NDT C.S.H.B. 1621 75(R)BILL ANALYSIS LICENSING & ADMINISTRATIVE PROCEDURES C.S.H.B. 1621 By: Pickett 4-1-97 Committee Report (Substituted) BACKGROUND Current law requires applicants for a real estate salesman license to have completed 12 semester (180 classroom) hours of approved course. Two semester (60 classroom) hours must have been completed in specific core courses dealing with the law of agency and principles of real estate. Applicants may study contract law as part of other courses, but are not required to do so. As licensees, however, applicants will need a basic understanding of contract law and standard form contracts. Furthermore, to renew or to obtain active licenses, real estate licensees must complete approved continuing education requirements which, if not completed, results in a licensee being unable to practice until such time as he completes the course work. If a licensee is a broker, all sponsored salesman could also be affected as well as buyers and sellers. An extension with a time certain deadline would keep a license active. It should also be noted that the Texas Real Estate Commission administers its licensing examination with the applicant paying a $25 fee. It has been determined that a change in the fee structure is overdue. PURPOSE C.S.H.B. 1621 would create a third required core real estate course on contract law without increasing the total number of hours of education required of applicants. TREC would be authorized to adopt rules under which its licensees could continue to practice while completing continuing education courses and could assess licensees who do not complete their courses timely an additional fee. The ceiling for examination fees would be raised from $25 to $50. TREC would be authorized to permit its employees to file complaints and conduct investigations for. RULEMAKING AUTHORITY It is the opinion of the committee that this bill grants additional rulemaking authority to the Texas Real Estate Commission as stated in SECTION 4 and SECTION 5 of the bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 2(5), Real Estate License Act (Art. 6573a, V.T.C.S.). Adds to the definition of "person" any other entity including, but not limited to a governmental body, partnership, or limited liability partnership. SECTION 2. Amends Section 3, Real Estate License Act (Art. 6573a, V.T.C.S.). States that the provisions of this act are not applicable to a partnership or limited liability partnership performing an act constituting an act of a broker or salesman, as defined by this Act, through a partner who is duly licensed as a real estate broker. SECTION 3. Amends Sections 7(a) and (e), Real Estate License Act (Art. 6573a, V.T.C.S.). Adds language to include among the required courses of study for licensure, contract law. This would also include, but is not limited to elements of a contract, statute of frauds, commission rules regarding use of adopted forms, and owner disclosure requirements. Furthermore, it adds language providing that a minimum of two (2) hours must be completed in Contract Law. SECTION 4. Amends Section 7A, Real Estate License Act (Art. 6573a, V.T.C.S.) by adding a new Subsection (g). (g) Provides that notwithstanding any other provision of this Act, the Commission by rule may establish procedures under which to issue, renew, or return active status to a licensee before the completion of the continuing education requirements. Procedures may require an applicant to pay an additional fee not to exceed $200 and completion of required continuing education within 60 days after issuance, renewal, or return. SECTION 5. Amends Real Estate License Act (Art. 6573a, V.T.C.S.) by adding Section 7B. Sec. 7B. States that notwithstanding any other provisions of this act, the commission by rule may provide for a waiver of one or all of the requirements for a license under this act if the applicant was licensed within the five years preceding the date of application. SECTION 6. Amends Section 11, Real Estate License Act (Art. 6573a, V.T.C.S.). Increases the fee for a license examination from $25 to $50. SECTION 7. Amends Section 15B(a), Real Estate License Act (Art. 6573a, V.T.C.S.). Authorizes the commission to permits its employees to file complaints and conduct investigations under certain conditions. SECTION 8. Repeals Section 24 (g), Real Estate License Act (Art. 6573a, V.T.C.S.). SECTION 9. (a) Except as provided by Subsection (b) of this section, this Act takes effect September 1, 1997. (b) Section 2 of this Act takes effect January 1, 1998. SECTION 10. Emergency Clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute adds the term "governmental body" and "limited liability partnership" to the definition of "person" in the Act. The substitute adds a partnership or limited liability partnership to the list of exemptions from licensing, if a member of the partnership is a licensed real estate broker. It also strikes the words "one hour" and adds the words "two hours".