House Bill 25-1269 Introduced

A Bill for an Act

• Page 1, Line 101Concerning building decarbonization measures, and, in

• Page 1, Line 102connection therewith, creating a building

• Page 1, Line 103decarbonization enterprise.

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.)

The bill updates energy use benchmarking and performance standard requirements for owners of certain buildings (covered building owners), including:

• A requirement to meet 2040 performance standards, as adopted by the air quality control commission, in consultation with the Colorado energy office (office) and in consideration of recommendations made by a task force convened by the office;
• Authorizing an alternative compliance mechanism for covered building owners to comply with certain performance standards; and
• Aligning civil penalties owed for a violation of the benchmarking and performance standard requirements with civil penalties owed for other air quality violations.

The bill also creates a building decarbonization enterprise (enterprise) to provide financial assistance, technical assistance, and other programmatic assistance to covered building owners to effectively and efficiently implement building decarbonization measures, including energy efficiency measures, electrification measures, energy upgrades, and participation in utility on-bill repayment programs. The enterprise is authorized to impose and collect from covered building owners an annual building decarbonization fee to cover the enterprise's costs in providing the financial, technical, and programmatic assistance.

The bill exempts a local government that adopts building codes from the requirement to adopt an energy code if the local government has adopted an approved wildfire resiliency code.

• Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:

• Page 2, Line 2SECTION 1.  In Colorado Revised Statutes, 30-28-211, add (3.5)(g) as follows:

• Page 2, Line 330-28-211.  Energy efficient building codes - legislative

• Page 2, Line 4declaration - definitions. (3.5) (g)  Notwithstanding the

• Page 2, Line 5requirements set forth in subsections (3.5)(a) and (3.5)(b) of this

• Page 2, Line 6section, a board of county commissioners that adopts a wildfire

• Page 2, Line 7resiliency code pursuant to section 24-33.5-1237 (2)(a) is not

• Page 2, Line 8required to adopt and enforce an energy code that meets the

• Page 2, Line 9requirements of subsections (3.5)(a) and (3.5)(b) of this section as a result of adopting the wildfire resiliency code.

• Page 2, Line 10SECTION 2.  In Colorado Revised Statutes, 31-15-602, add

• Page 2, Line 11(3.5)(f) as follows:

• Page 3, Line 131-15-602.  Energy efficient building codes - legislative

• Page 3, Line 2declaration - definitions - repeal. (3.5) (f)  Notwithstanding the

• Page 3, Line 3requirements set forth in subsections (3.5)(a) and (3.5)(b) of this

• Page 3, Line 4section, a governing body of a municipality that adopts a

• Page 3, Line 5wildfire resiliency code pursuant to section 24-33.5-1237 (2)(a) is

• Page 3, Line 6not required to adopt and enforce an energy code that meets

• Page 3, Line 7the requirements of subsections (3.5)(a) and (3.5)(b) of this section as a result of adopting the wildfire resiliency code.

• Page 3, Line 8SECTION 3.  In Colorado Revised Statutes, 25-7-142, amend

• Page 3, Line 9(2)(s), (3), (8)(c)(III), (8)(c)(IV), and (8)(f); and add (1.5), (2)(q.5), (8.5), (8.6), and (8.7) as follows:

• Page 3, Line 1025-7-142.  Energy benchmarking - data collection and access

• Page 3, Line 11- utility requirements - task force - rules - reports - definitions -

• Page 3, Line 12legislative declaration - repeal. (1.5)  The general assembly further finds and declares that:

• Page 3, Line 13(a)  Energy consumption by Colorado's built environment,

• Page 3, Line 14including large commercial and residential properties, is a significant contributor to statewide greenhouse gas pollution;

• Page 3, Line 15(b)  Reducing the greenhouse gas emissions arising from

• Page 3, Line 16energy consumption by the built environment is necessary to

• Page 3, Line 17achieve the 2050 net-zero greenhouse gas emission reduction goal set forth in section 25-7-102 (2)(g);

• Page 3, Line 18(c)  The commission satisfied the objectives set forth in

• Page 3, Line 19subsections (8)(a)(II) and (8)(c)(II) of this section by adopting

• Page 3, Line 20benchmarking and performance standard rules in August 2023; and

• Page 3, Line 21(d)  In implementing the requirements of this section and

• Page 4, Line 1the commission's rules adopted pursuant to this section, the

• Page 4, Line 2division should, consistent with section 25-7-122 (2), consider an

• Page 4, Line 3owner's effort to comply with building performance standards

• Page 4, Line 4when implementing enforcement and assessing penalties pursuant to section 25-7-122 and this section.

• Page 4, Line 5(2)  Definitions. As used in this section, unless the context otherwise requires:

• Page 4, Line 6(q.5)  "Operator" means a person that has access to utility data for a property.

• Page 4, Line 7(s)  "Performance standards" means standards that the commission

• Page 4, Line 8establishes by rule pursuant to subsection (8)(c) subsection (8)(c) or

• Page 4, Line 9(8.5)(a) of this section and with which owners of covered buildings are required to comply.

