[Adopted 11-8-1974 as Ch. 7, Art. I, of the 1974 Code]
As used in this article, the following terms shall have the meanings indicated:
DEED
Includes any instrument or writing pursuant to which title or possession of any real estate situate within the corporate limits of the City which shall be quitclaimed, granted, bargained, sold, conveyed or transferred by a seller, vendor, grantor, assignor or transferor to any purchaser, buyer, vendee, grantee, assignee or transferee, except as provided in § 245-2.
LEASE
Includes any document or instrument in writing transferring or purporting to transfer a title or possessory interest by a seller, vendor, lessor, assignor or transferor to any purchaser, buyer, vendee, lessee, assignee or transferee in or to any of the following:
A. 
A condominium unit or any property or properties subject to the Unit Property Act (25 Del. C. § 2201 et seq.) for a determinable term of five years or more.
B. 
An interest in land owned by another and/or improvements owned by another located on land owned by another for a determinable term of five years or more.
C. 
The exercise of any right or option to renew or extend the title or possessory interest in an existing document or instrument in writing when such renewal or extension is for a period of five years or more.
D. 
Any writing purporting to transfer a title interest or possessory interest of any lessee or other person in possession of real estate owned by the state or other political subdivision thereof.
[Added 7-20-1998 by Ord. No. 798-1]
TRANSACTION
Includes the making, executing, delivering, accepting or presenting for recording of a deed or lease as defined herein.
[Amended 7-20-1998 by Ord. No. 798-1]
VALUE
Includes, in the case of a deed or lease, the amount of the actual consideration thereof, including liens or other encumbrances thereon and ground rents or commensurate part of the liens or other encumbrances thereon which encumber the interest in real estate and other interest in real estate conveyed; provided that in the case of a transfer for an amount less than the highest appraised full value of said property, lands, tenements or hereditaments pursuant to the amount of the assessment as shown on the books of the City, "value" shall mean the highest such appraised value unless the parties, or one of them, can demonstrate that fair market value is less than the highest appraised value, in which case "value" shall mean fair market value or actual consideration, whichever is greater. A demonstration that the transaction was at arm's length between unrelated parties shall be sufficient to demonstrate that the transaction was at fair market value.
[Amended 7-20-1998 by Ord. No. 798-1]
[Amended 4-8-1994 by Ord. No. 494-3; 1-16-2001 by Ord. No. 0101-1]
As used in this article, deed and lease shall not include any of the following:
A. 
Any conveyance by will.
B. 
Any mortgage.
C. 
Any lease other than those described or defined in § 245-1.
D. 
Any conveyance between corporations operating housing projects pursuant to the laws of the state.
E. 
Any conveyance between nonprofit industrial developments agencies and industrial corporations purchasing from them.
F. 
Any conveyance to nonprofit industrial development agencies.
G. 
Any conveyance between husband and wife.
H. 
Any conveyance between persons who were previously husband and wife, but who have since been divorced, provided that such conveyance is made after the granting of the final decree in divorce, and the real estate or interest therein subject to such conveyance was acquired by the husband and wife or husband or wife, prior to the granting of the final decree in divorce.
I. 
Any conveyance between parent and child or a spouse of such child.
J. 
Any conveyance to a trustee, nominee or straw party for the grantor as beneficial owner; for the beneficial ownership of a person other than a grantor where, if such person were the grantee, no tax would be imposed upon the conveyance pursuant to this article; or from a trustee, nominee or straw party to the beneficial owner.
K. 
Any conveyance for the beneficial ownership of a person other than a grantor, where, if such person were the grantee, no tax would be imposed upon the conveyance pursuant to this article.
L. 
Any conveyance from a trustee, nominee or straw party to the beneficial owner.
M. 
Any conveyance between a parent corporation and a wholly owned subsidiary corporation, provided that such conveyance is without actual consideration.
N. 
Correctional deed without actual considerations.
O. 
Any conveyance to or from the United States, the State of Delaware, any instrumentality, agency or political subdivision of the state, and the University of Delaware.
[Amended 7-20-1998 by Ord. No. 798-1]
P. 
