[Ord. 680, 1/19/1989, § 1]
This Part shall be known as the "Realty Transfer Tax Ordinance of the Borough of Elizabethtown, Lancaster County, Pennsylvania."
[Ord. 680, 1/19/1989, § 2]
This Realty Transfer Tax is levied under authority of Article XI-D, entitled "Local Real Estate Transfer Tax," of the Pennsylvania Real Estate Transfer Tax Act, which is a new Article added by Act 77-1986 (Act of July 2, 1986, No. 77, P.L._____) to the Pennsylvania Real Estate Transfer Tax Act, Act 14-1981, (Act of May 5, 1981, No. 14, P.L. 36) as amended. The Pennsylvania Real Estate Transfer Tax is codified at 72 P.S. § 8101-C et seq., and Article XI-D is codified at 72 P.S. § 8101-D et seq. This Realty Transfer Tax is also levied under authority of "The Local Tax Enabling Act," Act of December 31, 1965, P.L. 1257, as amended.
[Ord. 680, 1/19/1989, § 3]
The following words when used in this Part shall have the meanings ascribed to them in this § 103, except where the context clearly indicates a different meaning:
- A partnership, limited partnership, or any other form of unincorporated enterprise owned or conducted by two or more persons.
- The Borough of Elizabethtown, Lancaster County, Pennsylvania.
- The Recorder of Deeds of Lancaster County, Pennsylvania, is hereby appointed collector of the tax levied by this Part.
- A corporation, joint-stock association, business trust or banking institution, which is organized under the laws of the Commonwealth of Pennsylvania, 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 within the Borough, 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 § 109 of this Part.
- FAMILY FARM CORPORATION
- 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: (1) recreational activities such as, but not limited to, hunting, fishing, camping, skiing, show competition or racing; (2) 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; (3) fur farming; (4) stockyard and slaughterhouse operations, or (5) manufacturing or processing operations of any kind.
- MEMBERS OF THE SAME FAMILY
- Any individual, such individual's brothers and sisters, the brothers and sisters of such individual's parents and grandparents, the ancestors or 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, or entity of any kind. 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.
- (1) All lands, tenements or hereditaments, 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 of land, but excluding permanently attached machinery and equipment in an industrial plant.
- (2) A condominium unit.
- (3) A tenant-stockholder's interest in a cooperative housing corporation, trust or association under lease or occupancy agreement.
- REAL ESTATE COMPANY
- 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:
- (1) Derives 60% or more of its annual gross receipts from the ownership of disposition of real estate; or,
- (2) 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.
- REAL ESTATE TRANSACTION
- The making, executing, delivering, accepting, or presenting for recording of a document.
- (1) An 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 if fee simple, life estate, or perpetual leasehold; or
- (2) An interest in real estate enduring for a fixed period of years by which, either by reason of the length of the term of the grant of a right to extend the term by renewal or otherwise, consists of a group of rights approximating 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, 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 a rental charge to the new lessee is fixed of if a method for calculating the rental charge is established.
- (1) In the case of any bona fide sale of real estate at arm's length for actual consideration therefor, paid or to be paid, including liens or other encumbrances thereof 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 the document 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.
- (2) 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, and 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 within the Borough determined by adjusting the assessed value of the real estate for local real estate tax purposes for the common level ration of assessed values to market values of the taxing Borough in which the Borough is located as established by the State Tax Equalization Board, or a commensurate part of the assessment where the assessment includes other real estate;
- (3) In the case of an easement or other interest in real estate the value of which is not determinable under clause one or two, the actual monetary worth of such interest.
- (4) 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 principal of the grantor or a related corporation, association or partnership and the grantee existing before or effective with the transfer. The singular shall include the plural and the masculine shall include the feminine and neuter.
[Ord. 680, 1/19/1989, § 4]
A tax is hereby levied and imposed, for general Borough purposes, on every real estate transaction, at the rate of 1% of the value of the real estate represented by the document involved in the real estate transaction.
The tax shall be payable at the earlier of the time the document if presented for recording, within 30 days of acceptance of such document or within 30 days of becoming an acquired company.
If the real estate is located partially within and partially outside the Borough, the tax shall be calculated on the value of the portion within the Borough.
The tax imposed hereunder shall be due and payable to the collector, as a joint and several liability, by 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, In the case of an acquired company, the company shall also have liability for payment of the tax. All such persons shall also be liable for any penalties imposed under this Part.
It is the intent of this Part that the entire burden of the tax imposed on a real estate transaction by the Borough and other political subdivisions shall not exceed the limitation prescribed in § 8 of the Local Tax Enabling Act, 53 P.S. § 6908, so that if any other political subdivision imposes a tax on real estate transactions taxed under this Part, the provisions of said § 8 shall apply.
[Ord. 680, 1/19/1989, § 5]
The payment of the tax imposed hereunder shall be evidenced by the collector affixing on the document an official stamp or writing setting forth the date of payment of the tax and amount of tax paid.
