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HomeMy WebLinkAboutordinance.council.014-89 ORDINANCE NO./~ (Series of 1989) AN ORDINANCE IMPOSING A GRADUATED REAL ESTATE TRANSFER TAX UPON THE TRANSFER OF INTEREST IN ALL REAL PROPERTY AND PAYABLE BY THE GRANTEE; REQUIRING THE COLLECTION OF SUCH TAX BY THE DIRECTOR OF FINANCE OR HER AGENTS; EXEMPTING CERTAIN TRANSACTIONS FROM THE TAX IMPOSED AND ESTABLISHING PROCEDURES FOR ACQUIRING A CERTIFI- CATE OF EXEMPTION; PROVIDING FOR THE APPLICATION OF FUNDS TO LIMITED USES; ESTABLISHING PENALTIES AND VIOLATIONS OF THIS ORDINANCE AND FOR THE CREATION OF A LIEN ON THE PROPERTY TRANS- FERRED FOR THE AMOUNT OF THE TAX UNPAID; AND FOR MAKING THIS ORDINANCE EFFECTIVE ON JULY 1, 1989, UPON APPROVAL OF THE SAME BY THE ELECTORATE WHEREAS, the City of Aspen, with input from the community and professional consultants, has determined that in order to address the issue of the current housing shortage that vacant land and existing buildings must be purchased and renovated and - construction of new housing must be commenced immediately; and WHEREAS, the City Council desires to impose a graduated real estate transfer tax on every document whereby title to real property situated in the City of Aspen is transferred to alleviate the chronic short-term shortage of housing for community members and to replace monies in the Land Fund for open space acquisitions converted to employee housing uses; and WHEREAS, such a tax must be ratified and approved by the electorate prior to its enforcement all as required by Section 12.1 of the Charter of the city of Aspen. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO: Section 1 - Graduated Real Estate Transfer Tax City Council hereby enacts a graduated real estate transfer tax on every document in writing, whereby title to real property situated in the City of Aspen is transferred, which tax shall be measured by the consideration paid or to be paid for such grant or conveyance and shall be due and payable by the grantee at the time of transfer contemporaneously therewith. The document shall not be recorded whereby or wherein title to real property situ- ated in the City of Aspen is transferred until the real estate transfer tax has been paid or exempted. Section 2 - Definitions For the purposes of this ordinance certain words are defined s follows: a. Document. "Document" means and includes any deed, instrument or writing by which real property located in the City of Aspen is transferred. b. Transfer. "Transfer" means and includes any conveyance of the ownership of a title to real property as evidenced by any deed or instrument or writing wherein or whereby title to real property situated in the City of Aspen is granted or conveyed, subject to the exclusions provided in this ordinance. "Conveyance of ownership" for the purposes of this ordinance means and includes the transfer of more than fifty percent (50%) of the authorized and issued shares of a corporation which has a principal asset of real property situated in the City of Aspen. 2 c. Real Property. "Real property" means and includes all lands or interest in land within the City of Aspen to which title or the right to title has been acquired or ratified by the government of the United States or the State of Colorado. d. Consideration. "Consideration" means and includes the actual cash paid and/or value of the property delivered, or contracted to be paid or delivered, in return for the transfer of ownership or title to real property and shall include the amount of any liens, mortgage, contract indebtedness, or other encum- brance, either given to secure the purchase price, or any part thereof, remaining unpaid on the property at any time at the time of sale. The term does not include the amount of any outstanding lien or encumbrance in favor of the United States, the State of Colorado, or of a municipal or quasi-municipal governmental corporation or district for taxes, special benefits or improve- ments. Section 3 - Amount of Tax The amount of the graduated real estate transfer tax payable shall be computed on a declining schedule of the consideration paid in return for the transfer of ownership or title; the schedule is as depicted on Exhibit "A" as annexed hereto and incorporated herein. City Council may amend the schedule by ordinance, by reduc- ing the schedule term or by reducing the declining schedule insofar as such amendment does not affect City's bonding capa- 3 city, bond rating, or otherwise, adversely affect outstanding bonds issued in furtherance of this ordinance. Section 4 - Lands Affected When a document subject to the ordinance includes property partly located within the City of Aspen and property partly located within another city or in Pitkin County or other coun- ties, the tax imposed under the authority of this ordinance shall be computed only with respect to property located within the City of Aspen and the tax shall be assessed on that part of the consideration fairly attributable to the part of such property located within the City. Section 5 - Director of Finance to Enforce a. The Director of Finance of the city of Aspen is charged with the enforcement of the provisions of this ordinance and is hereby authorized and empowered to prescribe, adopt and enforce rules and regulations pertaining thereto. b. At the time of any transfer upon which a tax is imposed by this ordinance, there shall be made a report to the Director of Finance on forms prescribed by her setting forth the true, complete and actual consideration for the transfer, and aims of the parties thereto, the location of the real estate transferred, and