Any conveyance to or from a volunteer fire company, organized under the laws of this state; provided, however, that only that portion of the tax which is attributable to and payable by the volunteer fire company under § 5402 of Title 30 of the Delaware Code shall be exempt.
[Amended 7-20-1998 by Ord. No. 798-1]
Q. 
Any conveyance by the owner of a previously occupied residential premises to a builder of new residential premises when such previously occupied residential premises were taken in trade by such builder as a part of the consideration from the purchaser of new, previously unoccupied premises.
R. 
Any conveyance from the purchase money mortgagor to the lender holding the purchase money mortgage, whether pursuant to a foreclosure or in lieu thereof.
S. 
Any conveyance to a religious organization or other body or person holding title to real estate for a religious organization, if such real estate will not be used following such transfer by the grantee or by any privy of the grantee for any commercial purpose; provided, however, that only that portion of the tax which is attributable and payable by the religious organization or other body or person holding title to real estate for a religious organization pursuant to 30 Del. C. § 5402 shall be exempt.
[Amended 7-20-1998 by Ord. No. 798-1]
T. 
Any conveyance made pursuant to a contract executed prior to December 1, 1973.
U. 
Any conveyance made by or to an individual, a corporation or partnership when there is no change in beneficial interest.
V. 
Any conveyance made by or to any organization exempt from ad valorem real estate taxes.
W. 
Any conveyance to or from a corporation, or a partnership, where the grantor or grantee owns stock of the corporation or an interest in the partnership in the same proportion as his interest in, or ownership of, the real estate being conveyed; provided, however, that this subsection shall not apply to any distribution in liquidation or other conveyance resulting from the partial or complete liquidation of a corporation, unless the stock of the corporation being liquidated has been held by the grantor or grantee for more than three years; provided, further, that this subsection shall not apply to any conveyance from a partnership to its partners unless the partners' interest in the partnership has been held for more than three years.
X. 
Any conveyance of a mobile home as defined in 25 Del. C. § 7003, provided tax on said conveyance has been paid pursuant to 30 Del. C. § 3002.
[Added 7-20-1998 by Ord. No. 798-1]
Y. 
Any conveyance without consideration to an organization exempt from tax under Section 501(c) of the Federal Internal Revenue Code [26 U.S.C. § 501(c)3].
[Added 7-20-1998 by Ord. No. 798-1]
Z. 
Any conveyance to a nonprofit conservation organization when the property is purchased for open space preservation purposes.
[Added 7-20-1998 by Ord. No. 798-1]
AA. 
Any conveyance between siblings, half-siblings or step-siblings.
[Amended 4-8-1994 by Ord. No. 494-3]
A. 
Every person who makes, executes, delivers, accepts or presents for recording any deed or lease, except as excluded by § 245-2, or in whose behalf any deed or lease 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 realty transfer tax at the rate of 1 1/2% of the value of the property represented by such deed or lease. Such tax shall be payable at the time of making, execution, delivery, acceptance or presenting of such document for recording.
[Amended 7-20-1998 by Ord. No. 798-1]
B. 
The transfer tax shall be apportioned equally between the parties to the transaction in the absence of an agreement to the contrary.
C. 
No tax shall be imposed on any conveyance when the actual value of the property being transferred is less than $100.
D. 
The rate of tax on deeds or leases as described in § 245-15 of this article shall be 3/4 of 1% on amounts exceeding $10,000, which shall be borne by the owner of the building whose construction is made subject to tax under § 245-15.
[Amended 7-20-1998 by Ord. No. 798-1]
E. 
The provisions of this article which increase the City's realty transfer tax to 1 1/2% in Subsection A and 3/4 of 1% in Subsection D above shall not become effective until the conditions regarding the defeasance of the Delaware Realty Transfer Tax Revenue Bonds have been met pursuant to Chapter 16 of Title 22 of the Delaware Code.
[Added 7-20-1998 by Ord. No. 798-1]
F. 
Any funds realized by the City from the City's realty transfer tax pursuant to this section shall be segregated from the City's general fund, and the funds, and all interest thereon, shall be expended solely by the City for the capital and operating costs of public safety services, economic development programs, public works services, capital projects and improvements, infrastructure projects and improvements and debt reduction.
