Editor’s note: This story was updated to accurately reflect the estimated revenue from a proposed rental car fee.

A train that would take passengers from Denver to Steamboat Springs and Craig is inching closer to reality after a bill that could create the first dedicated funding for the project was introduced Tuesday in the state legislature. 

Senate Bill 184 would create a fee of up to $3 per day on rental cars in the state with the hope of using that revenue — estimated at $50 million per year — to entice the federal government to help fund transit projects in Colorado.  

The hope is that the state would be able to use the funds to secure a chunk of the $66 billion from the Infrastructure Investment and Jobs Act set aside by Congress in 2021 for rail development in the country. 

“We actually have a real ability in a short window to get the funding necessary to turn these projects into reality,” said Senate President Steve Fenberg, D-Boulder, a prime sponsor of the bill. 

Federal grants can pay for up to 80% of a project with a 20% matching requirement, Fenberg said.

Sonja Macys, a county commissioner in Routt County, said the bill will help acquire the federal government match “without placing an undue burden on hardworking Coloradans.” 

Senate Minority Leader Paul Lundeen, a Colorado Springs Republican, called the rail projects a “rabbit hole.”

“We don’t need more fees, people. The people of Colorado need relief from fees and Democrat projects that burden their lives,” he said.

House Speaker Julie McCluskie, D-Dillon, Sen. Janice Marchman, D-Loveland, and Rep. Andrew Bosenecker, D-Fort Colllins, are also prime sponsors of the bill. 

The financing arm of the Colorado Department of Transportation would be charged with finding the best way to leverage the revenue from the fee to secure that federal funding. The mountain rail project, a train along the Front Range and an expansion of statewide bus service would all be short-term priorities for the ongoing revenue. 

Making a shortlist

The bill doesn’t specifically require funding to go to any of those projects because details of each of the options, including cost, timelines and service plans, are unknown.

“It’s too early to say exactly which projects it’s going to fund in the very near term but we narrowed the projects it should prioritize,” Fenberg said. 

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The mountain rail project would modify the already-existing rail line from Denver to Winter Park and extend it to Steamboat Springs, Hayden and Craig. There are already existing train tracks spanning the route but they are used exclusively for coal freight. That rail line will continue to be used by coal producers until their scheduled shutdown in late 2028 but could be shared by a passenger rail line. 

The Front Range rail project would begin with a first phase from Denver to Fort Collins with the hope of later extending to Pueblo. 

Gov. Jared Polis has honed in on expanding the state’s passenger train lines with the hopes it could also improve housing affordability. Polis has said he wants to make the Denver to Winter Park line year-round instead of just during ski season, adding multiple trips per day, decreasing the cost and even shortening the ride to the resort. 

In December, the federal government identified Colorado as a possible recipient of funding from the $66 billion set aside by the Bipartisan Infrastructure Act to boost rail across the country. 

The bill has been assigned to the Transportation and Energy committee.