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CSHB 33(L&C): "An Act relating to real estate licensees and to the real estate surety fund; and providing for an effective date."

00CS FOR HOUSE BILL NO. 33(L&C) 01 "An Act relating to real estate licensees and to the real estate surety fund; and 02 providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 08.67.010 is amended to read: 05 Sec. 08.67.010. Registration of mobile home dealers. A mobile home dealer 06 may not do business in the state unless the dealer is registered with the department. 07 However, a person licensed under AS 08.88 may, without registering under this 08 chapter, perform the same activities with respect to mobile homes as are 09 authorized for that person to perform under AS 08.88 with respect to real estate. 10 * Sec. 2. AS 08.88.051(c) is amended to read: 11 (c) The commission shall elect its officers at the first meeting of each fiscal 12 year . 13 * Sec. 3. AS 08.88.061 is amended to read: 14 Sec. 08.88.061. Assistants. Notwithstanding contrary provisions of

01 AS 08.01.050, the [THE] commission may assign or designate [USE] assistants to 02 (1) issue licenses to applicants who meet the qualifications for 03 licensure established under this chapter; 04 (2) prepare questions on examinations; 05 (3) administer and [(2)] grade examinations ; 06 (4) certify courses required under this chapter; 07 (5) approve instructors to teach courses required under this 08 chapter; and 09 (6) negotiate terms of payment of fines and other money due under 10 this chapter . 11 * Sec. 4. AS 08.88.071 is amended to read: 12 Sec. 08.88.071. Duties of the commission. (a) The commission shall 13 (1) determine whether [PASS ON QUALIFICATIONS OF] applicants 14 meet requirements for licenses under this chapter and issue licenses to those who 15 qualify; 16 (2) prepare and grade examinations; 17 (3) after hearing, have the authority to suspend or revoke the license 18 of a licensee or impose other disciplinary sanctions authorized under AS 08.01.075 19 on a licensee who 20 (A) with respect to a real estate transaction 21 (i) made a substantial misrepresentation; 22 (ii) made a false promise likely to influence, persuade, 23 or induce; 24 (iii) in the case of a real estate broker, pursued a 25 flagrant course of misrepresentation or made a false promise through 26 another [AN AGENT, ASSOCIATE REAL ESTATE BROKER, OR] 27 real estate licensee [SALESMAN]; 28 (iv) has engaged in conduct that is fraudulent or 29 dishonest; 30 (v) violates AS 08.88.391; 31 (B) procures a license by deceiving the commission, or aids

01 another to do so; 02 (C) has engaged in conduct of [IN] which the commission had 03 no knowledge at the time the licensee was licensed demonstrating the licensee's 04 unfitness to engage in the business for which the licensee is licensed; 05 (D) knowingly authorizes, directs, connives at or aids in 06 publishing, distributing, or circulating a material false statement or 07 misrepresentation concerning the licensee's business or concerning real estate 08 offered for sale , rent, or lease, or managed in the course of the licensee's 09 business in this or any other state or concerning the management of an 10 association in the course of a licensee's business in this or another state ; 11 (E) if a real estate broker, wilfully violates AS 08.88.171(d) or 12 08.88.291; 13 (F) if an associate real estate broker, claims to be a real estate 14 broker, or, if a real estate salesperson [SALESMAN], claims to be a real estate 15 broker or associate real estate broker; 16 (G) if a real estate broker, employs an unlicensed person to 17 perform activities for which a real estate license is required [ASSOCIATE 18 REAL ESTATE BROKER OR REAL ESTATE SALESMAN]; 19 (H) if an employed real estate licensee of a [ASSOCIATE] 20 real estate broker [OR REAL ESTATE SALESMAN], fails immediately to turn 21 money or other property collected in a real estate transaction over to the 22 employing real estate broker; 23 (4) prosecute, through the Department of Law, violations of the 24 provisions of this chapter or lawful regulations adopted under this chapter; 25 (5) release for publication [PUBLISH, ON THREE CONSECUTIVE 26 WEEKENDS] in a newspaper of general circulation in the locale of the offending 27 person's principal office registered with the commission notice of [LICENSED 28 UNDER THIS CHAPTER,] disciplinary action taken by the commission against a 29 person licensed under this chapter; 30 (6) issue a temporary permit to the personal representative of the estate 31 of a deceased real estate broker or to another [SOME OTHER] person designated by

01 the commission with the approval of the personal representative of the estate in order 02 to secure proper administration in concluding the affairs of the decedent broker's real 03 estate business; 04 (7) issue a temporary permit to the personal representative of a 05 legally incompetent real estate broker or to another person designated by the 06 commission with the approval of the personal representative of the broker in 07 order to secure proper administration in temporarily managing the real estate 08 business of the broker; 09 (8) establish and periodically revise the form of the seller's property 10 disclosure statement required by AS 34.70.010 ; 11 (9) have the authority to levy civil fines as established in this 12 chapter; 13 (10) revoke the license of a broker or associate broker who is 14 convicted of a felony committed while licensed under this chapter; 15 notwithstanding AS 08.88.171, a person whose license is revoked under this 16 paragraph is not qualified for a license under AS 08.88.171(a) or (b) until seven 17 years have elapsed since the person completed the sentence imposed for the felony 18 conviction . 19 (b) When an award is made from the real estate surety fund under this chapter 20 [IN REIMBURSEMENT OF LOSSES SUFFERED BY A CLAIMANT AS A 21 RESULT OF FRAUD, MISREPRESENTATION, DECEIT, OR CONVERSION OF 22 TRUST FUNDS ON THE PART OF A LICENSED BROKER, ASSOCIATE 23 BROKER, OR SALESMAN], the commission may suspend [CONSIDER THE 24 HEARING ON THE CLAIM TO BE A HEARING ON THE SUSPENSION OF] the 25 license of the real estate licensee whose actions formed the basis of the award 26 [BROKER, ASSOCIATE BROKER, OR SALESMAN, AND MAY SUSPEND THE 27 LICENSE OF THE BROKER, ASSOCIATE BROKER, OR SALESMAN]. A 28 suspension ordered under this subsection shall be lifted if the licensee [BROKER, 29 ASSOCIATE BROKER, OR SALESMAN] reaches an agreement with the commission 30 on terms and conditions for the repayment to the real estate surety fund of the money 31 awarded to the claimant and the costs of hearing the claim under AS 08.88.465. The

01 suspension shall be reimposed if the licensee [BROKER, ASSOCIATE BROKER, OR 02 SALESMAN] violates the terms of a repayment agreement entered into under this 03 subsection. 04 (c) For the purposes of (a)(3) of this section, the conduct of an employee is 05 [NOT] attributable to a real estate broker if [UNLESS] the real estate broker has actual 06 knowledge that the employee is going to engage in the conduct and agrees to the 07 conduct, either actively or by remaining silent, or ratifies the conduct after it is 08 engaged in. 09 * Sec. 5. AS 08.88.091(d) is amended to read: 10 (d) A person who is licensed under this chapter must complete 20 hours of 11 continuing education approved by the commission before the person's license may be 12 renewed. The commission may not establish limits that prevent a person from 13 satisfying this continuing education requirement within a two-day period. 14 * Sec. 6. AS 08.88.091(e) is amended to read: 15 (e) Except for a course described in (f)(1), (3), or (4) of this section, in 16 order for an educational course to be recognized for credit under this section, 17 [THE COMMISSION MAY NOT APPROVE AN EDUCATION OR CONTINUING 18 EDUCATION COURSE REQUIRED UNDER THIS SECTION UNLESS THE 19 COMMISSION CERTIFIES] the course outline and [APPROVES] the instructor of the 20 course must have been approved by the commission or the commission's designee 21 before the course was [IS] conducted. A course outline or instructor is considered 22 approved if the commission or the commission's designee does not disapprove the 23 outline or instructor within 30 days after the date on which complete application 24 was made for approval. The commission shall approve each submitted contact 25 hour of a course outline as one credit hour of continuing education. The fee for 26 continuing education course certification under AS 08.88.221 shall be based on the 27 hours approved for credit not hours submitted. 28 * Sec. 7. AS 08.88.091 is amended by adding new subsections to read: 29 (f) The commission shall establish by regulation the educational and continuing 30 educational requirements for each type of license issued by the commission. The 31 regulations for continuing education requirements must allow the following types of

