MARYLAND REAL ESTATE COMMISSION



MARYLAND REAL ESTATE COMMISSION

500 North Calvert Street

Baltimore, MD 21202

Mission: Protecting the health, safety, and welfare of the public

through examination, licensing, and regulatory activities regarding real estate

BUSINESS MEETING MINUTES

May 21, 2008, 10:30 a.m.

Highlights from the meeting:

Governor signs legislation

Grimes joins staff as investigator

Commissioners Cooke, Youngblood reappointed

License count now 54,701

CE audit progress

No MD-VA reciprocal agreement reached

Law changes considered for FY 2009

PRESENT:

Commissioner Nancy R. Simpers, Chair (Industry)

Commissioner Abraham Fernando Carpio (Consumer)

Commissioner Anne S. Cooke (Industry)

Commissioner J. Nicholas D’Ambrosia (Industry)

Commissioner Surina Jordan (Consumer)

Commissioner Georgiana S. Tyler (Industry)

Commissioner Colette P. Youngblood (Consumer)

Harry Loleas, Deputy Commissioner, O & P

Elizabeth Trimble, AAG, Counsel

Katherine F. Connelly, Executive Director

Steve Long, Assistant Executive Director

Patricia Hannon, Education Administrator, Session Recorder

ABSENT:

Commissioner Stephen F. Kupres, Vice Chair (Consumer)

Commissioner Sydney L. Machat (Industry)

PUBLIC IN ATTENDANCE:

Mark Feinroth, MAR

Robert Johnston, AACAR

Donald White, MREEA & PG Comm Coll

Rhonda Hottle, Carruthers Academy of Real Estate

Linda Quayle

Diane Harris

CALL TO ORDER:

Nancy R. Simpers, Chair, called the meeting to order at 10:30 a.m.

APPROVAL OF MINUTES:

Motion (made by Colette P. Youngblood, seconded by J. Nicholas D’Ambrosia) To approve the minutes of the April 16, 2008 business meeting. Unanimous approval.

REPORT OF COMPLAINTS/ADMINISTRATIVE DISMISSALS:

Motion (made by Anne S. Cooke, seconded by J. Nicholas D’Ambrosia) To approve the Administrative Dismissals for the month of May 2008. Motion carried.

COMMITTEE REPORTS:

1. Education – J. Nicholas D’Ambrosia, Education Chair – In April 2008, 601 salesperson and 79 broker exams were administered by PSI, the testing contractor. In response to Commission D’Ambrosia’s request last month, Ms. Hannon learned that the Maryland Higher Education Commission’s annual report on private career schools is no longer available in the same format for FY 2007 as earlier years. Ms. Hannon used MHEC’s statistics to construct a report, which was distributed to all Commissioners as a confidential in-house document. Thirty-three career schools were certified to offer 60 classroom hours in principles and practices for salespersons during the period July 1, 2006 to June 30, 2007.

2. Legislative – Anne S. Cooke, Legislative Chair, and Harry Loleas, Deputy Commissioner of O&P –

• Governor O’Malley signed SB181 (grounds for summary suspension), SB132 (distance learning for salesperson license course), and SB762 (5 year record retention).

• Recommendations to Secretary Perez for 2009 legislation will be decided at the June business meeting. Ideas were immediately mentioned and some were discussed. Executive Director Connelly asked Commissioners to e-mail their thoughts on today’s discussion as well as other suggestions to improve real estate law (add, change, or repeal).

COMMENTS FROM EXECUTIVE DIRECTOR: Katherine F. Connelly

1. Jennifer Grimes was welcomed as the newest investigator, filling the vacancy of Ronald Plummer. Ms. Grimes transferred from the Home Improvement Commission, where she had administrative and investigative experience. Cases will be assigned shortly.

2. Rajan Natarajan has been appointed as a Consumer Member of the Commission. His four-year term begins June 1, 2008.

3. Commissioners Cooke and Youngblood were re-appointed for four-year terms.

4. License count is now 54,701, of which 5,004 are brokers, 3,267 associate brokers, 45,486 sales-persons, 750 branch offices, 41 reciprocal brokers, 14 reciprocal associate brokers, and 139 reciprocal salespersons. There are 4,575 inactive licenses.

5. The Guaranty Fund balance as of March 31, 2008 is $2,152,798.00.

6. For the 2005 and 2006 continuing education audits, a total of 125 consent agreements were mailed. Of that number, 22 submitted their continuing education certificates, 38 signed their agreements and paid the fine, 17 want hearings, 45 are pending, and 3 surrendered their licenses rather than comply (but must comply to return).

7. Ms. Connelly reported on the ARELLO mid-year meeting in Pasadena, when workgroups and committees meet. There were timely and informative sessions given by expert presenters. Commissioners Jordan, Cooke, and D’Ambrosia also attended. Commissioner Jordan, Consumer Member, learned about the industry side of issues and other states’ challenges.

8. Budget year closes June 30, 2008; all outstanding expenses must be submitted before that date.

9. Outreach to industry – last month Ms. Connelly met with managers, brokers, and directors of the Southern Maryland Board and will meet next month with the Maryland Association of Realtors.

10. The Department’s Office of Information Technology is making progress on developing an improved complaint system for Real Estate. Technology funds from the FY 2009 budget will be used to cover the costs. New hard drives have been ordered for all staff and should arrive by the end of June.

