HOUSE BILL 22-1359
BY REPRESENTATIVE(S) Bacon and Snyder, Benavidez, Bernett, Bird,
Boesenecker, Caraveo, Cutter, Esgar, Gonzales-Gutierrez, Hooton, Jodeh,
Kennedy, Lindsay, Lontine, McCluskie, Michaelson Jenet, Sirota,
Valdez D., Weissman, Garnett, Herod, Kipp, Ricks, Valdez A., Woodrow;
also SENATOR(S) Rodriguez and Lee, Bridges, Buckner, Coleman, Ginal,
Gonzales, Moreno, Winter, Zenzinger, Fenberg.
C
ONCERNING THE CREATION OF THE COLORADO HOUSEHOLD FINANCIAL
RECOVERY PILOT PROGRAM
, AND, IN CONNECTION THEREWITH ,
MAKING AN APPROPRIATION.
Be it enacted by the General Assembly of the State of Colorado:
SECTION 1. In Colorado Revised Statutes, add part 3 to article 36
of title 24 as follows:
PART 3
COLORADO HOUSEHOLD FINANCIAL
RECOVERY PILOT PROGRAM
24-36-301. Short title. T
HE SHORT TITLE OF THIS PART 3 IS THE
"COLORADO HOUSEHOLD FINANCIAL RECOVERY PILOT PROGRAM ACT".
NOTE: This bill has been prepared for the signatures of the appropriate legislative
officers and the Governor. To determine whether the Governor has signed the bill
or taken other action on it, please consult the legislative status sheet, the legislative
history, or the Session Laws.
________
Capital letters or bold & italic numbers indicate new material added to existing law; dashes
through words or numbers indicate deletions from existing law and such material is not part of
the act. 24-36-302. Legislative declaration. (1) T HE GENERAL ASSEMBLY
FINDS AND DECLARES THAT
:
(a) T
HE COVID-19 PANDEMIC HAS HAD DEVASTATING EC ONOMIC
AND HEALTH CONSEQUENCES ACROSS THE STATE
, NEGATIVELY IMPACTING
MANY
COLORADANS AND DISPROPORTIONATELY HARMING INDIVIDUALS AND
HOUSEHOLDS THAT WERE ALREADY ECONOMICALLY INSECURE
;
(b) T
HE COVID-19 PANDEMIC HAS CAUSED MANY LOW - AND
MODERATE
-INCOME INDIVIDUALS AND HOUSEHOLDS TO LOSE INCOME DUE
TO THE LOSS OF EMPLOYMENT
, SPEND DOWN THEIR SAVINGS, BORROW FROM
FRIENDS
, AND INCUR MORE DEBT;
(c) A
S A RESULT OF THE RECESSION PRECIPITATED BY THE COVID-19
PANDEMIC, LONG-TERM ECONOMIC CHALLENGES CONTINUE FOR MANY IN
COLORADO, DUE TO, AMONG OTHER FACTORS, DAMAGED CONSUMER CREDIT
SCORES AND REDUCED FAMILIAL AND CHILDHOOD WELL
-BEING;
(d) F
URTHER, MANY INDIVIDUALS AND HOUSEHOLDS FACING
FINANCIAL INSECURITY
, INCLUDING UNSERVED AND UNDERSERVED
POPULATIONS
, LACK ACCESS TO FINANCIAL AND BANKING SERVICES ,
INCLUDING AFFORDABLE LOANS , TO HELP ADDRESS ECONOMIC INSECURITY ;
(e) T
OGETHER WITH FINANCIAL COACHING AND SAFE AND
AFFORDABLE BANKING PRODUCTS
, LOW-COST LOANS ARE AN IMPORTANT
TOOL TO BUILD LONG
-TERM FINANCIAL HEALTH;
(f) B
Y INCENTIVIZING FINANCIAL INSTITUTIONS TO ISSUE LOANS TO
IMPACTED INDIVIDUALS AND HOUSEHOLDS THROUGH A LOAN LOSS RESERVE
,
BUYING DOWN INTEREST RATES, OR PROVIDING LENDING CAPITAL, THE STATE
CAN FOSTER LONG
-TERM TRANSFORMATIVE CHANGE FOR INDIVIDUALS AND
HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC OR ITS NEGATIVE
ECONOMIC IMPACTS
;
(g) W
ITH ONE-TIME MONEY, THE STATE CAN CATALYZE POSITIVE
MARKET FORCES THAT EXIST OUTSIDE OF STATE GOVERNMENT
, LEVERAGING
NEW
, OR FREEING UP EXISTING, RESOURCES TO SUPPORT THE CREATION OF
AFFORDABLE LENDING PRODUCTS CURRENTLY UNAVAILABLE TO MANY
COLORADANS; AND
PAGE 2-HOUSE BILL 22-1359 (h) THEREFORE, THE CREATION OF A HOUSEHOLD FINANCIAL
RECOVERY PILOT PROGRAM SUPPORTS THE LONG
-TERM RECOVERY OF
COLORADO INDIVIDUALS AND HOUSEHOLDS IMPACTED BY THE COVID-19
PANDEMIC AND IS AN APPROPRIATE RESPONSE TO THE HARM CAUSED BY THE
COVID-19 PANDEMIC OR ITS NEGATIVE ECONOMIC IMPACTS .
24-36-303. Definitions. A
S USED IN THIS PART 3, UNLESS THE
CONTEXT OTHERWISE REQUIRES
:
(1) "A
DMINISTRATOR" MEANS AN ENTITY THAT THE STATE
TREASURER CONTRACTS WITH PURSUANT TO SECTION
24-36-304 TO
ADMINISTER THE PROGRAM
.
(2) "C
OUNCIL" MEANS THE COUNCIL ESTABLISHED PURSUANT TO
SECTION
24-31-1102 (3)(c) BY THE FINANCIAL EMPOWERMENT OFFICE
CREATED IN SECTION
24-31-1101.
(3) "COVID-19"
MEANS THE CORONAVIRUS DISEASE CAUSED BY THE
SEVERE ACUTE RESPIRATORY SYNDROME CORONAVIRUS
2, ALSO KNOWN AS
SARS-COV-2.
(4) "F
UND" MEANS THE COLORADO HOUSEHOLD FINANCIAL
RECOVERY PILOT PROGRAM FUND CREATED IN SECTION
24-36-306.
(5) "P
ROGRAM" MEANS THE COLORADO HOUSEHOLD FINANCIAL
RECOVERY PILOT PROGRAM CREATED IN THIS PART
3.
24-36-304. Colorado household financial recovery pilot program
- created - selection of administrators - grants. (1) T
HE STATE
TREASURER SHALL ESTABLISH THE
COLORADO HOUSEHOLD FINANCIAL
RECOVERY
PILOT PROGRAM ADMINISTERED IN ACCORDANCE WITH THE
REQUIREMENTS OF THIS PART
3 AND ANY POLICIES ESTABLISHED FOR THE
PROGRAM BY THE STATE TREASURER OR BY AN ADMINISTRATOR PURSUANT
TO SUBSECTION
(8) OF THIS SECTION. THE PURPOSE OF THE PROGRAM IS TO
FACILITATE LENDING TO INDIVIDUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC WHO FACE FINANCIAL INSECURITY AND WHO HAVE
DIFFICULTY ACCESSING AFFORDABLE LOANS TO ADDRESS THE FINANCIAL
INSECURITY
.
(2) (a) I
N RESPONSE TO THE COVID-19 PANDEMIC AND THE HARM
PAGE 3-HOUSE BILL 22-1359 CAUSED TO INDIVIDUALS AND HOUSEHOLDS BY ITS NEGATIVE ECONOMIC
IMPACTS
, MONEY FOR THE PROGRAM MAY BE USED FOR ONE OR MORE OF THE
FOLLOWING PURPOSES UNDER THE PROGRAM TO ASSIST INDIVIDUALS AND
HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC:
(I) T
O ESTABLISH A LOAN LOSS RESERVE IN ACCORDANCE WITH
SUBSECTION
(9) OF THIS SECTION TO PARTIALLY OFFSET RISK TO LENDERS IN
MAKING LOANS TO INDIVI DUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC;
(II) T
O MAKE PAYMENTS TO LENDERS TO BUY DOWN THE INTEREST
RATE ON LOANS MADE TO INDIVIDUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC;
(III) T
O PROVIDE LENDING CAPITAL FOR UNCOLLATERALIZED LOANS
TO INDIVIDUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC.