01 courses to qualify for the appropriate number of credit hours, as determined by the 02 commission: 03 (1) courses that are developed by national organizations, as identified 04 for the purpose of this paragraph in the commission's regulations, that are delivered by 05 nationally certified instructors and that are required in order to earn professional 06 designations from a national organization in specialized areas of licensed real estate 07 practice; notwithstanding other provisions of this chapter, the commission may not 08 charge a fee for these courses; 09 (2) technology courses directly related to real estate practice that are 10 designed to enhance the skills and performance of a real estate licensee; 11 (3) courses offered by an accredited college or university as part of a 12 real estate curriculum that are available for at least one quarter-hour or one-half 13 semester-hour of academic credit; the commission may not charge a fee for these 14 courses; and 15 (4) courses offered and attended at a national convention for real estate 16 licenses if the courses were approved for continuing education credit by the real estate 17 licensing board of the state in which the convention was held. 18 (g) The commission shall establish core curricula for continuing education in 19 the following areas: real estate sales, property management, community association 20 management, and commercial sales. A licensee shall complete at least one of the four 21 core curricula during each biennial licensing period as part of the licensee's continuing 22 education. 23 * Sec. 8. AS 08.88.161 is amended to read: 24 Sec. 08.88.161. License required. Unless licensed as a real estate broker, 25 associate real estate broker, or real estate salesperson [SALESMAN], a [NATURAL] 26 person [, FOREIGN OR DOMESTIC CORPORATION, OR PARTNERSHIP, OR 27 LIMITED PARTNERSHIP, OR OTHER ENTITY] may not 28 (1) sell, exchange, rent, lease, auction, or purchase real estate; 29 (2) list real estate for sale, exchange, rent, lease, auction, or purchase; 30 (3) collect rent for the use of real estate or collect fees for property 31 management ;

01 (4) practice, or negotiate for a contract to practice, property 02 management; 03 (5) collect fees for community association management; 04 (6) practice, or negotiate for a contract to practice, community 05 association management; 06 (7) as a business, buy, sell, or deal in 07 (A) options in real estate; or 08 (B) options in improvements to real estate; 09 (8) [(5)] assist in or communicate with or direct the procuring of 10 prospective buyers and sellers or the negotiation of a transaction that [WHICH] 11 results or is calculated to result in the sale, exchange, rent, lease, auction, or purchase 12 of real estate; 13 (9) accept or pay a fee for the performance of any of the activities 14 listed in this section except as otherwise specifically provided in this chapter; 15 (10) [(6)] hold out to the public as being engaged in the business of 16 doing any of the things listed in this section; or 17 (11) [(7)] attempt or offer to do any of the things listed in this section 18 [. 19 (8) REPEALED]. 20 * Sec. 9. AS 08.88 is amended by adding a new section to read: 21 Sec. 08.88.167. Civil penalty for unlicensed or unauthorized practice. (a) 22 In addition to penalties prescribed by any other provision of law, if a person engages 23 or offers to engage in an activity for which a license is required under AS 08.88.161 24 without being licensed or authorized to engage in the activity in accordance with the 25 provisions of this chapter, the commission may enter an order levying a civil penalty. 26 (b) A civil penalty levied under this section may not exceed $5,000, or the 27 amount of gain realized plus $5,000, whichever is greater, for each offense. In levying 28 a civil penalty, the commission shall set the amount of the penalty imposed under this 29 section after taking into account the seriousness of the violation, the economic benefit 30 resulting from the violation, the history of violations, and other facts the commission 31 considers relevant.

01 (c) Before entering an order under (a) of this section, the commission shall 02 send the person written notice of the proposed order that grants the person a 30-day 03 period during which the person may request a hearing on the record. 04 (d) In connection with proceedings under (a) - (c) of this section, the 05 commission may issue subpoenas to compel the attendance and testimony of witnesses 06 and the disclosure of evidence and may request the department to bring an action to 07 enforce a subpoena. 08 (e) A person aggrieved by the levy of a civil penalty under this section may 09 file an appeal with the superior court for judicial review of the penalty under 10 AS 44.62.560. 11 (f) If a person fails to pay a civil penalty within 30 days after entry of an order 12 under (a) of this section, or within 10 days after the court enters a final judgment in 13 favor of the commission of an order stayed pending an appeal under (e) of this section, 14 the commission may initiate other action to recover the amount of the penalty. 15 (g) An action to enforce an order under this section may be combined with an 16 action for an injunction under AS 08.88.037. 17 * Sec. 10. AS 08.88.171 is amended to read: 18 Sec. 08.88.171. Entitlement to license. (a) A natural person qualifies [IS 19 ELIGIBLE] for a real estate broker license if the person passes the [REAL ESTATE] 20 brokers examination , [IF THE PERSON] applies for a license within six months after 21 passing the [PERSON HAS TAKEN THE REAL ESTATE BROKERS] examination, 22 [IF THE PERSON] furnishes satisfactory proof of successful completion of the 23 education requirements of AS 08.88.091, [IF THE PERSON] has had at least 24 24 months of active and continuous experience as a licensed real estate salesperson 25 within the 36 months immediately preceding application for the broker license, 26 [SALESMAN, IF THE PERSON] is not under indictment for, or seven years have 27 elapsed since the person has completed a sentence imposed upon conviction of, 28 forgery, theft, extortion, conspiracy to defraud creditors, or any other felony involving 29 moral turpitude, and [IF THE PERSON] is an owner of a real estate business or 30 employed as a real estate broker by a foreign or domestic corporation , [OR A] 31 partnership, limited partnership, or limited liability company [AND IF THAT

01 CORPORATION OR PARTNERSHIP DOES NOT HAVE AN EXISTING 02 LICENSED BROKER. UNLESS THE BROKER FAILS TO PAY THE BIENNIAL 03 RENEWAL FEE OR UNLESS THE BROKER'S LICENSE IS SUSPENDED OR 04 REVOKED UNDER AS 08.88.071(a)(3), THE REAL ESTATE BROKER'S LICENSE 05 CONTINUES IN EFFECT SO LONG AS THE BROKER IS AN OWNER OF A 06 REAL ESTATE BUSINESS, OR THE BROKER IS EMPLOYED AS A REAL 07 ESTATE BROKER BY A CORPORATION OR A PARTNERSHIP]. If the broker 08 stops being an owner of a real estate business [,] or stops being employed as a real 09 estate broker by a foreign or domestic corporation , [OR] partnership , limited 10 partnership, or limited liability company , the broker's license is suspended from the 11 time the broker stops until 12 (1) the broker again becomes an owner of a real estate business or is 13 again employed as a real estate broker by a foreign or domestic corporation , [OR A] 14 partnership , limited partnership, or limited liability company ; or 15 (2) the broker is employed by another [A LICENSED REAL 16 ESTATE] broker as an associate [REAL ESTATE] broker, in which case the real 17 estate broker license shall be [IS] returned to the commission by the broker , and the 18 commission shall issue [ISSUES] the broker an associate real estate broker license. 19 (b) A natural person qualifies [IS ELIGIBLE] for an associate real estate 20 broker license if the person passes the [REAL ESTATE] brokers examination, [IF THE 21 PERSON] applies for the [A] license within six months after passing [THE PERSON 22 HAS TAKEN] the examination, [IF THE PERSON] submits satisfactory proof of 23 successful completion of the education requirements of AS 08.88.091, [IF THE 24 PERSON] has had at least 24 months of active and continuous experience as a licensed 25 real estate salesperson within the 36 months immediately preceding application for 26 the license, [SALESMAN, IF THE PERSON] is not under indictment for, or five 27 years have elapsed since the person has completed a sentence imposed upon conviction 28 of, forgery, theft, extortion, conspiracy to defraud creditors, or any other felony 29 involving moral turpitude, and [IF THE PERSON] is employed by a licensed real 30 estate broker as an associate real estate broker. Unless the associate broker fails to 31 renew the license [PAY THE BIENNIAL RENEWAL FEE] or unless the associate

