[HISTORY: Adopted by the Borough Council of the Borough of Lake City 12-22-1986 by Ord. No. 272-86. Amendments noted
where applicable.]
This chapter shall be known as the "Realty Transfer Tax of the Lake
City Borough."
A realty transfer tax for general revenue purposes is hereby imposed
upon the transfer of real estate or interest in real estate situated within
the Lake City Borough, regardless of where the documents making the transfer
are made, executed or delivered, or where the actual settlements on such transfer
took place as authorized by Article XI-D, Local Real Estate Transfer Tax,
72 P.S. § 8101-D et seq.
For the purposes of this chapter, the following terms shall have the
meanings indicated:
A partnership, limited partnership or any other form of unincorporated
enterprise owned or conducted by two or more persons other than a private
trust or decedent's estate.
A corporation, joint-stock association, business trust or banking
institution which is organized under the laws of this commonwealth, the United
States or any other state, territory, foreign country or dependency.
Any deed, instrument or writing which conveys, transfers, demises, vests, confirms or evidences any transfer or demise of title to real estate, but does not include wills, mortgages, deeds of trust or other instruments of like character given as security for a debt and deeds of release thereof to the debtor, land contracts whereby the legal title does not pass to the grantee until the total consideration specified in the contract has been paid or any cancellation thereof unless the consideration is payable over a period of time exceeding 30 years, or instruments which solely grant, vest or confirm a public utility easement. "Document" shall also include a declaration of acquisition required to be presented for recording under § 65-2 of this chapter.
A corporation of which at least 75% of its assets are devoted to
the business of agriculture and at least 75% of each class of stock of the
corporation is continuously owned by members of the same family. The business
or agriculture shall not be deemed to include:
Recreational activities, such as but not limited to hunting, fishing,
camping, skiing, show competition or racing;
The raising, breeding or training of game animals or game birds, fish,
cats, dogs or pets or animals intended for use in sporting or recreational
activities;
Fur farming;
Stockyard and slaughterhouse operations; or
Manufacturing or processing operations of any kind.
Any individual, such individual's brothers and sisters, the
brothers and sisters of such individual's parents and grandparents, the
ancestors and lineal descendants of any of the foregoing, a spouse of any
of the foregoing and the estate of any of the foregoing. Individuals related
by the half blood or legal adoption shall be treated as if they were related
by the whole blood.
Every natural person, association or corporation. Whenever used in
any clause prescribing and imposing a fine or imprisonment, or both, the term
"person," as applied to associations, shall include the responsible members
or general partners thereof and, as applied to corporations, the officers
thereof.
All lands, tenements or hereditaments within the Borough of Lake City,
including without limitation, buildings, structures, fixtures, mines, minerals,
oil, gas, quarries, spaces with or without upper or lower boundaries, trees
and other improvements, immovables or interests which by custom, usage or
law pass with a conveyance or land, but excluding permanently attached machinery
and equipment in an industrial plant.
A condominium unit.
A tenant-stockholder's interest in a cooperative housing corporation,
trust or association under a proprietary lease of occupancy agreement.
A corporation or association which is primarily engaged in the business
of holding, selling or leasing real estate, 90% or more of the ownership interest
in which is held by 35 or fewer persons and which:
Derives 60% or more of its annual gross receipts from the ownership
or disposition of real estate; or
Holds real estate, the value of which comprises 90% or more of the value
of its entire tangible asset holdings exclusive of tangible assets which are
freely transferable and actively traded on an established market.
Any interest in real estate which endures for a period of time, the
termination of which is not fixed or ascertained by a specific number of years,
including without limitation an estate in fee simple, life estate or perpetual
leasehold; or
Any interest in real estate enduring for a fixed period of years but
which, either by reason of the length of the term or the grant of a right
to extend the term be renewal or otherwise, consists of a group of rights
approximately those of an estate in fee simple, life estate or perpetual leasehold,
including without limitation a leasehold interest or possessory interest under
a lease or occupancy agreement for a term of 30 years or more or a leasehold
interest or possessory interest in real estate in which the lessee has equity.
