1. (1) The multifamily construction incentive program is created. On and after January 1, 2026, a builder of multifamily, attached housing of two or more units may participate in the program by:

   1. (a) Providing a warranty that covers any defect and damage at no cost to the homeowner for a minimum period of:

      1. (I) One year for workmanship and materials;
      2. (II) Two years for plumbing, electrical, and materials; and
      3. (III) Six years for major structural components;
   2. (b) Having a third-party inspection performed; and
   3. (c) Recording a notice of election to participate in the multifamily construction incentive program in the real property records of the county in which the property is located for the project intended to be covered before the unit is offered for sale. After recording a notice of election to participate, a builder may withdraw from the program only before the issuance of the last certificate of occupancy for the project.

2. (2)

   1. (a) Except as provided in subsection (3) of this section, a person must file with a complaint a certificate of review in compliance with section 13-20-602 for a construction defect action that is:

      1. (I) Against a construction professional who is an architect or engineer; and
      2. (II) For a program claim.

   2. (b) The certificate of review filed in accordance with subsection (2)(a) of this section must, based on facts known to the party filing the certificate of review:

      1. (I) Set forth the architect's or engineer's negligence, including any act or omission in providing advice, exercising judgment, giving an opinion, or exercising a similar professional skill; and
      2. (II) Declare that the individual consulted can demonstrate by competent evidence that, as a result of training, education, knowledge, and experience, the consultant is competent to express an opinion as to the negligence, including an act or omission, alleged.
   3. (c) If a claimant fails to file the certificate of review required in this subsection (2), the court shall dismiss the complaint against the defendant unless the claimant shows good cause for the failure.

3. (3) A claimant is not required to comply with the certificate of review requirements of subsection (2) of this section if:

   1. (a) A claim is for construction in which a governmental entity contracted with a single entity to provide both design and construction services for the construction, rehabilitation, alteration, or repair of a facility, a building or an associated structure, a civil works project, or a highway project; or
   2. (b) The period of limitation or repose could reasonably expire within ten days after the date of filing and, because of the time constraint, the claimant has alleged that a certificate of review by a third-party architect or engineer could not be prepared. A claimant that does not file a certificate of review under this section shall supplement the complaint with a certificate of review within twenty-eight days after the filing of the complaint; except that a court may, on motion and for good cause, grant a claimant additional time to file the certificate of review.
4. (4) A defendant that designates an architect or engineer as a nonparty at fault in accordance with section 13-21-111.5 (3)(b) must file a subsequent certificate of review that complies with subsection (2) of this section and section 13-20-602. The defendant shall file a certificate of review at least forty-five days prior to any trial or proceeding on the claim. If the defendant fails to file the certificate of review as required in this subsection (4), a court shall not consider the negligence or fault of the nonparty.

5. (5) Subsections (2) to (4) of this section do not:

   1. (a) Extend the applicable period of limitation or repose; or
   2. (b) Apply to a suit or action for the payment of fees arising out of the provision of professional services.

6. (6) A person shall not assert a program claim unless the defect has resulted in one or more of the following:

   1. (a) Actual damage to real or personal property;
   2. (b) Actual loss of the use of real or personal property;
   3. (c) Actual bodily injury or wrongful death;
   4. (d) An unreasonable reduction in the capability of, or an actual failure of, a building component to perform an intended function or purpose; or
   5. (e) An unreasonable risk of bodily injury or death to, or a threat to the life, health, or safety of, the occupants of the residential property.

7. (7)

   1. (a)

      1. (I) If the defendant is a construction professional who is not an architect or engineer and who has provided the claimant a written warranty for the residence that complies with subsection (1)(a) of this section, and if the claimant discovered or should have discovered the alleged defect or damage within the longest applicable warranty period, the claimant must bring the suit not later than six years after the substantial completion of the improvement.
      2. (II) If the defendant is a construction professional who is an architect or engineer, and the construction professional performed in a manner consistent with the degree of skill and care ordinarily exercised by members of the same profession currently practicing under the same or similar circumstances, the claimant must bring the suit not later than six years after the substantial completion of the improvement.
   2. (b) If a claim involves a defect or damage that is covered by the warranty described in subsection (7)(a) of this section, the claimant shall pursue all reasonable remedies available under the warranty process before bringing an action for damages. The statute of limitations and repose shall be tolled from the date the claimant first pursued a remedy available under the warranty for no more than one year or until the completion of the warranty process, whichever is longer.
   3. (c) Section 13-80-104 (2) and (3) applies to the limitation of claims in this subsection (7).

8. (8)

   1. (a) For program claims, a construction professional who makes a reasonable offer pursuant to subsection (9) of this section may be immune, in whole or in part, from an obligation, damage, loss, or liability under this part 8 related to or arising out of the construction defect, but only with respect to the portion of the claimant's damages, if any, the construction professional can demonstrate by a preponderance of the evidence were proximately caused or increased by an affirmative defense specified in subsections (8)(b) and (8)(c) of this section and not by the construction defect.

   2. (b) A construction professional is not liable for a damage or defect to the extent the professional can prove, as an affirmative defense, that the damage or defect was caused:

      1. (I) By a weather condition, earthquake, or other natural phenomenon in excess of the design criteria expressed by the applicable building codes, regulations, and ordinances in effect at the time of original construction;
      2. (II) By a human-caused event, such as war, terrorism, or vandalism;
      3. (III) By a homeowner's unreasonable failure to timely mitigate damages as required in section 13-20-803.5 (1);
      4. (IV) By the homeowner or the homeowner's agent, employee, or construction professional by virtue of their failure to follow the builder's or manufacturer's maintenance recommendations or to do commonly accepted homeowner maintenance obligations. In order to rely upon this defense as it relates to a construction professional's recommended maintenance schedule, the construction professional must show that the homeowner had written notice of these maintenance schedules and recommendations and that the maintenance recommendations and schedules were reasonable at the time they were issued and that the damage or defect did not directly prevent the homeowner from performing the recommended maintenance.