01 broker's license is suspended or revoked [UNDER AS 08.88.071(a)(3)], the associate 02 [REAL ESTATE] broker's license continues in effect as [SO] long as the associate 03 broker is employed by a licensed real estate broker as an associate broker. If the 04 associate broker stops being employed by a licensed real estate broker, the associate 05 broker's license is suspended from the time the associate broker stops until 06 (1) the associate broker again is employed by a real estate broker as an 07 associate broker; or 08 (2) the associate broker becomes an owner of a real estate business or 09 is employed as a real estate broker by a foreign or domestic corporation, 10 partnership, limited partnership, or limited liability company , in which case the 11 associate broker's [ASSOCIATE REAL ESTATE BROKER] license shall be [IS] 12 returned to the commission by the associate broker , and the commission shall issue 13 [ISSUES] the licensee [ASSOCIATE BROKER] a broker's [REAL ESTATE 14 BROKER] license. 15 (c) A natural person qualifies [IS ELIGIBLE] for a real estate salesperson 16 [SALESMAN] license if the person passes the real estate salesperson [SALESMAN] 17 examination, [IF THE PERSON] applies for the [A] license within six months after 18 passing [THE PERSON HAS TAKEN] the examination, [IF THE PERSON] submits 19 satisfactory proof of successful completion of the education requirements of 20 AS 08.88.091, [IF THE PERSON] is at least 19 years old, [IF THE PERSON] is not 21 under indictment for forgery, theft, extortion, conspiracy to defraud creditors, or any 22 other felony involving moral turpitude, or, if convicted of such an offense, the person 23 has completed the sentence imposed upon conviction, and [IF THE PERSON] is 24 employed by a real estate broker. Unless the salesperson [SALESMAN] fails to 25 renew the license [PAY THE BIENNIAL RENEWAL FEE] or unless the real estate 26 salesperson's [SALESMAN'S] license is suspended or revoked [UNDER 27 AS 08.88.071(A)(3)], a real estate salesperson's [SALESMAN'S] license continues in 28 effect as [SO] long as the salesperson [SALESMAN] is employed as a salesperson 29 [SALESMAN] by a licensed real estate broker. If the salesperson [SALESMAN] 30 stops being employed as a real estate salesperson [SALESMAN], the real estate 31 salesperson's [SALESMAN'S] license is suspended from the time the salesperson

01 [SALESMAN] stops until the salesperson [SALESMAN] again is employed as a real 02 estate salesperson [SALESMAN] by a licensed real estate broker. 03 (d) A real estate licensee shall promptly inform the commission of a change 04 in business association that affects the status of the licensee's license under this 05 section. 06 * Sec. 11. AS 08.88.171 is amended by adding new subsections to read: 07 (e) Notwithstanding (a) - (d) of this section, a natural person qualifies for a 08 limited license to practice community association management under (f) of this section 09 if the person 10 (1) applies by January 1, 1999; 11 (2) pays the required fees; 12 (3) demonstrates to the commission's satisfaction that the person has 13 engaged in the practice of community association management for at least 24 months 14 before January 1, 1999; and 15 (4) meets other requirements that may be established by the 16 commission in its regulations for issuance of a license under this subsection. 17 (f) A person who qualifies under (e) of this section shall be issued an associate 18 broker license if, at the time of issuance, the person is employed by a broker. A 19 person who qualifies under (e) of this section shall be issued a broker license if, at the 20 time of issuance, the person is the owner of a community association management 21 business or is employed as a community association manager by a foreign or domestic 22 corporation, partnership, limited partnership, or limited liability company. After initial 23 issuance of a license to a person under this subsection, the person is subject to the 24 same requirements that exist for other brokers and associate brokers licensed under this 25 chapter. However, notwithstanding other provisions of this chapter, under a license 26 issued under this subsection, a person may practice only community association 27 management and does not qualify as a broker or associate broker for purposes of 28 AS 08.88.161(1) - (4), (7), or (8) or 08.88.165(2). A person issued a limited license 29 to practice community association management under this section may not use the 30 terms "salesperson," "broker," or "associate broker" for any business purpose. 31 * Sec. 12. AS 08.88 is amended by adding new sections to read:

01 Sec. 08.88.173. Fidelity bond for community association managers. (a) If 02 the board of directors of a community association allows a broker to exercise some 03 control over community association fees or other community association funds, the 04 broker must provide evidence to the commission that the broker is covered by a 05 blanket fidelity insurance bond. The bond may be in the name of the broker with the 06 association as an additional insured or in the name of the association with the broker 07 as an additional insured. The bond must cover the maximum funds that will be within 08 the control of the community association manager at any time while the bond is in 09 force. The commission may adopt regulations to implement this subsection, including 10 regulations concerning the minimum coverage and terms of coverage that are required 11 and proof of bond and the granting of exemptions. 12 (b) If a loss covered by the fidelity bond required under this section is also 13 reimbursable from the real estate surety fund, the owners' association that suffered the 14 loss may not recover under the bond until the association has filed a claim for 15 reimbursement under AS 08.88.460 and proceedings relating to the claim are 16 concluded. 17  Sec. 08.88.175. Limitations on community association managers. A 18 licensee may not, within the practice of community association management, exercise 19 control over the 20 (1) reserves or investment accounts of a community association; 21 (2) operating account of a community association unless 22 (A) allowed under a contract that has been approved by the 23 association's board of directors; and 24 (B) duplicate financial statements concerning the account are 25 sent by the institution holding the account to the licensee and the association's 26 board of directors at separate addresses. 27 * Sec. 13. AS 08.88.181(a) is amended to read: 28 (a) The real estate examinations [EXAMINATION] may include [, BUT IS 29 NOT NECESSARILY LIMITED TO,] questions on real estate business ethics and 30 standards ; arithmetic; elementary principles of land economics and appraisal; the 31 general principles in state statutes relating to deeds, mortgages, real estate contracts,

01 subdivisions, legal descriptions, building restrictions, agency, disclosure requirements, 02 trust accounting requirements, landlord and tenant law, property management 03 ethics and standards, accounting, community association management operations 04 and ethics and standards, nonprofit corporation creation and operation, and 05 brokerage; and the general provisions of this chapter and of the regulations of the 06 commission. 07 * Sec. 14. AS 08.88.191(b) is amended to read: 08 (b) If the commission authorizes the department to contract with a national 09 testing service to prepare, administer , and grade examinations, 10 (1) the commission or its designee shall review the examination and 11 approve its contents; 12 (2) application for an [THE] examination [, ACCOMPANIED BY THE 13 PROPER FILING FEE,] may be transmitted by the applicant directly to the national 14 testing service ; payment of an examination fee shall be made by the applicant 15 directly to the national testing service's designated representative before the 16 examination is taken by the applicant . 17 * Sec. 15. AS 08.88.201 is amended to read: 18 Sec. 08.88.201. Reexamination. A person who fails an examination may 19 apply for a subsequent examination, but shall pay the application fee with [FOR] each 20 application. 21 * Sec. 16. AS 08.88.221 is amended to read: 22 Sec. 08.88.221. Fees. The Department of Commerce and Economic 23 Development shall set fees under AS 08.01.065 for a real estate broker, associate 24 broker, or salesperson [SALESMAN] licensee or applicant for the following: 25 (1) examination; 26 (2) [RECIPROCITY; 27 (3)] initial license; 28 (3) [(4)] renewal of an active license; 29 (4) [(5)] renewal of an inactive license; 30 (5) [(6)] amending or transferring a license; 31 (6) [(7)] publications offered by the commission;