[Added 7-20-1998 by Ord. No. 798-1]
Where there is a transfer of residential property by a licensed real estate broker which property was transferred to him within 12 months next preceding the transfer by him as part of the consideration for the purchase of other residential property, a credit for the amount of the tax paid at the time of the transfer to the licensed real estate broker shall be given toward the amount of tax due upon the transfer. If the tax due upon the transfer from the licensed real estate broker is greater than the credit given for the prior transfer, the difference shall be paid. If the credit allowed is greater than the amount of the tax due, no refund shall be allowed.
The tax imposed by this article shall be paid from the proceeds of any judicial sale of real estate as part of the costs of such sale before any such proceeds are applied toward any obligation, claim, lien, judgment or estate and of the writ upon which the sale is made.
The payment of the tax imposed by this article shall be evidenced by the fixing of a documentary stamp to every deed or lease by the person making, executing, delivering or presenting such deed or lease for recording. Such stamp shall be affixed in such manner that their removal will require the continued application of steam or water, and the person using or affixing such stamp shall write, stamp or cause to be written or stamped thereon the initials of his name and the date upon which such stamp is affixed or used so that such stamp may not again be used, provided that any other method of cancellation may be used if it is deemed expedient by the City Manager. The City Manager may provide for the evidence of payment of the tax to be shown on the deed or lease by means other than the affixing of documentary stamps.
The City Manager shall prescribe, prepare and furnish stamps of such denominations and quantities as may be necessary for the payment of the tax imposed and assessed by this article. The City Manager shall make provision from the sale of such stamps in such places as he may deem necessary.
[Amended 12-16-1985 by Ord. No. 1285-2]
A. 
The City Manager may appoint the Recorder of Deeds, in and for Sussex County, Mellon Bank (Delaware) N.A., and such other persons within or without the county as agents for the sale of stamps to be used in paying the tax imposed by this article.
B. 
A commission shall be allowed by the City Manager to such agents of 2% of the face value of the stamps. The commission allowed to the Recorder of Deeds, in and for Sussex County, shall be turned over to the County Treasurer for the use of the county.
Every deed or lease when lodged with or presented to the Recorder of Deeds, in and for Sussex County, for recording shall set forth therein as part of such deed or lease the true, full and complete value thereof or shall be accompanied by an affidavit 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 deed or lease is not subject to tax under this article.
No person shall commit any of the following acts:
A. 
Make, execute, deliver, accept or present for recording or cause to be made, executed, delivered, accepted or presented for recording any document without the full amount of tax thereon being duly paid.
B. 
Make use of any documentary stamp to denote payment of the realty transfer tax without canceling such stamp as required by this article.
C. 
Fraudulently cut, tear or remove from a deed or lease any documentary stamp or other evidence of payment of the transfer tax.
D. 
Fraudulently affix to any deed or lease upon which tax is imposed by this article any documentary stamp or other evidence of payment of the transfer tax which has been removed from any other document, any documentary stamp or other evidence of payment of the transfer tax if insufficient value, any forged or counterfeited stamp or other evidence of payment of the realty of the transfer tax or any impression, forged or counterfeited stamp, dye, plate or other articles.
E. 
Willfully remove or alter the cancellation marks of any documentary stamp or restore any such documentary stamp with intent to use or cause the stamp to be used after it has already been used, or knowingly buy, sell, offer for sale, give away or use any such altered or restored stamp to any person for use.
F. 
Knowingly have in his possession any altered or restored documentary stamp which has been removed from any deed or lease upon which tax is imposed by this article, provided that the possession of such stamp shall be prima facie evidence of an intent to violate the provisions of this article.
G. 
Knowingly or willfully prepare, keep, sell, offer for sale or have in his possession any forged or counterfeited documentary stamp.
H. 
Accept for recording in the office of the Recorder of Deeds, in and for Sussex County, any deed or lease upon which the transfer tax is imposed without the proper documentary stamp or other evidence of payment of the tax required by this article and as is indicated in such deed or lease or accompanying affidavit.
A. 
If any person shall fail to pay any transfer tax imposed by this article for which he is liable, the City Manager may make a determination of additional tax and interest due by such person, based upon any information within his knowledge or learned by him. All such determinations shall be made so that notice thereof shall reach the party or parties against whom it is made within three years after the date of the recording of the deed of lease.
