Unlocking Affordable Housing Near Transit: Understanding CHFA’s Transit-Oriented Communities (TOC) Credit

Colorado’s housing crisis demands creative solutions. One powerful tool now available is the Transit-Oriented Communities (TOC) Credit, launched by CHFA in 2024.

What Is the TOC Credit?

The TOC Credit is a new state housing tax credit designed to support affordable rental housing near high-frequency transit routes. Created by House Bill 24-1434, this program aims to boost density, reduce car dependence, and align housing investments with climate goals.

CHFA (Colorado Housing and Finance Authority) administers the TOC Credit as part of its broader affordable housing finance programs.

Key Program Objectives

The TOC Credit encourages the development of:

• Affordable multifamily housing

• Projects located in walkable, transit-connected areas

• Developments aligned with local and regional planning goals

• Buildings that reduce reliance on personal vehicles

This tax credit supports Colorado’s strategic shift toward more sustainable, equitable urban growth.

Eligibility Criteria

To qualify for the TOC Credit, a project must meet several requirements:

• Be located in a designated Transit-Oriented Community as defined by the legislation.

• Include low-income housing units, targeting households earning 60% AMI or below.

• Be near fixed-route transit, such as light rail, bus rapid transit, or high-frequency local bus routes.

• Demonstrate a long-term affordability commitment (typically 30 years or longer).

Projects may combine TOC Credits with LIHTC (Low-Income Housing Tax Credits) or other state funding sources.

Transit-Oriented Community Designation

To access this credit, a jurisdiction must first be certified by the Colorado Department of Local Affairs (DOLA) as a TOC. Certification requires:

• Zoning that allows at least 15 dwelling units per acre near a transit corridor.

• Demonstrated efforts to streamline housing approvals.

• Policies that reduce parking minimums or promote multi-modal transportation.

The certification process ensures communities actively support infill and transit-oriented housing development.

How the Credit Works

The TOC Credit functions like Colorado’s existing state affordable housing tax credit. Developers receive state tax credits based on eligible project costs. These credits are then sold to investors in exchange for equity.

This equity helps cover development costs, reducing the need for hard debt. That allows deeper affordability and more financially viable projects near transit hubs.

Benefits to Developers and Communities

• Equity infusion: TOC Credits reduce financing gaps.

• Walkable communities: Residents benefit from access to jobs, education, and services.

• Reduced emissions: Encouraging transit use supports Colorado’s climate goals.

• Greater housing choice: Especially in high-opportunity, high-demand neighborhoods.

For developers, the TOC Credit enhances project viability and competitiveness in tax credit funding rounds.

Application Timeline

CHFA accepts TOC Credit applications through its competitive housing credit application rounds. Developers must prepare a strong proposal that meets both state and local TOC requirements.

For more information, See CHFA’s TOC Overview

Final Thoughts

Colorado’s Transit-Oriented Communities Credit opens the door to more inclusive, walkable, and affordable neighborhoods. It bridges housing policy and transit planning to build more resilient cities.

Developers, planners, and local governments should strongly consider using this tool to meet their housing and climate goals.

Additional Resources

• House Bill 24-1434 Summary (via Colorado General Assembly):
  https://leg.colorado.gov/bills/hb24-1434