CAR Sponsors Eight Bills in 2010 Session

Published: February 8, 2010

After a successful year spent playing defense against a variety of point-of-sale bills and several tax measures aimed at Realtors®, the California Association of Realtors® is going back on the offense this year with eight new bills we are sponsoring. A sponsored bill is one that we author and then find a legislative sponsor – either Senator or Assembly member – to carry the bill for us. The selection of an author is a critical process as some bills have greater appeal to Democrats, others have more appeal to Republicans, some appeal to both in equal measure and some have no appeal at all. It’s a fascinating process that I’ll explain to you sometime if you’re interested.

The eight bills we’ll be sponsoring this year include:

SB206 (Dutton) – REO Homebuyer Tax Credit. As introduced, SB206 would have created a program similar to the federal first time homebuyer program providing a tax credit up to $8,000 for the purchase of a principle residence. Due to the state’s fiscal crisis it was later determined modofied to limit the tax credit to purchases of REO properties. At our recent BOD meeting, the language was further modified to include supporting a recent proposal by the Governor for the purchase of new or existing homes IF a reliable source of funding is found. This means if the Governor sponsors a bill to address substantially the same issue, we will abandon SB206 and sign on to support the Governor’s efforts assuming anybody can find money to fund such a program.

Local Property Maintenance Ordinance – (No author yet). This legislation will pre-empt over-reaching local vacant property ordinances that may adversely affect the market and unfairly expose Realtors® and homeowners to liability. While many cities, including those in Southwest County, have adopted workable ordinances to address abandoned property maintenance and blight issues, other cities have determined these ordinances are excellent sources of revenue for their cash-flow and have levied substantial fines. In some cases, the level of the fine is in excess of the value of the property. This bill would supersede local ordinances.

Anti Deficiency Protection (Corbett) – This bill would extend the existing borrower protections against personal liability for a purchase money loan to either refi the property or for improvements that increase the value of the property. Current policy states that any refinance, even with no cash out just to reduce interest rates, automatically shifts the loan from non-recourse to recourse. This bill addresses that.

CID Unit Owner Right To Rent – In 2008 we sponsored AB2259 (Mullin) which would have allowed current property owners within an HOA to continue to use their rental rights until such time as they sold the property even if the HOA decided to restrict rentals. Approved almost unanimously in both houses, it was vetoed by the Governor. This bill would require a 2/3 approval in a CID for any amendment that would prohibit owners from renting or leasing their units.

Portable Appraisals (Correia) – Current law permits, but does not require, lenders to utilize an appraisal ordered by a different lender. This bill states that if an appraisal is ordered and prepared by one lender, a second lender would be required to accept the appraisal to support the mortgage.

Appraisal Management Company (AMC) Regulatory Oversight (Hall) – Driven by the HVCC, Appraisal Management Companies have grown
enormously in both scope and power over the past two years. In 2009 CAR supported SB237 (Calderon) which subjects AMC’s to review by the Office of Real Estate Appraisers (OREA). This bill clarifies and expands OREA’s oversight of these behemoths. Since we can’t seem to stop HVCC at the federal level, we are trying to at least establish some control and oversight at the state level. By the way, HVCC technically sunsets this year but nobody is betting that the process or the AMC’s will simply pack it in and go home.

DRE ‘Poison Pill’ Reserve Protections – During the 1990’s the Governor and Legislature raided Department of Real Estate funds to help balance the budget. CAR sponsored legislation stating that if the funds were taken it would trigger a rollback of license fees to 1982 levels. The bill passed. Years later the state again  raided the DRE money but stated that it was borrowed by the general fund so the rollback was not triggered. We again addressed the matter legislatively and closed that avenue of pilferage. In 2009 DRE coffers were again raided in a manner than again did not trigger a rollback as the funds were not stolen, not borrowed, but loaned not to the general fund but directly to another department, the DOJ. Back to the drawing board yet again.

Advance Fee Definition Clarification (Hayashi) – Last year we supported SB 94 (Calderon) to prohibit ‘cash up front’ loan modification contracts. However, the language that emerged in the final bill requires some clarification of the definition of advance fees for services such that it cannot be construed to include a listing agreement – which is technically a fee agreement for future services to be rendered.

The legislative deadline for identifying authors and obtaining bill numbers is February 15 so we will keep you apprised of developments and successes in our 2010 advocacy efforts as they occur. Stay tuned for RED ALERTS as we elicit your support to persuade legislators of the importance of these measures.

There are also hundreds of ‘bills of interest’ in the process of being introduced by others. At future meetings CAR will evaluate those bills and members will be asked to take a position.

For a complete (as of January 2010) summary of both CAR sponsored bills as well as a list of these others bills of interest, please go to:


Last modified: February 8, 2010 at 10:36 am | Originally published: February 8, 2010 at 10:36 am
Printed: September 22, 2020