HomeMy WebLinkAbout0533.094TO:
ATTENTION:
FROM;
City of Palo Alto
___ c:::ity Mana.ger's Summary Report
HONORABLE CITY COUNCIL
HNANCE COMMITTEE
CITY MANAGER IJEPARTMEl'I'T: FINANCE
AGENDA DATE: DECEMBER 13, 1994 CMR:S33:94
SUBJECT: REAL PROPERTY TRAN~n:R TAX REVIEW
REQU~ST
Staff pedc:di..::a!ly reviews th~ ta.·..:cs imp1..1Sed by the City to t!):'UfL lh~<t Ihn~~ (;l\.t:., ;_iLC
ad.rnin\stcred ertlctcnHy anti \!quitab\y. Rl!c~nt'LY. ~h,ff complti<.:d "J l<.."\. \,-\\ OJ" lhi.' [I.')!
pruperty 1.ral1si(-r tax. Staff cnasulted with th;;; Bl..i.'1rJ of Re3ilnr,,-amJ the r,~;~l e':'l[ll("
cOrT"J1Uunity in order to ~omplete a review of this fa:.., and 10 evaluate pote-nl.iJl (').emFi~()n:s.
Staff also addressed process chaI'.gcs to impron: admini'itr.-Hion cd'th<.' laX.
RECOM;ME)'IDATlONS
Staff recommends that Cmmcil gnmt exemptions to the real property !Tar1.~t~r tax for all
tIan5al-'"tiOIlS involving a relea~e of ov,mership interl!sts held b) co--hQrro\\ers withGut
monetary consideration and for moderate i tlcome (as de fi ned by the pULl: base pM ce 0 f the
home) ftrst-time homebuyers. In addition, staff recommcn ds mndifying the ordinan.cc 5<' that
it fully identifies all transactions that arc eXl:!mpt from the ta.\:, If Council approves tht!"se
recommendations, staffwiU rcturn with proposed changes. to the-Palo Alto Municipal C, ... k.
Staff also recommends, jf sutTLcient revenues or expenditure reduction:; are identi!led in
future budget ye.ars~ that Council provide staff with direction regarding prioritization of
additional exemptions.
POLICY IMPLJCAIIONS
TIle infonnation contained in I..tlls report has been prepared. to aid in the analysis of potential
exemptions to the City's real property transfer tax for tramfer~ of rc~idential property
CMR:5.\J:94 Pagl' I or 9'
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EXECliTIVE SPMMARX
Staff periodically te"',riews the taxes imposed by the City to ensure that tIKlse taxL'"S are
administered efficiently and equitably. Recently, staff completed a review of the real
property transfer tax.
Following discussions with the Board of RealtnfS, \'arious members of the real estate
community, and representatives from the County. statr evaluated propos.ed exemptions to the
City's real property transfer tax for residential property. Staff revicwt:!d the r,er'!cfIts of
lIic!uding the exemptions in the current tax ordinam::e. ;J.'i well a.s; the aS50dated revenue
imp?.cL B~ed on lhe rc:view, staff recommends th"t COllndl grant 3Il exemption fOi
transa~'tion5 invc·lving a release of nwnership interes.ts hdd by co~b0rro\\'ef'i without
monetary ..::omideratior. and fOT Hludem!e income firsl-tirne hl)mebl.lyers, U' suffkient
ren:nue:" or expellditure reductions are identi!il!.j in future budgel year~, COIJ!1I;il can ..::onsidtr
implementation (\1' additional ext;mptions.
!J!>J:AL_IMPACT
Staffs recommem.idtion to implement the c'X¢mption for J. release of ownership interests held
by co-borrowers without monetary considerMiol1 \l'ould resllit in an estimated anrlual revenue
n:duction of approximately S 10,000. The exemption for moderate income first-time
homebuyers \\:'ould result in an annual revenue r~diKtion nmgiog from S33,000 to $86.000.
The revenue impact .for each of the exemption:;: is. di..,play-ed in Attac1lment E. ~n addition
to the revenue impa~'ts, there would bcs.nme nomina! costs as~o;,;iate<i wIth the administrdtioll
(i.rJ.~house or on a c('.mrnct basis) of the exemptions.