A
LL LOANS MADE OR INCENTIVIZED UNDER THE PROGRAM MUST INCLUDE
THE FOLLOWING TERMS
:
(A) A
MAXIMUM LOAN AMOUNT OF FIVE T HOUSAND DOLLARS , WHICH
LOAN AMOUNT MAY OTHERWISE VARY IN PROPORTION TO THE HARM
EXPERIENCED BY THE INDIVIDUALS OR HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC;
(B) A
MAXIMUM ANNUAL PERCENTAGE RATE OF FIVE PERCENT ;
(C) B
ORROWER REPORTING; AND
(D) REPORTING TO MAJOR CREDIT AGENCIES CONCERNING REQUIRED
PAYMENTS ON THE LOAN
.
(IV) T
O AWARD GRANTS TO NONPROFIT COMMUNITY -BASED
ORGANIZATIONS IN ACCORDANCE WITH SUBSECTION
(10) OF THIS SECTION TO
CONDUCT MARKETING AND OUTREACH TO INDIVIDUALS AND HOUSEHOLDS
IMPACTED BY THE
COVID-19 PANDEMIC WHO MAY BE ELIGIBLE TO
PARTICIPATE IN THE PROGRAM
, INCLUDING MARKETING AND OUTREACH TO
INDIVIDUALS AND HOUSEHOLDS THAT ARE ECONOMICALLY INSECURE AND
FINANCIALLY UNSERVED AND UNDERSERVED
.
(b) T
HE STATE TREASURER MAY CONTRACT WITH ONE OR MORE
PAGE 4-HOUSE BILL 22-1359 COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS TO ADMINISTER ALL
OR A PORTION OF THE MONEY AVAILABLE FOR THE PROGRAM
.
(3) T
HE STATE TREASURER SHALL:
(a) U
SE AN OPEN AND COMPETITIVE PROCESS FOR SELECTING ONE OR
MORE ADMINISTRATORS
; AND
(b) SELECT AN APPLICANT OR APPLICANTS TO ADMINISTER THE
PROGRAM BASED ON THE FOLLOWING CRITERIA
:
(I) T
HE APPLICANT'S PROPOSED USE OF MONEY AND WHETHER THE
PROPOSED USE ALIGNS WITH PROGRAM GOALS
;
(II) T
HE STRENGTH OF THE APPLICANT 'S RELATIONSHIPS WITH
NONPROFIT COMMUNITY
-BASED ORGANIZATIONS THAT SERVE INDIVIDUALS
AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC WHO:
(A) A
RE TRADITIONALLY UNSERVED OR UNDERSERVED BY THE
CURRENT BANKING SYSTEM
; AND
(B) SUFFERED THE GREATEST HARM FROM THE NEGATIVE ECONOMIC
IMPACTS OF THE
COVID-19 PANDEMIC, INCLUDING PEOPLE OF COLOR ,
INDIVIDUALS IN LOW-WAGE EMPLOYMENT , WOMEN, AND INDIVIDUALS
WITHOUT COLLEGE DEGREES
;
(III) T
HE APPLICANT'S ABILITY TO CONNECT BORROWERS TO :
(A) S
AFE AND AFFORDABLE BANKING PRODUCTS WITH LOW FEES AND
EASY ACCESS TO ACCOUNTS
; AND
(B) FINANCIAL COUNSELING AND COACHING AND WEALTH -BUILDING
SERVICES
;
(IV) T
HE APPLICANT'S ABILITY TO SERVE INDIVIDUALS WHO ARE
UNDERSERVED BY TRADITIONAL LENDERS
, INCLUDING INDIVIDUALS WHO
HAVE NO CREDIT HISTORY
;
(V) T
HE ABILITY OF THE APPLICANT TO DEVISE LOAN PAYMENT
PLANS THAT INCLUDE OPPORTUNITIES TO BUILD SAVINGS
; AND
PAGE 5-HOUSE BILL 22-1359 (VI) THE APPLICANT'S ABILITY TO ATTRACT LENDING CAPITAL.