B. 
Promptly after the date of such determination, the City Manager shall send, by certified or registered mail with return receipt requested, with postage prepaid, a copy thereof to the person against whom it was made.
C. 
Within 90 days after the date upon which the copy of determination of additional tax was mailed, such person may file with the City Manager a petition for redetermination of such tax. Every petition for redetermination shall state specifically the reason or reasons which the petitioner believes entitle him to such redetermination and shall be supported by affirmation that it is not made for the purpose of delay, and that the facts set forth therein are true and correct.
D. 
It shall be the duty of the City Manager within six months after the date of any determination to dispose of any petition for redetermination. Notice of the action taken upon petition for redetermination shall be given to the petitioner promptly after the date of redetermination by the City Manager.
E. 
Any person shall have the right to review by a court of competent jurisdiction of any determination made by the City Manager pursuant to this section.
F. 
Interest shall be added to any determination of additional tax and shall be computed at the rate of 6% per year from the date any transfer tax shall have been paid to the date paid.
Upon determination of any tax collected with respect to this article has been collected improperly, the City Manager shall refund to the tax payer the sum so paid with interest from the date of payment at the rate of 6% per annum.
[Added 4-8-1994 by Ord. No. 494-3]
A. 
Where beneficial ownership in real estate is transferred through a conveyance or series of conveyances of intangible interests in a corporation, partnership or trust, such conveyance shall be taxable under this article as if such property were conveyed through a duly recorded deed or lease as defined in § 245-1, and subject to the exemptions contained in § 245-2.
B. 
No bona fide pledge of stock or partnership interests as loan collateral nor any transfer of publicly traded stock or publicly traded partnership interests shall be deemed subject to taxation under this section.
C. 
Where the beneficial owners of real property prior to the conveyance or series of conveyances referred to in this section own 80% or more of the beneficial interest in the real estate following said conveyance or conveyances, such transfers shall not be subject to tax under this section. Where the beneficial owners of real property prior to the conveyance or series of conveyances referred to in this section own less than 80% of the beneficial interest in the real estate following said conveyance or conveyances, such transfers shall not be subject to tax under this section, unless, under regulations promulgated by the Secretary of Finance of the State of Delaware, such transfer or transfers are properly characterized as a sale of real property. Such characterization shall take into account the timing of the transaction, beneficial ownership prior to and subsequent to the conveyance or conveyances; the business purpose of the corporation, partnership or trust; and such other factors as may be relevant.
[Added 4-8-1994 by Ord. No. 494-3]
A. 
There shall be included in the definition of "deed" for purposes of this article any contract or other agreement or undertaking for the construction of all or a part of any building all or a portion of which contract, agreement or undertaking (or any amendment to the foregoing) is entered into, or labor or materials are supplied, either prior to the date of the transfer of the land on which the building is to be constructed or within one year from the date of the transfer to the grantee.
B. 
The Building Inspector shall not issue a building permit for any such building unless and until the person or persons (including corporations or other associations) requesting such permit shall demonstrate in whatever form may be specified by the Building Inspector, including, at his discretion, a form of affidavit, that:
(1) 
No transfer as described in this section has occurred within the preceding year;
(2) 
No portion of the contract for construction for which the permit is being requested was entered into and no materials or labor with respect to the building have been provided within one year of the date on which the property was transferred; or
(3) 
There has been paid a realty transfer tax on the document as defined in this section.
C. 
In addition, the Building Inspector shall not issue a certificate of occupancy relative to any building on which a tax is provided by this section unless and until the owner recertifies the actual cost of the building and pays any additional tax due as a result of such recertification.
D. 
A "building" for purposes of this section shall mean any structure having a roof supported by columns or walls which structure is intended for supporting or sheltering any use or occupancy but shall not include any alteration of or addition to an existing building where the cost of said alteration or addition is less than 50% of the value of the property transferred.
E. 
A "transfer" for purposes of this section shall include any transfer made by a "deed" or "lease" described in § 245-1 of this article and shall not include any transaction excluded from the definition of "deed" or "lease" under the provision of § 245-2 of this article.