ENVIRONMENTAL ASSESSMENT
There is no environmental assessment required.
ATIACHMENTS
A) Palo Alto Board of Reaitors Exemption Priorities
B) Average Residential Transfer Ta"':: Payment
C) Transfer Tax Rate Comparison
D) Transfer Ta.x Exemption Comparison
E) Exemption Reven Lle Impacts
CM1l:!33:94 Page 2 3f 9
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PREPARED BY: Melissa Ca\.'allo, Assistant Finance Director
CITY MI<NAGER APPROVAL:
cc: BI"\,lrd 01' RollOfS
Jal"J C .-'\a.rt~, COf:1i,~h 8: C1.{e~'
Erk T. Trailer, North Am::rican TiUe ComJ,KillY
CMR:533:94 Pai;e 3 of 9
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\ City of Palo Alto
City Manager's Rep()ft
SUBJECT: REAL PROPER!)' TR~NSfER TAJ( REVIEW
~CQ~fMI!'II)HIO~
staff Tccornmt"lw'S thai Cllun.:ii ClJe'pl e\:cmrrio!1:. in lht.' rcal rlOr-crt~,. tn1.n~;fer tax tor ali
tr.ms.a;,:tilm~ in\"('I"-lf1~: <! rl"k.l·;e (If \"\\n ... 'f~.hip inkTI.':-.l5 hdd by cl)·b(lrTOWt~r.;: withall!
!710nci.3j")' c-t'~.:;idt"f;HicID iIT,d '',.'l m~"'3CTJk ir.;:(~:r:e (3:' ddinl:'d by the pun:ha.s~' price of the
homc", tj~i-tHTh. t1omt;:bllycl:'1. In :.:.JJi ~ i:_':n. ~'J t (T(-,-'Olrlrl1ell:,{.. Dwdi I\ing tnt.' (lrd inancc so that
it ftlJl) idcntific-. dl (ranS,3l1lmL~ LfD! J.i'C .::.',.'mf1 f'r'Jm lhc lax. If Council appw\'e":' ihese
rec:JmlT'.c-nd.::.!:ci'i', stu.ty,,\;il r~'llirti \"'ilh rr.-,f"·""':.j ('hJnJ:c" ll: t!it;: P~ilo Alto :'\1unicip",i Code.
Staff al"'l) re{:om.."T1cT:ds. jf ~uni,.;:i~111 r,:'.e!i'J";~, (1) "',\pelldiIUfl." [cdlJctions Me identitkd in
future budget ~tars, tha.t Co:!nc:iI provide s.ull' \\iltl direction regarding prioritization of
additional exemptic.ns,
!I.~oUDd
During the 1~2~93 budget proces~, the City l'.3ced a revc:'nue shortfall. In order to rai~e the
revenues necessary to baJance tilt" 1992-93 budge!. the City, in ,\1arch 1992, instituted a real
propcrt)' transfer tax tor commcrci3l and rc~id~nlial property of 51.65 per $500 of asse5sed
value. Upon instituting. the real prop.:rty transfer ta.'\. the Cit)' relinquished its share ($.215
per $5(0) of the: Count~""~ d("lcum~n! transfer lax, Start" proje\:ted that the n;!w tax would
generate n:venues of appro.'timatel) S i.5 million, a revenue increase of approximately $1.2
miUion. DlJring FY 1992-93, the :irst full year the tax was. in place, re\'enues of $1.3
millioo wen: gmerated, S20(l,OOO below staffs original revenue proJection. In FY 1993-94,
the tax generated TC\'enUCS of approximately $01 ,S million. Tht:" increase of 5300,000 over
slatTs original pn·,je;;,,;tion i::. arlfibut.:-ci to s.t:'.'t:ral llirgl' onc·time sales in the Stanford
Research Park. In fiscal )e.ar l~94-95, budgeted revenues total $1.5 mlLlion.