(4) I
N SELECTING AN APPLICANT OR APPLICANTS TO ADMINISTER THE
PROGRAM
, THE STATE TREASURER SHALL CONSULT WITH THE COUNCIL .
M
EMBERS OF THE COUNCIL WHO ARE OFFICIALS IN OR EMPLOYEES OF THE
DEPARTMENT OF LAW SHALL RECUSE THEMSELVES FROM THE EVALUATION
AND SELECTION PROCESS
.
(5) T
HE STATE TREASURER MAY ADVANCE MONEY UNDER A
CONTRACT TO AN APPLICANT SELECTED TO ADMINISTER THE PROGRAM IN
ORDER TO PAY FOR INITIAL COSTS
.
(6) T
HE STATE TREASURER'S CONTRACT WITH AN ADMINISTRATOR
MAY REQUIRE THE RETURN OF MONEY FROM THE ADMINISTRATOR FOR
REALLOCATION UNDER THE PROGRAM IF THE ADMINISTRATOR HAS BEEN
UNABLE TO EFFECTIVELY USE MONEY ALLOCATED FOR THE PROGRAM
.
(7) T
HE STATE TREASURER'S CONTRACT WITH AN ADMINISTRATOR
MAY REQUIRE AN ADMINISTRATION FEE IN AN AMOUNT REASONABLY
CALCULATED TO COVER THE ONGOING COSTS OF THE STATE TREASURER IN
OVERSEEING THE PROGRAM ADMINISTRATION
. THE STATE TREASURER SHALL
DEPOSIT THE ADMINISTRATION FEE IN THE FUND
.
(8) T
HE STATE TREASURER , IN COLLABORATION WITH ANY
ADMINISTRATOR SELECTED BY THE STATE TREASURER
, SHALL ESTABLISH
AND PUBLICIZE POLICIES FOR THE USE OF MONEY UNDER THE PROGRAM
, TO
INCLUDE
:
(a) P
ROGRAM DEADLINES, APPLICATION PROCEDURES AND FEES, AND
ANY OTHER COSTS ASSOCIATED WITH THE USE OF MONEY UNDER THE
PROGRAM
;
(b) U
NDERWRITING OR RISK MANAGEMENT POLICIES ; AND
(c) ELIGIBILITY REQUIREMENTS TO INCLUDE INDIVIDUALS AND
HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC.
(9) (a) I
F THE STATE TREASURER DETERMINES THAT A LOAN LOSS
RESERVE WILL INCENTIVIZE LENDING TO INDIVIDUALS AND HOUSEHOLDS
IMPACTED BY THE
COVID-19 PANDEMIC, THE STATE TREASURER MAY
PAGE 6-HOUSE BILL 22-1359 ESTABLISH A LOAN LOSS RESERVE FOR THE PROGRAM IN THE DEPARTMENT
OF THE TREASURY
, OR MAY SELECT ONE OR MORE ADMINISTRATORS
PURSUANT TO SUBSECTION
(3) OF THIS SECTION TO ESTABLISH A LOAN LOSS
RESERVE
. THE LOAN LOSS RESERVE MAY BE USED TO PROVIDE GRANTS TO
FINANCIAL INSTITUTIONS PARTICIPATING IN THE PROGRAM TO PARTIALLY
OFFSET LOSSES ON LOANS MADE TO INDIVIDUALS AND HOUSEHOLDS
IMPACTED BY THE
COVID-19 PANDEMIC.
(b) T
HE STATE TREASURER SHALL DETERMINE THE AMOUNT AND
CONDITIONS FOR THE OFFSET OF LOSSES THROUGH THE LOAN LOSS RESERVE
AND SHALL ESTABLISH AND PUBLICIZE POLICIES FOR PARTICIPATING
FINANCIAL INSTITUTIONS
.
