HBA-DMD H.B. 1948 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1948 By: Staples Licensing & Administrative Procedures 4/13/1999 Introduced BACKGROUND AND PURPOSE Under current law, the Texas Real Estate Commission (commission) governs the licensing and regulation of those engaged in the real estate profession. H.B. 1948 authorizes the commission to prescribe the content of certain core real estate courses. This bill modifies the length of certain required real estate courses. This bill also authorizes the commission to provide for the collection of assessments at different times and under certain conditions. It authorizes the commission to assess an administrative penalty against a person if the person violates this Act or a rule or order adopted by the commission under this Act. H.B. 1948 establishes a fee not to exceed $20 for filing a request for issuance of a license because of a change of name, return to active status, or change in sponsoring professional inspector. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Real Estate Commission in SECTIONS 3 and 10 (Sections 8 and 23, Article 6573a, V.T.C.S. (The Texas Real Estate License Act)) and that rulemaking authority previously delegated to the Texas Real Estate Commission is modified in SECTION 2 (Section 7, Article 6573a, V.T.C.S. (The Texas Real Estate License Act)) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 6(a), Article 6573a, V.T.C.S. (The Real Estate License Act), as follows: (a) Authorizes, rather than requires, a broker desiring to engage a person to participate in real estate brokerage activity, to join the person in filing an application for an active salesperson license, rather than an application for a salesperson license, on a form prescribed by the Texas Real Estate Commission (commission). Authorizes a person, rather than a person previously licensed as a salesperson, to apply for a salesperson license on inactive status without participation of a broker. Deletes text authorizing a person previously licensed as a broker to apply for inactive status. Deletes text providing that the person must apply for inactive status on a form prescribed by the commission no later than one year after the expiration of the broker or salesperson license. SECTION 2. Amends Sections 7(b) and (e), Article 6573a, V.T.C.S. (The Real Estate License Act), as follows: (b) Authorizes the commission, by rule, to prescribe the content of certain core real estate courses. Makes conforming changes. (e) Requires each applicant for a salesperson license to furnish the commission satisfactory evidence of having completed 12 semester hours, or equivalent classroom hours, of post-secondary education, eight, rather than six, hours of which must be completed in certain core real estate courses. Provides that, rather than requires, the remaining four, rather than six, hours must be completed in core real estate courses or related courses. Requires the applicant, as a condition for the first renewal of a salesperson license, to furnish the commission satisfactory evidence of having completed a minimum of 14 semester hours, or equivalent classroom hours, 10, rather than eight, hours of which must be completed in core real estate courses. Requires the applicant, as a condition for the second renewal of a salesperson license, to furnish the commission satisfactory evidence of having completed a minimum of 16 semester hours, or equivalent classroom hours, 12, rather than ten, hours of which must be completed in core real estate courses. Requires the applicant, as a condition for the third renewal of a salesperson license, to furnish the commission satisfactory evidence of having completed a minimum of 18 semester hours, or equivalent classroom hours, 14, rather than 12, hours of which must be completed in core real estate courses. SECTION 3. Amends Sections 8(c) and (f), Article 6573a, V.T.C.S. (The Real Estate License Act), as follows: (c) Requires each real estate broker and each real estate salesperson on the next renewal of the license to pay the lesser of a fee of $10 or a pro rata share of the amount necessary to bring the real estate recovery fund to $1.7 million upon the determination by the commission at any time, rather than on December 31 of any year, that the balance remaining in the real estate recovery fund is less than $1 million. Authorizes the commission, by rule, in order to ensure the availability of a sufficient amount of money to pay anticipated claims on the fund, to provide for the collection of assessments at different times and under conditions other than those specified in this Act. (f) Deletes the requirement that the aggrieved person show that the person has obtained a judgment under Subsection (e) of this section that is not subject to a stay or discharge in bankruptcy, stating the amount of the judgment and the amount owing on the judgment at the date of the application, on the hearing on the application. SECTION 4. Amends Section 11, Article 6573a, V.T.C.S. (The Real Estate License Act), to require the commission to charge and collect a fee of $20, rather than $15, for transcript evaluation. SECTION 5. Amends Section 15(a), Article 6573a, V.T.C.S. (The Real Estate License Act), to authorize the commission, on its own motion, and require the commission, on the signed complaint in writing of any person, rather than a consumer or service recipient, provided the complaint, or the complaint together with evidence, documentary or otherwise, presented in connection with the complaint, provides reasonable cause, to investigate the actions and records of a real estate