With the implementation of the March 1992 lax increase, the City transfer tax on an avC"rage~
priced Palo Alto rC"Sidena in 1994 would be approximately $1,369 (see Attachment A). in
Palo Alto. the bu)\!r and ~,t'ller lr~d.ltil)Il:lHy ~pii1 th~ transfer la;..:, with Cl1ch paying 50
pt:rcenL Based 011 this splil, a buyer ur an a\'eragt"-pric~d home in Palo Alto would pay a
City transfer tax of S685, j
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('ompaiis91LQ.LJy.trs and Enmptiolls iJ1 Surr_9JIJ~dIDg Citit"S
Staff has sW"'\ieyed surrou.lldiiig cili~ to deiermlne the: J~,'cl oflJ1L'ir re.al pwpert)· transfer !a\..
The results of that survey are sho~"!1 in Attachment f:3, \\ith the highest {.a\ raiC'S dj:.;.pla)cd
fIrst. The ,ha...'1: delajl~ the-distributil10 of Ihe lli.\ to ea,::h (-Jt)" and county. rnosc SAnta
Clara County cities without their r. .... T1 transfer ~a.\ split a docurncnta.r~· trclI1sler tax of 5.55
per SSOU with the COUnty. Three Santa Clara (\-)linty cilk--s, Pa'o Alw irdudtd. hElve
established their O\\'TI tr.tnsfer [a .... of S1.65 per S5DO 3.!1d haye relii1quished Ihe $.275 per
S500 do\""umentary transfer la"\: to the County. ~ retjulred b~' \Iate la\\.
Alta\:hment C provides a (ompariS~ln (II' l'"cmr:i0n~ ,-ln~rc;d ,~i'hin S.1r.!J Cl:1I<l CI.'U!1!Y fnE
trdl1sfer~ of r,;~idcntiai pr(';p-t:T1~·. rhf-:; ilil'-..u.i:c:,> li-:,:H lh~' '-\,:mrti.-1n·, !I~;' ,'"lit ,)1' Iht'
jurisdicl10ns within the ('(lunty :lr~ !ht': S.lnl~, ',', ~111 th~' t.'\l'qYI«,r; ;"( :r:lJi<,di,~n' in\ ,"Ih ~ng :!
release of owner:,l1'lp \niere~f ... by ',;:o-~n)'j\)\\;;r\ \~ilr-,',;Ul ,1',,',:1(;,'[') (t)n~:,J~'r,1t':('t: rn~~~
tran~actions are not conr.;:;ctt:d \\i;h ~j "Jk and 1111.';1 ;i1\'\.,1\,_' Ir.!.i1~t~'r\ h'~·,L">'·'1 f2rI1il.'
members (e.g., parent to L:hild tJ:.l.'\~kf~) ',~i!hoUl ,~n:' OII.'I-:,,;t...:r:, !' t:. rr:~'11t
Of th~ cIties sUI\'t:yed. two c!tie~ in th\" .:',umhlnJ;n.~ M':J h;1\ l' imrkm;.·{H~d t:-_\t'mptions
beyond those otlered in Santa CI:if3. County. In 19q~. tht eiI)" of i:i Cc;rnlo irnpk'Tl1tT:tc:U
a.."1 exemption for seller:') who ov,neo Ilome:<-for ~I :;p('In p..:-nc-..j r,f liml'. The l'.,\emption i.;;
c.alculateu. on a sliding scale: 1 ry) percent t'.\Cmpl!f'n i r 0\\ n::-r.-hir i" k"" than nile year. 57
percent if les,,> than three years. and ;rq pcr.:cnl if k,','; th:U1 _~ :. t:~r:;. Iii 1993, the Cli.~' of
Oakhnrl implcmo:-nted an exemption fl1T \()\Y and mo..-ierde: incl'lne i1r~Him~ hnmebuycn..
It exempt~ these b!..1}'C"f5 from a .25 percent increa'Jc implementcd ill 1 'Xl3. In 19~3.lhc CiL)'
of Oakland also implemented exemptions fllf Iran,<;·ac:t!r-:1S tx-f"\\ t"l"n d(lm~sti,-' r<l!1:ners.
Analysis of Exemotinns
Following di&-cuss.ions with the Board cf Reahcrs, \'-a.nous member (If the real ~-ute
community, and representatives from the Cou.nty. s,iJff ;;;-yalualed several proposed
exemptions to the real property transfer tax fur resldential prope-ny. Statf revic-wed the
benefits of offering these exern.?tion~, the ass.oda~ed P!\'("!',lle irr,~act-:., .:'-f"\d }~':;\~m\a\ i:)~u.:'s
Pruvided on Attachment 0 is a ie!ter from the Board of J{cJ.!tor5 dt''i\.'ribing h,:)~\' it would
prioritize each of the cxempt!ons reviewc::d by :'!ta.ll'.