(10) (a) T
HE STATE TREASURER, OR AN ADMINISTRATOR SELECTED
PURSUANT TO SUBSECTION
(3) OF THIS SECTION, MAY AWARD GRANTS TO
NONPROFIT COMMUNITY
-BASED ORGANIZATIONS TO CONDUCT MARKETING
AND OUTREACH TO INDIVI DUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC WHO MAY BE ELIGIBLE TO PARTICIPATE IN THE
PROGRAM
, INCLUDING MARKETING AND OUTREACH TO INDIVIDUALS AND
HOUSEHOLDS THAT ARE ECONOMICALLY INSECURE AND FINANCIALLY
UNSERVED AND UNDERSERVED
. THE STATE TREASURER, IN COLLABORATION
WITH ANY ADMINISTRATOR SELECTED PURS UANT TO SUBSECTION
(3) OF THIS
SECTION
, SHALL DEVELOP PROCEDURES FOR APPLYING FOR A GRANT , FOR
ALLOWABLE USES OF GRANT MONEY
, AND FOR REPORTING ON THE USE OF
GRANT MONEY
.
(b) A
NONPROFIT COMMUNITY -BASED ORGANIZATION MAY USE A
GRANT TO PROVIDE SERVICES AND ASSISTANCE TO THE PROGRAM
,
INCLUDING:
(I) E
DUCATIONAL AND OUTREACH ACTIVITIES , INCLUDING STAFF
SUPPORT FOR THESE ACTIVITIES
;
(II) T
ECHNICAL ASSISTANCE RELATING TO THE PROGRAM ; AND
(III) OTHER ACTIVITIES THAT HELP CONNECT INDIVIDUALS AND
HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC TO THE PROGRAM.
24-36-305. Report. (1) O
N OR BEFORE NOVEMBER 1, 2023, AND ON
OR BEFORE
NOVEMBER 1 OF EACH YEAR THEREAFTER IN WHICH THE
PAGE 7-HOUSE BILL 22-1359 PROGRAM IS BEING ADMINISTERED BY THE STATE TREASURER OR A SELECTED
ADMINISTRATOR
, THE SELECTED ADMINISTRATOR OR ADMINISTRATORS
SHALL SUBMIT A COMBINED REPORT TO THE GOVERNOR AND TO THE HOUSE
OF REPRESENTATIVES BUSINESS AFFAIRS AND LABOR COMMITTEE AND THE
SENATE BUSINESS
, LABOR, AND TECHNOLOGY COMMITTEE , OR THEIR
SUCCESSOR COMMITTEES
, DETAILING THE EXPENDITURE OF MONEY
APPROPRIATED FOR THE PROGRAM AND THE IMPACT OF THE PROGRAM ON
INDIVIDUALS AND HOUSEHOLDS IMPACTED BY THE
COVID-19 PANDEMIC OR
ITS NEGATIVE ECONOMIC IMPACTS
. NOTWITHSTANDING THE REQUIREMENTS
OF SECTION
24-1-136 (11)(a)(I), THE REQUIREMENT IN THIS SUBSECTION (1)
TO SUBMIT THE REPORT CONTINUES INDEFINITELY .
(2) A
T A MINIMUM, THE REPORT SUBMITTED PURSUANT TO
SUBSECTION
(1) OF THIS SECTION MUST INCLUDE:
(a) T
HE PURPOSES, AS SPECIFIED IN SECTION 24-36-304 (2)(a), FOR
WHICH PROGRAM MONEY WAS USED
, AND THE NUMBER AND A DESCRIPTION
OF THE INDIVIDUALS AND HOUSEHOLDS BENEFITTING FROM THE PROGRAM
;
(b) T
HE GEOGRAPHIC DISTRIBUTION OF PROGRAM BENEFICIARIES ;
(c) T
HE NUMBER OF LOAN DEFAULTS ;
(d) I
NFORMATION CONCERNING THE USE AND IMPACT OF A LOAN
LOSS RESERVE
; AND
(e) A SUMMARY OF GRANTS AWARDED TO NONPROFIT
COMMUNITY
-BASED ORGANIZATIONS TO PROVIDE EDUCATIONAL AND
OUTREACH ACTIVITIES AND ASSISTANCE TO THE PROGRAM
.
