Legislature(2015 - 2016)BARNES 124
03/30/2016 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB214 | |
| HB372 | |
| HB281 | |
| HB290 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 372 | TELECONFERENCED | |
| *+ | HB 281 | TELECONFERENCED | |
| *+ | HB 290 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 214 | TELECONFERENCED | |
HB 281-REAL ESTATE BROKER LICENSURE REQS
4:01:40 PM
CHAIR OLSON announced that the next order of business would be
HOUSE BILL NO. 281, "An Act relating to real estate broker
licensure; relating to the real estate commission; and providing
for an effective date."
4:02:30 PM
TERRY HARVEY, staff to Representative Cathy Munoz, Alaska State
Legislature, speaking on behalf of Representative Munoz, sponsor
of HB 281, provided background information on the real estate
industry in Alaska. The real estate business was an industry
consisting of small local individuals who financed property
through banks or local investors. Over time, the real estate
business has become increasingly complex involving contracts,
documents, orders, sales, trust accounts, and foreclosures. The
bill addresses education requirements and experience
requirements for a licensee seeking to apply for a broker
license. There is one broker per real estate firm, whose duties
include oversight of monetary transactions, fees, trust fund
transactions, and the ultimate responsibility for all of the
licensees associated with that firm. The proposed bill would
require additional education credits and real estate experience
of an applicant, and was brought to the legislature by the
Alaska Real Estate Commission and the Alaska Association of
REALTORS. Mr. Harvey said the intent of the bill is to better
serve consumers, ensure high quality transactions, avoid
litigation, and improve standards in Alaska. If passed, in
order to apply for a broker license, a real estate licensee or
associate broker would have to complete 30 hours of education,
and have 48 months of experience. He said the industry supports
the bill.
4:06:47 PM
REPRESENTATIVE COLVER asked if the continuing education
requirement follows a two-year license renewal cycle.
MR. HARVEY explained the bill does not change rules on
continuing education, but adds hours to the education
requirement to apply for a broker license.
REPRESENTATIVE COLVER expressed his concern about continuing
education that is not relevant specifically to Alaska; he
suggested adding a local element to the curriculum, such as
weatherization. He urged the sponsor to contact real estate
professionals regarding directing a portion of the education to
Alaska issues and laws.
REPRESENTATIVE LEDOUX observed that a bill that increases
regulation on an industry is suspect. She pointed out that the
bill would benefit current real estate brokers and make it more
difficult for others to become brokers; in fact, it would take
four years of practice to become a broker, and she questioned
the bill's value to public safety.
REPRESENTATIVE COLVER agreed that professional licensing creates
protection for an industry, and he cautioned against
exclusionary exceptions. He asked for additional background on
why the legislation is necessary.
REPRESENTATIVE HUGHES expressed interest in hearing about
problems that the bill would address.
4:15:07 PM
MR. HARVEY noted that testimony is available from those with
experiences in the real estate industry which would provide the
reasoning behind HB 281, such as the growth of the industry in
Alaska, the responsibilities of a real estate broker, the lack
of standards in Alaska, and examples of situations.
[The committee treated the hearing on HB 281 as open for public
testimony.]
4:16:33 PM
NANCY BLATCHLEY DAVIS, chair, Alaska Real Estate Commission
(AREC), informed the committee the issue was brought forward not
by AREC, but by 25 various licensees who felt brokers were not
sufficiently knowledgeable to protect the public. She said
Alaska ranks in the bottom four of broker licensing
requirements, and AREC seeks not to limit the number of brokers,
but to protect the public. Ms. Davis said AREC sees cases of
public harm that could have prevented with more education. Her
experience was that she needed a mentor to assist with her
upgrade to broker.
REPRESENTATIVE LEDOUX restated her interest in examples [of
problems].
MS. DAVIS said she could not provide an example because there
are no issues in Sitka, but offered to provide information from
AREC.
REPRESENTATIVE JOSEPHSON asked whether broker applicants are
normally real estate licensees.
MS. DAVIS said yes, if upgrading to an associate broker or
broker, licensees have been working for two years. In further
response to Representative Josephson, she said currently,
licensees can work for two years, upgrade to a broker and open
their own business. She said the licensees who approached AREC
felt there was not sufficient experience required to protect the
public.
REPRESENTATIVE LEDOUX asked for examples [of problems] including
the length of time and experience of those involved.
4:21:54 PM
KRIS CURTIS, Legislative Auditor, Legislative Audit Division,
Legislative Agencies and Offices, said an audit of the
activities of the Alaska Real Estate Commission did not identify
a specific need to change the requirements for licensees, or
identify a risk area. The audit would have shown if there was a
problem reported in meeting minutes, and AREC did not respond.
4:22:54 PM
TRACI BARICKMAN, Real Estate Licensee, said she was representing
herself as a real estate professional and as an educator. She
said she has been licensed for over 23 years - 16 years as a
broker - and has supervised thousands of transactions and
hundreds of licensees. She also serves as a commissioner of the
Alaska Real Estate Commission, has served as an educator in real
estate for 18 years, is a subject matter expert for real estate
industry testing materials, both on the state and on the
national level, and therefore her experience gives her insight
into the conduct of licensees. Ms. Barickman said real estate
is not a "buyer beware" field, and restraint of trade does not
outweigh consumer protection. A broker license in Alaska can be
obtained with only 85 hours of education and 2 years of
experience, which is much less than in other states. She said
she supports HB 281 to protect the public, and related her
recent experience with brokers who could not resolve a dispute
due to lack of an understanding of contract law, experience, and
problem-solving skills, and clients "stood to lose" $10,000 and
a $600,000 contract. Ms. Barickman said in today's climate she
would not like to be in a position supervising those with
minimal education. Protecting Alaskans' homes and financial
future is the responsibility of educators, commissioners, and
legislators.
4:26:40 PM
REPRESENTATIVE COLVER inquired as to whether there is an Alaska-
based continuing education curricula available.
MS. BARICKMAN said broker upgrade curriculum covers general real
estate knowledge in depth, including financial investments;
however, a big part is Alaska law, disclosures, and trust
accounts specific to Alaska.
REPRESENTATIVE COLVER asked whether there is a continuing
education requirement to renew licenses.
MS. BARICKMAN said yes, adding that all licensees are required
to have a minimum of 20 hours of continuing education every 2
years, and of that, 8 hours is mandated by AREC to be Alaska-
specific, and 12 hours is elective. In further response to
Representative Colver, she confirmed that the continuing
education requirement is in regulation.
4:30:30 PM
CHAIR OLSON announced public testimony would remain open.
[HB 281 was held over.]