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

JUNE 16, 2010, 10:30 a.m.

Highlights from the meeting:

Welcome to Commissioner Juan Munoz

Current license count 44,541

CE regulations to be re-published

Task Force to develop supervision course

Task Force to develop agency course

Task Force on social media policy

Deposits on HOA contracts

More on REOs

Cooke elected Chair; D’Ambrosia Vice Chair

PRESENT:

Commissioner J. Nicholas D’Ambrosia, Chair (Industry)

Commissioner Anne S. Cooke, Vice Chair (Industry)

Commissioner Marla S. Johnson (Industry)

Commissioner Juan Munoz (Consumer)

Commissioner Nancy R. Simpers (Industry)

Commissioner Jeff Thaler (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

J. Steven Long, Assistant Executive Director

Shannon Davis, Outreach Coordinator

Patricia Hannon, Education Administrator, Session Recorder

ABSENT:

Commissioner Robin L. Pirtle (Consumer)

PUBLIC IN ATTENDANCE:

Susan Mitchell, MAR

Lindsay Eastwood, DLS

Carl Kessler, Prof. Dev. Inst.

CALL TO ORDER:

J. Nicholas D’Ambrosia, Chair, called the meeting to order at 10:40 a.m. Chairman D’Ambrosia welcomed Juan Munoz, who begins serving today as a Commissioner representing consumers. Mr. Munoz lives and works in Rockville.

APPROVAL OF MINUTES:

Motion (made by Georgiana S. Tyler, seconded by Colette P. Youngblood) To approve the minutes of the May 19, 2010 business meeting. Unanimous approval.

REPORT OF COMPLAINTS/ADMINISTRATIVE DISMISSALS:

The dismissal list was emailed to Commissioners in advance of the meeting. Commissioners may ask questions about individual cases to gain more information if needed before voting. Motion (made by Nancy R. Simpers, seconded by Anne S. Cooke) To approve the Administrative Dismissals for the month of June 2010. Motion carried. Based on case review, an article in the newsletter is needed to remind licensees to communicate with their client when or why there are delays in responses from banks or other parties.

COMMITTEE REPORTS:

1. Education – Georgiana S. Tyler, Education Chair, read the exam statistics. For the month of May 2010, PSI administered 455 salesperson and 42 broker exams. Study continues on schools’ pass/fail rates on the state portion of the salesperson exam.

2. Legislative – Anne S. Cooke, Legislative Chair, reported on a recent discussion at panel about guaranty fund claims. After discussion, it was decided that panel members over the next year will pay attention to the kinds of loss or damage suffered by consumers. Then changes to the law could be considered that would allow recovery.

COMMENTS FROM EXECUTIVE DIRECTOR: Katherine F. Connelly

1. Current license count totals 44,541, of which 4,783 are brokers, 3,151 associate brokers, 35,840 salespersons, 551 branch offices, 4 timeshares, 59 reciprocal brokers, 14 reciprocal associate brokers, and 139 reciprocal salespersons. Of the total count, 4,425 are inactive

2. The Guaranty Fund balance through May 2010 will be available next month.

3. Subcommittees are needed to develop the Agency and Broker Supervision courses under the new law.

4. Licensees responded to the recent newsletter article on teams and groups legislation (HB 406) with many questions. A Do’s and Don’ts list for teams and groups will be posted soon. The law takes effect October 1, 2010.

5. A disclosure form for teams and groups will be needed.

6. The deadline to submit mileage and travel expenses for reimbursement is June 30, 2010.

7. Staff suggested changing the term of inactive status to 3 years, and the length of time to reinstate to 3 years. Current law allows 4 years for each.

8. The Department of Legislative Services has begun its full 10-year evaluation of the Maryland Real Estate Commission as required by law. Ms. Lindsay Eastwood has returned to conduct the full Sunset review.

9. The legislative auditors are on site to conduct the 2-year review of processes MD REC staff follow for deposits, complaints, etc.

10. Industry outreach, along with Chairman D’Ambrosia, to a meeting with the Maryland Association of Realtors’ Board of Directors; Ms. Connelly also visited the Historic Highlands board and met with agents in Eldersburg, Timonium, and Salisbury. Future visits are planned to Berlin, Solomons Island and Southern Maryland.

