There isn’t a single solution to Colorado’s housing crisis. FGMC’s David Foster and Chip Schoneberger had an idea for change that would promote the number of housing units being built. HB24-1107- Judicial Review of Local Land Use Decisions, which was signed yesterday, May 30th, by Governor Polis, will help bolster the number of housing units in Colorado by discouraging housing opponents from filing meritless lawsuits against housing development project approvals.
HB24-1107 was sponsored by Senator Faith Winter, Senator Jeff Bridges, Representative William Lindstedt, and Representative Shannon Bird. HB24-1107’s purpose is to deter the filing of meritless Rule 106(a)(4) actions in district court. As developers know all too well, the approval of a new housing development by a city council or board of county commissioners is often met with a Rule 106(a)(4) lawsuit. These lawsuits, though often unsuccessful, have a chilling effect on the approved development.
Rule 106(a)(4) actions are specialized legal proceedings that allow interested parties to challenge local government decisions. Despite the exhaustive public hearing process that local governments must adhere to in order to approve a land use application, opponents to housing projects often file Rule 106(a)(4) actions because they disagree with the decision. When a plaintiff files a Rule 106(a)(4) action, it functions much like a cloud on title: the existence of the pending litigation makes it nearly impossible for developers to secure the financing needed for the construction of the project. In summary, Rule 106(a)(4) actions slow or halt development, driving up costs for project approvals that are typically upheld by the court.
David and Chip worked closely with the sponsors and their legislative staff to develop the language of HB24-1107. David and Chip testified at the House’s Local Government committee hearing and the Senate’s Judiciary committee hearing to explain the reasoning and context of the bill. In addition to supporting David and Chip during hearings at the capitol, Associate Amelia Stefan synthesized research on Rule 106(a)(4) filings across the state, drafted bill information sheets, and answered the bill sponsors’ questions throughout the legislative process.
HB24-1107 was supported by the Colorado Municipal League, Denver Metro Chamber of Commerce, Colorado Contractors Association, Colorado Association of Homebuilders and many Colorado cities and counties.
HB24-1107 functions as follows:
- Plaintiffs must pay the local government’s attorneys’ fees if their challenge is unsuccessful. In other words, if the local government’s decision is upheld, the plaintiff will be accountable for attorneys’ fees.
- Applies only to developments that include a residential use with a net density of a minimum of five (5) dwelling units per acre. This includes mixed use developments.