In Colorado, a landlord must return the entire security deposit when the tenant vacates, which means he can't take out money for the usual wear and tear in a building, such as needing new paint, cleaning carpets and stove drip pans. The law is clear about this, and it states as follows:
No security deposit shall be retained to cover normal wear and tear. In the event that actual cause exists for retaining any portion of the security deposit, the landlord shall provide the tenant with a written statement listing the exact reasons for the retention of any portion of the security deposit.
He can withhold some of the security deposit only if you, the tenant, agreed to have him perform work at your expense. I'm sure that's not the case here.
In your state, if the landlord wrongfully withholds the security deposit for any reason, he can be liable as follows:
The willful and wrongful retention of a security deposit in violation of this section shall render a landlord liable for triple the amount of that portion of the security deposit wrongfully withheld from the tenant, together with reasonable attorney fees and court costs.
Your landlord is doing usual wear and tear repairs and updating. This is not allowed to come out of your security deposit. If he says it does, you may want to discuss this with a landlord-tenant attorney, but if you're still living there, and expect to be there awhile, you may just want a consult with a landlord-tenant attorney (ask for a free consultation) and then you can decide if you want to do anything. You can also write a letter to the landlord, if he's planning on taking money out, stating that this is not permissible under Colorado law, that he must return the deposit in full under (C.R.S. 38-12-103(1) otherwise he will be liable for triple damages under C.R.S. 38-12-103(2) and (3a), attorneys fees and court costs.