01 (7) [(8)] seminars offered by the commission ; 02 (8) reinstatement of a lapsed license; 03 (9) changes to registered office information; 04 (10) course certification and recertification; and 05 (11) instructor approval and renewal of approval . 06 * Sec. 17. AS 08.88.241 is repealed and reenacted to read: 07 Sec. 08.88.241. Reinstatement of lapsed license. (a) A person whose real 08 estate license has lapsed less than 24 months is eligible for reinstatement of the license 09 if the person provides the required application, license fees, proof of continuing 10 education as required by AS 08.88.091 for licensing periods during which the license 11 was inactive or lapsed. 12 (b) A real estate licensee whose license has been lapsed for more than 24 13 months is not eligible for reinstatement of the license and is eligible for the license 14 only by meeting the qualifications applicable to initial licensure under AS 08.88.171. 15 * Sec. 18. AS 08.88.251 is amended to read: 16 Sec. 08.88.251. Inactive license. (a) A real estate licensee who intends to 17 [PERSON LICENSED BY THE COMMISSION MAY] become inactive shall return 18 [BY RETURNING] to the commission the person's license certificate and a completed 19 inactivation form provided by the commission along with any applicable fees . [IN 20 THE FORM, THE PERSON SHALL STATE THE DATE ON WHICH THE PERSON 21 INTENDS TO BECOME INACTIVE. THE PERSON'S INACTIVE STATUS 22 BEGINS ON THE DATE STATED.] The commission shall issue the person an 23 inactive license certificate. 24 (b) An inactive licensee may not attempt or offer to do any of the activities 25 listed in AS 08.88.161, but may receive commissions or other payments from the 26 broker who previously contracted with or employed the licensee for services 27 performed while actively licensed [EXCEPT AS OTHERWISE ALLOWED FOR 28 UNLICENSED PERSONS UNDER AS 08.88.165]. 29 (c) A person who has an [IS] inactive license certificate under (a) of this 30 section may reactivate the license [BECOME ACTIVE] by applying for an active 31 license and paying the required fees. [IN THE APPLICATION FORM THE PERSON

01 SHALL STATE THE DATE ON WHICH THE PERSON INTENDS TO BECOME 02 ACTIVE. THE PERSON'S ACTIVE STATUS BEGINS ON THE DATE STATED. 03 THE COMMISSION SHALL SEND THE PERSON A LICENSE CERTIFICATE.] 04 A person is eligible for change from an inactive to an active status under this 05 subsection only [WITHOUT EXAMINATION] if the person has [NOT] been in 06 inactive status for less [MORE] than 24 months [TWO YEARS]. If the person has 07 been in inactive status for 24 months or for more than 24 months [TWO YEARS], 08 the person is required to meet the requirements for initial licensure in order to be 09 licensed under this chapter again [TAKE AN EXAMINATION]. 10 * Sec. 19. AS 08.88.281 is amended to read: 11 Sec. 08.88.281. Real estate surety fund. Before issuing a license to an 12 applicant under this chapter, the commission shall ensure [DETERMINE] that the 13 applicant has complied with the provisions of AS 08.88.455 and is covered by the real 14 estate surety fund established in AS 08.88.450. 15 * Sec. 20. AS 08.88.291 is amended to read: 16 Sec. 08.88.291. Location. A person licensed as a real estate broker shall , by 17 registering with the commission, inform the commission of the person's 18 [BROKER'S] principal office and of any branch offices of the person's real estate 19 business and include in the information the names of the real estate licensees who 20 are employed at each office. A [BROKER HAS. THE BROKER AND THE 21 ASSOCIATE] real estate licensee [BROKERS AND REAL ESTATE SALESMEN 22 THE BROKER EMPLOYS] may do real estate business only through a [IN OR OUT 23 OF THE BROKER'S] principal office or from a [AND THE BROKER'S] branch 24 office registered by the broker by whom the licensee is employed [OFFICES]. 25 Failure of a real estate broker to maintain a place of business or to inform the 26 commission of its location and the names and addresses of all real estate licensees 27 employed at each location by the broker is [UNDER THE BROKER'S 28 JURISDICTION AT THE LOCATION ARE] grounds for the suspension or revocation 29 of the broker's license. 30 * Sec. 21. AS 08.88.301 is amended to read: 31 Sec. 08.88.301. Change of location. Before [IF] a real estate broker changes

01 the location of the broker's principal office or of a branch office, the broker shall 02 [IMMEDIATELY] notify the commission of the new address and any other office 03 changes on a form provided by the commission and pay the applicable fees . 04 * Sec. 22. AS 08.88.311 is amended to read: 05 Sec. 08.88.311. Branch offices. (a) A branch office shall be under the direct 06 supervision of a real estate associate broker whose principal place of business is that 07 office and who is licensed under this chapter. An associate [REAL ESTATE] broker 08 may serve in the capacity of direct supervisor at only one office [ONLY]. 09 (b) A [ALL] branch office [OFFICES] shall bear and be advertised only in the 10 name of the principal office but may also indicate that it is a [THEY ARE] branch 11 [OFFICES OF THE PRINCIPAL] office. 12 * Sec. 23. AS 08.88.321 is repealed and reenacted to read: 13 Sec. 08.88.321. Possession and display of license certificates. (a) The 14 license certificate of a real estate broker shall be displayed in the broker's principal 15 office. 16 (b) The license certificate of each licensee working in the broker's principal 17 office shall be displayed in that office. 18 (c) The license certificate of the designated associate broker who is in charge 19 of a branch office and the certificate of each licensee working in a branch office shall 20 be displayed in the branch office indicated as the office of the licensees' employment 21 in the registration required under AS 08.88.291. 22 (d) Certificates displayed under this section must be displayed where they are 23 available for public clients and customers to verify the current active status of licensees 24 working in the office. 25 * Sec. 24. AS 08.88.331 is amended to read: 26 Sec. 08.88.331. Making of transactions. An active [A] real estate 27 salesperson [SALESMAN] or associate real estate broker may perform activities for 28 which a real estate license is required [MAKE A REAL ESTATE TRANSACTION] 29 only through the real estate broker who employs or contracts with the licensee 30 [REAL ESTATE SALESMAN OR ASSOCIATE REAL ESTATE BROKER]. All 31 money or other proceeds collected in trust and related to a real estate transaction

01 [ON BEHALF OF THE BROKER] shall immediately be turned over to the broker or 02 the broker's authorized agent. [ALL TRANSACTIONS IN REAL ESTATE BY A 03 REAL ESTATE SALESMAN OR ASSOCIATE REAL ESTATE BROKER SHALL 04 BE PROCESSED THROUGH THE REAL ESTATE SALESMAN'S OR THE 05 ASSOCIATE REAL ESTATE BROKER'S EMPLOYING REAL ESTATE 06 BROKER'S OFFICE, WHETHER THE TRANSACTIONS ARE FOR THE REAL 07 ESTATE SALESMAN'S OR ASSOCIATE REAL ESTATE BROKER'S OWN USE 08 OR THE USE OF A CLIENT.] 09 * Sec. 25. AS 08.88.341 is amended to read: 10  Sec. 08.88.341. Listings and management contracts . All real estate listings 11 and management contracts must be in writing and must be signed by the broker 12 [SELLER] or associated licensee [BY AN AGENT] of the broker and by the client 13 or an authorized representative of the client for whose benefit the real estate 14 licensee will act [SELLER]. All real estate exclusive listings and management 15 contracts must have a definite expiration date that may be renewed or extended 16 only by a written agreement signed by the client or the client's authorized 17 representative . 18 * Sec. 26. AS 08.88.351 is amended to read: 19 Sec. 08.88.351. Record of transaction. A real estate broker shall 20 (1) keep a complete record , [OF ALL REAL ESTATE 21 TRANSACTIONS MADE BY THE BROKER OR EMPLOYEES OF THE BROKER] 22 for [AT LEAST] three years , of all real estate transactions in which the broker or 23 employed licensees of the broker engaged ; 24 (2) provide upon request to any principal in a transaction an 25 [MAKE A CLOSING STATEMENT SHOWING DISBURSEMENTS AND] 26 accounting for all money or other property collected or held in the course of each 27 transaction; 28 (3) keep a separate trust account in a bank [,] into which the broker 29 shall deposit all earnest money deposits , [AND] purchase money , security deposits, 30 contingency funds, collected rental money, rental receipts, or other money 31 collected in trust until it is appropriate [PROPER] for the broker to distribute the

