Legislature(1997 - 1998)
02/17/1998 01:40 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 33
"An Act relating to real estate licensing and the real
estate surety fund; and providing for an effective
date."
REPRESENTATIVE NORMAN ROKEBERG reviewed the changes made to
the work draft, 0-LS0197\R, Lauterbach, 2/14/98.
Co-Chair Therriault clarified that a realtor could still
take less of a commission in the new language.
Representative Rokeberg agreed and noted that if there
should be mitigation inside a transaction, the commission
amount could be reduced and the market place would then
again have free range.
Representative Martin MOVED that version 0-LS0197\R,
Lauterback, 2/14/98, be the version before the Committee.
There begin NO OBJECTION, it was adopted.
Representative Rokeberg spoke to Amendment #1, which would
address a miscalculation made by the drafters in the
original legislation. [Copy on File]. Co-Chair Therriault
MOVED to adopt Amendment #1. There being NO OBJECTION, it
was adopted.
Co-Chair Therriault MOVED to adopt Amendment #2. [Copy on
File]. Representative Rokeberg explained the intent of
Amendment #2, which would clarify the meaning of "by
employment" or the act of employment for an independent
contractor. Many licensees are independent contractors and
not employees. This language would help them. There being
NO OBJECTION, Amendment #2 was adopted.
Representative Mulder disclosed a conflict of interest as
he holds a real estate license.
Co-Chair Therriault MOVED to adopt Amendment #3. [Copy on
File]. Representative Rokeberg spoke to the amendment,
which redrafts the entire section on "conflict of
interest". He suggested that the new language would
minimize litigation, although, would not restrict the types
of claims resulting from cause of action that could be
brought forward.
Co-Chair Therriault supported the inclusion of the
language, which stipulates that the private person still
has the right to sue if there is misrepresentation.
Representative Martin voiced concern regarding an audit,
which involved the Alaska Housing Finance Corporation
(AHFC). Representative Rokeberg replied that
recommendations in the audit indicated that the Real Estate
Commission should address the issue. The recommendations
of the audit are fully addressed through the proposed
language.
Representative Mulder referenced the conflict of interest
language in addressing who is a "relative". He asked the
problem in representing a niece or nephew. Representative
Rokeberg replied that relative had been clearly defined in
the exception section. The exception was intended to cover
a relative managing property without licensure. He added
that language resulted from concerns by AHFC who felt that
integrity of the Real Estate Commission could come into
question.
There being NO OBJECTION, Amendment #3 was adopted.
Representative Grussendorf questioned Section #22 and
language regarding disclosure of a sex offender.
Representative Rokeberg explained that the laws as they
apply to real estate licensees have changed dramatically
over the past few years. He mentioned case law around the
U.S. dealing with disclosure of everything from ghosts to
murders. The laws create duties, which are enforced. The
duties to disclose can be cross-purposed.
Co-Chair Hanley questioned if there was a requirement to
disclose a ghost in a home. Representative Rokeberg stated
there was not. Co-Chair Hanley asked if it was the "duty"
of the agent to disclose sex offenders. Representative
Rokeberg stated that a duty could arise between the agency
relationship of the client and licensee. Co-Chair Hanley
asked the type of situations, which are required to be
disclosed. Representative Rokeberg replied that those
disclosures generally have to do with the condition of the
property.
RUTH BLACKWELL, POWELL REAL ESTATE, JUNEAU, reported that
in Juneau, everything known is disclosed. Co-Chair Hanley
noted that with concern to a physical defect, the law will
protect if it is unknown, whereas, some information such as
a homicide occurrence would not legally have to be
submitted. Discussion followed regarding the legality of
types of information being disclosed.
Co-Chair Hanley reiterated his concern resulting from suits
of selling a property, which is located next door to a sex
offender. He questioned why that liability would differ
from other pertinent info. Co-Chair Therriault pointed out
that anyone can access the database to find out where a sex
offender lives. Ms. Blackwell added that federal law
prohibits a real estate agent from disclosing who lives
next door. Although, she pointed out that the agent should
always recommend that the buyer go to the City/Borough to
find information regarding the neighboring houses.
Co-Chair Hanley pointed out that sexual offenders have an
85% chance of recidivism. He recommended that there should
be information added, which clearly defines whose
responsibility it is to disclose where sex offenders live.
Representative Rokeberg noted that it is estimated that
less than half of the sex offenders are registered. He
asked how much can we statutorily mandate an agent to
provide.
(Tape Change HFC 98- 32, Side 2).
Representative Mulder commented that there must be
consistency established by the law. He recommended that
"everything you know should be disclosed". The liability
for a real estate agent is sky high. Representative
Rokeberg pointed out that there is a disclosure statement
provided with each property sale, and perhaps a new section
should be added to the disclosure statement warning
potential buyers to seek information regarding sex
offenders in the neighborhood. Ms. Blackwell noted that
the Real Estate Commission is currently working on such a
disclosure statement.
Co-Chair Hanley supported that action, pointing out that
the general public is more concerned about sex offenders
than most other neighborhood information.
Representative Hanley MOVED to ADOPT a conceptual amendment
with language, which indicates that, the buyer is
responsible for becoming aware of the location of sex
offenders. Co-Chair Therriault recommended that language
be added which provides direction as to where a person can
be directed to find out information on sex offender's
residence. Ms. Blackwell understood that information
should be included on the property disclosure statement.
There being NO OBJECTION, the conceptual amendment was
adopted.
Representative Martin MOVED to report CS HB 33 (FIN) out of
Committee with individual recommendations and the
accompanying fiscal note. Representative Rokeberg asked if
the conceptual amendment would create greater fiscal
impact. Ms. Blackwell responded that the form was already
being changed so that it should not create a greater fiscal
impact. There being NO OBJECTION, CS HB 33 (FIN) was
reported out of Committee with "no recommendation" and with
a fiscal note by the Department of Commerce and Economic
Development dated 1/30/98.
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