broker or real estate salesperson. Authorizes the commission to take other disciplinary action authorized by this Act at any time when the commission has determined that certain conditions have occurred. Includes a person being found guilty of false advertising on the Internet representing that person as a real estate broker or agent, among those actions which authorize the commission to suspend or revoke a license issued under the provisions of this Act. SECTION 6. Amends Section 15B(e), Article 6573a, V.T.C.S. (The Real Estate License Act), to include among the conditions authorizing the commission to authorize a commission employee to file a signed complaint against a licensee and to conduct an investigation if the licensee fails to comply with a commission rule adopted under Section 7A(g) of this Act, or the licensee fails to provide, within a reasonable time, information requested by the commission in connection with an application to renew a license. SECTION 7. Amends Sections 19A(a), (b), (d), (h), (m), and (o), Article 6573a, V.T.C.S. (The Real Estate License Act), as follows: (a) Authorizes the commission to assess an administrative penalty against the person as provided by this section, if a person, rather than a person licensed under this Act, violates this Act or a rule or order adopted by the commission under this Act. (b) Requires the penalty for each violation to be set in an amount not to exceed $1,000 a day, rather than in an amount not to exceed $1,000. Authorizes each day a violation continues or occurs to be considered a separate violation for purposes of penalty assessment. (d) Authorizes the commission to authorize the administrator to delegate to another commission employee the administrator's authority to act under this section. (h) Authorizes the commission to authorize the hearing examiner to conduct the hearing and enter a final decision. Updates a statutory reference. (m) Updates a statutory reference. (o) Requires a penalty collected under this section for a violation by a person who is not licensed under this Act to be deposited in the real estate recovery fund or the real estate inspection recovery fund. SECTION 8. Amends Section 23(h)(1), Article 6573a, V.T.C.S. (The Real Estate License Act), to include a fee not to exceed $20 for filing a request for issuance of a license because of a change of name, return to active status, or change in sponsoring professional inspector, among the existing list of fees that the commission is required to charge and collect in order to recover the costs of administering this section. SECTION 9. Amends Section 23(k), Article 6573a, V.T.C.S. (The Real Estate License Act), to provide that a real estate inspector must submit satisfactory evidence to the commission of successful completion of at least eight, rather than four, classroom hours of core real estate inspection courses annually before a licensed renewal is issued. Provides that a professional inspector must submit satisfactory evidence to the commission of successful completion of at least 16, rather than eight, classroom hours of core, rather than core related, real estate inspection courses annually before a license renewal is issued. SECTION 10. Amends Sections 23(o)(3), (7), and (15), Article 6573a, V.T.C.S. (The Real Estate License Act), as follows: (3) Requires each inspector on the next renewal of the person's license, to pay the lesser of a fee of $75 in addition to the license renewal fee or a pro rata share of the amount necessary to bring the real estate inspection recovery fund to $450,000, if at any time, rather than on December 31 of any year, the balance remaining in the real estate inspection recovery fund is less than $300,000. Authorizes the commission, by rule, to ensure the availability of a sufficient amount of money to pay anticipated claims on the fund, to provide for the collection of assessments at different times and under conditions other than those specified by this Act. (7) Deletes the requirement that the aggrieved person is required to show that the person has obtained a judgment under Subdivision (6) of this subsection that is not subject to a stay or discharge in bankruptcy, stating the amount of the judgment and the amount owing on the judgment at the date of the application, on the hearing on the application. (15) Requires payments from the real estate inspection recovery fund that are subject to the payments for claims, including attorney fees, interest, and court costs, arising out of the same transaction to be limited in the aggregate to $10,000, rather than $7,500, regardless of the number of claimants and payments for claims based on judgments against a licensed inspector are prohibited from exceeding in the aggregate $30,000, rather than $15,000, until the fund has been reimbursed by the licensee for all amounts paid, notwithstanding any other provision. SECTION 11. (a) Effective date: September 1, 1999, except as provided by Subsection (b) of this section. (b) Makes application of Section 7(e), Article 6573a, V.T.C.S. (The Real Estate License Act), as amended by this Act, prospective to January 1, 2000. (c) Makes application of Section 23(k), Article 6573a, V.T.C.S. (The Real Estate License Act), as amended by this Act, prospective on December 31, 1999. (d) Makes application of Sections 8(f) and 23(o)(7), Article 6573a, V.T.C.S. (The Real Estate License Act), as amended by this Act, prospective. (e) Makes application of a change in law made by this Act that relates to a disciplinary action or imposition of an administrative penalty prospective. SECTION 12.Emergency clause.