• Page 4, Line 10(3)  Benchmarking requirements on owners and operators.

• Page 4, Line 11(a)  On or before December 1, 2022, and on or before June November

• Page 4, Line 121 of each subsequent year, the owner of a covered building shall submit

• Page 4, Line 13a report of the benchmarking data for the previous calendar year to the office.

• Page 4, Line 14(b)  Notwithstanding subsection (3)(a) of this section, if an

• Page 4, Line 15owner of a covered building demonstrates that it lacks access

• Page 4, Line 16to benchmarking data, the operator of the covered building

• Page 4, Line 17shall, on or before November 1 of each year, submit to the office

• Page 4, Line 18a report of the benchmarking data for the covered building for the previous calendar year.

• Page 4, Line 19(b)  (c)  Before providing a benchmarking report pursuant to

• Page 4, Line 20subsection (3)(a) of this section, an owner of a covered building or

• Page 4, Line 21operator shall run any automated data checking function of the benchmarking tool and correct any errors discovered.

• Page 5, Line 1(c)  (d)  The following owners and operators may comply with this subsection (3) collectively at the campus-wide level:

• Page 5, Line 2(I)  The owner or operator of multiple covered buildings that are part of a master metered group of buildings without submetering;

• Page 5, Line 3(II)  The owner or operator of a correctional facility; and

• Page 5, Line 4(III)  The owner or operator of a public building that is a covered building.

• Page 5, Line 5(8)  Task force recommendations for implementation - rules -

• Page 5, Line 6repeal. (c) (III)  The commission shall not adopt rules to rescind or

• Page 5, Line 7modify the exemptions for owners of public buildings from payment of

• Page 5, Line 8the annual fee, as set forth in section 24-38.5-112 (1)(e)(II), from

• Page 5, Line 9payment of the building decarbonization fee, as set forth in

• Page 5, Line 10section 25-7-142.5 (5)(b), or from payment of civil penalties, as set forth in section 25-7-122 (1)(i) section 25-7-122 (1)(b) and (1)(i).

• Page 5, Line 11(IV)  The commission shall, as necessary, adopt rules to modify or

• Page 5, Line 12continue the performance standards beyond 2030 and until 2050 in order

• Page 5, Line 13to achieve or exceed greenhouse gas emission reduction targets set forth in section 25-7-102 (2)(g).

• Page 5, Line 14(f)  Subsections (8)(a), (8)(b), (8)(c)(I), (8)(c)(II), (8)(d), and

• Page 5, Line 15(8)(e) of this section and this subsection (8)(f) are repealed, effective July 1, 2025.

• Page 5, Line 16(8.5)  2040 performance standard targets - division to propose

• Page 5, Line 17standards - commission to adopt rules - task force - membership -

• Page 5, Line 18repeal. (a) (I)  To help achieve or exceed greenhouse gas emission

• Page 5, Line 19reduction targets pursuant to subsection (8)(c)(IV) of this

• Page 5, Line 20section, the commission shall adopt rules to develop 2040 performance standards.

• Page 6, Line 1(II)  On or before March 31, 2029, the division, after

• Page 6, Line 2consultation with the office and in consideration of

• Page 6, Line 3recommendations from the task force created pursuant to

• Page 6, Line 4subsection (8.5)(d) of this section, shall propose 2040

• Page 6, Line 5performance standards to the commission for the commission to

• Page 6, Line 6consider including in the rules adopted pursuant to subsection(8.5)(a)(I) of this section.

• Page 6, Line 7(b) (I)  The division, in proposing 2040 performance

• Page 6, Line 8standards, and the commission, in adopting 2040 performance

• Page 6, Line 9standards, shall consider whether the long-term targets

• Page 6, Line 10included in the 2040 performance standards support the 2050

• Page 6, Line 11economy-wide emission reduction goals set forth in section

• Page 6, Line 1225-7-102 (2)(g), taking into consideration the capital planning

• Page 6, Line 13periods for covered buildings and the feasibility of an owner

• Page 6, Line 14planning and implementing a building upgrade project ahead of

• Page 6, Line 15the compliance date for the 2040 performance standard that the

• Page 6, Line 16commission sets by rule pursuant to subsection (8.5)(a)(I) of this section.

• Page 6, Line 17(II)  The rules adopted pursuant to this subsection (8.5)

• Page 6, Line 18must include a requirement that an owner of a covered building

• Page 6, Line 19submit with its benchmarking report submitted in 2035 an interim

• Page 6, Line 20status report regarding the owner's progress toward the 2040

• Page 6, Line 21performance standards and submitted in a format determined by the office.