The revenue impacts associated with the exemptions \\'~~re-c:.timale-d b:1SCU on .1 sUi"vey that
sampled real property trdnsfff'S for a three-month reriod nftime. The-surYey \\'<l~ ne(~~sary,
because daw is not retClined on lhl' dLtr~rl'll1 L::.Ih'gnrit'"\ n~ !wmdHly(.-r.~ l"Ir :'.dkr:o. (t:,g" tlr:il
timt'" home buyer, short-time home-buyer, ClI,:,) \\h .... 11 til.: La.'\ i:i as~c·s5ed. Starr wor).:t:!d \I,'ilh
the Board ~")f Realtors on the sUrYey thaI wa.'l: di'ilrihuted 10 ~cycral Pall) Aito reai estate
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CMR::,33:94 ~oe 5 of9
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offices. Each (If the offices, in turn, passed the survey along to its agenL'), Wh0 pr0vided
information on the nu.tJ1ber of transactions in each cxcmptivn categm), during the three
month timcframc. While not statistit:all), precise. the resuits of the SUr-iCY capture a cross
~---ction of about 5 ptTcent of the total annaal property transfcrs; and staff behe\'e~ it l~ t.'1e
best indication of trends that can be obtained without Jevoting a signifLca.nt aroowu of
resources.
For each of the exemp!iom;, the intent would be to benefit the buyer (first.time homebuy~.
transfer 'Nithin the City) or the selicT (selling a home within two years or ks~ of pun.:ha.'i-c).
Since the trnditio.n is that bot.1 tht buyer and the seiler split tht.> tax Wi:11 O:'<Lch rarty p<:lying
50 percent, staff ncommends a c~p on tjie exemption l)f Sf) pen:e.nt of lr,t: \Nal tax dlJC fm
each transaction. Tbis woulJ cnsurr.: that o:1ly the buyer or th.e seHer in -1l1~' sU(.'h transaciion
would benefit from tht: exemption. The 50 pt"r~'ent cap wa·, im;orpOiat~d into the revenue
impact calculations.
Relea..,e l)f Ov'nersbuuntere~t by a Co-Borrower
Most of the curnpiainls ~taff has received regMclog the Clty':; tran.s.(~r ta:x ha\'c inw"hed
nnsfcrs \ .. 'here there i'S. merely a release of ownership interest hdd by a (,."(l-oorrower .... 'ithout
monetary consideration. 1n these tram.a,tions, title is changed in 0rder 10 n:n1o\"e an
ownership interest of one or more partie", In many cases, these tnmXlctions art: txtwcen
family memb..."7S. Parties are often thlstrated with the ta."'\: on thcs<: transa,"tl'o(tS bec£:.u5e, in
their opinion. no sale has occurred. no cash ha3 been exchanged, and other jurisdic:ions. like
Santa Clara County and the City of Mountain View do no! tax these !rall,tm. In order to
align QUI tax with the County's and to eliminate staif time and etTon. involved In explaining.
and resolving the issues surrounding these tf'dllsfers, statlrecomme-nds implementatiO:1 of an
exemption for these transactions. The County would administer this exemption" 'ntis
exemption would result in an estimated annual revenue loss of SlO,()(){).
First-time Homebuyers
By offering this exemption, the Clt)' would assist low and moderate income fi.rs.t-time
homebuyers who, with the high cost of rea! estate in Palo Altc.:, t)'pically have difliculry
coming up with the cash dO\vnpayment needed to purchase their first home.