01 money to the proper persons; 02 (4) if authorized by the board of directors of a community 03 association to collect, control, or disburse association funds, keep a separate 04 account in a bank for the funds; 05 (5) make available to the commission, on request, account records and 06 all other documents [RELATING TO TRANSACTIONS UNDER (3) OF THIS 07 SECTION] that the commission may require in order to conduct an investigation or 08 to [A COMPLETE] audit an account required under this section; 09 (6) if records are delivered to a partnership, corporation, or 10 business entity other than another licensed broker upon termination of 11 employment, ensure by contract the maintenance and availability of those records 12 for a minimum of three years in accordance with this section [OF TRUST 13 ACCOUNTS]. 14 * Sec. 27. AS 08.88.351 is amended by adding new subsections to read: 15 (b) A real estate licensee 16 (1) shall keep, for a minimum of three years, a complete record of all 17 real estate transactions in which the licensee was a principal; 18 (2) who maintains records concerning management or sale of the 19 licensee's own properties or the licensee's client properties separate from the broker's 20 file, shall retain those records for a minimum of three years; 21 (3) shall make available to the commission, on request, records and 22 other documents that the commission may require to conduct an investigation. 23 (c) For the purposes of this section, the three-year requirement for records 24 maintenance begins at the initiation of a transaction and continues, as applicable, until 25 three years after the date 26 (1) a listing agreement ends; 27 (2) a sales transaction closes or otherwise ends; 28 (3) a management contract ends; or 29 (4) another contractual or fiduciary obligation ends. 30 * Sec. 28. AS 08.88.361 is amended to read: 31 Sec. 08.88.361. When commission or other fee is earned. An obligation to

01 pay a [A] commission , management fee, or other compensation to a real estate 02 broker must be based on [IS EARNED WHEN THE REAL ESTATE BROKER 03 FULFILLS] the terms of a written listings and management [PERSONAL 04 SERVICES] contract. Other than through enforcement of the terms of a written 05 listings and management contract, a licensee has no right under law to enforce 06 collection of a commission or other fee for a service that requires a real estate 07 license. 08 * Sec. 29. AS 08.88.381 is amended to read: 09 Sec. 08.88.381. Signs. A [LICENSED] real estate broker shall maintain a sign 10 at each of the [REAL ESTATE] broker's registered real estate offices [,] prominently 11 showing the name of the real estate [BROKER'S] business as registered with the 12 commission. The required size, content, and location of signs under this section 13 may be determined by the commission under regulations. The regulations must 14 allow signs in offices located on premises with more restrictive sign requirements 15 than would otherwise be applicable under the commission's regulations to be 16 considered to be in compliance with the regulations if the signs meet the 17 requirements of the premises and the licensee submits a copy of the sign 18 requirements of the premises to the commission . 19 * Sec. 30. AS 08.88.391 is amended to read: 20 Sec. 08.88.391. Conflict of interest. A [LICENSED] real estate licensee 21 [BROKER, ASSOCIATE REAL ESTATE BROKER, OR REAL ESTATE 22 SALESMAN] who has a personal financial interest or other conflict of interest 23 relating to [IN] a real estate transaction shall , at the time of initial substantive 24 contact with the principals or agents of the principals, disclose that interest in 25 writing to the principals and agents of the principals [EVERY PERSON] involved 26 in the transaction. In this section, "conflict of interest" is when a licensee 27 (1) has a present personal interest in the property that is the 28 subject of a transaction; 29 (2) is whole or part owner of a business interest in the property 30 being marketed or considered for purchase or lease; 31 (3) represents a person with whom the licensee has a financial

01 relationship or who has a present financial interest in the property being 02 marketed or considered for purchase or lease; 03 (4) represents more than one party in a transaction without giving 04 disclosure notification as required by law; 05 (5) receives compensation from someone other than a party to the 06 contract or another party having a financial interest in the transaction. 07 * Sec. 31. AS 08.88.396 is amended to read: 08 Sec. 08.88.396. Disclosure of agency to prospective buyers and sellers . (a) 09 A person licensed [HOLDING A LICENSE] under this chapter shall, when acting as 10 an agent for a prospective seller of real estate, 11 (1) disclose in writing the licensee's [PERSON'S] agency relationship 12 with the seller to each prospective buyer at the time that the licensee [PERSON] 13 begins to provide specific assistance to locate or acquire real estate for the buyer, and 14 obtain from each prospective buyer a signed acknowledgement that the buyer is aware 15 of the agency relationship between the licensee [PERSON LICENSED UNDER THIS 16 CHAPTER] and the seller; and 17 (2) include in the purchase agreement a statement of the agency 18 relationship between the licensee [PERSON LICENSED UNDER THIS CHAPTER] 19 and the seller. 20 (b) A person licensed [HOLDING A LICENSE] under this chapter shall, when 21 acting as an agent for a prospective buyer of real estate, 22 (1) disclose the licensee's [PERSON'S] relationship with the buyer to 23 a prospective seller of real estate, or to the seller's agent, at the time of the initial 24 contact between the licensee [PERSON LICENSED UNDER THIS CHAPTER] and 25 the prospective seller or the seller's agent, and confirm the relationship in writing as 26 soon as possible after the initial contact; 27 (2) include in the purchase agreement a statement of the agency 28 relationship between the licensee [PERSON LICENSED UNDER THIS CHAPTER] 29 and the buyer; 30 (3) if the prospective seller has an unexpired exclusive listing contract 31 for a property, present all offers [AN OFFER] to purchase that property through [TO]

01 the seller's agent; and 02 (4) disclose in writing to all parties to a transaction when the licensee's 03 [PERSON'S] compensation as agent for the buyer is to be paid by anyone other than 04 the buyer being represented by the licensee [PERSON]. 05 (c) A person licensed under this chapter may [NOT] act as an agent for both 06 a prospective seller and a prospective buyer of real estate only after [UNLESS] the 07 licensee [PERSON] informs both the seller and the buyer of the dual agency and 08 obtains written consent to the dual [JOINT] agency from both principals . 09 (d) When a change occurs during a transaction that makes a prior written 10 disclosure required by this section incomplete, misleading, or inaccurate, the licensee 11 [PERSON LICENSED UNDER THIS CHAPTER] shall make a revised disclosure, in 12 writing, to all parties to the transaction as soon as possible. The revised disclosure 13 must include the date of the revision and shall be acknowledged in writing by all the 14 parties. 15 * Sec. 32. AS 08.88 is amended by adding a new section to read: 16 Sec. 08.88.397. Licensed assistants. A licensed real estate salesperson or 17 licensed associate real estate broker may act as a licensed assistant to a real estate 18 licensee other than the broker who employs the salesperson or associate broker if 19 (1) the employment arrangement between the licensed assistant and the 20 other licensee is in writing and conforms to the applicable state and federal regulations 21 regarding employment; 22 (2) the employment of the licensed assistant is approved in writing by 23 the broker of the licensee who employs the assistant; 24 (3) the licensee who employs the assistant agrees to be responsible for 25 paying the licensed assistant's wages and appropriate taxes and completing the 26 appropriate state and federal tax forms; 27 (4) the broker of the licensee who employs the assistant agrees to be 28 liable for the actions of the licensed assistant. 29 * Sec. 33. AS 08.88.401 is amended to read: 30 Sec. 08.88.401. Prohibited conduct. (a) A person licensed under this chapter 31 may not falsely represent to