The making, executing, delivering, accepting or presenting for recording
of a document.
In the case of any bona fide sale of real estate at arm's length
for actual monetary worth, the amount of the actual consideration therefor,
paid or to be paid, including liens or other encumbrances thereon existing
before the transfer and not removed thereby, whether or not the underlying
indebtedness is assumed, and ground rents, or a commensurate part thereof
where such liens or other encumbrances and ground rents also encumber or are
charged against other real estate, provided that where such documents shall
set forth a nominal consideration, the "value" thereof shall be determined
from the price set forth in or actual consideration for the contract of sale:
In the case of a gift, sale by execution upon a judgment or upon the
foreclosure of a mortgage by a judicial officer, transactions without consideration
or for consideration less than the actual monetary worth of the real estate,
a taxable lease, an occupancy agreement, a leasehold or possessory interest,
any exchange of properties, or the real estate of an acquired company, the
actual monetary worth of the real estate determined by adjusting the assessed
value of the real estate for local real estate tax purposes for the common
level ratio factor developed by the Pennsylvania Department of Revenue for
Pennsylvania realty transfer tax base calculations;
The actual consideration for or actual monetary worth of any executory
agreement for the construction of buildings, structures or other permanent
improvements to real estate between the grantor and other persons existing
before the transfer and not removed thereby or between the grantor, the agent
or principle of the grantor of a related corporation, association or partnership
and the grantee existing before or effective with the transfer.
A.
Every person who makes, executes, delivers, accepts or
presents for recording any document or in whose behalf any document is made,
executed, delivered, accepted or presented for recording, shall be subject
to pay for and in respect to the transaction or any part thereof, a tax at
the rate of 1% of the value of the real estate represented by such document,
which tax shall be payable at the earlier of the time the document is presented
for recording or within 30 days of acceptance of such document or within 30
days of becoming an acquired company.
B.
The payment of the tax imposed herein shall be evidenced
by the affixing of an official stamp or writing by the recorder whereon the
date of the payment of the tax, amount of the tax and the signature of the
collecting agent shall be set forth.
C.
It is the intent of this resolution that the entire burden
of the tax imposed herein on a person or transfer shall not exceed the limitations
prescribed in the Local Tax Enabling Act, Act of December 31, 1965, P.L. 1257,
53 P.S. § 6901 et seq., so that if any other political subdivision
shall impose or hereafter shall impose such tax on the same person or transfer,
then the tax levied by Lake City Borough under the authority of that Act shall,
during the time such duplication that the tax exists, except as hereinafter
otherwise provided, be 1/2 of the rate, and such 1/2 rate shall become effective
without any action on the part of Lake City Borough; provided, however, that
Lake City Borough and any other political subdivision which impose such tax
on the same person or transfer may agree that, instead of limiting their respective
rates to 1/2 of the rate herein provided, they will impose respectively different
rates, the total of which shall not exceed the maximum rate permitted under
the Local Tax Enabling Act.
D.
If for any reason the tax is not paid when due, interest
at the rate in effect at the time the tax is due, shall be added and collected.
The United States, the commonwealth or any of their instrumentalities,
agencies or political subdivisions shall be exempt from payment of the tax
imposed by this chapter. The exemption of such governmental bodies shall not,
however, relieve any other party to a transaction from liability for the tax.
A.
The tax imposed by § 65-4 shall not be imposed upon:
(1)
A transfer to the commonwealth, or to any of its instrumentalities,
agencies or political subdivisions, by gift. dedication or deed in lieu of
condemnation or deed of confirmation in connection with condemnation proceedings,
or a reconveyance by the condemning body of the property condemned to the
owner of record at the time of condemnation which reconveyance may include
property fine adjustments, provided that said reconveyance is made within
one year from the date of condemnation.
(2)
A document which Lake City Borough is prohibited from
taxing under the Constitution or statutes of the United States.
