§ 21.9

(Amended by Ord. No. 166,976, Eff. 7/3/91, Oper. 7/1/91.)

This article shall be known as the “Real Property Transfer Tax Ordinance of the City of Los Angeles.” It is adopted pursuant to the authority contained in Part 6.7 (commencing with Section 11901) of Division 2 of the Revenue and Taxation Code of the State of California. It is also enacted under the authority of Subdivision (d) of Subsection (11) of Section 2 of the Los Angeles City Charter and other authority held as a Charter City.

(Amended by Initiative Approved by the Voters on 11/8/22, Ord. No. 187,692, Eff. 1/1/23.)

(a) There is hereby imposed on each deed, instrument or writing by which any lands, tenements, or other realty sold within the City of Los Angeles shall be granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by the person’s or persons’ direction, when the consideration or value of the interest or property conveyed (exclusive of the value of any lien or encumbrance remaining thereon at the time of sale) exceeds $100.00, a tax at the rate of $2.25 for each $500.00 or fractional part thereof.

(b) In addition to and separate from any tax imposed under Subsection (a) of this section, starting on April 1, 2023, there is hereby imposed a tax known as the “Homelessness and Housing Solutions Tax” on each deed, instrument or writing by which any lands, tenements, or other realty sold within the City of Los Angeles shall be granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by the person or their direction, when the consideration or value of the interest or property conveyed (including the value of any lien or encumbrance remaining thereon at the time of sale) exceeds:

(1) $5,000,000 but is less than $10,000,000, a tax at the rate of 4% of the consideration or value; or

(2) $10,000,000 or greater, a tax at the rate of 5.5% of the consideration or value.

(c) The Director of Finance for the City of Los Angeles shall adjust the consideration or value thresholds set forth in Subsection (b) of this section adjusted annually based on the Bureau of Labor Statistics Chained Consumer Price Index (C-CPI-U), pursuant to guidelines and procedures the Director of Finance establishes pursuant to Subsection (c) of Section 21.9.11 of this Code.

Any tax imposed pursuant to Sec. 21.9.2 hereof shall be paid by any person who makes, signs or issues any document or instrument subject to the tax, or for whose use or benefit the same is made, signed or issued.

Any tax imposed pursuant to this article shall not apply to any instrument in writing given to secure a debt.

(Amended by Ord. No. 140,085, Eff. 5/11/70.)

Any deed, instrument or writing to which the United States or any agency or instrumentality thereof, any state or territory, or political subdivision thereof, is a party shall be exempt from the tax imposed pursuant to this article when the exempt agency is acquiring title.

Any tax imposed pursuant to this article shall not apply to the making, delivering or filing of conveyances to make effective any plan of reorganization or adjustment:

(a) Confirmed under the Federal Bankruptcy Act, as amended;

(b) Approved in an equity receivership proceeding in a court involving a railroad corporation, as defined in Subdivision (m) of Sec. 205 of Title 11 of the United States Code, as amended;

(c) Approved in an equity receivership proceeding in a court involving a corporation, as defined in Subdivision (3) of Sec. 506 of Title 11 of the United States Code, as amended; or

(d) Whereby a mere change in identity, form or place of organization is effected.

Subdivisions (a) to (d), inclusive, of this section shall only apply if the making, delivery or filing of instruments of transfer or conveyances occurs within five years from the date of such confirmation, approval or change.

Any tax imposed pursuant to this article shall not apply to the making or delivery of conveyances to make effective any order of the Securities and Exchange Commission, as defined in Subdivision (a) of Sec. 1083 of the Internal Revenue Code of 1954; but only if:

(a) The order of the Securities and Exchange Commission in obedience to which such conveyance is necessary or appropriate to effectuate the provisions of Sec. 79k of Title 15 of the United States Code, relating to the Public Utility Holding Company Act of 1935;

(b) Such order specifies the property which is ordered to be conveyed;

(c) Such conveyance is made in obedience to such order.

(a) In the case of any realty held by a partnership, no levy shall be imposed pursuant to this article by reason of any transfer of an interest in a partnership or otherwise, if:

(1) Such partnership (or another partnership) is considered a continuing partnership within the meaning of Sec. 708 of the Internal Revenue Code of 1954; and

(2) Such continuing partnership continues to hold the realty concerned.

(b) If there is a termination of any partnership within the meaning of Sec. 708 of the Internal Revenue Code of 1954, for purposes of this article, such partnership shall be treated as having executed an instrument whereby there was conveyed, for fair market value (exclusive of the value of any lien or encumbrance remaining thereon), all realty held by such partnership at the time of such termination.

(c) Not more than one tax shall be imposed pursuant to this article by reason of a termination described in Subdivision (b), and any transfer pursuant thereto, with respect to the realty held by such partnership at the time of such termination.

(Amended by Ord. No. 166,976, Eff. 7/3/91, Oper. 7/1/91.)

The County Recorder shall administer this article in conformity with the provisions of Part 6.7 of Division 2 of the Revenue and Taxation Code and the provisions of any County ordinance adopted pursuant thereto. The Director of Finance of the City of Los Angeles is authorized to negotiate and enter into a contract with the County of Los Angeles or one of its officials for the administration of this article and payment to the County for its costs of administration.

Claims for refund of taxes imposed pursuant to this article shall be governed by the provisions of Chapter 5 (commencing with Section 5096) of Part 9 of Division 1 of the Revenue and Taxation Code of the State of California.