[Ord. 680, 1/19/1989, § 6]
The United States, the Commonwealth of Pennsylvania, or any of their instrumentalities, agencies or political subdivisions shall be exempt from payment of the tax imposed by this Part. The exception of such governmental bodies shall not, however, relieve any other party to a real estate transaction from liability for the tax.
[Ord. 680, 1/19/1989, § 7; as amended by Ord. 829, 11/15/2001]
The tax imposed by this Part shall not be based upon:
A transfer to the Commonwealth of Pennsylvania, or to any or 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 line adjustments provided said reconveyance is made within one year from the date of condemnation.
A document which the Borough is prohibited from taxing under the Constitution or statutes of the United States.
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 sheriff shale or tax claim bureau sale.
A transfer for no or nominal actual consideration which corrects or confirms a transfer previously recorded, but which does not extend or limit existing record legal title or interest.
A transfer of division of kind for no or nominal actual consideration of property passed by testate or intestate succession and held by cotenants; however if any of the parties take shares greater in value than their undivided interest, tax is due on the excess.
A transfer between husband and wife, between persons who were previously husband and wife who since been divorced, provided 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 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.
A transfer for no or nominal actual consideration or property passing by testate or intestate succession from a personal representative of a descendant to the descendants; devisee or heir.
A transfer for no or nominal actual consideration of 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 collector is presented with a copy of the trust instrument that clearly identifies the grantor and all possible beneficiaries.
A transfer for no or nominal actual consideration from a trustee to a beneficiary of an ordinary trust.
A transfer for no or nominal actual consideration from trustee to successor trustee.
For no or nominal 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 Part. Where the document by which title is acquired by a grantee or statement of value fails to set forth that the property of the grantee in his individual capacity if the grantee claims an exemption from taxation under this clause.
A transfer made pursuant to the statutory merger or consolidation of a corporation of statutory division of a nonprofit corporation, except where the Borough reasonably determines that the primary intent for such merger, consolidation of division is avoidance of the tax imposed by this Part.
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.
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 of the grantee, or a transfer to a nonprofit industrial development agency or authority.
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 conservation, energy conservation, energy production, pollution control, warehousing or agriculture; and,
The agency or authority has the full ownership interest in the real estate transferred.
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.
Any transfer between religious organizations or other bodies or person holding title for a religious organization if such real estate is not being or has not been used by such transferor for commercial purposes.
A transfer to a conservancy which possesses tax exempt status pursuant to § 501(c)(3) of the Internal Revenue Code of 1954, and which has as its primary purpose preservation of land for historic, recreational, scenic, agricultural or open space opportunities.
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.
A transfer between members of the same family of an ownership interest in a real estate company or family farm corporation.
A transaction wherein the tax due in $1 or less.
Leases for the production or extraction or coal, oil, natural gas or minerals and assignments thereof.
[Ord. 680, 1/19/1989, § 8]
Except as otherwise provided in § 107, documents which make, confirm or evidence any transfer of 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 Part, corporations and associations are entities separate from their members, partners, stockholders or shareholders.
[Ord. 680, 1/19/1989, § 9]
A real estate company is an acquired company upon a change in the ownership interest in the company, however effected, if the change:
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 acquisition or transfer of assets there are devoted to the business of agriculture, it fails to meet the minimum requirements of a family farm corporation under this Part.
Within 30 days after becoming an acquired company, the company shall present a declaration of acquisition to the collector for recording and for the affixation of the official stamp or writing evidencing payment of the tax. Such declaration shall set forth the value of real estate holdings of the acquired company in the Borough.
[Ord. 680, 1/19/1989, § 10]
Where there is a transfer of a residential property to 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.
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.
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.
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.
If the tax due upon the transfer is greater than the credit given under this § 110, the difference shall be paid. If the credit allowed is greater than the amount of tax due, no refund or carryover credit shall be allowed.
[Ord. 680, 1/19/1989, § 11]
Every document lodged with or presented to the collector 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 Part. The provisions of this § 111 shall not apply to any excludable real estate transfers which are exempt from taxation based on family relationship, provided the relationship is specified in the deed, instrument or writing. Documents which are not to be recorded shall be presented to the collector and shall be accompanied by a certified copy of the document and 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 Part. Evidence of such payment shall be affixed to the original document and the certified copy. The certified copy and statement of value shall be filed with the collector.
[Ord. 680, 1/19/1989, § 12]
It shall be unlawful for any person to:
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;
Fail to record a declaration of acquisition, as required by this Part;
Fraudulently affix to any document any forged evidence of payment; or
Fail, neglect or refuse to comply with or violate other provisions of this part or any rules and regulations promulgated by the Borough under this part, or any rules and regulations of the Pennsylvania Department of Revenue to the extent applicable to the tax levied hereunder.
Any person violating any of the provisions of this § 112 shall be guilty of a summary offense.
A person who makes a false statement of value or declaration of acquisition, when he does not believe the statement or declaration to be true, is guilty of a misdemeanor of the second degree.