There are several options to be considered in offering a 10\'1-' and moderate income first-time
Iwmcbuyer exemption. The ftrs! opt lOll is to otler this c:o:emption only to Mortgage Credit
Certificate (MCC)-quaHfled home-buyers. Palo Allo j" one of eJeven citit~ in Santa (,Jara
County that p.articipates in the MCC p.rogram. The Mec program provides. quaHt1.ed tlrsl-
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time buyers with fe-deral L'lcomc ta..,"\: credits. The MCC quaiification criteria is restrictive
(e.g., the cost of a new home must be less than S250,()OO, the total hou.s.ehoid income for a
one or t"I'D-person household cannot exceed $62,QOO, etc.) and would limit the number of
first-time homcbuyers who might qualify for this exemptiono It ,,"ould be easy for st.aff to
implement this option, however, as SlIlta Clam County, the MCC program administrator,
dc\ermilles MCC qualificalioll. Rased lln tbe numher ofMCC's issued in Palo Alto in 1994,
the resulting revenue reduction l,\/(p.dd be appr..:>ximately $5,000 annua:lly.
AnothM" option would be to offer the n~'-time homebuycr exemption oniy tel low-income
homeburers (e.g., buyers earning not mor~ than l25 percent of the median family income
fo!" the Santa Clar& Prim.;!TY MetropoHtan Statistil:al Are.'! of S62,900). Tnis Opti0J1 would
be slightly !/;:,s:; restric!iH tJ"tan the ~'fCC optioll, al!mo'l-'ing the exemption to be :JvaiJ<3.ble to
more fi~t-time, homcbuyers, Thus, the e:;timated I1nnua! reveCl1\e impact of lhi:; exempti0n
(rption " ... ·ou!d be greater, ranging fh:nTl S5,(JOO to SIO,OOO. This exemption poses a~ditional
concerns fOT staff. Staff .,.yould need to have the-ability, in-ho:.J~;e ur on () COI"ltract basis, to
"t:L-ify im;ome len:1s and fLrs:~time hom(.'buyer 5tatus to addrt'~s concems posed by fraudulent
exernption applic:a:ions.
Finally, there L:; the op~ion of offering this exemption to both 10\\' and llwderate income first
time homebuyers. \Vith this option, a limit {e.g., the cost oft.he home must be res:; than 80
p!rcent of the average priced Palo Alto residenl.:'c, adjusted annually) \"','Quld be placed on the
value oftht.· home. TIlis option is the least restrktivc and ,yould rC5uit in tht gre.atest annual
revenue impact to the City, ranging fwm .$33,000 to $86,000. AldlOUgh, a, with the jow,
income option, staff would need to venf)' first-time homebuyer status to address concem~
posed by frauduJent applicatiuns, staff would not need to verify ip.cnme levels.
Staff recommends that Council grant an exemption for the third option, moderate income
first-time homcbu)'er5. By offering this exemptLon~ the City WQutd be promoting affordable
housing for the greatest number of low and moderate-income households.
Short-Tilne Homebuyers
When a move is made in kss than a t\v(}-ycar time fmnte. often it is a forced move due to
unforeseen circumstances. Since the seller of the property recently paid-the tn>.nsfcr tax and
other closing costs when the home was purchased, a.."l exemptioll would minimize pctentiai
financial burdens. A small percent ofrcal estate transactions are for parties who move out
of the Cit)' after a short period of time, with approximat:::ly 4 percent moving in less than
two years. This exemption \vould result in all estimated annual r~\'t"nue loss of S 19,000.
}'age 7 of C;
Iumsfm "itilintjle Cit)'
A''Ptoximately one-fO' . .trth ofth:: home sales in Palo Alto involve parties who move within
the City. V,'hC11 this happer". the tmnsfer tax is paid boLl on the safe a."d tho purc"ase of
a replacement horr.re. By exempting the sub:;etjuent purchase transactio/] (provided it was
completro in a ~~ified time period) trcm the transfer tax, the City would eliminate double
taxation. This Exemption v;,oo!d restJJt in an estimated annual reyenue loss of $115,000.
A~_m_iDistr~tjgR
JfL~C: exemption.';; n:1r fir;l-timc-homcruyers. -short-time homt:;,uyeTh, and transfers within the
C~ty were irnr!emcf'.ted. statl \,(:)utJ need to r'erf(~nn ~()me type of vcrificatlon to ensure hie.