• Page 6, Line 22(c) (I)  On or before July 1, 2027, the director shall appoint

• Page 6, Line 23and convene a task force. The task force shall review the

• Page 7, Line 1benchmarking data submitted for calendar years 2021 through

• Page 7, Line 22027 and, on or before July 1, 2028, develop and provide

• Page 7, Line 3recommendations to the division regarding the 2040

• Page 7, Line 4performance standards, including recommendations on the

• Page 7, Line 5content of the interim status reports submitted pursuant to

• Page 7, Line 6rules adopted in accordance with subsection (8.5)(b)(II) of this section.

• Page 7, Line 7(II)  As part of the recommendations developed pursuant

• Page 7, Line 8to subsection (8.5)(c)(I) of this section, the task force shall consider:

• Page 7, Line 9(A)  The 2050 economy-wide emission reduction goals set forth in section 25-7-102 (2)(g); and

• Page 7, Line 10(B)  The capital planning periods for covered buildings and

• Page 7, Line 11the feasibility of an owner planning and implementing a building

• Page 7, Line 12upgrade project ahead of the compliance date for the 2040

• Page 7, Line 13performance standard that the commission sets by rule pursuant to subsection (8.5)(a)(I) of this section.

• Page 7, Line 14(d)  The task force consists of the following members, all

• Page 7, Line 15of whom, except the representatives of the office and the division, are voting members:

• Page 7, Line 16(I)  The director of the office or the director's designee;

• (II)  The director of the division or the director's designee;

• Page 7, Line 17(III)  One member who is an owner of commercial covered

• Page 7, Line 18buildings or who represents owners of commercial covered buildings;

• Page 7, Line 19(IV)  One member who is an owner of a multifamily

• Page 7, Line 20residential covered building or who represents owners of multifamily residential covered buildings;

• Page 8, Line 1(V)  One member who represents an affordable housing organization;

• Page 8, Line 2(VI)  One member who has direct experience in, or is a

• Page 8, Line 3member of an organization representing workers in, mechanical,

• Page 8, Line 4HVAC, or electrical work at the commercial or multifamily building level;

• Page 8, Line 5(VII)  One member who represents architects;

• Page 8, Line 6(VIII)  One member who represents professional engineers

• Page 8, Line 7with experience working on systems for buildings or with extensive experience as a building operating engineer;

• Page 8, Line 8(IX)  One member who represents an electric utility, a gas utility, or a combined electric and gas utility;

• Page 8, Line 9(X)  One member who is from an environmental

• Page 8, Line 10conservation or environmental justice group with experience in energy efficiency or the built environment;

• Page 8, Line 11(XI)  One member who is from a local government that has

• Page 8, Line 12enacted or adopted a benchmarking or building energy performance ordinance or resolution; and

• Page 8, Line 13(XII)  Three members who have relevant building

• Page 8, Line 14performance expertise, as determined by the director of the office.

• Page 8, Line 15(8.6)  Notwithstanding any rules that the commission adopts pursuant to this section before July 1, 2025:

• Page 8, Line 16(a) (I)  An owner of a covered building may comply with building performance standards adopted by the commission by:

• Page 8, Line 17(A)  Submitting complete and accurate 2019 benchmarking data to the office no later than January 1, 2026;

• Page 9, Line 1(B)  In 2026, achieving and maintaining a standard percent

• Page 9, Line 2reduction of at least thirteen percent in comparison to the

• Page 9, Line 3covered building's 2019 benchmarked baseline weather-normalized site energy use intensity; and

• Page 9, Line 4(C)  In 2030, achieving and maintaining a standard percent

• Page 9, Line 5reduction of at least twenty-nine percent in comparison to the

• Page 9, Line 6covered building's 2019 benchmarked baseline weather-normalized energy use intensity; and

• Page 9, Line 7(II)  An owner of a covered building located within the

• Page 9, Line 8jurisdiction of a local government that has adopted and

• Page 9, Line 9implemented a building performance standards program or

• Page 9, Line 10other similar program intended to reduce greenhouse gas

• Page 9, Line 11emissions from covered buildings is deemed in compliance with

• Page 9, Line 12this section and rules adopted by the commission pursuant to

• Page 9, Line 13this section by complying with the requirements of the local program if:

• Page 9, Line 14(A)  The owner of the covered building maintains

• Page 9, Line 15compliance with the local program and certifies its affirmative

• Page 9, Line 16compliance status in annual benchmarking reports submitted to the office;

• Page 9, Line 17(B)  The office has determined that the greenhouse gas

• Page 9, Line 18emission reductions from covered buildings complying with the

• Page 9, Line 19local program are reasonably similar to the greenhouse gas

• Page 9, Line 20emission reductions that would have been achieved through

• Page 9, Line 21compliance with this section and the commission's rules adopted

• Page 9, Line 22pursuant to this section.

• Page 10, Line 1(III)  Decisions made by the office, the division, or the

• Page 10, Line 2commission with regard to deemed compliance pursuant to

• Page 10, Line 3subsection (8.6)(a)(II) of this section are subject to judicial review pursuant to section 24-4-106.

