DENVER, Colorado — Two bills are moving through the Colorado legislature that will expand passenger rail beyond the Front Range and into the mountains. One of the proposals would collect money from tourists and people who are moving to help pay for transportation improvements.
Senate Bill 184 creates a new $3 per day impact fee for rental cars and moving vans. The fee drops to $2 per day for customers renting an electric vehicle or plug-in hybrid.
The nonpartisan Legislative Counsel Staff estimates in its Fiscal Note the bill will generate $28.5 million in revenue for the 2024-2025 fiscal year. That amount is projected to grow to $58.2 million in the following year.
The legislation declares rental vehicles use public highways and add extra wear and tear on road infrastructure. The money is intended to help with highway maintenance.
It will also be used to help fund the Front Range Passenger Rail. As News 5 has previously reported, the rail project is in a federal pipeline to receive grant funding through the Bipartisan Infrastructure Act. However, federal grants typically require state and local governments to match the funding by a certain percentage.
Senate Bill 184 indicates that Colorado's match for Front Range Passenger Rail could be roughly 20 percent.
The bill also establishes a new mountain rail line connecting Denver to Winter Park and beyond.
"Connecting Craig, to Hayden, to Steamboat, and then going even further, going beyond that to Grand County and to Denver is something that we really see as an exciting opportunity for our future for passenger rail," said State Rep. Meghan Lukens of Steamboat. Her house district represents voters in Eagle, Moffat, Rio Blanco, and Routt counties in northwestern Colorado.
Lukens is sponsoring a second bill related to mountain rail. Senate Bill 190 aims to preserve existing freight rail lines for future passenger rail development.
Residents in Craig and Hayden face a similar economic challenge as people in Pueblo where Xcel Energy has announced plans to shut down large coal power generating facilities. Coal trains are a primary source of rail traffic on the lines connecting Craig and Hayden.
"The coal plants are shutting down which is going to have a devastating impact on our coal-transitioning communities," Lukens explained. "This bill is one piece of the puzzle."
The bill creates a $5 million annual freight rail tax credit within the Colorado Office of Economic Development and International Trade. The idea is to incentivize investment by new or existing businesses to ship their products to market by rail. The bill also creates a $5 million annual rail operator tax credit under the Colorado Department of Transportation to continue to maintain the existing rail lines.
The tax incentives are available to communities considered Tier One Transition Communities facing the steepest economic fallout from the transition from coal power generation. They include Moffat, Montrose, Morgan, Pueblo, Rio Blanco, and Routt counties.
Both bills have cleared the Colorado State Senate and their first committee hearing in the State House.
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