01 (1) have been awarded a degree or other designation ; 02 (2) [OR TO] be a member or an affiliate of a professional organization ; 03 or 04 (3) be a member of a franchise or other business association . 05 (b) A person licensed under this chapter 06 (1) [WHO IS NOT A REAL ESTATE BROKER LICENSED IN THIS 07 STATE] may not pay [ACCEPT] a fee or a commission for performance of an act for 08 which a license is required by this chapter to a person unless the person is licensed 09 under this chapter, except that a real estate broker may pay to a person validly 10 licensed as a broker in another state [MAY ACCEPT] a fee or commission [OR A 11 PORTION OF A FEE OR COMMISSION] for assisting [A REAL ESTATE BROKER 12 LICENSED IN THIS STATE] in the performance of an act for which a license is 13 required by this chapter; 14 (2) as an associate broker or [WHO IS A] real estate salesperson 15 [SALESMAN LICENSED IN THIS STATE] may [NOT] accept a fee or commission 16 for performance of an act for which a license is required by this chapter only from 17 [UNLESS ACCEPTANCE IS AUTHORIZED BY] the licensee's employing broker , 18 except that the wages of a person who is engaged as a licensed assistant under 19 AS 08.88.397 may be accepted by the person from the assistant's employer [WHO 20 EMPLOYS THE SALESMAN]. 21 (c) A person licensed under this chapter may not knowingly make, authorize, 22 direct, or aid in the publication of a false statement or misrepresentation concerning 23 land or a subdivision or other real estate offered for sale , [OR] lease , or rent or 24 concerning an association being managed . 25 (d) A person who violates [A PROVISION OF] this section, AS 08.88.161, 26 or 08.88.396 is guilty of a class A misdemeanor. 27 * Sec. 34. AS 08.88.401 is amended by adding new subsections to read: 28 (e) A person licensed under this chapter may not knowingly pay any part of 29 a fee, commission, or other compensation received by the licensee in buying, selling, 30 exchanging, leasing, auctioning, or renting real estate to 31 (1) a person who is not licensed under this chapter, except as provided

01 in (f) of this section; 02 (2) another licensee, except through the licensee's responsible broker; 03 or 04 (3) another licensee knowing that the other licensee intends to pay all 05 or a portion of that which is received to a person who is not licensed under this 06 chapter. 07 (f) The prohibition of (e)(1) of this section does not prohibit 08 (1) payments by a licensee to a person licensed to perform real estate 09 activities in another jurisdiction if the other person has assisted the licensee in the 10 performance of an act for which a license is required by this chapter; 11 (2) negotiations between a licensee and a principal in a real estate 12 transaction concerning the amount of a commission or other compensation; or 13 (3) payments from a real estate licensee to a principal as part of the 14 resolution of a dispute regarding the terms of a transaction or regarding the property 15 transferred. 16 (g) A person may not 17 (1) use or attempt to use a license issued under this chapter that was 18 issued to another person; 19 (2) give false or forged evidence to the commission or to a 20 representative of the commission in an attempt to obtain a license; 21 (3) impersonate an applicant under this chapter; 22 (4) knowingly use or attempt to use an expired, suspended, revoked, 23 or nonexistent license; or 24 (5) falsely claim to be licensed and authorized to practice under this 25 chapter. 26 * Sec. 35. AS 08.88.405 is amended to read: 27 Sec. 08.88.405. Preparation of documents. Notwithstanding AS 08.08, a 28 person licensed as a real estate broker, associate real estate broker, or real estate 29 salesperson under this chapter may prepare real property contracts, mobile home 30 contracts, earnest money agreements, leases, and other documents related to real 31 property or mobile homes if the documents are prepared by the person in the course

01 of the person's work as a licensed real estate broker, associate real estate broker, or 02 real estate salesperson under this chapter. 03 * Sec. 36. AS 08.88.450 is amended to read: 04 Sec. 08.88.450. Real estate surety fund. The real estate surety fund is 05 established in the general fund to carry out the purposes of AS 08.88.450 - 08.88.500. 06 The fund is composed of payments made by [LICENSED] real estate licensees 07 [BROKERS AND SALESMEN] under AS 08.88.455 and filing fees retained under 08 [IN ACCORDANCE WITH] AS 08.88.460. The fund may not exceed $500,000 and 09 amounts in the fund in excess of $250,000 may be appropriated for real estate 10 educational purposes as provided in AS 08.88.091. 11 * Sec. 37. AS 08.88.455 is amended to read: 12 Sec. 08.88.455. Payments by real estate licensees [BROKERS AND 13 SALESMEN]. (a) A [LICENSED] real estate licensee, [BROKER, ASSOCIATE 14 BROKER, OR SALESMAN] when applying for [OBTAINING] or renewing a real 15 estate license, in lieu of obtaining a corporate surety bond, shall pay to the commission 16 in addition to the license fee, a surety fund fee not to exceed $125. After the fund 17 reaches $250,000 , the commission shall by regulation adjust the surety fund fees so 18 that, taking into account anticipated expenditures for claims against the fund and real 19 estate educational purposes, the fund is maintained at a level not less than $250,000. 20 (b) All fees collected under this section shall be paid at least once a month by 21 the department [COMMISSION] into the general fund. These payments shall be 22 credited to the real estate surety fund. 23 * Sec. 38. AS 08.88.460 is amended to read: 24 Sec. 08.88.460. Claim for payment. (a) Subject to (e) of this section, a [A] 25 person seeking reimbursement for a loss suffered in a real estate transaction as a result 26 of fraud, misrepresentation, deceit, or the conversion of trust funds or community 27 association accounts under the control of a community association manager on the 28 part of a real estate licensee [BROKER, ASSOCIATE REAL ESTATE BROKER, OR 29 REAL ESTATE SALESMAN LICENSED UNDER THIS CHAPTER] shall make a 30 claim to the commission for reimbursement on a form furnished by the commission. 31 In order to be eligible for reimbursement by the commission, the claim form must

01 be filed within two years after the occurrence of the fraud, misrepresentation, 02 deceit, or conversion of trust funds or community association accounts under the 03 control of a community association manager claimed as the basis for the 04 reimbursement. The form shall be executed under penalty of unsworn falsification 05 [,] and must include the following: 06 (1) the name and address of each [THE] real estate licensee involved 07 [BROKER, ASSOCIATE REAL ESTATE BROKER, OR REAL ESTATE 08 SALESMAN]; 09 (2) the amount of the alleged loss; 10 (3) the date or period of time during which the alleged loss occurred; 11 (4) the date upon which the alleged loss was discovered; 12 (5) the name and address of the claimant; and 13 (6) a general statement of facts relative to the claim. 14 (b) A copy of a claim filed with the commission under (a) of this section shall 15 be sent to each [THE] real estate licensee [BROKER, ASSOCIATE REAL ESTATE 16 BROKER, OR REAL ESTATE SALESMAN] alleged to have committed the 17 misconduct resulting in losses, to the principal [AS WELL AS A] real estate broker 18 employing a licensee [AN ASSOCIATE REAL ESTATE BROKER OR REAL 19 ESTATE SALESMAN] alleged to have committed the conduct resulting in losses, and 20 to any other real estate licensee involved in the transaction at least 20 days before 21 any hearing held on the claim by the commission. 22 (c) Within seven days after receipt of notice of a claim under (b) of this 23 section , each [THE] real estate licensee [BROKER, ASSOCIATE REAL ESTATE 24 BROKER, OR REAL ESTATE SALESMAN] against whom the claim is made may 25 elect to defend the claim as a small claims action in district court under District Court 26 Civil Rules 8 - 22 [,] if the claim does not exceed the small claims jurisdictional limit. 27 An election to defend a claim in district court under the small claims rules may not 28 be revoked by the real estate licensee [BROKER, ASSOCIATE BROKER, OR 29 SALESMAN] without the consent of the claimant. Upon receipt of a valid written 30 election under this subsection , the commission shall dismiss the claim filed with the 31 commission and notify the claimant that the claim must be brought as a small claims