• Page 10, Line 4(b) (I)  Notwithstanding subsection (8.6)(a) of this section

• Page 10, Line 5and any rules adopted by the commission before July 1, 2025, an

• Page 10, Line 6owner may either comply with the 2026 performance standards

• Page 10, Line 7or, as part of the owner's benchmarking reports submitted to the office in 2026 through 2029:

• Page 10, Line 8(A)  Track its progress toward compliance with the performance standards;

• Page 10, Line 9(B)  Express any need for technical assistance from the office; and

• Page 10, Line 10(C)  Provide other information that the office deems

• Page 10, Line 11necessary demonstrating measures planned or being taken to comply with the 2030 performance standards.

• Page 10, Line 12(II)  The office shall prioritize any grant money that is made available for owners of covered buildings:

• Page 10, Line 13(A)  That comply with or establish plans to go beyond the 2026 performance standards; or

• Page 10, Line 14(B)  That comply with the 2030 performance standard

• Page 10, Line 15early or establish plans to go beyond the 2030 performance standards.

• Page 10, Line 16(III)  Nothing in this subsection (8.6)(b) precludes or

• Page 10, Line 17modifies the division's authority to enforce against an owner of

• Page 10, Line 18a covered building for noncompliance with 2030 performance

• Page 10, Line 19standards or performance standards set for subsequent years.

• Page 11, Line 1(8.7)  Notwithstanding the requirements of subsection

• Page 11, Line 2(8)(a)(II) of this section or rules adopted pursuant to that

• Page 11, Line 3subsection, subsection (8.6) of this section is necessary to

• Page 11, Line 4effectively implement the performance standards. The

• Page 11, Line 5commission is not required to revise rules adopted before July 1,

• Page 11, Line 62025, that establish performance standards or establish the

• Page 11, Line 7calculation of greenhouse gas emission reductions that may be achieved pursuant to subsection (8.6) of this section.

• Page 11, Line 8SECTION 4.  In Colorado Revised Statutes, add 25-7-142.5 as follows:

• Page 11, Line 925-7-142.5.  Building decarbonization enterprise - creation -

• Page 11, Line 10membership - powers and duties - building decarbonization

• Page 11, Line 11enterprise cash fund - legislative declaration - definitions - rules -

• Page 11, Line 12repeal. (1)  Legislative declaration. (a)  The general assembly finds that:

• Page 11, Line 13(I)  Reducing greenhouse gas emissions from combustion devices in residential and commercial buildings:

• Page 11, Line 14(A)  Is necessary to help the state achieve its statewide

• Page 11, Line 15greenhouse gas emission reduction goals set forth in section

• Page 11, Line 1625-7-102 (2)(g), including the goal to reach net-zero greenhouse gas emissions by 2050; and

• Page 11, Line 17(B)  Presents significant opportunities to lower and

• Page 11, Line 18stabilize energy bills, provide for more comfortable living and

• Page 11, Line 19working spaces, and reduce local air pollution that contributes to ground-level ozone;

• Page 11, Line 20(II)  Covered building owners are required to comply with

• Page 11, Line 21benchmarking requirements and performance standard

• Page 12, Line 1requirements and would benefit from additional financial and technical assistance to meet those requirements; and

• Page 12, Line 2(III)  With additional financing and technical assistance,

• Page 12, Line 3covered building owners may effectively and efficiently

• Page 12, Line 4implement building decarbonization measures, including, but not

• Page 12, Line 5limited to, by participating in, receiving financing for, and

• Page 12, Line 6obtaining technical assistance for participating in on-bill repayment programs that:

• Page 12, Line 7(A)  Help finance energy efficiency measures, electrification measures, and other energy upgrades; and

• Page 12, Line 8(B)  Provide assistance for conducting building energy

• Page 12, Line 9audits, employing or consulting with building engineers,

• Page 12, Line 10purchasing energy use tracking software for covered building

• Page 12, Line 11owners to more effectively track energy use, and providing training on such software.

• Page 12, Line 12(b)  Now, therefore, the general assembly declares that:

• Page 12, Line 13(I)  It is in the public interest to create an enterprise

• Page 12, Line 14within the office that is committed to financing and providing

• Page 12, Line 15technical and other support for the implementation of building decarbonization measures;

• Page 12, Line 16(II)  The activities of the enterprise shall be funded by

• Page 12, Line 17revenue generated from building decarbonization fees paid by

• Page 12, Line 18covered building owners and any gifts, grants, and donations received;

• Page 12, Line 19(III)  It is appropriate that covered building owners should

• Page 12, Line 20pay a building decarbonization fee, as covered building owners

• Page 12, Line 21are the direct beneficiaries of services provided by the

• Page 13, Line 1enterprise, which services include the financing and technical

• Page 13, Line 2assistance provided for the building decarbonization measures described in subsection (1)(a)(III) of this section;

• Page 13, Line 3(IV)  Covered building owners benefit from the

• Page 13, Line 4implementation of building decarbonization measures because such measures can:

• Page 13, Line 5(A)  Reduce covered building owners' long-term costs related to energy use;