(3)
A conveyance to a municipality, township, school district
or county pursuant to acquisition by the municipality, township, school district
or county of a tax-delinquent property at a Sheriff's sale or Tax Claim
Bureau sale.
(4)
A transfer for no nominal actual consideration which
corrects or confirms a transfer previously recorded, but which does not extend
or limit existing record legal title or interest.
(5)
A transfer of division in kind for no nominal actual
consideration of property passed by testate or intestate succession and held
by covenants; however, if any of the parties takes shares greater in value
than their undivided interest, tax is due on the excess.
(6)
A transfer between husband and wife, between persons
who were previously husband and wife who have since been divorced, provided
that the property or interest therein subject to such transfer was acquired
by the husband and wife or husband or wife prior to the granting of the final
decree in divorce; between parent and child or the spouse of such child, between
brother or sister or the spouse of a brother or sister and brother or sister
or the spouse of a brother or sister; and between a grandparent and grandchild
or the spouse of such grandchild, except that a subsequent transfer by the
grantee within one year shall be subject to tax as if the grantor were making
such transfer.
(7)
A transfer for no or nominal actual consideration of
property passing by testate or intestate succession from a personal representative
of a decedent to the decedent's devisee or heir.
(8)
A transfer for no or nominal actual consideration to
a trustee of an ordinary trust where the transfer of the same property would
be exempt if the transfer was made directly from the grantor to all of the
possible beneficiaries, whether or not such beneficiaries are contingent or
specifically named. No such exemption shall be granted unless the Recorder
of Deeds is presented with a copy of the trust instrument that clearly identifies
the grantor and all possible beneficiaries.
(9)
A transfer for no or nominal actual consideration from
a trustee to a beneficiary of an ordinary trust.
(10)
A transfer for no or nominal actual consideration from
a trustee to a successor trustee.
(11)
A transfer for no or nominal actual consideration between
principal and agent or straw party; or from or to an agent or straw party
where, if the agent or straw party were his principal, no tax would be imposed
under this chapter. Where the document by which title is acquired by a grantee
or statement of value fails to set forth that the property was acquired by
the grantee from, or for the benefit of, his principal, there is a rebuttable
presumption that the property is the property of the grantee in his individual
capacity if the grantee claims an exemption from taxation under this claim.
(12)
A transfer made pursuant to the statutory merger or consolidation
of a corporation or statutory division of a nonprofit corporation, except
where the department reasonably determines that the primary intent for such
merger, consolidation or division is avoidance of the tax imposed by this
chapter.
(13)
A transfer from a corporation or association of real
estate held of record in the name of the corporation or association where
the grantee owns stock of the corporation or an interest in the association
in the same proportion as his interest in or ownership of the real estate
being conveyed and where the stock of the corporation or the interest in the
association has been held by the grantee for more than two years.
(14)
A transfer from a nonprofit industrial development agency
or authority to a grantee of property conveyed by the grantee to that agency
or authority as security for a debt or the grantee or a transfer to a nonprofit
industrial development agency or authority.
(15)
A transfer from a nonprofit industrial development agency
or authority to a grantee purchasing directly from it, but only if the grantee
shall directly use such real estate for the primary purpose of manufacturing,
fabricating, compounding, processing, publishing, research and development,
transportation, energy conversion, energy production, pollution control, warehousing
or agriculture; and if the agency or authority has the full ownership interest
in the real estate transferred.
(16)
A transfer by a mortgagor to the holder of a bona fide
mortgage in default in lieu of a foreclosure or a transfer pursuant to a judicial
sale in which the successful bidder is the bona fide holder of a mortgage,
unless the holder assigns the bid to another person.
(17)
A transfer between religious organizations or other bodies
or persons holding title for a religious organization if such real estate
is not being or has not been used by such transferor for commercial purposes.
(18)
A transfer to a conservancy which possesses a tax exempt
status pursuant to Section 501(c)(3) of the Internal Revenue Code of 1954
[68A Stat. 3, 26 U.S.C. § 501(c)(3)] and which has as its primary
purpose preservation of land for historic, recreational, scenic, agricultural
or open space opportunities.
