Jackson & Campbell P.C. Update
	September 22, 2006
	Dear Real Estate Professional: DC has Increased Recordation and Transfer Taxes (on Deeds of Trust also!) Plan your settlements accordingly!: As reported in the past, the recordation and transfer taxes on transfers of all commercial property and of residential above $400,000 will increase to 1.45% (each tax is increased to 1.45% totaling 2.9%). This applies to deeds signed by the seller after September 30, 2006 (but, watch out for the requirement that deeds must be recorded within 30 days of execution!). The NEW news, however, is that the Council, in Emergency Legislation and with no advance notice (when will the Council realize that most matters really are not "emergencies" and deserve the full deliberative process with notice, testimony, etc. contemplated by home rule?) on Tuesday, September 19, applied the 1.45% to Deeds of Trust, which were not included in earlier legislation. The bills (in the form of emergency legislation which is law and expires December 18, 2006 and in the form of temporary legislation which expires in May of 2007) are numbered 16-884 and 885 and are not yet on the District's website but are titled 'Deed Transfer and Recordation Clarification Emergency Amendment Act of 2006'. An advance copy of the bill supplied to us today(unverified) is viewable by clicking here. DC Passes Legislation Increasing the Condominium Conversion Fee. Folded intricately into the Budget Support Act were a provisions that strongly affect condominium conversions. The conversion fee applies to vacant units as well as to occupied units. The reductions in the conversion fee for low income housing that used to exist have been severely limited (wonder when penalizing low-income tenants became in vogue). The condo conversion fee is now 5% of the anticipated value of the condo. Underestimating the sales price is penalized by imposition of a surcharge. A lien has to be filed at the time of registration with lien releases to be filed at each out-sale. But, the ENTIRE fee is owed within two years, even if there have been no sales! Thus, if a 75-unit building is converted with anticipated prices of $350,000/unit, a $1,312,500 conversion fee must be paid within two years, even if no condos are sold. DC: Council Considering Legislation to Correct Anachronism in Code that Requires Non-Titled Spouses/Domestic Partners to co-sign Deeds of Trust. Hats off to Councilmember David Catania who recognized the legitimacy and urgency of the industry's concern that 15 D.C. Code 502 be corrected to eliminate the need for signatures of non-titled parties. He introduced corrective legislation (Bill Number not yet available). When a Bill number is assigned, we will advise you and you might want to pass along an encouraging word to your Councilmember when the matter comes to a vote. Click Here to See Article Explaining this issue. DC Proposed Form for Notice of Mechanic's Lien available by clicking here. Please send your comments to RKaufmann@Jackscamp.com. Please feel free to circulate this newsletter to others in the industry, both within and outside your office. The contents of this Update are intended for general informational purposes only and should not be relied upon as legal advice or as a substitute for consultation with a qualified attorney. Moreover, the mailing hereof is not intended to create nor does it constitute an attorney-client relationship. Sincerely, Roy L. Kaufmann of the Real Property and Asset Management Group Jackson & Campbell P.C. email: rkaufmann@jackscamp.com voice: (202) 457-1600 web: http://www.JacksCamp.com

Jackson & Campbell P.C. · 1120 20th Street NW · Washington · DC · 20036