• Page 13, Line 6(B)  Improve building comfort; and

• Page 13, Line 7(C)  Increase the market value and desirability of covered buildings to tenants;

• Page 13, Line 8(V)  Consistent with the determination of the Colorado

• Page 13, Line 9supreme court in Nicholl v. E-470 Public Highway Authority, 896

• Page 13, Line 10P.2d 859 (Colo. 1995), that the power to impose taxes is

• Page 13, Line 11inconsistent with enterprise status under section 20 of article

• Page 13, Line 12X of the state constitution, the general assembly concludes

• Page 13, Line 13that the stewardship fee is a fee, not a tax, and the enterprise operates as a business because the stewardship fee is:

• Page 13, Line 14(A)  Imposed for the specific business purposes of providing

• Page 13, Line 15financing and technical assistance to covered building owners

• Page 13, Line 16to effectively and efficiently implement building

• Page 13, Line 17decarbonization measures, including improvements that will reduce energy use and emissions; and

• Page 13, Line 18(B)  Collected at a rate that is reasonably related to the overall cost of the business services being provided; and

• Page 13, Line 19(VI)  So long as the enterprise qualifies as an enterprise

• Page 13, Line 20for purposes of section 20 of article X of the state constitution,

• Page 14, Line 1the revenue from the building decarbonization fee imposed,

• Page 14, Line 2collected, and administered by the enterprise is not state fiscal

• Page 14, Line 3year spending, as defined in section 24-77-102 (17), or state

• Page 14, Line 4revenues, as defined in section 24-77-103.6 (6)(c), and does not

• Page 14, Line 5count against either the state fiscal year spending limit imposed

• Page 14, Line 6by section 20 of article X of the state constitution or the excess state revenues cap, as defined in section 24-77-103.6 (6)(b)(I)(G).

• Page 14, Line 7(2)  As used in this section, unless the context otherwise requires:

• Page 14, Line 8(a)  "Benchmarking requirements" means the energy

• Page 14, Line 9benchmarking requirements set forth in section 25-7-142 (3) with

• Page 14, Line 10which an owner of a nonexempt covered building is required to comply.

• Page 14, Line 11(b)  "Board" means the board of directors of the enterprise appointed pursuant to subsection (4)(a) of this section.

• Page 14, Line 12(c)  "Building decarbonization fee" or "fee" means the fee

• Page 14, Line 13paid by the owner of a covered building pursuant to subsection(5)(b) of this section.

• Page 14, Line 14(d)  "Covered building" has the meaning set forth in section 25-7-142 (2)(j).

• Page 14, Line 15(e)  "Covered building owner" means an "owner", as defined in section 25-7-142 (2)(r), of a covered building.

• Page 14, Line 16(f)  "Enterprise" means the building decarbonization enterprise created in subsection (3) of this section.

• Page 14, Line 17(g)  "Fund" means the building decarbonization enterprise cash fund created in subsection (6)(a) of this section.

• Page 14, Line 18(h)  "Inflation" means the annual percentage change in the

• Page 15, Line 1in the United States department of labor's bureau of labor

• Page 15, Line 2statistics consumer price index, or a successor index, for

• Page 15, Line 3Denver-Aurora-Lakewood for all items paid for by urban consumers.

• Page 15, Line 4(i)  "Office" means the Colorado energy office created in section 24-38.5-101.

• Page 15, Line 5(j)  "On-bill repayment program" means a utility's on-bill

• Page 15, Line 6repayment program through which energy efficiency measures,

• Page 15, Line 7electrification measures, and energy upgrades installed at a

• Page 15, Line 8participating customer's premises that is associated with the

• Page 15, Line 9utility meter are financed through loans that are repaid through monthly utility bill payments.

• Page 15, Line 10(k)  "Performance standards" has the meaning set forth in section 25-7-142 (2)(s).

• Page 15, Line 11(l)  "Performance standard requirements" means the

• Page 15, Line 12performance standard requirements set forth in section 25-7-142

• Page 15, Line 13(8) and (8.5) with which an owner of a nonexempt covered building is required to comply.

• Page 15, Line 14(3)  Enterprise created. (a)  The building decarbonization

• Page 15, Line 15enterprise is created in the office and exercises its powers and

• Page 15, Line 16performs its duties and functions as a government-owned

• Page 15, Line 17business in the office to execute its business purposes set forth

• Page 15, Line 18in this subsection (3). The enterprise is created for the purposes of:

• Page 15, Line 19(I)  Imposing and assessing building decarbonization fees on owners of covered buildings;

• Page 15, Line 20(II)  Providing technical assistance, financing, and other

• Page 16, Line 1programmatic support for covered building owners' building

• Page 16, Line 2decarbonization measures, including, but not limited to,

• Page 16, Line 3financing of owners' participation in an on-bill repayment

• Page 16, Line 4program, building energy audits, consulting building engineers,

• Page 16, Line 5purchasing energy use tracking software, and providing training on such software; and

• Page 16, Line 6(III)  Ensuring that the building decarbonization fees paid

• Page 16, Line 7by covered building owners are used solely to support

• Page 16, Line 8programs, technical assistance, and financial assistance for the

• Page 16, Line 9covered building owners that pay the building decarbonization fees.