(19)
A transfer of real estate devoted to the business of
agriculture to a family farm corporation by a member of the same family which
directly owns at least 75% of each class of the stock thereof.
(20)
A transfer between members of the same family of an ownership
interest in a real estate company or family-farm corporation.
(21)
A transaction wherein the tax due is $1 or less.
(22)
Leases for the production or extraction of coal, oil,
natural gas or minerals and assignments thereof.
B.
In order to exercise any exclusion provided in this section,
the true, full and complete value of the transfer shall be shown on the statement
of value. A copy of the Pennsylvania realty transfer tax statement of value
may be submitted for this purpose. For leases of coal, oil, natural gas or
minerals, the statement of value may be limited to an explanation of the reason
such document is not subject to tax under this chapter.
Except as otherwise provided in § 65-6, documents which make, confirm or evidence any transfer or demise of title to real estate between associations or corporations and the members, partners, shareholders or stockholders thereof are fully taxable. For the purposes of this chapter, corporations and associations are entities separate from their members, partners, stockholders or shareholders.
A.
A real estate company is an acquired company upon a change
in the ownership interest in the company, however effected, if the change
does not affect the continuity of the company; and of itself or together with
prior changes has the effect of transferring, directly or indirectly, 90%
or more of the total ownership interest in the company within a period of
three years.
B.
With respect to real estate acquired after February 16,
1986, a family-farm corporation is an acquired company when, because of voluntary
or involuntary dissolution, it ceases to be a family-farm corporation or when,
because of issuance or transfer of stock or because of issuance or transfer
of stock or because of acquisition or transfer of assets that are devoted
to the business of agriculture, it fails to meet the minimum requirement of
a family-farm corporation under this resolution.
C.
Within 30 days after becoming an acquired company, the
company shall present a declaration of acquisition with the Recorder of each
county in which it holds real estate for the affixation of documentary stamps
and recording. Such declaration shall set forth the value of real estate holdings
of the acquired company in such county. A copy of the Pennsylvania realty
transfer tax declaration of acquisition may be submitted for this purpose.
A.
Where there is a transfer of a residential property by
a licensed real estate broker which property was transferred to him within
the preceding year as consideration for the purchase of other residential
property, a credit for the amount of the tax paid at the time of the transfer
to him shall be given to him toward the amount of the tax due upon the transfer.
B.
Where there is a transfer by a builder of residential
property which was transferred to the builder within the preceding year as
consideration for the purchase of new, previously unoccupied residential property,
a credit for the amount of the tax paid at the time of the transfer to the
builder shall be given to the builder toward the amount of the tax due upon
the transfer.
C.
Where there is a transfer of real estate which is leased
by the grantor, a credit for the amount of tax paid at the time of the lease
shall be given the grantor toward the tax due upon the transfer.
D.
Where there is a conveyance by deed of real estate which
was previously sold under a land contract by the grantor, a credit for the
amount of tax paid at the time of the sale shall be given the grantor toward
the tax due upon the deed.
E.
If the tax due upon the transfer is greater than the
credit given under this section, the difference shall be paid. If the credit
allowed is greater than the amount or tax due, no refund or carry-over credit
shall be allowed.
In determining the term of a lease, it shall be presumed that a right
or option to renew or extend a lease will be exercised if the rental charge
to the lessee is fixed or if a method for calculating the rental charge is
established.
The tax herein imposed shall be fully paid, and have priority out of
the proceeds of any judicial sale of real estate before any other obligation,
claim, lien, judgment, estate or costs of the sale and of the writ upon which
the sale is made, except the state realty transfer tax, and the Sheriff or
other officer conducting said sale shall pay the tax herein imposed out of
the first moneys paid to him in connection therewith. If the proceeds of the
sale are insufficient to pay the entire tax herein imposed, the purchaser
shall be liable for the remaining tax.
A.
