By Pickett H.B. No. 1621
75R5270 GJH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to certain licensing in the real estate industry.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Sections 7(a) and (e), The Real Estate License
1-5 Act (Article 6573a, Vernon's Texas Civil Statutes), are amended to
1-6 read as follows:
1-7 (a) Competency as referred to in Section 6 of this Act shall
1-8 be established by an examination prepared by or contracted for by
1-9 the commission. The examination shall be given at such times and
1-10 at such places within the state as the commission shall prescribe.
1-11 The examination shall be of scope sufficient in the judgment of the
1-12 commission to determine that a person is competent to act as a real
1-13 estate broker or salesman in a manner to protect the interest of
1-14 the public. The examination for a salesman license shall be less
1-15 exacting and less stringent than the examination for a broker
1-16 license. The commission shall furnish each applicant with study
1-17 material and references on which his examination shall be based.
1-18 When an applicant for a real estate license fails a qualifying
1-19 examination, he may apply for reexamination by filing a request
1-20 therefor together with the proper fee. The examination requirement
1-21 must be satisfied not later than six months after the date on which
1-22 the application for a license is filed. Courses of study required
1-23 for a license may include but are not limited to the following,
1-24 which shall be considered core real estate courses for all
2-1 purposes of this Act:
2-2 (1) Principles of Real Estate (or equivalent) shall
2-3 include but not be limited to an overview of licensing as a real
2-4 estate broker and salesman, ethics of practice, titles to and
2-5 conveyancing of real estate, legal descriptions, [law of agency,]
2-6 deeds, encumbrances and liens, distinctions between personal and
2-7 real property, [contracts,] appraisal, finance and regulations,
2-8 closing procedures, real estate mathematics, and at least three
2-9 classroom hours of instruction on federal, state, and local laws
2-10 relating to housing discrimination, housing credit discrimination,
2-11 and community reinvestment.
2-12 (2) Real Estate Appraisal (or equivalent) shall
2-13 include but not be limited to the central purposes and functions of
2-14 an appraisal, social and economic determinant of value, appraisal
2-15 case studies, cost, market data and income approaches to value
2-16 estimates, final correlations, and reporting.
2-17 (3) Real Estate Law (or equivalent) shall include but
2-18 not be limited to legal concepts of real estate, land description,
2-19 real property rights and estates in land, contracts, conveyances,
2-20 encumbrances, foreclosures, recording procedures, and evidence of
2-21 titles.
2-22 (4) Real Estate Finance (or equivalent) shall include
2-23 but not be limited to monetary systems, primary and secondary money
2-24 markets, sources of mortgage loans, federal government programs,
2-25 loan applications, processes and procedures, closing costs,
2-26 alternative financial instruments, equal credit opportunity acts,
2-27 community reinvestment act, and state housing agency.
3-1 (5) Real Estate Marketing (or equivalent) shall
3-2 include but not be limited to real estate professionalism and
3-3 ethics, characteristics of successful salesmen, time management,
3-4 psychology of marketing, listing procedures, advertising,
3-5 negotiating and closing, financing, and the Deceptive Trade
3-6 Practices-Consumer Protection Act, as amended, Section 17.01 et
3-7 seq., Business & Commerce Code.
3-8 (6) Real Estate Mathematics (or equivalent) shall
3-9 include but not be limited to basic arithmetic skills and review of
3-10 mathematical logic, percentages, interest, time-valued money,
3-11 depreciation, amortization, proration, and estimation of closing
3-12 statements.
3-13 (7) Real Estate Brokerage (or equivalent) shall
3-14 include but not be limited to law of agency, planning and
3-15 organization, operational policies and procedures, recruiting,
3-16 selection and training of personnel, records and control, and real
3-17 estate firm analysis and expansion criteria.
3-18 (8) Property Management (or equivalent) shall include
3-19 but not be limited to role of property manager, landlord policies,
3-20 operational guidelines, leases, lease negotiations, tenant
3-21 relations, maintenance, reports, habitability laws, and the Fair
3-22 Housing Act.
3-23 (9) Real Estate Investments (or equivalent) shall
3-24 include but not be limited to real estate investment
3-25 characteristics, techniques of investment analysis, time-valued
3-26 money, discounted and nondiscounted investment criteria, leverage,
3-27 tax shelters depreciation, and applications to property tax.
