As we move past the halfway mark of Colorado’s legislative session, the pace under the Gold Dome is beginning to shift. With just seven short weeks remaining, bill introductions have slowed significantly, and attention has turned to committee hearings and floor debates. This is the point in the session where priorities crystallize, some proposals advance, while others rightfully stall or fail as their broader impacts on businesses and Colorado’s economy come into sharper focus.

Several issues of importance to Colorado’s banking industry continue to demand close attention.

Interchange Legislation

Senate Bill 26-134, Concerning Credit Card Swipe Fees, was introduced on March 4 and proposes to prohibit interchange fees on the tax portion of a transaction. The bill received a hearing on March 12 under circumstances that underscore just how dynamic, and at times unpredictable, the legislative process can be.

Leading up to the hearing, opponents of the bill had secured sufficient votes to defeat the measure in committee. However, in an unprecedented move on the morning of the hearing, Senate leadership replaced a committee member with one of the bill’s sponsors, allowing the bill to pass out of committee.

Since that time, the bill has remained on the Senate floor awaiting debate. Proponents have been unable to secure the votes necessary for passage and continue to circulate amendments in an effort to build support. At the time this article was written, the bill does not have a clear path forward.

The Colorado Bankers Association has been actively engaged on this issue. I met directly with representatives from the Governor’s Office to clearly communicate the industry’s position, including the potential to pursue litigation should the bill be signed into law. This is in addition to numerous meetings Alison Morgan, CBA’s director of state government relations, had with the Governor’s team. The stakes are high, and we remain committed to ensuring policymakers fully understand the operational, legal and economic consequences of this proposal.

Artificial Intelligence

Colorado continues to be at the forefront of artificial intelligence policy. In 2024, the state enacted groundbreaking legislation (HB24-205) aimed at protecting consumers from discriminatory practices in AI systems. At the time of signing, Governor Polis acknowledged structural flaws within the law that would need to be addressed.

Efforts to refine the law have so far been unsuccessful in the legislature. The only accomplishment has been to push the implementation date to June 2026. In response, the Governor convened a broad-based AI working group tasked with developing a path forward. While the group included a wide range of stakeholders, representing venture capital, education, healthcare, technology, consumer advocates and business, it notably did not include representation from the banking or financial services sector.

After months of discussion, the working group advanced a proposed framework. The bill will be subject to the full legislative process, including amendments. Additional legislation is also anticipated that could further restrict the use of AI in Colorado.

While there is general agreement on the need to address the issues within the current law, the challenge will be finding a balanced approach that protects consumers without stifling innovation or creating unintended consequences for industries that rely on advanced technologies to serve their customers.

State Budget Outlook

The broader fiscal environment is also shaping legislative decisions this year. On March 19, the Joint Budget Committee (JBC) received the spring revenue forecast, which reflected a significant downturn. The state is now facing a projected $1.5 billion shortfall for fiscal year 2026-2027.

In the current fiscal year, revenues are expected to come in $914 million below the TABOR cap, eliminating the possibility of taxpayer refunds in 2026. Contributing factors include changes in federal tax policy, rising Medicaid costs and increasing concerns about a potential economic slowdown.

Colorado’s constitutional requirement to pass a balanced budget means that difficult decisions lie ahead. The JBC is actively working through additional reductions and spending cuts, and these fiscal constraints will inevitably influence policy decisions across the board in the weeks to come.

Looking Ahead

As we enter the final stretch of the session, engagement remains critical. The legislative process is fluid, and outcomes can shift quickly as we saw with the interchange bill. Ensuring that the voice of Colorado’s banking industry is heard, understood and respected requires constant vigilance and thoughtful advocacy.

As members of the Colorado Bankers Association, we are fortunate to have strong, professional advocates representing our industry both at the State Capitol and in Washington, D.C. Our advocacy team works daily to build relationships with policymakers, provide clear and factual information on complex issues, and ensure that the real-world impact of proposed legislation is fully understood. Just as importantly, many of you, our member bankers, play a vital role by engaging directly with elected officials, sharing your expertise, and reinforcing the essential role banks play in supporting communities, businesses, and economic growth across Colorado.

That collective voice matters. It is what allows us to navigate challenging proposals, shape meaningful policy outcomes and protect the ability of Colorado’s banks to serve their customers effectively.

The final weeks of session will be pivotal. We will continue to monitor developments closely and keep you informed as these issues evolve.