As provided in 16 P.S. § 11011-6, as amended
by Act of July 7, 1983 (P.L. 40, No. 21), the Recorder of Deeds shall be the
collection agent for the local realty transfer tax, including any amount payable
to Lake City Borough based on a redetermination of the amount of tax due by
the Commonwealth of Pennsylvania of the Pennsylvania realty transfer tax,
without compensation from Lake City Borough.
B.
In order to ascertain the amount of taxes due when the
property is located in more than one political subdivision, the Recorder shall
not accept for recording such a deed unless it is accompanied by a statement
of value showing what taxes are due each municipality.
C.
On or before the 10th of each month, the Recorder shall
pay over to the Lake City Borough all local realty transfer taxes collected,
less 2% for use of the county, together with a report containing the information
as is required by the Commonwealth of Pennsylvania in reporting collections
of the Pennsylvania realty transfer tax. The 2% commission shall be paid to
the county.
D.
Upon a redetermination of the amount of realty transfer
tax due by the Commonwealth of Pennsylvania, the Recorder shall rerecord the
deed or record the additional realty transfer tax form only when both the
state and local amounts and a rerecording or recording fee has been tendered.
E.
If additional realty transfer tax is determined to be
due to the Commonwealth, the Recorder of Deeds for Erie County shall collect
a like amount for Lake City Borough, but without interest and penalty; if
a refund is determined to be due by the commonwealth, the Recorder of Deeds
for Erie County shall refund a like amount, without interest and charge said
refund to Lake City Borough on the monthly report for the month in which the
refund is made.
Every document lodged with or presented to the Recorder of Deeds for
recording, shall set forth therein and as a part of such document the true,
full and complete value thereof, or shall be accompanied by a statement of
value executed by a responsible person connected with the transaction showing
such connection and setting forth the true, full and complete value thereof
or the reason, if any, why such document is not subject to tax under this
chapter. A copy of the Pennsylvania realty transfer tax statement of value
may be submitted for this purpose. The provisions of this subsection shall
not apply to any excludable real estate transfers which are exempt from taxation
based on family relationship. Other documents presented for the affixation
of stamps shall be accompanied by a certified copy of the document and a statement
of value executed by a responsible person connected with the transaction showing
such connection and setting forth the true, full and complete value thereof
or the reason, if any, why such document is not subject to tax under this
chapter.
A.
If any part of any underpayment of tax imposed by this
chapter is due to fraud, there shall be added to the tax an amount equal to
50% of the underpayment.
B.
In the case of failure to record a declaration required
under this chapter on the date prescribed therefor, unless it is shown that
such failure is due to reasonable cause, there shall be added to the tax 5%
of the amount of such tax if the failure is for not more than one month, with
an additional 5% for each additional month or on thereof during which such
failure continues, not exceeding 50% in the aggregate.
The tax imposed by this chapter shall become a lien upon the lands,
tenements or hereditaments, or any interest therein, lying, being situated,
wholly or in part within the boundaries of Lake City Borough, which lands,
tenements, hereditaments or interest therein, are described in or conveyed
by or transferred by the deed which is the subject of the tax imposed, assessed
and levied by this chapter, said lien to begin at the time when the tax under
this chapter is due and payable, and continue until discharge by payment,
or in accordance with the law, and the solicitor is authorized to file a municipal
or tax claim in the Court of Common Pleas of Erie County, in accordance with
the provisions of the Municipal Claims and Liens Act of 1923, 53 P.S. § 7101
et seq., its supplements and amendments.
A.
All taxes imposed by this chapter, together with interest
and penalties prescribed herein, shall be recoverable as other debts of like
character are recovered.
B.
The Treasurer of Lake City Borough is charged with enforcement
and collection of tax and is empowered to promulgate and enforce reasonable
regulations for enforcement and collection of the tax. The regulations which
have been promulgated by the Pennsylvania Department of Revenue under 72 P.S.
§ 8101-C et seq. are incorporated into and made a part of this chapter.