4-1 (10) Law of Agency (or equivalent) shall include but
4-2 not be limited to the principal-agent and master-servant
4-3 relationships, the authority of an agent, the termination of an
4-4 agent's authority, the fiduciary and other duties of an agent,
4-5 employment law, deceptive trade practices, listing or buying
4-6 representation procedures, and the disclosure of agency.
4-7 (11) Contract Law (or equivalent) shall include but
4-8 not be limited to the elements of a contract, offer and acceptance,
4-9 the statute of frauds, specific performance, remedies for breach,
4-10 the unauthorized practice of law, commission rules regarding the
4-11 use of adopted forms, and owner disclosure requirements.
4-12 (e) Each applicant for a salesman license shall furnish the
4-13 commission satisfactory evidence of having completed 12 semester
4-14 hours, or equivalent classroom hours, of postsecondary education,
4-15 six hours of which must be completed in core real estate courses,
4-16 of which a minimum of two hours must be completed in Principles of
4-17 Real Estate as described in Subsection (a)(1) of this section,
4-18 [and] a minimum of one hour [two hours] must be completed in Law of
4-19 Agency as described in Subsection (a)(10) of this section, and a
4-20 minimum of one hour must be completed in Contract Law as described
4-21 in Subsection (a)(11) of this section. The remaining six hours
4-22 shall be completed in core real estate courses or related courses.
4-23 As a condition for the first renewal of a salesman license, the
4-24 applicant shall furnish the commission satisfactory evidence of
4-25 having completed a minimum of 14 semester hours, or equivalent
4-26 classroom hours, eight hours of which must be completed in core
4-27 real estate courses. As a condition for the second renewal of a
5-1 salesman license, the applicant shall furnish the commission
5-2 satisfactory evidence of having completed a minimum of 16 semester
5-3 hours, or equivalent classroom hours, 10 hours of which must be
5-4 completed in core real estate courses. As a condition for the
5-5 third renewal of a salesman license, the applicant shall furnish
5-6 the commission satisfactory evidence of having completed a minimum
5-7 of 18 semester hours, or equivalent classroom hours, 12 hours of
5-8 which must be completed in core real estate courses.
5-9 SECTION 2. Section 7A(e), The Real Estate License Act
5-10 (Article 6573a, Vernon's Texas Civil Statutes), is amended to read
5-11 as follows:
5-12 (e) Notwithstanding any other provision of this Act to the
5-13 contrary, the commission may by rule establish procedures under
5-14 which licenses are issued, renewed, or returned to active status
5-15 before the completion of the continuing education required by this
5-16 Act. These procedures may require an applicant to pay an
5-17 additional fee not to exceed $200 and to complete the required
5-18 continuing education within 60 days after the date on which the
5-19 license is issued, renewed, or returned to active status. [On or
5-20 before September 25, 1991, the commission shall:]
5-21 [(1) identify each real estate broker that:]
5-22 [(A) has been licensed under this Act for at
5-23 least 10 years as of September 1, 1991, and holds a license as a
5-24 real estate broker on that date; and]
5-25 [(B) on June 1, 1991, has the principal place of
5-26 real estate brokerage business, as designated on the real estate
5-27 broker's license pursuant to Subsection (a) of Section 12 of this
6-1 Act, located in a county with a population of 225,000 or less,
6-2 according to the 1980 federal decennial census; and]
6-3 [(2) send a written notice to each real estate broker
6-4 identified under Subdivision (1) of this subsection stating that
6-5 the real estate broker may qualify to opt out of the mandatory
6-6 continuing education requirements required by this Act in
6-7 accordance with Subsection (f) of this section if the real estate
6-8 broker has held a broker's license for 10 years or more and holds a
6-9 broker's license on September 1, 1991.]
6-10 SECTION 3. The Real Estate License Act (Article 6573a,
6-11 Vernon's Texas Civil Statutes), is amended by adding Section 7B to
6-12 read as follows:
6-13 Sec. 7B. WAIVER OF LICENSE REQUIREMENTS. Notwithstanding
6-14 any other provision of this Act to the contrary, the commission by
6-15 rule may provide for a waiver of one or all of the requirements for
6-16 a license under this Act if the applicant was licensed under this
6-17 Act within the five years preceding the date the applicant files an
6-18 application.
