“By not imposing the RETT on a creditor … in a foreclosure situation, the city is avoiding taxing persons or entities that are already facing losses,” Judge Nichols wrote. “The city’s desire to tax a creditor such as Jerome Property, which acquired the special warranty deed (in lieu of foreclosure) at a discount … with the purported aim of foreclosing on the property so it could have it to operate at a profit is understandable.”
ASPEN REAL ESTATE – A local judge has exempted the owners of the Hotel Jerome from paying at least $375,000 in real estate transfer taxes, according to a court ruling issued last week.Pitkin County District Court Judge Gail Nichols on Friday sided with the hotel ownership’s argument that their takeover of the historic property was not subject to the local Real Estate Transfer Tax, also known as the RETT.Jerome Ventures LLC and Jerome Property LLC — groups representing Chicago businessmen Fred Latsko and Mark Hunt — sued the Aspen government in September after city officials indicated they planned to assess the RETT on the property acquisition.The complaint in the case states that Jerome Ventures and Jerome Property are not subject to the RETT because they took control of the hotel through a deed in lieu of foreclosure, which they argued exempts them from the tax. Judge Nichols agreed, and found that the city was using a too-narrow of an interpretation of its own municipal code in pursuing the tax on the Jerome transfer.
By Curtis Wackerle, June 23, 2011 ADN
Hotel Jerome, Main St, Aspen, CO – marketing photo