      5. (V) After sale or transfer of ownership to the claimant, by:

         1. (A) The homeowner's or homeowner's agent's alterations;
         2. (B) Ordinary wear and tear;
         3. (C) Misuse of the structure or component;
         4. (D) Abuse of the structure or component;
         5. (E) Neglect of the structure or component; or
         6. (F) The use of the structure or component for something other than the structure's or component's intended purpose.

   3. (c) A construction professional may assert an affirmative defense to the extent that:

      1. (I) The damage was caused by a particular violation covered by a valid release obtained by the construction professional, if the release is enforceable against the claimant, was executed with knowledge of the particular violation, and does not violate section 13-20-806 (7); or
      2. (II) The construction professional's repair completed pursuant to section 13-20-803.5 (3) was successful in correcting the particular violation and any damage resulting from the violation of the applicable standard.
   4. (d) The affirmative defenses set forth in this subsection (8) are in addition to, and shall not limit, impair, replace, or otherwise affect, any other defense available to a construction professional under statute or common law.

9. (9)

   1. (a) For program claims, a construction professional and the insurer, as defined in section 10-1-102 (13), providing coverage related to the claim shall send or deliver to the claimant, by certified mail, return receipt requested, or by personal service:

      1. (I) An offer to settle the claim by:

         1. (A) Payment of a sum certain; or
         2. (B) Agreeing to remedy the claimed defect described in the notice of claim;

      2. (II) A written response that:

         1. (A) Identifies the standards that apply to the claimed defect's construction or performance; and
         2. (B) Explains why the claimed defect does not require repair; or
      3. (III) A written response that explains the construction professional's scope of work and why the claimed defect is not within the work and responsibility of the construction professional.
   2. (b) A written offer to remedy a construction defect must include a report of the scope of the inspection, the findings and results of the inspection, a description of the additional construction work necessary to remedy the defect described in the notice of claim and all damage to the improvement to real property caused by the defect, and a timetable for the completion of the remedial construction work.
   3. (c) The construction professional shall provide an offer pursuant to subsection (9)(a)(I) of this section within ninety days after the deadline to inspect the property and claimed defect pursuant to section 13-20-803.5 or a written response pursuant to subsection (9)(a)(II) or (9)(a)(III) of this section within thirty days after the deadline to inspect the property and claimed defect pursuant to section 13-20-803.5. Notwithstanding any provision in a contract or any requirement in the governing documents, if a construction professional requests an extension to provide an offer pursuant to subsection (9)(a)(I) of this section and the claimant does not agree to the requested extension, the parties shall designate a mutually agreeable third party in writing to determine whether the requested extension is reasonable. Notwithstanding any other provision in this section, the total time to provide an offer must not exceed two hundred ten days after the date of the notice of claim by the construction professional providing an offer pursuant to subsection (9)(a)(I) of this section.
   4. (d) If a claimant unreasonably rejects a reasonable written offer of settlement made pursuant to this subsection (9) and subsequently commences an action against the construction professional, the court may award attorney fees and costs to the construction professional.
   5. (e) If a construction professional fails to make a reasonable written offer of settlement pursuant to this subsection (9), the limitations on damages and defenses to liability provided in subsections (2), (5), (6), (7), and (8) of this section do not apply, and the court may award attorney fees and costs to the claimant.

   6. (f)

      1. (I) A construction professional's written offer of settlement is reasonable, and a claimant's rejection of the offer is unreasonable, if the claimant recovers a final judgment in an amount that is less than the amount offered or the reasonable value of the repair offered by the construction professional.
      2. (II) A construction professional's written offer of settlement is unreasonable, and a claimant's rejection of the offer is reasonable, if the claimant recovers a final judgment in an amount that exceeds the amount offered or the reasonable value of the repair offered by the construction professional.

10. (10)

    1. (a) Within thirty days after the rejection of an offer made pursuant to subsection (9) of this section, a claimant shall provide a construction professional with a written proposal to have the construction defect repaired at the construction professional's expense or to settle the claim.
    2. (b) If the construction professional does not accept the proposal provided by the claimant pursuant to subsection (10)(a) of this section in writing within fifteen days after delivery of the proposal, the proposal is deemed to have been rejected.
    3. (c) If the construction professional accepts the proposal provided by the claimant pursuant to subsection (10)(a) of this section, the construction professional shall pay the claimant's reasonable attorney fees and costs incurred in investigating the defect and proposing the repair.

11. (11) Nothing in this section:

    1. (a) Affects the Colorado Governmental Immunity Act, article 10 of title 24, or section 13-20-806 (7); or
    2. (b) Prohibits, limits, or impairs a contractual claim or expands the definition of action in section 13-20-802.5 (1).

Source: L. 2025: Entire section added, (HB 25-1272), ch. 183, p. 785, § 3, effective August 6.

Editor's note: Section 8(2) of chapter 183 (HB 25-1272), Session Laws of Colorado 2025, provides that the act adding this section applies to construction defect claims brought on or after August 6, 2025.

Cross references: For the short title (Colorado American Dream Act) and the legislative declaration in HB 25-1272, see section 1 of chapter 183, Session Laws of Colorado 2025.