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11. Virginia Real Estate Board’s draft reciprocal agreement and May 7, 2008 letter - At this time it appears that a Virginia-Maryland reciprocal agreement is not possible. The latest Virginia draft is the same as the previous one. Virginia cannot offer the same terms to Maryland licensees that Maryland would offer to Virginia, placing a greater burden on Maryland licensees. Since the intent of Maryland’s reciprocity law cannot be met, there is no reason to continue discussions. In the future, if Virginia law changes, another attempt may be made. Commissioner D’Ambrosia advised that the Virginia Association of Realtors was interested in genuine reciprocity. As Commissioner D’Ambrosia is a member of VAR, he was appointed to provide a copy of the May 7, 2008 letter and serve as liaison over this issue. Ms. Connelly will notify Virginia’s Executive Director.

12. The Working Task Force on Teams and Groups met on April 16, 2008. Commissioners D’Ambrosia, Tyler, Jordan, and Cooke, Brokers Yerman and Karavasilis, and Executive Director Connelly attended. On May 20, 2008, Commissioner D’Ambrosia, Ms. Trimble, Ms. Connelly, and Mr. Long met to follow up on the discussion. The Task Force plans to meet again next week to finalize a report to present to the full Commission at the June 18 business meeting. Since a decision most likely will be needed in June, Ms. Connelly will e-mail the report in advance to prepare for discussion.

13. Under the Maryland-Pennsylvania reciprocal agreement, licenses must remain active. Current expiration for Pennsylvania licensees is May 31, 2008. Ms. Connelly recommended an e-mail be sent to remind Pennsylvania licensees to renew active or their Maryland license will void. The e-mail will also remind them that, at the time of their Maryland renewal, a Pennsylvania license history will be required. These are basic terms agreed to at application. All Commissioners approved of the e-mail reminder. The Department’s OIT unit will oversee sending the e-mails.

14. The contract with the current testing vendor, PSI, has been extended until December 2008. The extension would allow for resolution of the bid protest and a new contract timeframe. It can be cut back if not needed.

15. A recent applicant from Pennsylvania under the MD-PA Reciprocal agreement presented a Pennsylvania license category of “Standard.” However, the applicant did not meet Pennsylvania’s own requirements of experience, education, and exam. Upon inquiry, Ms. Hannon learned that Pennsylvania accepts licensed out-of-state brokers under a lower standard yet gives the category of “Standard.” The same term is applied to all, but all are not equally credentialed. Under the reciprocal agreement, Maryland surrendered its ability to look at credentials by trusting in Pennsylvania’s prequalifying. Since we now know the standards are lower, Counsel asked if the Commission wants to explore amending the agreement with Pennsylvania to have assurance that the person coming to Maryland under the agreement has met the intent. Commissioners attending ARELLO conferences heard some states are rescinding agreements because of similar issues. It was agreed that Ms. Connelly will write Pennsylvania’s legal counsel with our concerns.

16. Elections of officers will be held at the June business meeting. The process is to either nominate a committee today to present a slate in June or accept nominations from the floor in June. Motion (made by Anne S. Cooke, seconded by Abraham Fernando Carpio) To allow nominations from the floor in June. All in favor; Motion passed.

17. The hearing schedule and panel assignments beginning in July 2009 were provided to all Commissioners. Senior Commissioners have not been assigned a panel and instead serve as alternates when needed. Thursday hearings will be rotated between panels. The schedule will be confirmed in June by the new officers.

18. Dates for hearings as a result of the continuing education violations are set for September 2 and 4, 2008. September 29, 2008 will be the third hearing date if needed. The hearings will be scheduled in 30 minute intervals.

19. Ms. Connelly requested a Subcommittee on Fees to meet prior to the June meeting. Commissioners Simpers, Jordan, and Youngblood will assist Ms. Connelly.

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COMMENTS FROM COUNSEL: Elizabeth Trimble – comments covered in previous discussions

COMMENTS FROM CHAIR: Nancy R. Simpers

For the month of June only, Commissioners Jordan, Natarajan, and D’Ambrosia are assigned to Panel 1. Commissioners Cooke, Carpio, and Tyler are assigned to Panel 2. Cases are sent to panel members for review in advance of the meeting; it is important for members to be present at 9 a.m. so panels can start on time.

UNFINISHED BUSINESS:

1. Committees with ideas for 2009 legislation need to inform the Executive Director this week. Immediate discussion centered on continuing education (increasing number of hours or adding specific topics); mandating affiliates’ attendance at broker training sessions; and recent law changes on lease-back as a foreclosure rescue technique.

2. While the law allowing distance education for salesperson prelicensing instruction takes effect October 1, 2008, there has been no change to the requirement of approved Maryland education providers.

3. Commissioner D’Ambrosia noted for the record that Commissioner Machat presided over the Pasadena meeting as ARELLO President and did an outstanding job. Mr. Machat is well respected at ARELLO and gives Maryland lots of positive recognition. ARELLO’s national conference will be held in Baltimore in 2011

NEW BUSINESS: Covered under previous discussions

ADJOURNMENT:

There being no further business, the meeting adjourned at 12 noon. The next monthly business meeting is Wednesday, June 18, 2008.

APPROVED AS PRESENTED ____________________________________________________

Nancy R. Simpers, Chairperson

APPROVED AS AMENDED ______________________________________________________

Nancy R. Simpers, Chairperson

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