• Page 16, Line 10(b)  The board, in consultation with the office, shall administer the enterprise in accordance with this section.

• Page 16, Line 11(c) (I)  The enterprise constitutes an enterprise for

• Page 16, Line 12purposes of section 20 of article X of the state constitution so

• Page 16, Line 13long as it retains the authority to issue revenue bonds and

• Page 16, Line 14receives less than ten percent of its total revenues in grants, as

• Page 16, Line 15defined in section 24-77-102 (7), from all Colorado state and

• Page 16, Line 16local governments combined. So long as it constitutes an

• Page 16, Line 17enterprise, the enterprise is not subject to section 20 of article X of the state constitution.

• Page 16, Line 18(II)  The enterprise is authorized to issue revenue bonds for

• Page 16, Line 19the expenses of the enterprise, secured by revenue of the enterprise.

• Page 16, Line 20(4)  Enterprise board of directors created - membership -

• Page 16, Line 21duties - repeal. (a)  The enterprise board of directors is created to

• Page 16, Line 22administer the enterprise. The board consists of the following seven members:

• Page 17, Line 1(I)  The following four members appointed by the governor and confirmed by the senate:

• Page 17, Line 2(A)  A representative of covered building owners;

• Page 17, Line 3(B)  An expert in building energy efficiency and decarbonization;

• Page 17, Line 4(C)  A local government representative with expertise in planning or energy codes; and

• Page 17, Line 5(D)  A utility representative;

• (II)  The director of the office or the director's designee;

• Page 17, Line 6(III)  The executive director of the department of public

• Page 17, Line 7health and environment or the executive director's designee; and

• Page 17, Line 8(IV)  The director of the public utilities commission or the director's designee.

• Page 17, Line 9(b) (I)  The governor shall appoint initial members to the

• Page 17, Line 10board pursuant to subsection (4)(a)(I) of this section on or before September 1, 2025.

• Page 17, Line 11(II)  This subsection (4)(b) is repealed, effective July 1, 2026.

• Page 17, Line 12(c) (I)  Board members appointed pursuant to subsection

• Page 17, Line 13(4)(a)(I) of this section serve three-year terms. A board member may serve an unlimited number of terms.

• Page 17, Line 14(II)  Notwithstanding subsection (4)(c)(I) of this section,

• Page 17, Line 15the governor shall make the initial terms of two of the board

• Page 17, Line 16members who are appointed pursuant to subsection (4)(a)(I) of this section two years.

• Page 17, Line 17(d)  Board members serving pursuant to subsection (4)(a)(I)

• Page 18, Line 1of this section may receive compensation from the enterprise on

• Page 18, Line 2a per diem basis for reasonable expenses actually incurred in the performance of their duties.

• Page 18, Line 3(e) (I)  The chair and vice-chair of the board are selected

• Page 18, Line 4by the members of the board in accordance with the board's bylaws.

• Page 18, Line 5(II) (A)  The director of the office or the director's

• Page 18, Line 6designee shall call the first meeting of the board, and the board

• Page 18, Line 7shall select the chair and vice-chair at that meeting in accordance with subsection (4)(e)(I) of this section.

• Page 18, Line 8(B)  This subsection (4)(e)(II) is repealed, effective July 1, 2026.

• Page 18, Line 9(5)  Powers and duties - building decarbonization fee. (a)  In

• Page 18, Line 10addition to any other powers and duties specified in this section,

• Page 18, Line 11the board has the following powers and duties on behalf of the enterprise:

• Page 18, Line 12(I)  To adopt procedures for conducting the board's affairs;

• Page 18, Line 13(II)  To engage the services of contractors, consultants,

• Page 18, Line 14and the staff of the office for professional and technical

• Page 18, Line 15assistance and advice and to supply other services related to

• Page 18, Line 16the conduct of the affairs of the enterprise without regard to

• Page 18, Line 17the "Procurement Code", articles 101 to 112 of title 24. The

• Page 18, Line 18enterprise shall engage the attorney general's office for legal

• Page 18, Line 19services. The enterprise may contract with the office for the

• Page 18, Line 20provision of office space and administrative staff to the

• Page 18, Line 21enterprise at a fair market rate.

• Page 19, Line 1(III)  To establish and administer a program through which

• Page 19, Line 2owners of covered buildings may apply for, and the board may

• Page 19, Line 3review and approve applications for, financing or technical

• Page 19, Line 4assistance for building decarbonization measures, including, but

• Page 19, Line 5not limited to, participating in on-bill repayment programs that

• Page 19, Line 6help finance energy efficiency measures, electrification

• Page 19, Line 7measures, and other energy upgrades; conducting building

• Page 19, Line 8energy audits; employing or consulting with building engineers;

• Page 19, Line 9and purchasing energy use tracking software and providing training on such software;

• Page 19, Line 10(IV)  To impose the building decarbonization fee described in subsection (5)(b) of this section; and

• Page 19, Line 11(V)  To have and exercise all rights and powers necessary

• Page 19, Line 12or incidental to or implied from the specific powers and duties granted by this section.

