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7 min read

Colorado's New Lien Law: What it Means for Construction

Kristin Alford September 30, 2026

Mechanics Lien Legislative Updates & News Alerts Mechanic's Liens & Bond Claims Preliminary Notices & Construction Credit Bond Claim Lien Waivers
Colorado's New Lien Law: What it Means for Construction

In Brief

Colorado's Senate Bill 26-074 took effect August 12, 2026. It updates both the private mechanic's lien statute and the public construction bond claim statute, allowing liens and bond claims to include disputed amounts and contract-based delay, lost productivity, and disruption costs.

  • The Excessive Lien Penalty: The bill also adds a good-faith safe harbor: a claim isn't automatically "excessive" just because a court later awards less than the amount claimed.
  • Colorado Lien Filing Deadlines: Filing deadlines and notice requirements for mechanic's liens, public improvement liens, and bond claims in Colorado did not change. 

Why Colorado Changed Its Lien and Bond Claim Law

Colorado's mechanic's lien and public works bond claim statutes changed this year. Senate Bill 26-074 was signed into law on April 6, 2026, by Governor Polis, and it took effect August 12, 2026. The changes impact both private mechanic's liens and public construction bond claims, and they shift how much a claimant can include in a claim without risking forfeiture.

Here's what changed, what stayed the same, and how to protect lien and bond claim rights in Colorado.

 

What SB26-074 Changed

The enacted bill amends four sections of Colorado's lien statutes: C.R.S. § 38-22-101 and § 38-22-128 (private mechanic's liens) and C.R.S. § 38-26-107 and § 38-26-110 (public works bond claims). Three changes stand out:

  • Disputed amounts are now allowed. A lien or bond claim can include amounts the parties still disagree on. A claimant no longer has to wait for the owner or contractor to agree on the number before filing.
  • Delay, lost productivity, and disruption costs count. If the contract allows recovery of these costs, they can now be included in the claim amount. This closes a gap that Colorado courts had read into the statute for decades.
  • A good-faith safe harbor now protects reasonable claims. If a court later awards less than the amount claimed, that alone doesn't make the claim excessive. The claimant just needs a good-faith basis for believing the full amount was due at the time of filing.

Why the Good-Faith Safe Harbor Matters

That last point matters. Colorado's excessive mechanic's lien penalty is severe: a claimant who knowingly overstates a lien loses the entire claim and owes the other side's attorney fees. Before SB26-074, that risk pushed many contractors and subcontractors toward conservative, incomplete filings rather than risk the penalty. The new safe harbor narrows that risk considerably for good-faith claims.

 

SB26-074 and the Wadsworth v. Regional Rail Partners Decision

We're covering this case because it answers the exact question SB26-074 answers, in a real, high-dollar dispute, and because of a genuine coincidence: the Colorado Supreme Court decided the case on April 6, 2026, the same day Governor Polis signed SB26-074 into law.

The case arose from a $343 million RTD rail line project. A subcontractor filed a verified statement of claim for roughly $15.8 million, which it later amended down to about $12.8 million after the project owner disputed a retention amount. The Colorado Court of Appeals found the amended claim excessive and held that the subcontractor forfeited all rights to the amount claimed. The Colorado Supreme Court reversed, holding that disputed and unliquidated amounts, including qualifying delay and disruption damages, may lawfully be included in a verified statement of claim under the Public Works Act. SB26-074 codifies and expands on those principles, amending both Colorado's Public Works Act and Mechanics' Lien Act.

 

What Stayed the Same

Filing deadlines and notice requirements stay the same. The bill expands what a claimant can include in the dollar amount, not how or when a lien or claim gets filed.

 

Protecting Your Lien and Bond Claim Rights in Colorado

Colorado recognizes three related but distinct ways to secure payment on a construction project, and each follows its own notice, filing, and lawsuit deadlines under C.R.S. Title 38. Missing any one of these deadlines can mean losing the right to collect, so it helps to know which one applies to your project and what it requires.

1. Mechanic's and Materialman's Lien (Private Projects)

This is the standard lien for private construction work. It gives you a legal claim against the property itself if you're not paid for labor or materials.

