The bill amends Section 44-25-1 of the General Laws regarding the Real Estate Conveyance Tax, introducing a new tax structure for residential real property transactions. It establishes a base tax of $3.75 for every $500 of consideration paid for properties exceeding $100, with an additional tax for residential properties sold for more than $900,000. This additional tax is set at up to $10 for every $500, or fractional part thereof, on the consideration in excess of $900,000 or such higher amount as may be adopted by local ordinance.

The bill also outlines the distribution of tax revenues, specifying that municipalities shall retain the local tax collected and deposit it into restricted accounts. These funds must be allocated and spent only for the creation and development of affordable housing for individuals or families at or below 80% of the area median income, and the municipality must maintain a local affordable housing board to oversee the funds. The funds must be allocated within five years, and the municipality is required to include in the housing element of their local comprehensive plan the process for fund allocation.

Alternatively, municipalities may elect to transfer the collected taxes to the housing resources commission, the Rhode Island department of housing, or Rhode Island Housing for the purpose of developing affordable housing within that community. Any tax funds collected and not allocated within five years must be transferred to the Rhode Island department of housing for affordable housing development.

The act is set to take effect upon passage.

Statutes affected:
8193: 44-25-1