-::\emrt:0n;;. 'oyer\,' \',JII,j, St.atT '~u,<2ge5h thal a rcbau' program v,-olild be the mo'>t dllcient,
In su,:h J, pi()gram. ti-;t'; COll!it~' Re;:cnrdcr would col1(;:(;1 tnt.' full payment {Jfthe ta.;x at rhe time
tht: Cc.;1.1 c,r otiler inqrum~lli effe,;Iing a tl'an:skr is n,·/';:l1rdcd. !"he t)xpaycr would then
'.l:lx'nit.3 ,eDatt' ,qllt":;! (0 lhe: Fin~_llc~ LkpanrrH:nl cmd include !h:;:-appropriate d():::um~ntatiol:l
~(I that 'li:lll' "'"~ll!ld ',',:-rlj~' th,: trd.fl::-<l{.:tloo t ~)~:~[) appro,,',)1 of rh{' Ieb:lte request, the' tax \\'ou!d
0e retimded to the L1..'.:payl!'I.
nSCAL IMPAct
Stairs reccmmenaatiQo to implement the l'\.crnption for a release of "~O--sigllcr' \-vithout
mon~tary consider3ti0!1 WQuliJ result in an annual reyenue reduction of approximately
5W.OO(}, The exemption for moder(-lte inromc fLrst-timc homebuyer~ would result in an
annual re"'r'enuC' rt"duclion ranging from $33.000 to S86,OO(l. 'Ioe revenue impacu fo!' each
of the exemptions re .... iewed are displayed in Attachment E. In additt(,n to the re .... enue
impacts, there would he some nominal cost, assodatcd with admifdstration (in-house or on
a contra-;:t basi~} of most of the txempttons.
E,."!YJ!l,ONMENT ~ASS[~So~ENT
There i-s no em-ironment a.,;;sC:.')smen! required.
SUPS t'OLLOWING APPRQYAk
Staff wiJl rerum with proposed changes to the PaID AlIO .Municipal Cooe, as appropriate,
In addition. if suftkient revenues or expcnditllre reductions are identified in future budget
ye-nrs, st.aff \~ ill hring fo·rth e;.:..:mr110Il requc_~ts directed by C01.Jn,,·iI.
CMIH.!H4 Page 8 l1r 9
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AITACHMt;.NTS
A} Palo AJto Board or Realtors Exemption Prio,i!ies
B) Avcn.ge Residential Transfer Tax Payment
C) Transfer Tax Rate Comp.rison
DJ Transfer Tax Exemption Compa:i"m
E) Exemption Revenue Impacts
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CMR:S33;94
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Attachment A
Averago Residontial Transfer Tax Payment
Total Tax Paymentwrth
f'a=rtl ~Qi~OS~ict
Average Palo Alto Home Price (al 5414,958 $0414.958
Palo Alto TronsfSf Tax ($1.65 per $500) $1,369 $685
S&nta Cia", Transfer Tax (.55 per $500) $0456 $228
T alai Transfer Tax PaYrTlent $1,825 $913
Average First-Time Buyer PA Home Pilce (b) 5·335,250 S335,250
Palo A~o Transfer Tax (.$1.65 per $5DO) $1,106 $553
Santa Clara Transfer Tax (55 per $500) $369 SiBS
Total Transfer Tax Payment $1,475 $738
(a) Based on average price 0' single family residences and condominiums In 1994 & 1993.
(b) This average is based on a sample of first-time buyer purchases 0' single family
residences and condominiums in 1994.
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Attachment B
TRANSFER TAX RATE COMPARISON
Rates per $500 of valuation:
Taxpayer City County
JurisdictJ,," Pays Recelva. Receives
Alameda County:
AJbany
Ber1<eley
Oakland
Piodr'Tlcnt
San Leandro
Alameda
Hayward
Contra C-O$~!! County;
EI Cerrito
&In Franctsco County:
San Francisco
San Mawo County:
San Mateo
All Other Cities
Santa Clara County:
Mountain View
San Jose
Alviso
Campbell
Cupertino
Gilloy
Los Altos
Los Altos Hills
Los Gatos
Milpitas
Morgan Hill
Santa Clara
Saratog.
