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SPONSOR: |
Boitano |
DATE TYPED: |
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HB |
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SHORT TITLE: |
Real Estate Salesperson Licensure |
SB |
507 |
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ANALYST: |
Maloy |
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REVENUE
Revenue |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04 |
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(See
Narrative) |
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Recurring |
OSF |
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(Parenthesis
( ) Indicate Expenditure Decreases)
Relates to SB 43, SB 45 and SB 571, all of which
propose to amend the Real Estate Licensing Act.
Conflicts with Section 61-29-2(A) (9) of SB
45.
Responses
Received From
Office
of the Attorney General
Regulation
and Licensing Department, Real Estate Commission
SUMMARY
Synopsis
of Bill
Senate Bill 507 amends the real estate licensing laws to redefine the real estate activities for which a license is required, and to modify some of the experience and training requirements necessary for obtaining a license.
Specifically,
SB507 proposes to amend existing real estate licensing laws to phase out the
Salesperson category of real estate license by
In regrouping existing licensees, the bill requires that a licensee have been actively engaged in the real estate business as an Associate Broker or Salesperson for at least two years, and provide proof that they have taken a Commission-approved Broker Basics course before being eligible to apply for a Qualifying Broker’s license.
The bill makes Associate Broker the entry-level real estate license, and increases the pre-licensing education requirement from the current 60 hours for a Salesperson license to 90 hours for an Associate Broker license. The current pre-licensing education requirement for a Broker’s license is 180 hours, 90 hours of which can be waived if the applicant documents equivalent experience.
SB507
provides that existing Salespersons licensees would have until
Significant Issues
Opponents of “single licensure” assert it will
force Salespersons to become Brokers, and make it more difficult for brokerages
to recruit prospective Salespersons by increasing pre-licensing education
requirements.
Proponents of “single licensure” assert it
increases the level of education of entry-level licensees, and assures that a
licensee had experience in the real estate business before being eligible to
open a real estate brokerage.
FISCAL IMPLICATIONS
SB507 could result in fewer total real estate
licensees if Salespersons unwilling to convert to Associate Brokers allowed
their licenses to lapse, resulting in decreased license fee revenues to the
Real Estate Commission. The Real Estate Commission’s revenue is OSF and does
not come to the general fund.
ADMINISTRATIVE IMPLICATIONS
SB507 would require staff at the Real Estate
Commission to establish mechanisms for educating their population of licensees
and for conversion of Salespersons to Associate Brokers.
CONFLICT AND RELATIONSHIP
SB 507 conflicts with Section 61-29-2 (A) (9) of
SB45, which proposes to eliminate the term “non-agent”. SB507 retains this term.
SB 507 also relates to SB571 that would retain
the existing structure of real estate licensing, but add the two-year
experience requirement for becoming a Qualifying Broker.
TECHNICAL ISSUES
When “single licensure” legislation was
introduced in 2001, it required 120 hours of pre-licensing education for the
entry-level Associate Broker license.
SB507 requires only 90 hours. It
is not known whether the sponsor intended to lower the entry-level requirement
from 120 to 90, or whether the 90-hour requirement was mistakenly taken from
the succeeding section of the law, which provides for a waiver of 90 hours of
the 180 hours currently required for a Broker’s license if the applicant
demonstrates equivalent experience.
ALTERNATIVES
The most obvious alternative would be to retain
the current structure of real estate licensing.
Another positive alternative would be enactment of SB571 in lieu of
SB507. SB571 adds a two-year experience
requirement to become a Qualifying Broker.
This would be a positive change to the license law.
Section 61-29-2 (A) (9) of SB507 could be
amended to strike paragraph (9) in its entirety. This would make SB 507 consistent with SB45,
which also strikes that paragraph.
Another possible amendment, depending on the
intent of the sponsor, would be to amend Section 61-29-9 (B) (2), Line 3 on
Page 13, and 61-29-9 (C), Line 18 on Page 13, to substitute 120 hours for 90
hours.
SJM/yr/NJW