6-19 SECTION 4. Section 11, The Real Estate License Act (Article
6-20 6573a, Vernon's Texas Civil Statutes), is amended to read as
6-21 follows:
6-22 Sec. 11. FEES. [(a)] The commission shall charge and collect
6-23 the following fees:
6-24 (1) a fee not to exceed $100 for the filing of an
6-25 original application for a real estate broker license;
6-26 (2) a fee not to exceed $100 for annual renewal of a
6-27 real estate broker license;
7-1 (3) a fee not to exceed $50 for the filing of an
7-2 original application for a real estate salesman license;
7-3 (4) a fee not to exceed $50 for annual renewal of a
7-4 real estate salesman license;
7-5 (5) a fee not to exceed $50 [$25] for an application
7-6 for a license examination;
7-7 (6) a fee not to exceed $20 for filing a request for a
7-8 license for each additional office or place of business;
7-9 (7) a fee not to exceed $20 for filing a request for a
7-10 license for a change of place of business, change of name, return
7-11 to active status, or change of sponsoring broker;
7-12 (8) a fee not to exceed $20 for filing a request to
7-13 replace a license lost or destroyed;
7-14 (9) a fee not to exceed $400 for filing an application
7-15 for approval of an education program under Section 7(f) of this
7-16 Act;
7-17 (10) a fee not to exceed $200 a year for operation of
7-18 an education program under Section 7(f) of this Act;
7-19 (11) a fee of $15 for transcript evaluation;
7-20 (12) a fee not to exceed $10 for preparing a license
7-21 history;
7-22 (13) a fee not to exceed $50 for the filing of an
7-23 application for a moral character determination;
7-24 (14) an annual fee of $20 from each real estate broker
7-25 to be transmitted to Texas A&M University for the Texas Real Estate
7-26 Research Center as provided by Section 5(m) of this Act; and
7-27 (15) an annual fee of $17.50 from each real estate
8-1 salesman to be transmitted to Texas A&M University for the Texas
8-2 Real Estate Research Center as provided by Section 5(m) of this
8-3 Act.
8-4 SECTION 5. Section 15B(a), The Real Estate License Act
8-5 (Article 6573a, Vernon's Texas Civil Statutes), is amended to read
8-6 as follows:
8-7 (a) Notwithstanding any other provision of the Act, there
8-8 shall be no undercover or covert investigations conducted by
8-9 authority of this Act unless expressly authorized by the commission
8-10 after due consideration of the circumstances and determination by
8-11 the commission that such measures are necessary to carry out the
8-12 purposes of this Act. No investigations of licensees or any other
8-13 actions against licensees shall be initiated on the basis of
8-14 anonymous complaints whether in writing or otherwise but shall be
8-15 initiated only upon the commission's own motion or a signed written
8-16 complaint from a consumer or service recipient. Upon the adoption
8-17 of such motion by the commission or upon receipt of such complaint,
8-18 the licensee shall be notified promptly and in writing unless the
8-19 commission itself, after due consideration, determines otherwise.
8-20 The commission may authorize an employee to file a signed, written
8-21 complaint against a licensee and to conduct an investigation when:
8-22 (1) a judgment against the licensee has been paid from
8-23 a recovery fund established under this Act;
8-24 (2) the licensee has been convicted of a criminal
8-25 offense that may constitute a ground for the suspension or
8-26 revocation of a license; or
8-27 (3) the licensee has failed within a reasonable time
9-1 to make good a check issued to the commission after the commission
9-2 has mailed a request for payment by certified mail to the
9-3 licensee's last known business address as reflected by the
9-4 commission's records.
9-5 SECTION 6. Sections 7A(f) and 24(g), The Real Estate License
9-6 Act (Article 6573a, Vernon's Texas Civil Statutes), are repealed.
9-7 SECTION 7. (a) Except as provided by Subsection (b) of this
9-8 section, this Act takes effect September 1, 1997.
9-9 (b) Section 2 takes effect on January 1, 1998.
9-10 SECTION 8. The importance of this legislation and the
9-11 crowded condition of the calendars in both houses create an
9-12 emergency and an imperative public necessity that the
9-13 constitutional rule requiring bills to be read on three several
9-14 days in each house be suspended, and this rule is hereby suspended.