Sunnyvale
$8.05
$8.05
$8.05
$7.05
$3.55
$3.25
0280
$3.50
$3.40
$3.05
$0.55
$7.50
$7.50
$750
$6.50
$3.0)
$2.70
$21.5
$2.95
$3.40
$2.50
$0.275
$0.55
$0.55
SO.55
$0_55
SO 55
$055
$0.55
$0.55
$0.55
$0.275
.J)l!t"'it${$.;i>':Y!S'f liiJFJ.;/'
$2.20 $165 $0.55
$2.20 $1.65 $0.55
$0.550 $0.275 $0.275
$0.550 $0.275 $0.275
$0.550 50.275 $0.275
$0.550 $0.275 $0.275
SO.550 $0.27S $0 27f.
$0.550 $0.275 $0.275
$0.550 SO.275 SO.275
SO.550 $0.275 $0.275
$0.550 $0.275 $0.275
$0.550 $0.275 $0.275
$0.550 $0.275 $0.275
$0.550 $0.275 $0.275
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At~(,.':hmcnt C
TRAi'iSH:R TAX EXEMPTION COMPARISON
City of Palo Alto City of Mountain View City of SlIIn Jose Coullt,. of S.otlQua
EXEMTnONS.
Release of Cv-.igDm
(with no oomid<:mi¢n)
Immediate Family
("itt. OOftSidention)
No
No
Yes No Yes
No Nu No
..
------------:1---.-....... ---+--.-.. --------.-.. --
Gifts (al Yes y", Yes Yes -_ ....... _---_. __ ._--. __ ._-_ .•... _ ........ _-_._ ... _ .... __ ._ .... __ •...... -... .
B-Jnkruptc-)'/
Fore;: r osure -..---.... -... -... -.. c--'" .-.-.... ....... .... .. -....... ... ....... . .. ---.----... --........ -.
L.e-g?:l St"jJ"J"ation."
Yes
WiUs (11) Yes
_ .. _---_ ..... _._._._---1----.. --............ -----------.---_._» .... _._--
First-time Home nLlY~ No No No No
-----... -......... _-----_ .. ---.---.--_ .. _» ............ --.--.. _---.. _._ .... _.------_._--
rrsnsfer ""ithin Cit)' ND No No No
-----_ .. -.... --------'---'-'-._------._--_._-
SI>ro-tUn< Home Buy"" No No No No _._---------_ ..... --_. __ ._ ... --.. -------_._."--_.-... __ .-
{a) ""-0 instrument \\-ilich is given witho>.lt consideration ;mJ not in connection with a sale. including bona fide
gifld<eds
(b) An ins[fU!!lent which is given itl accordance with the term;:; of a will
('
AT I ACHML~ r 0
PALO ALTO BOp,RD OF REALTORS
RE~L PROPERTYTRA:>GFER TAX LXE7>IPTIO~S
On trh1J( of t"'v: ovcr 40.) 8Cf!ltx1'! Of the P.J.1o AJ~o Soan] of RE -\L TORS<!! i ..... uu.Jd JL"e {O
oe~ our ~""JghLS .... 'ti.." '.>::~ to llc~ Ot;. '50 cum!'" .;or.si!,.\!l2.t:cn (.\.f e);,em~k"i'.s ~o th~ eil), real.