01 action in the appropriate state court. 02 (d) A claimant under this section shall pay a filing fee of $250 to the 03 commission at the time the claim is filed. The filing fee shall be refunded [ONLY] 04 if 05 (1) the commission makes an award to the claimant from the real estate 06 surety fund; 07 (2) the claim is dismissed under (c) of this section; or 08 (3) the claim is withdrawn by the claimant before the commission holds 09 a hearing on the claim. 10 * Sec. 39. AS 08.88.460 is amended by adding a new subsection to read: 11 (e) If the claim is for a loss incurred as a result of acts or omissions occurring 12 in the course of the licensee's practice of community association management, only the 13 owners' association for which the real estate licensee practices community association 14 management may file a claim under this section. 15 * Sec. 40. AS 08.88.465(b) is amended to read: 16 (b) A certified or authenticated copy of a record, including a transcript of 17 testimony, of a hearing held under AS 08.88.071(a)(3) in which fraud, 18 misrepresentation, deceit, or conversion of trust funds or community association 19 accounts under the control of a community association manager on the part of a 20 [LICENSED BROKER, ASSOCIATE BROKER, OR] real estate licensee 21 [SALESMAN] is established [,] may constitute sufficient evidence to support a finding 22 that a claim should be paid . 23 * Sec. 41. AS 08.88.465(c) is amended to read: 24 (c) Before the commission finds that payment should be made from the real 25 estate surety fund, each [THE] real estate licensee against whom the claim is made 26 [BROKER, ASSOCIATE BROKER, OR REAL ESTATE SALESMAN] shall be 27 afforded an opportunity to file with the commission, within 10 days after receipt of 28 notification of the claim under AS 08.88.460(b), either a written statement in 29 opposition to the claim or an application for the presentation of additional evidence. 30 * Sec. 42. AS 08.88.465(d) is amended to read: 31 (d) The claimant bears the burden of proof of establishing that the claimant

01 suffered losses in a real estate transaction as a result of fraud, misrepresentation, 02 deceit, or the conversion of trust funds or community association accounts under the 03 control of a community association manager on the part of a real estate licensee 04 [BROKER, ASSOCIATE REAL ESTATE BROKER, OR REAL ESTATE 05 SALESMAN] and the extent of those losses. All facts shall be established by a 06 preponderance of the evidence. 07 * Sec. 43. AS 08.88.470 is amended to read: 08 Sec. 08.88.470. Findings and payment. At the conclusion of the 09 commission's consideration of a claim made under AS 08.88.460, it shall make written 10 findings and conclusions on the evidence. If the commission finds that the claimant 11 has suffered a loss in a real estate transaction as a result of fraud, misrepresentation, 12 deceit, or the conversion of trust funds or community association accounts under the 13 control of a community association manager on the part of a real estate licensee 14 [BROKER, ASSOCIATE BROKER, OR SALESMAN], the commission may award 15 a claimant reimbursement from [OUT OF] the real estate surety fund for the 16 claimant's loss up to $10,000. Not [HOWEVER, NOT] more than $10,000 may be 17 paid for each transaction regardless of the number of persons injured or the number 18 of parcels of real estate involved in the transaction. 19 * Sec. 44. AS 08.88.472(a) is amended to read: 20 (a) The [WHEN AN AWARD IS MADE FROM THE REAL ESTATE 21 SURETY FUND UNDER AS 08.88.470, THE] commission may charge to the real 22 estate surety fund the costs of a hearing on a claim for reimbursement held under 23 AS 08.88.465. The commission shall deposit into the real estate surety fund 24 amounts [AS 08.88.071 OR 08.88.465. AMOUNTS SUBSEQUENTLY] recovered 25 [BY THE COMMISSION] for these costs from the licensee under AS 08.88.071(b) or 26 from other parties under AS 08.88.490 [SHALL BE DEPOSITED TO THE REAL 27 ESTATE SURETY FUND]. 28 * Sec. 45. AS 08.88.474 is amended to read: 29 Sec. 08.88.474. Payment of small claims judgment. If a claim originally 30 filed with the commission is dismissed and is heard as a small claims action under 31 AS 08.88.460(c) and the claimant prevails in the small claims action against a [THE]

01 real estate licensee [BROKER, ASSOCIATE REAL ESTATE BROKER, OR 02 SALESMAN], the commission shall make an award from the fund of any outstanding 03 portion of the small claims judgment on receipt of a copy of the final judgment and 04 an affidavit from the claimant stating that more than 30 days have elapsed since the 05 judgment became final and that the judgment has not yet been satisfied by the 06 licensee determined responsible [BROKER, ASSOCIATE BROKER, OR 07 SALESMAN HAS NOT SATISFIED THE JUDGMENT DURING THAT TIME]. 08 After payment of a small claims judgment , the commission is subrogated to the 09 claimant's rights in the judgment under AS 08.88.490. 10 * Sec. 46. AS 08.88.475 is amended to read: 11 Sec. 08.88.475. Maximum liability. (a) The maximum liability of the real 12 estate surety fund may not exceed $50,000 for any one real estate licensee [BROKER 13 OR SALESMAN]. 14 (b) If the $50,000 liability of the fund as provided in (a) of this section is 15 insufficient to pay in full the valid claims of all persons who have filed claims against 16 an individual licensee [ONE BROKER OR SALESMAN], the $50,000 shall be 17 distributed among the claimants in the ratio that their individual claims bear to the 18 aggregate of valid claims, or in another manner that the commission considers 19 equitable. Distribution shall be among the persons entitled to share in the recovery [,] 20 without regard to the order [OF PRIORITY] in which their claims were filed. 21 * Sec. 47. AS 08.88.490 is amended to read: 22 Sec. 08.88.490. Right to subrogation. When the commission has paid to a 23 claimant from the real estate surety fund the sum awarded by the commission, the 24 commission shall be subrogated to all of the rights of the claimant to the amount paid , 25 and the claimant shall assign all right, title , and interest in that portion of the claim to 26 the commission. Money collected [AMOUNTS SUBSEQUENTLY REALIZED] by 27 the commission on the claim shall be deposited to the real estate surety fund. 28 * Sec. 48. AS 08.88.900 is amended to read: 29 Sec. 08.88.900. Exceptions. This chapter does not apply to 30 (1) a person who is not licensed under this chapter who manages or 31 makes a real estate transaction with respect to real estate the person owns or is seeking

01 to own so long as the compensation the person receives does not include any 02 portion of the commission or other compensation paid to a real estate licensee in 03 the transaction [ON THE PERSON'S OWN BEHALF, UNLESS THE 04 TRANSACTION INVOLVES LAND DEFINED IN AS 34.55.044(7) THAT IS NOT 05 IN ALASKA]; 06 (2) an attorney in fact under a power of attorney authorizing the 07 consummation of a specific real estate transaction; an attorney in fact may not act as 08 such under this paragraph for more than two transactions in a calendar year; 09 (3) a lawyer performing duties as a lawyer; 10 (4) a public official in the conduct of official duties; 11 (5) a person acting as receiver, trustee, administrator, executor, or 12 guardian; 13 (6) a person acting under court order; 14 (7) a person acting under the authority of a will or trust instrument; 15 (8) a person dealing in mineral rights transactions; 16 (9) an [A DOMESTIC OR FOREIGN CORPORATION, A GENERAL 17 OR LIMITED PARTNERSHIP, OR A PARTNER OR REGULAR] employee of a 18 domestic or foreign corporation , [OR A] general or limited partnership, or limited 19 liability company when performing an act described in AS 08.88.161 incidental to 20 [IN] the regular course of business [, OR AS AN INCIDENT TO, THE 21 MANAGEMENT, SALE, OR OTHER DISPOSITION OF REAL ESTATE OWNED 22 BY THE CORPORATION OR PARTNERSHIP]; the exemption under [PROVIDED 23 IN] this paragraph does not apply to a person employed by a foreign or domestic 24 corporation, partnership, limited partnership, or limited liability company who 25 performs an act described in AS 08.88.161 [, UNLESS ALLOWED FOR 26 UNLICENSED PERSONS UNDER AS 08.88.165,] either 27 (A) as a vocation; or 28 (B) for compensation if the amount of the compensation is 29 dependent upon or directly related to the value of the real estate with respect 30 to which the act is performed; 31 (10) a resident manager ;

