Repeal Retail Delivery Fees

The Bottom Line

You know that annoying 28-cent charge tacked onto every Amazon, DoorDash, and Walmart delivery? This bill would completely wipe it out, saving shoppers pennies per order. But killing the fee also blows a massive $120 million hole in the state's transportation budget, effectively zeroing out funding for local road repairs, electric vehicle rebates, and clean transit projects.

What This Bill Actually Does

Back in 2021, the state legislature passed a massive transportation funding package that introduced a brand new concept to Colorado shoppers: the Retail Delivery Fee. Fast forward to today, and anytime a motor vehicle drops off tangible goods at a Colorado address—think Amazon packages, furniture deliveries, or even a local boutique shipping a sweater—you get hit with a 28-cent charge. HB26-1266 proposes a clean, complete repeal of this fee, striking it entirely from the books.

While consumers just see a single "delivery fee" line item on their checkout screens, that 28 cents is actually a composite of six distinct state fees bundled together. These micropayments are collected by the Department of Revenue and routed into different buckets. About 9 cents goes to the state highway and multimodal funds to fix roads. The remaining 19 cents is sliced up among five state enterprises—quasi-government agencies that fund specific initiatives like bridge and tunnel repairs, replacing diesel buses with clean transit, and mitigating air pollution in areas with high smog.

By repealing the fee, the bill essentially pulls the plug on the primary funding streams for these programs. The impact isn't just a haircut; it's a structural shutdown for some. For example, the Community Access Enterprise—which focuses on building out electric vehicle charging infrastructure across the state—is funded entirely by this fee and would be forced to cease operations completely. Other agencies, like the Bridge and Tunnel Enterprise, would survive but have to aggressively scale back their planned infrastructure projects due to the sudden loss of millions in anticipated revenue.

What It Means for You

On a day-to-day basis, this bill directly lowers the cost of ordering goods to your home. If your household relies heavily on deliveries for groceries, pet food, and online shopping, removing the 28-cent Retail Delivery Fee provides immediate relief to your wallet. You won't have to keep a mental tally of how those nickels and dimes add up over the course of a year, and the final checkout screens on your favorite apps will look a little cleaner without that extra state surcharge.

But the secondary effects on your wallet are much more complex, particularly when it comes to your taxes. Because of how Colorado's intricate tax laws and revenue limits work, eliminating these fees creates a massive domino effect on triggered tax credits. By shrinking the overall pool of revenue the state collects, the bill actually forces a reduction in popular family-focused tax breaks—specifically the Family Affordability Tax Credit and the expanded Earned Income Tax Credit—starting around tax year 2028. If your household relies on those specific credits, you might actually lose significantly more money at tax time than you ever saved on delivery fees.

There is also a highly tangible impact on the roads you drive on every day. A solid chunk of the current delivery fee goes straight to your local county and city governments to fix potholes, pave roads, and build bike lanes. Without this money, local governments are projected to lose roughly $15.4 million in the first year alone. If you have been waiting for a specific dangerous intersection in your neighborhood to get upgraded or a new local bus route to launch, those quality-of-life projects might be delayed or shelved indefinitely as city planners scramble to fill the budget hole.

What It Means for Your Business

If you run a retail business, restaurant, or e-commerce shop, this bill removes a massive administrative headache. For the past few years, businesses have had to update their point-of-sale systems, train staff, and jump through accounting hoops to accurately collect, report, and remit this highly specific 28-cent charge. Repealing the fee removes a persistent compliance burden, saving you ongoing software programming costs and the anxiety of ensuring every applicable delivery is properly taxed. However, keep in mind that the state has a four-year statute of limitations on tax collection, so it's wise to keep your records clean, as the Department of Revenue will still be auditing past returns even after the fee is gone.

On the flip side, if you are in the construction, engineering, or environmental sectors, this bill represents a severe threat to your pipeline of state and local government contracts. The repeal wipes out over $120 million in state revenue in its first year, much of which was strictly earmarked for multi-year infrastructure projects. Companies that bid on highway maintenance, bridge repairs, or local multimodal transit upgrades will see the pool of available work shrink significantly as the Department of Transportation and local governments tighten their belts in response to the missing revenue.

The ripple effects will also hit the automotive and green energy sectors hard. The Clean Fleet Enterprise and the Community Access Enterprise would lose millions—or in the latter's case, all of its funding. If your business relies on state grants to help transition your commercial delivery fleet from diesel to electric vehicles, or if you are a contractor making a living installing EV charging stations across Colorado, those specific grant programs and incentives will largely evaporate. It is highly recommended to review your projected government contracts and adjust your long-term revenue expectations if your sector relies heavily on these enterprise funds.

Follow the Money

The fiscal impact of repealing the delivery fee is massive, bidirectional, and highly complex. According to the nonpartisan fiscal note, the state would lose $121.1 million in revenue in the first year (FY 2026-27), with losses growing in subsequent years since the fee was originally scheduled to adjust upward for inflation. This directly drains the Highway Users Tax Fund (HUTF) and defunds five separate state enterprises. Local governments also take a severe hit, losing out on $15.4 million in the first year and $18.9 million the next, specifically money earmarked for community road and transit projects.

Ironically, eliminating the fee makes the state's General Fund operations even more complicated. To stop collecting the fee, the Department of Revenue requires a one-time $28,232 cash injection to reprogram its GenTax software and perform user testing. Because the dedicated cash funds to pay for state tax examiners will disappear, those ongoing personnel costs will actually shift over to the state's General Fund to handle audits of past returns.

More surprisingly, the bill creates wild swings in your TABOR refunds. It shrinks total refunds by $42.8 million in the first year, but actually increases the refund pool by $53.1 million the following year. How does that work? The loss of fee revenue alters the state's economic triggers. That alteration reduces the payouts for certain family tax credits, which inadvertently leaves more money in the general revenue pool, pushing that excess cash back into the general TABOR refund bucket. It is a textbook example of how pulling one lever in Colorado's tax code inevitably moves three others.

Where This Bill Stands

HB26-1266 is currently Dead. The latest official action came on 03/10/2026: House Committee on Transportation, Housing & Local Government Postpone Indefinitely.

That means the bill is no longer advancing this session. In practice, measures that are postponed indefinitely or otherwise declared lost generally stay dead unless they are reintroduced in a future session.