News & Events
HB25-1090: Colorado’s Residential Landlords Must Eliminate “Junk Fees” in 2026 (Including CAM Charges)
On August 5, 2025, the Colorado legislature enacted House Bill 25-1090 (the “Bill”) in an attempt to eliminate deceptive consumer pricing practices across various markets in Colorado, including in the residential leasing landscape. When the Bill goes into effect on January 1, 2026, landlords will be prohibited from engaging in several industry-standard practices, such as advertising a base rental price that does not include amenity or parking fees, or passing through common area maintenance costs to tenants as a separate charge. This alert will provide a brief overview of the Bill and outline some basic compliance requirements for Colorado landlords.
The Bill Builds on Previous Legislation
The Bill is supplemental to HB23-1095, which was passed in 2023 to protect renters from “junk fees” and lower the rate of evictions in Colorado (the “2023 Bill”). The 2023 Bill, in part, prohibits any lease provision that requires a tenant to pay a markup on its landlord’s third party costs, unless that markup or fee does not exceed 102% of the amount charged to the landlord by a third party, or a total of $10.00 per month, but not both (the “Third Party Markup Limitation”). The Bill reiterates the Third Party Markup Limitation.
Example: A landlord violates the Third Party Markup Limitation by seeking a $150 reimbursement from a tenant for in-unit washing machine repair services if the landlord only paid the repair person $100. The law limits the landlord’s reimbursement from the tenant to a maximum of $110.
The Bill Will Impose Additional Prohibitions on Landlords in 2026
Transparency in rental pricing.
As of January 1, 2026, the Bill will require landlords to generate a base rental price that incorporates all mandatory and unavoidable costs into a single dollar amount that can be displayed, clearly and conspicuously, in all of a landlord’s advertisements and lease agreements for a rental unit. In this context, “mandatory and unavoidable costs” are amounts that must be paid by the tenant to “purchase, enjoy or utilize” the rental property, and any amount that tenant cannot reasonably avoid or opt out of.
Example 1: In 2025, every tenant paid a mandatory $50 parking and amenity fee each month. In 2026, the landlord can no longer assess the amenity fee as a separate charge, but could increase base rent by $50 to compensate.
Example 2: An optional valet trash service is not a mandatory and unavoidable cost, and could be separately assessed if it reflected the landlord’s actual cost to provide the service.
There are numerous specific requirements for what constitutes a “clear and conspicuous” disclosure, but the spirit of the requirement is that the number be bold, obvious, prominent, primary, and displayed as a singular total with no asterisks, fine print, hidden fees, or omissions. With very few exceptions, the amount advertised should be the amount owed.
Can any fees still be separately assessed?
The following fees can still be separately billed to tenants or omitted from the total rental disclosure:
- Utilities (provided that landlords may not charge more than the actual amount billed by the utility provider, except as permitted by the Third Party Markup Limitation).
- Optional Fees (such as pet rent, optional covered parking or valet trash).
- Certain government charges and taxes.
The following fees can no longer be passed through/separately charged to the tenant:
- Fees for the maintenance of common areas;
- For instance, the cost of lighting and maintaining a building’s 24-hour fitness center should now be rolled into the total base rent
- Any fee related to the payment of property taxes;
- A processing fee on rent payments (unless tenants have another way to pay rent that is free);
- A late fee or charge for any amount owed that is not rent;
- For instance, landlords cannot charge tenants a late fee on separately billed utilities
- Any fee to cover a landlord’s costs incurred in the performance of its statutory obligations;
- For instance, a landlord is responsible for the cost of ensuring a unit is habitable (equipped with running water, heat, smoke alarms, etc.)
- Any fee in excess of a landlord’s actual costs, except as permitted by the Third Party Markup Limitation;
- For instance, a permitted rental processing fee cannot exceed a landlord’s actual costs incurred to process payments
- Any fee that increases by more than 2% over the course of a lease with a term of a year or less (except utilities, which are not within the landlord’s control); or
- A fee for a service that is not actually provided to tenants.
- For instance, failing to pause the monthly “pool fee” during winter months when the pool is closed
If a landlord charges separate fees permitted by the Bill, they still cannot mislead tenants about the nature of the fees, including:
- Whether the fee is refundable;
- How and to what the fee will be applied;
- Who will receive the fee and how much they are charging.
Example 1: A landlord that uses RUBS (Ratio Utility Billing System) to calculate utilities for all un-submetered units complies with the law by clearly disclosing the landlord’s method for calculating monthly utility bills to prospective and existing tenants. (Please see our supplemental alert published on October 13, 2025 for more information on RUBS)
Example 2: A landlord’s policy is to require tenants with dogs to provide a $300 pet deposit at lease signing. The landlord violates the law by failing to inform tenants or otherwise make clear that the deposit will be fully refundable, as required by statute, if the pets do not damage the unit beyond reasonable wear and tear.
Does the Bill apply to existing leases?
Unlike the 2023 Bill, the Bill is silent as to whether it will retroactively apply to leases executed prior to January 1, 2026. For now, landlords should assume that the Bill prohibits them from imposing junk fees on any current or future tenant. The Bill will render any unenforceable lease provision void by law, but if existing tenants are currently paying fees that will be prohibited in 2026, the safest way forward for landlords is to proactively amend existing leases to bring them into full compliance before the Bill goes into effect. At a minimum, landlords should notify existing tenants of specific changes in writing.
Note that, even if a landlord explicitly eliminates all prohibited fees from an existing lease, the landlord may not be entitled to simultaneously raise the rent to compensate for the lost revenue, since (1) landlords are prohibited from increasing rent more than one time in any 12-month period, and (2) a written lease agreement must expressly allow for increases in rent, and may dictate certain prior notice requirements or caps on increases that make a full or immediate recovery impossible.
What are the penalties for non-compliance?
The penalties for non-compliance include: civil action by tenants, including a now-codified cause of action under the Colorado Consumer Protection Act for deceptive, unfair and unconscionable pricing practices; tenants’ or consumers’ lawful refusal to pay, or demand for reimbursement of, any prohibited or enforceable fee; and, if deceptive or unenforceable fees paid are not returned within 14 days of demand, damages subject to a substantial 18% annual interest rate.
How will landlords recover their reasonable expenses for overhead such as common area maintenance costs and property taxes?
The Bill is a transparency measure, not a rent control measure. While the law is intended to curb so-called “greedflation” and “bait and switch” tactics that lure in renters with a low price and then tack on hidden or needless fees, nothing in the Bill caps the amount landlords can charge for rent, and a landlords’ rent calculations will remain opaque to tenants. The market’s tolerance for higher base rent is the only limitation on rent adjustments intended to recapture lost revenue from fees.
This summary does not capture every nuance of HB25-1095 or any other bill or statute, and is a limited overview of the Bill’s application and intent. Please contact an Otten Johnson attorney directly to discuss bringing your leases and operations into compliance with HB25-1090 and the recent landslide of tenant-favorable legislation in Colorado.
