Sponsor Summary of CSHB 33 (FIN) am

Real Estate Licensing, AS 08.88

Requires community association managers to be real estate licensees to protect consumers

• Results from theft of $570,000 from 18 associations
• Creates limited/grandfathered licensees for current community association managers minimizing transition problem
• Establishes fidelity bonds/account procedures
• Allows surety fund claims

Clarifies and Empowers the Real Estate Commission ("REC") statutory authority. For example:

• Staff delegation to speed up workload
• Grants authority to levy civil fines
• Expands disciplinary powers of REC
• Increases authority to charge fees to licensees

Expands and clarifies educational requirements and courses

• Provides that determination on courses submitted for approval/disapproval must be accomplished within 45 days
• Establishes core curricula for continuing education in real estate sales, property management, community association management, and commercial sales.
• Grants credit for nationally recognized professional designations, technology courses, and college courses.

Licensed required

• Activities are clarified and expanded to include community association management

Prohibited Conduct

• Existing law clarified and strengthened to strictly prohibit a licensee from entering into a "marketing kickback" scheme with a marketing company that promises kickbacks to unlicensed persons.
• In spite of conflicting legal opinions (including legislative counsel), the Attorney General has recommended a statutory remedy. (See Section 34, page 23.)

Conflict of Interest

• Disclosure is clarified with new definitions
• Disclosure is expanded to protect consumers and meet the recommendations of a 1995 Legislative Audit.

Exceptions

• Current 10 exceptions to real estate activity requiring a license expanded to 21. Exceptions include:

1. Administrative activities
2. Self-management of community association
3. Management for a fee of 4 or less units
4. Management by relatives
5. Management for expenses, but not a fee
6. Exempts real estate licensees from mobile home dealer license requirements
7. Property management jurisdiction of the REC is not expanded in HB 33 and the new property management clarifying exceptions are to current law

Miscellaneous Provisions

• Allows licensed assistants to be employed (not currently allowed)

Adds several definitions

Calls for immediate effective date except for certain educational changes which will require regulations to be implemented.

ED2: 3/9/98

Sponsor Summary of CSHB 33 (FIN)

Real Estate Licensing, AS 08.88

Requires Community Association Managers to be Real Estate Licensees to protect consumers

• Results from theft of $570,000 from 18 associations
• Creates limited/grandfathered licensees for current community association managers minimizing transition problem
• Establishes fidelity bonds/account procedures
• Allows surety fund claims

Clariefies and Empowers the Real Estate Commission ("REC") Statutory Authority. For example:

• Staff delegation to speed up workload
• Grants authority to levy civil fines
• Expands disciplinary powers of REC
• Increases authority to charge fees to licensees

Expands and Clarifies Educational Requirements and Courses

• Provides that determination on courses submitted for approval/disapproval must be accomplished within 45 days
• Establishes core curricula for continuing education in real estate sales, property management, community association management, and commercial sales.
• Grants credit for nationally recognized professional designations, technology courses, and college courses.

Licensed required

• Activities are clarified and expanded to include community association management

Prohibited Conduct

• Existing law clarified and strengthened to strictly prohibit a licensee from entering into a "marketing kickback" scheme with a marketing company that promises kickbacks to unlicensed persons.
• In spite of conflicting legal opinions (including legislative counsel), the Attorney General has recommended a statutory remedy. (See Section 35, page 23.)

Written Contract

• Required to collect a fee or commission for real estate services in order to decrease litigation and disputes.

Conflict of Interest

• Disclosure is clarified with new definitions
• Disclosure is expanded to protect consumers and meet the recommendations of a 1995 Legislative Audit.

Exceptions

• Current 10 exceptions to real estate activity requiring a license expanded to 21. Exceptions include:

1. Administrative activities
2. Self-management of community association
3. Management for a fee of 4 or less units
4. Management by relatives
5. Management for expenses, but not a fee
6. Exempts real estate licensees from mobile home dealer license requirements
7. Property management jurisdiction of the REC is not expanded in HB 33 and the new property management clarifying exceptions are to current law

Miscellaneous Provisions

• No duty to notify clients of sex offenders (Megan’s Law exemption) because of agency law conflicts and potential litigation. Provides for notice to prospective buyers as to where to make inquiries about sex offenders should be made. Such notice will be on the property disclosure statement which is a part of the real estate transaction.
• Allows licensed assistants to be employed (not currently allowed)

C. Adds several definitions

D. Calls for immediate effective date except for certain educational changes which will require regulations to be implemented.