-22-552, the geothermal electricity generation26
production tax credit created in section 39-22-553, and the heat pump27
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technology and thermal energy network tax credit created in section1
39-22-554. The office shall keep an accounting of all money expended2
from the fund pursuant to this subsection (7)(d). for purposes of3
calculating the repayment of the administrative costs required by section4
24-38.5-120 (3)5
SECTION 4. In Colorado Revised Statutes, 24-38.5-506, amend6
(2)(b) as follows:7
24-38.5-506. Community access to electric bicycles cash fund8
- creation - gifts, grants, or donations - transfer - repeal.9
(2) (b) For state fiscal years 2023-24 and 2024-25, the office and,10
subject to annual appropriation, the department of revenue may expend11
money in the fund for the administration and implementation of the12
electric bicycle tax credit created in section 39-22-555. The office shall13
keep an accounting of all money expended from the fund pursuant to this14
subsection (2)(b). for purposes of calculating the repayment of the15
administrative costs required by section 24-38.5-120 (3)16
SECTION 5. In Colorado Revised Statutes, 25-7-1405, amend17
(2)(b) as follows:18
25-7-1405. Electrifying school buses grant program cash fund19
- creation - gifts, grants, and donations - transfer - repeal.20
(2) (b) For state fiscal years 2023-24 and 2024-25, and subject to21
annual appropriation, the Colorado energy office, created in section22
24-38.5-101, and the department of revenue may expend money from the23
fund for the administration and implementation of the innovative motor24
vehicles and innovative trucks tax credits created in sections 39-22-516.725
and 39-22-516.8 and for the specific ownership tax rate reduction for26
electric medium-duty and heavy-duty trucks that are part of a fleet as set27
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forth in section 42-3-107 (1)(a)(IV). The office shall keep an accounting1
of all money expended from the fund pursuant to this subsection (2)(b).2
for purposes of calculating the repayment of the administrative costs3
required by section 24-38.5-120 (3)4
SECTION 6. In Colorado Revised Statutes, 34-60-122, repeal5
(5)(f) as follows:6
34-60-122. Expenses - energy and carbon management cash7
fund created - repeal.8
(5) (f) (I) On June 30, 2025, the state treasurer shall transfer two9
million five hundred thousand dollars from the energy and carbon10
management cash fund to the decarbonization tax credits administration11
cash fund created in section 24-38.5-120 (2).12
(II) This subsection (5)(f) is repealed, effective July 1, 2026.13
SECTION 7. In Colorado Revised Statutes, 39-29-108, amend14
(2)(b); and repeal (2)(e) as follows:15
39-29-108. Allocation of severance tax revenues - definitions16
- repeal.17
(2) (b) Except as set forth in subsections (2)(d) and (2)(e)18
SUBSECTION (2)(d) of this section, of the total gross receipts realized from19
the severance taxes imposed on minerals and mineral fuels under the20
provisions of this article after June 30, 2017, fifty percent shall be21
credited to the state severance tax trust fund created by section 39-29-109,22
and fifty percent shall be credited to the local government severance tax23
fund created by section 39-29-110.24
(e) (I) For the state fiscal years 2023-24 through 2026-27, the state25
treasurer shall credit the discrete increased amount of severance tax for26
oil and gas production that is attributable to the reduction of the credit27
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against tax pursuant to section 39-29-105 (2)(b)(II) to the decarbonization1
tax credits administration cash fund created in section 24-38.5-120 (2);2
except that, for state fiscal years 2024-25 and 2025-26, money credited3
to the decarbonization tax credits administration cash fund shall not4
exceed the net revenue from the oil and gas severance tax collection.5
(II) Repealed.6
(III) As used in this subsection (2)(e), unless the context otherwise7
requires:8
(A) Repealed.9
(B) "Discrete increased amount of severance tax for oil and gas10
production" means the amount of tax collected that is attributable to a11
twelve and one-half percent reduction in the severance tax credit for oil12
and gas production set forth in section 39-29-105 (2)(b)(II) for tax years13
beginning on or after January 1, 2024, but before January 1, 2026.14
(C) Repealed.15
(IV) This subsection (2)(e) is repealed, effective December 31,16
2036.17
SECTION 8. Effective date. This act takes effect only if House18
Bill 26-1405 becomes law, in which case this act takes effect on July 1,19
2027.20
SECTION 9. Safety clause. The general assembly finds,21
determines, and declares that this act is necessary for the immediate22
preservation of the public peace, health, or safety or for appropriations for23
the support and maintenance of the departments of the state and state24
institutions.25
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