such other information as she may require. c. For the purpose of collection of taxes imposed by this office, the office of the Pitkin County Clerk and Recorder, together with all banks, title companies, escrow companies, 4 building and loan institutions, private mortgage companies, and real estate agents permitted as such to do business under the laws of the State of Colorado maintaining offices within the city of Aspen are hereby authorized and directed to adopt procedures for the collection of said tax. The Director of Finance is directed to negotiate with such appointed agent to allow them to retain a reasonable amount of the sum collected to cover their expenses in the collection and remittance of said tax. Section 6 - Exemptions The real estate transfer tax imposed by this ordinance shall not apply to: a. Any document wherein the United States, or any agency or instrumentality thereof, the State of Colorado, any county, city and county, municipality, district or other political subdivision of the state, is either the grantor or grantee. b. Any document wherein the grantee corporation, associa- tion or trust have been organized, operated and maintained solely and exclusively for charitable or religious purposes. c. Any document granting or conveying title to real property and the consequence of the gift of such property, where no consideration other than love and affection, charitable donation or a nominal compensation is evidenced by the terms of the instrument of transfer. d. Any document terminating or evidencing termination of a joint tenancy in real property except where additional considera- 5 tion and value is paid in connection with such termination, or a decree or agreement partitioning real property held under common ownership unless a consideration of value is paid in connection therewith. e. Transfer of title or change of interest in real pro- perty by reason of death, will or decree of distribution. f. Transfers made pursuant to mergers or consolidation of corporations or by a subsidiary to a parent corporation for no consideration other than cancellation or surrender of the sub- sidiary's stock. g. Any deed or conveyance made and delivered without consideration for the purposes of confirming, correcting, modify- ing or supplementing a transfer previously recorded; making minor boundary adjustments, removing clouds on titles; or granting easements, rights-of-way or licenses. h. Any decree or order of a court of record determining or vesting title, including the final awarding title pursuant to a condemnation proceedings. i. Any deed granting or conveying title to cemetery lots. j. Any lease of real property (or assignment or transfer of any interest in any such lease) provided such lease by its terms does not constitute a de factor conveyance of the subject property. In the latter event, the real estate transfer tax shall be based on the capitalization of five percent (5%) of the average annual rental over the entire term of the lease, includ- ing any renewal term, plus actual consideration, other than rent, paid or to be paid. When the average annual rental cannot be determined, or at the election of the Director of Finance, the tax shall be based on the assessed value of the property covered by the lease. k. Any mineral deed or royalty deed. 1. Transfers to secure a debt or other obligation, or transfers or releases of property which is security for a debt or other obligation. m. Any executory contract for the sale of real property which the vendee is entitled to or does take possession thereof without acquiring thereto, or any assignment or cancellation of any such contract. n. Any deed or conveyance under execution, sale, fore- closure sale under a power sale or court decree of lien fore- closure; sheriff's deed; public trustee deed or treasurer's deed. o. All deed restricted employee housing subject to the Aspen/Pitkin County Housing Authority Guidelines as amended from time to time. p. The first $100,000.00 of all transactions. Section 7 - Application for Exemption In the event any document which is exempt from the real estate transfer tax herein imposed does not contain language clearly showing its intent and character, the grantor or grantee may apply for and obtain from the Director of Finance a certifi- 7 cate of exemption, may be affixed to such deed or instrument of transfer. Any person whose claim of exemption duly applied for under the provisions of this section is denied by the Director of Finance may immediately appeal to the City Council for a deter- mination of such exemption and such appeal shall be considered by the City Council at its next regular meeting. In the event of a determination by City Council favorable to said grantor, any amount previously deposited or so much thereof as may be allowed by the Council shall be promptly refunded to said grantor. A certificate of exemption shall be in substantially the follow- ing form: EXEMPTION FROM REAL ESTATE TRANSFER TAX STATE OF ) ) ss. County of ) The undersigned, as grantor or grantee of the deed or instrument of conveyance for (grantor) to (grantee) dated , transferring the following described property, situate in the State of Colorado, County of Pitkin, City of Aspen: hereby does apply for an exemption from the payment of the graduated real estate transfer tax imposed by Ordinance No. 14 (Series of 1989) of the City of Aspen. The basis for such exemption is as follows: (state briefly the grounds for exemp- tion, including applicable section and subdivision of Ordinance No. 14 (Series of 1989). (Signature) STATE OF COLORADO ) ) ss. County of Pitkin ) 8 Subscribed and sworn