01 (11) a bookkeeper or accountant performing bookkeeping or 02 accounting functions; 03 (12) a secretary or receptionist in a real estate office who accepts 04 rent or association fees and provides a written receipt for the rent or fees when 05 a tenant or community association member delivers the rent or fees to the real 06 estate office; 07 (13) tradesmen or vendors of services performing maintenance and 08 repair functions; 09 (14) an employee of a real estate firm or of a property owner who 10 delivers or accepts a real estate contract or application, or a related amendment, 11 to or from another person; 12 (15) an individual assisting in the performance of real estate 13 activities only by carrying out administrative, clerical, or maintenance tasks; 14 (16) a person who manages a total of four or fewer residential units 15 for other persons; 16 (17) a resident owner of a unit in property organized under 17 AS 34.07 or AS 34.08 who is a member of a self-managed community association; 18 (18) a developer of a community association during the period that 19 the developer retains control of at least 51 percent of the association; 20 (19) an attorney in fact who, for a relative, acts under a power of 21 attorney that authorizes the consummation of a specific real estate transaction; 22 in this paragraph, "relative" means a spouse or a great grandparent, 23 grandparent, parent, uncle, aunt, sibling, child, nephew, niece, grandchild, or 24 great grandchild by the whole or half blood or by marriage but does not include 25 a relative who is only related through a step relationship, such as a stepbrother 26 or the child of a stepbrother, except that "relative" includes a stepchild; or 27 (20) a mobile home dealer licensed under AS 08.67 performing 28 within the scope of the dealer's license [OF RENTED REAL ESTATE IF THE 29 RESIDENT MANAGER'S DUTIES ARE LIMITED TO THE NEGOTIATION OF 30 LEASES AND RENTAL AGREEMENTS AND THE COLLECTION OF RENT FOR 31 THE USE OF THE REAL ESTATE AND IF THE RESIDENT MANAGER IS

01 (A) EMPLOYED BY THE OWNER OF THE REAL ESTATE; 02 OR 03 (B) EMPLOYED BY, OR ENGAGED UNDER CONTRACT 04 WITH, A LICENSED REAL ESTATE BROKER]. 05 * Sec. 49. AS 08.88.900 is amended by adding a new subsection to read: 06 (b) Notwithstanding that a person is exempt from licensure under this section, 07 the prohibition in AS 08.88.401(e)(1) is applicable to that person. 08 * Sec. 50. AS 08.88.990(1) is amended to read: 09 (1) "commission" means the Real Estate Commission except where the 10 context indicates that "commission" refers to a fee paid for personal services ; 11 * Sec. 51. AS 08.88.990(3) is amended to read: 12 (3) "real estate" means an interest in a mobile home or an interest or 13 estate in land, corporeal or incorporeal , except that it does not include a unit in a 14 hotel, motel, boarding house, rooming house, or other transient lodging facility, 15 or a unit in a warehouse, mini-storage facility, or other facility the function of 16 which is limited to warehousing purposes ; 17 * Sec. 52. AS 08.88.990(4) is amended to read: 18 (4) "resident manager" means a person who resides on rented or leased 19 real property or on contiguous property owned by the same owner, [AND] manages 20 the property [IT] for the benefit of another person , and is either employed by the 21 owner of the real estate or employed by, or under contract with, a real estate 22 licensee . 23 * Sec. 53. AS 08.88.990 is amended by adding new paragraphs to read: 24 (5) "community association management" means an activity undertaken 25 for an owners' association with regard to property organized under either AS 34.07 or 26 AS 34.08 under an agreement in exchange for a fee, commission, or other valuable 27 consideration, including the following activities: preparing budgets and other financial 28 documents, collecting, controlling, or disbursing funds, obtaining insurance for the 29 association, contracting for maintenance and repair to association property, and 30 supervising the day-to-day operations of the association under the direction of the 31 association's board of directors;

01 (6) "employ," "employing," "employs," "employed," "employee," 02 "employees," and "employment" include being an independent contractor with an 03 employer; 04 (7) "knowingly" has the meaning given in AS 11.81.900(a); 05 (8) "mobile home" has the meaning given in AS 08.67.080; 06 (9) "property management" is an activity undertaken for another with 07 regard to a mobile home or real property under an agreement in exchange for a fee, 08 commission, or other valuable consideration, including the following activities: 09 marketing, leasing, contracting for physical, administrative, or financial maintenance, 10 performance of overall management of mobile homes or real property, and the 11 supervision of these actions; 12 (10) "real estate licensee" is a person who holds a license under this 13 chapter; the term includes a broker unless the context clearly excludes brokers; 14 (11) "real estate transaction" 15 (A) in sales, means the transfer or attempted transfer of an 16 interest in a mobile home or a unit of real property, an act conducted as a 17 result of or in pursuit of a contract to transfer an interest in a mobile home or 18 a unit of real property, or an act conducted in an attempt to obtain a contract 19 to market a mobile home or real property; 20 (B) in property management, means the lease or rental of a unit 21 of real property or a mobile home, including collection of rent from a tenant 22 of a unit of rented or leased real property or a mobile home, an attempt to rent 23 or lease a unit of real property or a mobile home, an attempt to collect rent 24 from a tenant of rented or leased real property or a mobile home, or an act 25 conducted as a result of or in pursuit of a contract to manage a unit of leased 26 or rented real property or a mobile home; 27 (C) in community association management, means the collection 28 or attempted collection of dues from a unit owner or an activity conducted as 29 a result of or in pursuit of a contract with a community association to manage 30 the affairs of a community association. 31 * Sec. 54. AS 08.88.111 is repealed.

01 * Sec. 55. TRANSITIONAL PROVISION. Notwithstanding AS 08.88.161(5) and (6), a 02 person may practice, or negotiate a contract to practice, community association management 03 and may collect fees for community association management without a license issued under 04 AS 08.88 until January 1, 1999. 05 * Sec. 56. REGULATIONS. Notwithstanding sec. 58 of this Act, the Real Estate 06 Commission may proceed to adopt regulations necessary to implement AS 08.88.091(f) and 07 (g), added by this Act. The regulations take effect under AS 44.62 (Administrative Procedure 08 Act), but not before January 31, 1999. 09 * Sec. 57. REVISOR'S INSTRUCTION. Wherever in the Alaska Statutes and the Alaska 10 Administrative Code the term "salesman" is used in a context relating to real estate salesmen 11 licensed under AS 08.88, it shall be read as "salesperson" when to do so would be consistent 12 with changes made by this Act. Under AS 01.05.031, the revisor of statutes shall implement 13 this section in the statutes, and, under AS 44.62.125, the regulations attorney shall implement 14 this section in the administrative code. 15 * Sec. 58. AS 08.88.091(f) and (g), added by sec. 7 of this Act, take effect January 31, 16 1999. 17 * Sec. 59. Except as provided in sec. 58 of this Act, this Act takes effect immediately 18 under AS 01.10.070(c).