• Page 19, Line 13(b) (I)  Beginning in state fiscal year 2026-27 and in

• Page 19, Line 14furtherance of the enterprise's business purposes, the board

• Page 19, Line 15shall impose the building decarbonization fee on all covered building owners.

• Page 19, Line 16(II)  On or before November 1, 2026, and on or before each

• Page 19, Line 17November 1 of each year thereafter, and except as provided in

• Page 19, Line 18subsection (5)(b)(III) of this section, each owner of a covered

• Page 19, Line 19building shall pay a building decarbonization fee in an amount

• Page 19, Line 20of four hundred dollars to the office, which shall collect the building decarbonization fee on behalf of the enterprise.

• Page 19, Line 21(III)  Beginning in state fiscal year 2026-27, the board

• Page 19, Line 22shall increase the fee from the previous year's fee, as adjusted

• Page 20, Line 1for inflation and, on or before March 15 of each of the state

• Page 20, Line 2fiscal years thereafter, shall notify the office of the adjusted

• Page 20, Line 3amount of the fee. On or before April 15 of each of the state

• Page 20, Line 4fiscal years thereafter, the office shall publish the updated amount of the fee on the office's website.

• Page 20, Line 5(IV)  Money collected as a building decarbonization fee shall be credited to the fund.

• Page 20, Line 6(V)  Money collected by the office for transfer to the fund pursuant to subsection (5)(b)(IV) of this section:

• Page 20, Line 7(A)  Is collected for the enterprise;

• Page 20, Line 8(B)  Is custodial money intended for the enterprise and

• Page 20, Line 9held temporarily by the office and the state treasurer solely

• Page 20, Line 10for the purpose of transferring the money to the fund for use by the enterprise; and

• Page 20, Line 11(C)  Based on the enterprise's status as an enterprise, is

• Page 20, Line 12not subject to section 20 of article X of the state constitution at any time during the money's collection, transfer, and use.

• Page 20, Line 13(6)  Building decarbonization enterprise cash fund - creation

• Page 20, Line 14- repeal. (a)  The building decarbonization enterprise cash fund is created in the state treasury. The fund consists of:

• Page 20, Line 15(I)  Money received as building decarbonization fees pursuant to subsection (5)(b) of this section;

• Page 20, Line 16(II)  Any money received from the issuance of revenue bonds, as described in subsection (3)(c)(II) of this section; and

• Page 20, Line 17(III)  Any other money that the general assembly may appropriate or transfer to the fund.

• Page 20, Line 18(b) (I)  Section 24-77-108 does not apply to the enterprise

• Page 21, Line 1because the total amount of money credited or appropriated to

• Page 21, Line 2the fund as building decarbonization fees shall not exceed one

• Page 21, Line 3hundred million dollars in the first five years of the enterprise's existence.

• Page 21, Line 4(II)  This subsection (6)(b) is repealed, effective July 1, 2031.

• Page 21, Line 5(c)  Money credited to the fund is continuously

• Page 21, Line 6appropriated to the enterprise for the purposes set forth in this

• Page 21, Line 7section and to pay the enterprise's reasonable and necessary

• Page 21, Line 8operating expenses. The state treasurer shall credit all

• Page 21, Line 9interest and income derived from the deposit and investment of money in the fund to the fund.

• Page 21, Line 10(d)  Any unexpended and unencumbered money remaining

• Page 21, Line 11in the fund at the end of a fiscal year remains in the fund and is not credited or transferred to the general fund.

• Page 21, Line 12SECTION 5.  In Colorado Revised Statutes, 25-7-122, amend (1)(b) introductory portion and (1)(i) as follows:

• Page 21, Line 1325-7-122.  Civil penalties - rules - definitions. (1)  Upon

• Page 21, Line 14application of the division, the division may collect penalties as

• Page 21, Line 15determined under this article 7 by instituting an action in the district court

• Page 21, Line 16for the district in which the air pollution source affected is located, in accordance with the following provisions:

• Page 21, Line 17(b)  Any person who violates any requirement or prohibition of a

• Page 21, Line 18final order of the division or commission, an applicable emission control

• Page 21, Line 19regulation of the commission, the state implementation plan, a

• Page 21, Line 20construction permit, any provision for the prevention of significant

• Page 21, Line 21deterioration under part 2 of this article 7, any provision related to

• Page 21, Line 22attainment under part 3 of this article 7, or any provision of or

• Page 22, Line 1commission rule adopted pursuant to section 25-7-105, 25-7-106,

• Page 22, Line 225-7-106.3, 25-7-108, 25-7-109, 25-7-109.5, 25-7-111, 25-7-112,

• Page 22, Line 325-7-113, 25-7-114.2, 25-7-114.5, 25-7-118, 25-7-141, 25-7-142,

• Page 22, Line 425-7-146, 25-7-206, 25-7-403, 25-7-404, 25-7-405, 25-7-407, 42-4-403,