Stage What to Do
Notice of Intent Send at least 10 days before filing the lien, to both the owner and the general contractor.
File the lien (commercial) Within 4 months of the last day you supplied labor or materials.
File the lien (residential) Within 2 months of project completion if you want the lien to reach a new buyer of the property; otherwise, within 4 months of your last day on the job.
File suit to enforce Within 6 months of your last day of work, or 6 months from project completion, whichever comes later.
Release the lien As soon as you're paid, and no later than 10 days after the owner asks for a release.

 

Does a Colorado Lien Cover the Full Balance Even If the Owner Already Paid the GC?

On commercial projects, the lien covers the full amount you're owed, even if the owner has already paid the general contractor (i.e. full balance lien state). If you're a laborer paid by the day or the piece, your filing window is 2 months from project completion, a separate rule from the 2-month bona fide purchaser window above. Both happen to run 2 months, but one protects your lien's priority against a new buyer of a residential property, and the other is a general filing deadline for day-rate and piece-rate labor. And if the project runs past a year after you file, you'll need to file a short affidavit confirming the project still isn't finished, within 30 days of each yearly anniversary of your filing.

 

2. Public Improvement Lien (Public Projects)

On public projects, you can't place a lien on the property. Instead, this lien attaches to any project funds the public entity is still holding. It's governed by C.R.S. § 38-26-101 through -110.

Stage What to Do
Preliminary notice Not required by statute, but sending a non-statutory notice is recommended.
File the lien As early as possible, and before the project reaches final settlement, so it attaches to funds still on hand.
File suit to enforce Within 90 days of the project's final settlement.
Release the lien As soon as you're paid.

 

3. Bond Claim (Public Projects)

Many public projects require the general contractor to carry a payment bond instead of allowing a lien. A bond claim is how you collect against that bond if you're not paid.

Stage What to Do
Get a copy of the bond Request it from the public entity as early as possible. Payment bonds are generally required on state contracts over $150,000 and local public works over $50,000.
Preliminary notice Not required by statute, but sending a non-statutory notice is recommended.
File the bond claim No statutory notice deadline but follow the terms written into the bond itself; many bonds require a claim within 90 days of your last day of work.
File suit to enforce Within 6 months of project completion.
Release the claim Withdraw it promptly once you're paid.

 

4. Lien Waivers in Colorado

Lien waivers deserve their own mention, since Colorado handles them differently than many states. Colorado doesn't require a specific waiver form or template, the way California (Civil Code § 8132) and Texas (Property Code § 53.284) do. Any document works as a Colorado lien waiver, as long as it clearly states the intent to waive lien rights and meets one narrow requirement written into statute.

What Must a Colorado Lien Waiver Say?

Under C.R.S. § 38-22-119, every Colorado lien waiver must include a specific statement, in substance, from the person waiving their rights:

“All debts owed to any third party by the person waiving the lien rights and relating to the goods or services covered by the waiver of lien rights have been paid or will be timely paid.”

Leave that statement out, and the waiver risks being unenforceable, even if everything else about it looks standard. Because Colorado doesn't prescribe a form, this sentence (or something clearly equivalent to it) is the one piece of language a compliant Colorado waiver actually has to contain.

Does a General Contractor's Waiver Cover Its Subcontractors Too?

The statute also limits how far a waiver reaches. A lien waiver only binds the parties who actually signed it. If a general contractor waives its own lien rights, that waiver doesn't reach down and waive the rights of an unpaid subcontractor or supplier further down the chain. And because Colorado doesn't prohibit waiving lien rights before work even begins, it's worth reading any contract or waiver language closely before signing it, since an early waiver clause can carry the same effect as one signed at the time of payment.

 

What This Means Going Forward

For Subcontractors and Suppliers

SB26-074 takes some of the pressure off. A good-faith claim that includes delay or disruption costs no longer carries the same forfeiture risk it did before August 2026.

For Owners, General Contractors, and Lenders

The practical effect runs the other way. Lien and bond claim amounts may run larger and include more disputed line items than before, and the excessive lien penalty is harder to use as leverage for conservative filings. Reviewing claims more closely, and resolving payment disputes earlier, become more useful tools under the new law.

None of the underlying deadlines changed. Getting notices and filings in on time, for private liens, public improvement liens, and bond claims alike, still matters as much as it always has.

Staying on top of those deadlines is exactly what NCS Credit's Notice & Lien Services and LienTracker® Online are built to track.

 

Frequently Asked Questions

 

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