24-36-306. Colorado household financial recovery pilot program
fund - created - transfer - gifts, grants, and donations authorized.
(1) (a) T
HE COLORADO HOUSEHOLD FINANCIAL RECOVERY PILOT PROGRAM
FUND IS HEREBY CREATED IN THE STATE TREASURY
.
(b) T
HE STATE TREASURER SHALL CREDIT ALL INTEREST AND INCOME
DERIVED FROM THE DEPOSIT AND INVESTMENT OF MONEY IN THE FUND TO
THE FUND
.
(c) M
ONEY APPROPRIATED, TRANSFERRED, OR CREDITED TO THE
PAGE 8-HOUSE BILL 22-1359 FUND IS CONTINUOUSLY APPROPRIATED TO THE STATE TREASURER FOR THE
PURPOSES SPECIFIED IN SUBSECTION
(4) OF THIS SECTION.
(d) T
HE STATE TREASURER MAY EXPEND UP TO FOUR PERCENT OF
THE MONEY APPROPRIATED TO THE FUND TO PAY THE DIRECT AND INDIRECT
COSTS INCURRED BY THE STATE TREASURER IN IMPLEMENTING OR
ADMINISTERING THE PROGRAM
.
(2) T
HE FUND CONSISTS OF:
(a) M
ONEY APPROPRIATED TO THE FUND BY THE GENERAL ASSEMBLY
FOR PURPOSES OF THIS PART
3;
(b) M
ONEY TRANSFERRED TO THE FUND ;
(c) F
EES COLLECTED PURSUANT TO SECTION 24-36-304 (7); AND
(d) GIFTS, GRANTS, OR DONATIONS CREDITED TO THE FUND
PURSUANT TO SUBSECTION
(3) OF THIS SECTION.
(3) T
HE STATE TREASURER MAY SEEK , ACCEPT, AND EXPEND GIFTS,
GRANTS, OR DONATIONS FROM PRIVATE OR PUBLIC SOURCES FOR THE
PURPOSES OF THIS PART
3. THE STATE TREASURER SHALL CREDIT ALL MONEY
RECEIVED THROUGH GIFTS
, GRANTS, AND DONATIONS TO THE FUND.
(4) M
ONEY IN THE FUND MAY BE USED FOR:
(a) T
HE PURPOSES SPECIFIED IN SECTION 24-36-304; AND
(b) ANY OTHER PURPOSE RELATING TO THE ADMINISTRATION AND
IMPLEMENTATION OF THIS PART
3.
SECTION 2. Appropriation. (1) For the 2022-23 state fiscal year,
$5,200,000 is appropriated to the Colorado household financial recovery
pilot program fund created in section 24-36-306 (1)(a), C.R.S. This
appropriation is from the general fund. The department of the treasury is
responsible for the accounting related to this appropriation.
(2) For the 2022-23 state fiscal year, $59,142 is appropriated to the
department of law. This appropriation is from reappropriated funds received
PAGE 9-HOUSE BILL 22-1359 from the department of the treasury from the Colorado household financial
recovery pilot program fund created in section 24-36-306 (1)(a), C.R.S., and
is based on an assumption that the department of law will require an
additional 0.3 FTE. To implement this act, the department of law may use
this appropriation to provide legal services for the department of the
treasury.
SECTION 3. Safety clause. The general assembly hereby finds,
PAGE 10-HOUSE BILL 22-1359 determines, and declares that this act is necessary for the immediate
preservation of the public peace, health, or safety.
____________________________ ____________________________
Alec Garnett Steve Fenberg
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Robin Jones Cindi L. Markwell
CHIEF CLERK OF THE HOUSE SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
(Date and Time)
_________________________________________
Jared S. Polis
GOVERNOR OF THE STATE OF COLORADO
PAGE 11-HOUSE BILL 22-1359