(Amended by Initiative Approved by the Voters on 11/8/22, Ord. No. 187,692, Eff. 1/1/23.)

(a) The Director of Finance, in the Director’s capacity of Tax Collector of the City of Los Angeles, is hereby designated as the officer of the City responsible for maintaining relations with the County of Los Angeles for the purpose of administering the tax imposed under this article and receiving and accounting for the funds collected thereunder.

(b) If the County of Los Angeles does not collect a tax due under this article, or any portion of such tax, then the Director of Finance shall have the power and duty to enforce all of the provisions of this article. In such case, the City taxes are due prior to recordation with the County of Los Angeles of any written instrument subject to the tax and the Director of Finance may make an assessment for taxes not paid in the manner provided in 21.16 of this Code, and make refunds as provided in Section 22.13 of this Code.

(c) The Director of Finance is authorized and empowered, consistent with applicable law and the purposes of this article, to issue any rules and regulations reasonably necessary to enforce and administer this article, including but not limited to regulations further defining the term “realty sold” in Section 21.9.2 of this article and establishing procedures for administering exemptions to the tax imposed under this article. The Director of Finance shall provide reasonable notice prior to the effective date of any rules or regulations promulgated pursuant to this section.

(Added by Ord. No. 170,326, Eff. 3/10/95.)

Any deed, instrument or writing by which a person acquires real property in an exchange with the City shall be exempt from the tax imposed pursuant to this article where the real property received by the City is of equal or greater value than the real property received by the other person.

(Added by Ord. No. 171,644, Eff. 8/2/97.)

(a) In the case of any realty held by a non-profit corporation, no levy shall be imposed pursuant to this article by reason of any transfer of the realty, if:

(1) The realty is transferred to a limited partnership, of which the non- profit corporation is the general partner; and

(2) The City required such transfer to be made in order to facilitate the use of tax credits and federal affordable housing development assistance.

(b) Any person exempt from the tax imposed by this article because of the provisions of Subsection (a) hereof shall pay to the County of Los Angeles the tax that would be owed if such exemption did not exist, and thereafter may apply to the Director of Finance for a refund, which refund shall be made in the same manner as is provided in Section 21.07 of this chapter for refunds of overpayments of Business Taxes.

(Added by Initiative Approved by the Voters on 11/8/22, Ord. No. 187,692, Eff. 1/1/23.)

The Homelessness and Housing Solutions Tax imposed by Subsection (b) of 21.9.2 of this Code shall not apply with respect to any deed, instrument or writing by which any lands, tenements, or other realty sold within the City of Los Angeles shall be granted, assigned, transferred or otherwise conveyed to, or vested in, a purchaser or purchasers, or any other person or persons, by the person or their direction if such transferee is: (1) a non-profit entity within Internal Revenue Code Section 501(c)(3); (2) a Community Land Trust, as defined in Section 22.618.2 of the Los Angeles Administrative Code; (3) a Limited- Equity Housing Cooperative, as defined by California Civil Code Section 817; or (4) a limited partnership or limited liability company in which only bona fide nonprofit corporations, Community Land Trusts, and/or Limited-Equity Housing Cooperatives are the general partners or managing members. To qualify for an exemption under this section, the transferees or one of its partners or members must demonstrate a history of affordable housing development and/or affordable housing property management experience, as determined by the Los Angeles Housing Department, or its successor agency, according to a procedure that will be promulgated by the Los Angeles Housing Department, or its successor agency. Community Land Trusts and Limited- Equity Housing Cooperatives may qualify for an exemption under this subsection without demonstrating a history of affordable housing development and/or affordable housing property management experience by (a) partnering with experienced non-profit organizations as the Los Angeles Housing Department, or its successor agency, defines those terms consistently with the purpose of Article 9 of Chapter 24 of Division 22 of the Los Angeles Administrative Code; or (b) recording at the time of acquisition an affordability covenant consistent with Section 22.618.3(d)(l)(i)b. of the Los Angeles Administrative Code.

(Added by Initiative Approved by the Voters on 11/8/22, Ord. No. 187,692, Eff. 1/1/23.)

The Homelessness and Housing Solutions Tax imposed by Subsection (b) of 21.9.2 of this Code shall not apply with respect to any deed, instrument or writing by which any lands, tenements, or other realty sold within the City of Los Angeles shall be granted, assigned, transferred, or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, if such transferee is:

(a) a non-profit entity within Internal Revenue Code Section 501(c)(3), which received its initial Internal Revenue Service Determination Letter at least ten years prior to the purchase and has assets of less than $1 billion;

(b) the United States or any agency or instrumentality thereof, any state or territory, or political subdivision thereof, or any other federal, state, or local public agency or public entity; or

(c) any other transferee exempt from the City’s taxation power under the state or federal Constitutions.

(Added by Initiative Approved by the Voters on 11/8/22, Ord. No. 187,692, Eff. 1/1/23.)

The People of the City Los Angeles authorize the City Council to enact ordinances, without further voter approval, to exempt from the Homelessness and Housing Solutions Tax imposed by Subsection (b) of Section 21.9.2 of this article property acquired by non-profit organizations to produce income-restricted affordable housing, as the Council may define those terms consistently with the purposes set forth in Article 9 of Chapter 24 of Division 22 of the Los Angeles Administrative Code.