Legislature(2015 - 2016)BARNES 124

03/30/2016 03:15 PM LABOR & COMMERCE

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as
Download Video part 1. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 372 OMNIBUS INSURANCE TELECONFERENCED
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
*+ HB 281 REAL ESTATE BROKER LICENSURE REQS TELECONFERENCED
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
*+ HB 290 EXTENDING THE REAL ESTATE COMMISSION TELECONFERENCED
Moved HB 290 Out of Committee
-- Public Testimony <Time Limit May Be Set> --
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 214 REPEAL WORKERS' COMP APPEALS COMMISSION TELECONFERENCED
Moved CSHB 214(L&C) Out of Committee
-- Public Testimony <Time Limit May Be Set> --
**Streamed live on AKL.tv**
            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.]                                                                                                         
                                                                                                                                

Document Name Date/Time Subjects
HB290 ver W.pdf HL&C 3/30/2016 3:15:00 PM
HB 290
HB290 Sponsor Statement.pdf HL&C 3/30/2016 3:15:00 PM
HB 290
HB290 Fiscal Note-DCCED-CBPL-03-25-16.pdf HL&C 3/30/2016 3:15:00 PM
HB 290
HB290 Supporting Documents-2015 Sunset Audit.pdf HL&C 3/30/2016 3:15:00 PM
HB 290
HB290 Supporting Documents-2015 Audit Summary.pdf HL&C 3/30/2016 3:15:00 PM
HB 290
HB281 ver A.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Sponsor Statement.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Sectional Analysis.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Fiscal Note-DCCED-CBPL-02-19-16.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Supporting Documents-Letter Alaska Real Estate Commission 01-15-15.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Supporting Documents-Letter Alaska Real Estate Commission 10-27-15.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Supporting Documents-Letter Alaska Association of Realtors.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Supporting Document-Pre-licensing Ed and Experience Matrix.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Opposing Documents-Letter Matt Steele.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Opposing Documents-Email Matt Steele 03-14-16.pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Draft Proposed Amendment (AS08.88.172(e)).pdf HL&C 3/30/2016 3:15:00 PM
HB 281
HB281 Draft Proposed Amendment A.2.pdf HL&C 3/30/2016 3:15:00 PM
HB 281