propert)' U3i'tSfer til. o..:.r BQiL"'d ~blid)' (~~ dra'!1.'l.'.\c ~!Ki''t.ue mth/: re,Jj property
I:!'"'artSferw in 1991 W,: f:::i.! ~"l.iiI: this lU ruct.d mlG1it!c'lJ.l fln.l.')Cioil b>J~.Ji on partJe$
tn:nstem:0l propmy. 1I>1'll.ie iIddI_o:g 10 f!tt iW'e3dy !'>jgh co,;( (If hol!.sing in Pilo ,4Jto. Wrule: we
~u th:: ~'i;.lu.e m:1:mp::>fUllCt of o.:vui!'l'Ji.."lg Z ".lgh le\·~i of cit~' ~:r.-!ces, ""'e fell tIlerland
ccr.tinue 10 f!%l m"I" t,1.oU if !(et'CraJ (...-d re"e:!J~ ~ ~~ to con 11 .. .'1 U<!" gmeral {II, services, then
:.'k..~ revel'1uts sl"culd l'\X}1e ~m a ttn:"ad ~J !-"'T'~':Jp
Tt-::;> r~,) ;\1(1) B l"1." rU ,;.1 R E ,-\LT(iRS ~'. ~Ln.":~! :-,~'.; f;:D as _, c~' c', i n ~ ;11 i c ( rnt' ::: ·,:t2rnpicns U1:(\; (
C,"T,,,i:kj7f,:"f'_ ~J\ lc'r -(',=-r ,:-:-;,'(,~, d p" ,,' ," i ,,_: I ,\ C" ,-:,<.,,'/, .::;J;~:\ u-_,':: ("-;(' ~ \,'mpticn.> in the
f"I',-:,,:.,. i;:~ (':'.!:::
L" f hc~ ~·_.1 .. -rer~\i P Lil P :' -I A,I:O. \) '/' , :; J C:iT ,~ Ul': [r,,_' (',l~ l.'..~1 ~~, i ~; 1 (C':-',;,ll.lt {\,jI \.;d f,~rc~~,
:.c!.../f'irl g d',.j in..---re ... ,:cir,s: (j, ~ en), tr-;-':i~ :,: J !! '. 'J;~ ~.' r i,! 1-:), f.,' '-,;-f: > .cl, j J j.jj 1j(~-l:J :,n.'!n': i ill ('':\;;ra.;1 ~
fc'! fi.~t .. 1..imc. t{)!)",e:',.l) en
2. PItrties rTJ(tying witi11~ tht-C:-ir~"
Panit"S ,,"nc, wa...'l! l_) [ll(l\{' 1,.\ i chi.-" tnc CiiY f ",e VJ:, JlJ~ I)",,' '-'1.'1 ;;,' r [.1'. b..""): \~ !:<~ Il1('Y :,.;'U 11-1 ~ ir
tJ..""me, ;t."'A; ~gJ.in '''''hen tJ,~,\' ru~ch4..-':::; r.-_'''-,I, f{'",,' H,',: :..1\ ~~'''::1ili'''' pm'.;":) munn,i: v:ilr.inU1('
(iIY. aTld pres-:ms;<.n l'rp..)(iLilir/ f'::'j(k'J"rJk l'~.H;(
J. T ~ bet-tlIi tom famil, merr-.btrs
This t)'pe of lTInSao::lJ....-m lI-.S'J..!ll)' 0..,", om im-f'h eo ;! tr..mkr uf p~Clf'Cn;.-_ 11 (lrJy .aUCCI$ s. sm:lll
number of trarua.--tio."lS, lr.o:1 i'S currrotl;: t,(011pled u.'1~cr lh·: (O\.i.!tTy tr.:ut5ier Ln
4. Sbon-term bomt'O~ (2-3 yean)
p;l!ties who mcn.-"e OUI cf ~,,1 Allo after .. shon p!!l"xf of time h.il;\i.': ~ h.u1l1luch opportunity to
benefl t fro.;r. the services of [he Ci l)' .. Thc=)'.are u_.ual.ly ffiu',' ing out l.,f tlk! CilY dlJe to fi:1:lnc ial
citcumsunc-es Of te!.x-.a.tion
Wt ropt lh-:o\ ~ou "Il>ili a,},:-.p-: UI(: t"i.fl7',r i ,:,:-._, Fc-,.cl':~J -;cbihC'. ("tlJ .. .: h:~}.:: f0l\.a.')j w prQviding
.VOll .,.,ith aIly admii"l.i$rr3.u. e ""~l$!".ncc wll.ic[l ,C!U 1'113)' il:'il.ijrt io J:::tue-~'(' [his goaL ![.\ 011 s}1(1ll1d
have any addi.tion~] que.."tic-ns. plt'.a5e feel !re-C 10 <:;j,jJ AJi~;j ron!,! at Our Bow office ..
•• :oil; $ % F.
,
Attachment E
EXEMPTION REVENUE IMPACrS
I 'I
I
1,,1odernre Income Firsl-timc Hume HLly~r
Short-time Home Buyer
Transfen Wilhin the City
E51imat~d Aruma)
R~·_~IJlJ-LReduC1ro .. l.S
~ lU,I}iJI)
S l:i.UOH
S J I ).O(l[l