COMMENTS FROM COUNSEL: Elizabeth Trimble

As requested at the May business meeting, Counsel re-drafted two sections of the continuing education regulations – adding definitions and clarifying advertising – and e-mailed these sections to Commissioners in advance of today’s meeting. After discussion, Motion (made by Nancy R. Simpers, seconded by Marla S. Johnson) To approve these sections and the ones previously discussed at the

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May 19, 2010 meeting. All in favor; Motion passed. The re-draft will be published at the end of July or early August, with 45-day comment period. Counsel will withdraw the one published in February 2010.

COMMENTS FROM CHAIR: J. Nicholas D’Ambrosia – Nothing additional at this time. Comments later during discussion on Unfinished and New Business.

UNFINISHED BUSINESS:

1. Chairman asked for Commissioners to serve on a Task Force to Develop a Supervision Course. Commissioners Cooke, Tyler, and Pirtle will serve. Meeting dates will be decided and published in The Maryland Register.

2. Commissioners are needed to serve on a Task Force to Develop an Agency Course. Commissioners Johnson, Youngblood, and Simpers responded. Meeting dates will be decided and published in The Maryland Register

3. Chairman D’Ambrosia, Commissioners Munoz and Thaler will serve on a Task Force for Social Networking/Media Policy.

4. Deposits on property under a Homeowners Association – Real Property Article 11B parallels the one on condominium purchase discussed at the May meeting. The buyer can, within a certain period of time, choose not to go forward with the sale, although the cost of reproducing the HOA documents may be retained. Since it is the absolute right of the purchaser to get the deposit back, Motion (made by Nancy R. Simpers, seconded by Marla S. Johnson) it is acceptable for the broker holding the deposit to return it to the buyer. All in favor; Motion passed.

5. Proposed Legislation for 2011

• Motion (made by Nancy R. Simpers, seconded by Anne S. Cooke) To propose legislation changing the time to reactivate from 4 to 3 years. All in favor; Motion passed.

• Motion (made by Nancy R. Simpers, seconded by Marla S. Johnson) To propose legislation changing the time to reinstate from 4 to 3 years. All in favor; Motion passed.

Other states will be contacted on their timeframes for inactive and expired status.

6. Property management license – Counsel explained that the current exemption in 17-301 was considered in 1979 to apply to a resident manager in one place for one location and owner. While this may be the situation for some property managers, there are also seasonal rentals of multiple locations and different owners, and many long-term housing rentals with a variety of services and locations and different owners. This last group create the larger number of property management complaints filed with MD REC and payouts from the guaranty fund. A real estate licensee may be disciplined while a unlicensed property manager doing the same activity would not be subject to MD REC, so the consumer is not protected. Motion (made by Nancy R. Simpers, seconded by Marla S. Johnson) To consider legislation to license property managers. All in favor; Motion passed. Counsel will draft legislation in consideration of residential property managers and commercial managers.

7. REOs, bank-owned properties, foreclosures – Continuing the discussion from the May business meeting, Counsel learned from the US Office of the Comptroller of the Currency that federal banks are required to furnish documents and are not exempt. What should the buyer’s agent be doing in this situation? The buyer’s agent is to tell the buyer what is normally provided, the value of the documents, that the bank is choosing not to disclose, that the buyer still has the decision to stop or go ahead, that the buyer may need to consult an attorney or seek the information elsewhere. The listing agent has the same responsibilities under the law for the material facts, HOA, property, etc. as in a transaction where a federal bank is not involved.

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NEW BUSINESS:

Nominations and Election of Officers – Motion (made by J. Nicholas D’Ambrosia, seconded by Marla S. Johnson) To nominate Anne S. Cooke as Chair. Commissioner Cooke accepted the nomination. Unanimous approval; Motion passed. Motion (made by Nancy R. Simpers, seconded by Georgiana S. Tyler) To nominate J. Nicholas D’Ambrosia as Vice Chair. Nomination accepted. Unanimous approval; Motion passed.

ADJOURNMENT:

There being no further business, the meeting adjourned at 12:20 p.m. The next monthly business meeting is Wednesday, July 21, 2010.

APPROVED AS PRESENTED ____________________________________________________

Anne S. Cooke, Chairperson

APPROVED AS AMENDED ______________________________________________________

Anne S. Cooke, Chairperson

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