• Page 22, Line 542-4-404, 42-4-405, 42-4-406, 42-4-407, 42-4-409, 42-4-410, or

• Page 22, Line 642-4-414 is subject to a civil penalty of not more than forty-seven

• Page 22, Line 7thousand three hundred fifty-seven dollars per day for each day of the violation; except that:

• Page 22, Line 8(i) (I)  On and after January 1, 2024, and except as provided in

• Page 22, Line 9subsection (1)(i)(II) of this section, an owner of a covered building that

• Page 22, Line 10violates section 25-7-142 (3) or (6) is subject to a civil penalty of up to

• Page 22, Line 11five hundred dollars for a first violation and up to two thousand dollars

• Page 22, Line 12for each subsequent violation. As part of the requirement that the

• Page 22, Line 13commission adopt rules to establish performance standards pursuant to

• Page 22, Line 14section 25-7-142 (8)(c), the commission shall establish by rule, with

• Page 22, Line 15regard to a violation of the performance standards, civil penalties in an

• Page 22, Line 16amount not to exceed two thousand dollars for a first violation and five thousand dollars for a subsequent violation.

• Page 22, Line 17(II)  The division shall not assess a civil penalty for a violation related to a public building.

• Page 22, Line 18(III)   Notwithstanding section 25-7-129, the division shall transmit

• Page 22, Line 19civil penalties collected pursuant to this subsection (1)(i) to the state

• Page 22, Line 20treasurer, who subsection (1)(b) of this section, as paid by owners

• Page 22, Line 21of covered buildings for a violation of section 25-7-142, shall

• Page 22, Line 22credit them be credited to the climate change mitigation and adaptation fund created in section 24-38.5-102.6.

• Page 22, Line 23(IV)  As used in this subsection (1)(i):

• Page 23, Line 1(A)  "Covered building" has the meaning set forth in section 25-7-142 (2)(j).

• Page 23, Line 2(B)  "Owner" has the meaning set forth in section 25-7-142 (2)(r).

• Page 23, Line 3SECTION 6.  In Colorado Revised Statutes, 24-38.5-403, add (4) as follows:

• Page 23, Line 424-38.5-403.  Energy code training - energy code adoption -

• Page 23, Line 5grant writing assistance. (4)  Notwithstanding subsection (3) of

• Page 23, Line 6this section, the Colorado energy office may use funding

• Page 23, Line 7provided through subsection (3) of this section to cover the

• Page 23, Line 8costs of the task force created in section 25-7-142 (8.5) and the

• Page 23, Line 9costs to the Colorado energy office for participating in

• Page 23, Line 10rule-making that the air quality control commission engages in pursuant to section 25-7-142.

• Page 23, Line 11SECTION 7.  In Colorado Revised Statutes, 24-38.5-102.6, amend (1) introductory portion and (1)(a) as follows:

• Page 23, Line 1224-38.5-102.6.  Climate change mitigation and adaptation fund

• Page 23, Line 13- creation - use. (1)  The climate change mitigation and adaptation fund,

• Page 23, Line 14referred to in this section as the "fund", is hereby created in the state treasury. The fund consists of:

• Page 23, Line 15(a)  Civil penalties credited to the fund pursuant to section 25-7-122 (1)(i)(III) section 25-7-122 (1)(b) and (1)(i);

• Page 23, Line 16SECTION 8.  In Colorado Revised Statutes, 24-38.5-112, amend (1)(a)(IV) as follows:

• Page 23, Line 1724-38.5-112.  Building performance program - duties of the

• Page 23, Line 18office - county assessor records database - fees - definitions. (1)  The

• Page 23, Line 19Colorado energy office shall implement a building performance program

• Page 23, Line 20as follows:

• Page 24, Line 1(a)  Based on county assessor records and other available sources

• Page 24, Line 2of information, the office shall administer the building performance program by:

• Page 24, Line 3(IV)  In a form and manner determined by the office, in

• Page 24, Line 4consultation with the division of administration in the department of

• Page 24, Line 5public health and environment, periodically providing the division with

• Page 24, Line 6a list of noncompliant owners for the division's enforcement of the

• Page 24, Line 7building performance program pursuant to section 25-7-122 (1)(i) sections 25-7-115, 25-7-121, and 25-7-122 (1)(b) and (1)(i).

• Page 24, Line 8SECTION 9.  Applicability. This act applies to conduct occurring on or after the effective date of this act.

• Page 24, Line 9SECTION 10.  Safety clause. The general assembly finds,

• Page 24, Line 10determines, and declares that this act is necessary for the immediate

• Page 24, Line 11preservation of the public peace, health, or safety or for appropriations for

• Page 24, Line 12the support and maintenance of the departments of the state and state institutions.