Colorado's 2025: Progress on Red Tape, Major Setbacks for Business Freedom

When states compete for business investment and talent, they need to get the fundamentals right: lower taxes, streamlined regulations, and policies that respect both entrepreneurs and employees. Colorado's 2025 demonstrated why these principles matter and what happens when they're neglected. The state made meaningful progress on regulatory audits and announced several significant job-creation deals, but lawmakers also passed policies that drove major employers away and signaled that Colorado may not be as business-friendly as it once was. 

The Wins: Colorado's Regulatory Reform and Economic Development

Colorado entered 2025 with momentum on regulatory reform and made concrete strides toward cutting red tape, a critical competitive advantage in the increasingly crowded race for business investment.

Auditing Regulations to Cut Red Tape

Senate Bill 25-306, signed into law in 2025, requires performance audits within state agencies such as the Department of Public Health and Environment and the Department of Labor and Employment, precisely where many of the state's newer regulations are enforced.

The bill requires the state auditor to conduct performance audits to help the state identify regulations that are outdated, duplicative, or ineffective – and eventually cut red tape, potentially saving businesses and residents millions of dollars.

This is important because Colorado's air pollution control laws are particularly strict. Industries that deal extensively with air-quality permitting and compliance – energy, manufacturing, construction, and other emission-intensive operations – are likely to benefit significantly if audits identify regulations that have become outdated, duplicative, or inefficient.

The symbolism here matters too. It shows that Colorado recognizes an important truth: regulations don't always make sense just because they exist, and periodic audits are necessary to ensure that rules actually serve their intended purpose rather than simply creating unnecessary burden.

RK Industries: Over 1,700 New Jobs in Aurora

Governor Jared Polis and RK Industries announced in 2025 that the construction, manufacturing, advanced fabrication, and building services company would relocate and expand its headquarters into a 154,000+ square-foot facility in Aurora. The move is expected to produce over 1,700 new jobs over the next eight years, providing significant annual wages for Adams County.

This is what pro-business policy delivers. Colorado's business tax credits attract and grow companies in ways that translate into more jobs, better jobs, economic improvements in struggling areas, and a stronger long-term tax base for Coloradans. RK is a leader in workforce development through its accredited apprenticeship programs and is a heavy investor in workforce training. A more skilled workforce strengthens the communities where Colorado's employees live and work.

Quantum Technology Hub: $4.3 Million to Attract Advanced Manufacturing

Colorado's Economic Development Commission recently offered a $4.3 million incentive package to bring a quantum tech company to the state's federally designated quantum tech hub. The currently unnamed company is expected to add 195 jobs with an average wage of $110,000 to Colorado.

This demonstrates that when states invest strategically in emerging industries, they can shape the future economy in their favor. Colorado's focus on quantum technology is forward-looking and has the potential to position the state as a leader in one of the most important technological domains of the coming decades.

Raven Space Systems: 392 Jobs with $130,000+ Average Wages

In August 2025, Governor Polis and Raven Space Systems, a 3D printing company specializing in aerospace-grade materials, announced that Raven had selected Broomfield, Colorado, for its headquarters and manufacturing facility. Raven expects to create up to 392 net new jobs with an average annual wage of $130,867, which is 19% higher than the average annual wage in the locale.

This will be a major economic boost for Broomfield County and the greater Denver metropolitan area. Over time, these tax credits will pay dividends for the state as revenue from these high-wage jobs flows into the state budget and local economies.

The Setbacks: Taxes, Union Power, and Misguided Healthcare Regulation

Despite progress on regulatory audits and job announcements, Colorado's 2025 also featured several policy decisions that undermine the business-friendly image the state has worked to cultivate. These decisions sent the wrong signal to employers and potentially contributed to at least one major company's decision to leave the state.

Rolling Back Tax Credits: Raising Costs on Business

To plug budget shortfalls in 2025, Governor Polis held a special legislative session that produced bills rolling back $153.2 million in business tax breaks. Business leaders criticized the bills, arguing that the rollbacks would only lead to greater revenue declines over time.

Here's the economic reality: more taxes mean reduced profitability, less available capital for investment, and potential shifts in business operations. Tax rollbacks also mean less money available for innovation and employment expansion. States that raise taxes on businesses don't become more attractive to employers; they become less attractive.

This decision, while understandable given budget pressures, sends the wrong signal at a critical moment when Colorado is trying to compete for major employers and investment.

TIAA's Departure: A Wake-Up Call

TIAA, one of Denver's largest employers in the financial services sector, announced that it would relocate, along with nearly 1,000 jobs, to Frisco, Texas, in July 2026. Among TIAA's reasons for leaving: to realize savings in "operational costs" and to "invest in business needs that align with our strategy."

Translation: Colorado was too expensive and too heavily regulated.

TIAA's departure is more than a statistic; it's a wake-up call. When major employers are leaving for lower-cost, lower-regulation states like Texas, it signals that Colorado's competitive position is slipping. The state's business community is expressing concern through the Colorado Chamber of Commerce, which regularly calls out the regulatory burdens that make Colorado less attractive than competitors.

One thousand jobs leaving the state is a significant loss. And TIAA won't be the last if Colorado doesn't address the fundamental issues: taxes, regulations, and cost of doing business.

What Colorado's 2025 Teaches Us

The lesson to be learned from Colorado’s 2025 business track record is stark: progress on one front means little if you're moving backward on others. States that want to attract and retain businesses need to get the fundamentals right across the board—taxes, regulations, labor policy, and healthcare rules all matter.

Colorado got some things right in 2025. SB 25-306's regulatory audits, the RK Industries expansion, Raven Space Systems' commitment, and Quantum technology hub investments are all positive signs.

But the $153.2 million in tax credit rollbacks and TIAA's departure to Texas are troubling signals that suggest Colorado's competitive position may be eroding.

As Colorado heads into 2026, state leaders need to send a clear message: the Centennial State is open for business, committed to cutting red tape, and willing to compete for investment and jobs. The regulatory audits should translate into concrete red-tape cutting. Tax policy should reward, not punish, business investment. And lawmakers should trust markets and entrepreneurs to solve problems better than government mandates.