to before me this day of , 1989, by . WITNESS MY HAND AND OFFICIAL SEAL. My commission expires: Notary Public Address CERTIFICATION OF EXEMPTION I hereby certify that the above-described transfer of real property is exempt from the payment of the graduated real estate transfer tax under Ordinance No. 14 (Series of 1989), Section ( ). (Signature) Section 8 - Application of Funds a. All funds received by the City of Aspen pursuant to this ordinance shall be deposited in a fund which fund has already been created. The fund shall be subject to appropriation by City Council of the City of Aspen, or its designee, only for the purpose of acquiring vacant land, acquiring buildings for the purposes of employee housing, for the construction, reconstruc- tion of employee housing, maintenance of employee housing build- ings and property, for the operation of employee/community housing projects, for the payment of principal and interest on the bonds issued for such purposes and incidental costs of issuing the bonds and the funding of any reserve therefor, and 9 for repayment of the Land Fund for open space acquisitions converted to employee housing purposes and for payment of all costs, including, without limitation, legal fees, associated therewith. b. The City Council, pursuant to ordinance, and without an election, may borrow money, issue bonds, or otherwise extend the credit of the City for the acquisition of vacant land, acquisi- tion of existing buildings for employee housing, construction and reconstruction of employee housing, maintenance of employee housing, repayment to the Land Fund of open space acquisitions converted to employee housing purposes, and operation of employee housing projects, providing that such bonds or other community obligations shall be made payable from the funds derived from this ordinance. Section 9 - Penalties and Liens a. All taxes imposed by this ordinance, if not paid when due, shall bear interest at the rate of eighteen percent (18%) per annum until so paid. The amount of the graduated real estate transfer tax imposed by this ordinance and interest due thereon is hereby assessed against the property upon the transfer of which said tax is imposed, and if not paid when due, such tax and interest, if any, shall constitute a lien on the property for the amount thereof, which lien shall continue until the amount thereof is paid or until it is discharged or recorded by foreclo- sure or otherwise. 10 b. Any person who shall fail or refuse to pay any tax due thereunder shall be punished by a fine not exceeding Three Hundred Dollars ($300.00) or imprisonment for a period of not more than ninety (90) days, or both such fine and imprisonment. c. Any remedies provided for herein shall be cumulative not exclusive and shall be in addition to any other remedies provided by law. Section 10 - Effective Date The provisions of this ordinance shall be effective upon the 1st day of July, 1989, provided that the electorate approve the imposition of this excise tax pursuant to the requirements of Section 12.1 of the Charter of the City of Aspen, Colorado. Section 11 - Duration of Ordinance This ordinance shall continue effective insofar as the levy of the graduated real estate transfer tax is concerned through December 31, 1994; and insofar as the collection of the tax levied in the aforesaid period and actions for proceedings for collecting any tax so levied, including interest and penalties thereon, and enforcing any of the provisions in this ordinance are concerned, this ordinance shall continue effectively until all of said taxes levied in the aforesaid period are fully paid and any and all suits or prosecutions for the collection of said tax and for the punishment of violations of this ordinance shall have been fully terminated. 11 Section 12 - Provisions Irrepealable or Unamendable After the approval of the electorate for the imposition of this excise tax, Section 3 and 8(a) providing for the amount of the tax and the application of the funds shall be and remain irrepealable and unamendable without the approval of the elec- torate for the repeal or the amendment pursuant to the require- ments of Section 12.1 of the Charter of the City of Aspen, Colorado. Section 13 - Severability If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held invalid or unconstitutional in a court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and shall not affect the validity of the remaining portions thereof. Section 14 Nothing in this ordinance shall be construed to affect any right, duty or liability under any ordinances in effect prior to the effective date of this ordinance, and the same shall be continued and concluded under such prior ordinances. Section 15 A public hearing on the ordinance shall be held on the~ day of ~/~~--~ , 1989, in the City Council Chambers, Aspen City Hall, Aspen, Colorado. 12 INTRODUCED, READ AND ORDERED PUBLISHED as provided by law by the City Council of the City of Aspen on the ,,~,'~'-~ day of ~'L,'L,.~LA.~ 1989 William L. St~rling, Ma~or ATTEST: Kath~n ~ Koch, City Clerk FINALLY adopted, passed and approved this /~ day of ~ , 1989. William L. S~irling, Mayor ATTEST: Ka~yn S~ Koch, City Cler~ 13 DECLINING SCHEDULE GRADUATED REAL ESTATE TRANSFER TAX The Graduated Real Estate Transfer Tax payable shall be computed on the declining schedule of the consideration paid in return for the transfer of ownership or title as follows: Ownership holding period of 0-1 years 2.5% Ownership holding period of 1-2 years 2.0% Ownership holding period of 2-3 years 1.5% Ownership holding period of 3-4 years 1.0% Ownership holding period of 4-5 years .5%