[Ord. 680, 1/19/1989, § 13]
If any tax owing under the terms of this Part shall not be paid when due, 10% of the amount of the tax shall be added and collected as an initial penalty for nonpayment or underpayment of the tax.
In addition, if any tax owing under the terms of this Part shall not be paid when due, a penalty shall accrue on the amount of the unpaid tax at the rate of 1% per month of fractional part of a month, on the amount of the unpaid tax, from the due date until an amount of the tax is paid in full.
In addition, in the case of failure of any acquired company to record a declaration of acquisition, as required by this Part, unless it is shown to the satisfaction of the Township that such failure is due to reasonable cause, a penalty shall accrue on the amount of the unpaid tax at the rate of 5% per month or fractional part of the month, on the amount of the unpaid tax, from the due date until the amount of the tax is paid in full. This penalty shall be in addition to all other penalties, but shall not in the aggregate exceed 50% of the amount of unpaid taxes.
In addition, if any part of any underpayment of tax id due to fraud, there shall be added to the tax an amount equal to 50% of the underpayment.
In addition, if the Borough files suit in order to collect the amount of any tax not paid when due under this part, at the discretion of the court, any person liable for payment of the tax shall also be liable for reasonable attorneys' fees incurred by the Borough in prosecution of the suit.
No document upon which tax is imposed by this part shall at any time be made the basis of any action or other legal proceeding, nor shall proof thereof be offered or received in evidence in any court of this Commonwealth, or recorded in the office of any Recorder of Deeds of any county of this Commonwealth, unless the tax imposed hereunder shall have been paid in full and evidence of payment shall have been affixed thereto by the collector.
[Ord. 680, 1/19/1989, § 14]
The tax imposed by this Part 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 the Borough, which land, 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 Part, said lien to begin at the time when the tax under this Part 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 Lancaster 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.
[Ord. 680, 1/19/1989, § 15]
The tax imposed under this Part 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, and the sheriff, or other officer, conducting said sale, shall pay the tax herein imposed out of the first monies 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.
[Ord. 680, 1/19/1989, § 16]
In order to determine whether the proper amount of tax has been paid, without limiting any other rights of the Borough, the Borough shall have the right to review all documents or records relating to any real estate transaction or any related transactions, and to take such other steps as the Borough shall deem necessary or appropriate, including a review or audit of any documents or records of any party to a real estate transaction to determine the fair market value of the real estate or any other relevant matter as determined by the Borough. Upon request of the Borough, and at such place and time as specified by the Borough, any party shall make available to the Borough any documents or records requested by the Borough.
In the event any tax is not paid when due, the Borough may enforce payment of the tax, together with all penalties, by suit in assumpsit or any other appropriate means.
[Ord. 680, 1/19/1989, § 17]
As provided in 10 P.S. § 11011-6, the Recorder of Deeds shall be the collection agent for this tax, without compensation for the Borough.
In order to ascertain the amount of taxes due when the property is located in more than one political subdivision, the collector shall not accept for recording any document unless it is accompanied by a statement of value showing what taxes are due each municipality.
On or before the tenth day of each month, the collector shall pay over to the Borough all taxes collected under this Part, less 2% for use of the county, and shall also provide a report containing the information required by the Commonwealth of Pennsylvania in reporting collections of the Pennsylvania Realty Transfer Tax. The 2% commission shall be paid to the county.
In accordance with Act 77-1986, any Recorder of Deeds who shall record any document upon which tax is imposed under this Part without payment of tax as required under this part, as is indicated in the document or accompanying statement of value shall, upon summary conviction, be sentenced to pay a fine of not more than $500 and costs of prosecution.
[Ord. 680, 1/19/1989, § 19]
The Borough may promulgate and enforce reasonable rules and regulations for the interpretation, collection and enforcement of the tax.
[Ord. 680, 1/19/1989, § 20]
To the extent this Part imposes a tax on a real estate transaction which is subject to the Commonwealth of Pennsylvania Realty Transfer Tax imposed by Act 77-1986, and to the extent not inconsistent herewith or with rules or regulations adopted by the Borough, this Part shall be interpreted in the same manner as Act 77-1986 and in accordance with regulations promulgated thereunder.
The provisions of this Part, so far as they are the same as those of ordinances in force immediately prior to adoption of this part, are intended as a continuation of such ordinances, and not as new enactments.
This Part shall impose a tax on all transactions which the Borough is permitted to tax under Act 77-1986 to the fullest extent permissible.
In the event this Part is declared invalid, the prior ordinance or ordinances of the Borough levying a realty transfer tax shall remain in full force and effect, and shall not be affected in any way by adoption of this Part.
The provisions of this Part shall not affect any suit or prosecution pending or to be instituted to enforce any right or penalty or to punish any offense, under the authority of any ordinance in force prior to adoption of this Part.
Subject to the provisions in this § 120, this Part shall supersede, replace and repeal ordinances levying a realty transfer tax in force immediately prior to adoption of this Part.
[Ord. 680, 1/19/1989, § 21]
This Part shall become effective immediately, or on the date permitted by law, and shall continue in force hereafter without annual reenactment.