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2012 Winter Summary of Action Items

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CALIFORNIA ASSOCIATION OF REALTORS®
BOARD OF DIRECTORS
533rd SESSION
JANUARY 20 - 21, 2012

The following is a summary of the significant action items approved by the CALIFORNIA ASSOCIATION OF REALTORS® Board of Directors at its Winter 2012 meeting.  Some additional information items are included, but do not necessarily represent Association policy.  A complete set of minutes is available for review upon request.

California REALTOR® Expo Advisory
1. It was reported for information only that the CALIFORNIA REALTOR® EXPO 2012 will be held October 2-4, 2012 in Anaheim.  The theme will be "Your Membership, Your Way." 

C.A.R. Scholarship Foundation/C.A.R. Education Foundation
1. It was reported for information only that the C.A.R. Scholarship Foundation awarded scholarships totaling $12,500. 

CREPAC Trustees
1. It was reported for information only that the CREPAC Trustees will transfer the 2012 Fair Share contribution of $710,000 from CREPAC/Federal to the National RPAC.  CREPAC recommended to RPAC that contributions of $14,000 be made to bi-partisan candidates for congress.  CREPAC contributed $965,000 to candidates and to the party caucuses for the Assembly and Senate.
It was further reported for information only that the CREPAC Trustees made the following update to the Local Candidate Recommendation Committee Cooperative Agreement.
 
Under Section title:  Responsibilities of the Local Association
Paragraph 3: CREPAC shall maintain Local Candidate Recommendation Committee funds for the amounts received through the AOR.
(C) In its annual dues billing statement, or any electronic equivalent, the AOR shall use the allocation conforming to the PACS contribution formula approved and adopted by C.A.R., which shall include the REALTOR® Action fund in above-the-line billing in the amount approved and adopted by C.A.R. The AOR shall also use the language in C.A.R.’s dues billing statement regarding PACS contributions in the AOR’s annual dues billing statement for compliance with applicable laws.  All PACS contributions received through the AOR’s annual dues billing statement shall be allocated to the local sub-account for the AOR and the general CREPAC funds as stated in the allocation formula approved by C.A.R., unless state or local laws conflict with this allocation.

Distressed Properties Task Force
It was reported for information only that the Distressed Properties Task Force has made the following recommendations:
1.  C.A.R. should research options (in both statute and regulation) to address the financial incentive that servicers have to delay.
2.  REALTORS® need to better train agents on how to prequalify or “triage” short sellers; in  particular in discovering whether Mortgage Insurance covers a loan, and in discovering the identity of the investor/owner of note.
3.  C.A.R. should continue to pursue improved language in individual lenders’ contract addenda for distressed property sales. At the same time Standard Forms should review short sale forms in the areas of:
     a. Continuing to receive back-up offers.
     b. Asking for documents revealing defect correction or code compliance citations in AVID or contract addenda for REO sales.
     c. Inclusion of last four digits of Social Security Number and DOB, as those items are routinely required by lenders.
4. C.A.R. should continue to clarify the rules under SB 458, Corbett, (the C.A.R.-sponsored legislation prohibiting deficiency liability after a short sale), especially regarding seller contributions to sale proceeds.
5. C.A.R. should expand its members’ need for training on lender-specific transaction rules.
6. C.A.R. should continue to support a streamlined HARP (Home Affordable Re-finance Program) based upon C.A.R.’s earlier policy motion adopted in 2011.
7. The Task Force recommends to the Transaction and Regulatory Committee that it SUPPORT extension of the “no underwriting HARP refinance” rule in #6 above to non-agency loans pursuant to the same HARP guidelines.

Executive Committee
1. That the following 2012 Presidential appointments be approved:
 
2012 Executive Committee
Le Francis Arnold
Don Faught
Chris Kutzkey
Joel Singer
Jeff Barnett
Diana Bustamante
Janet Dorsey
Richard Gaylord
Glenn Hellyer
Karl Lee
Robert Leighton
Tangie Leverett
Terry Murphy
Pat Neal
Marian Norris
Beth L. Peerce
Larry Spiteri

2012 Directors at Large
Darnella Barnes, Delta
Kathryn Burdett, Inglewood
Virginia Butler, Palos Verdes Peninsula
Mary Jane Cambria, Orange County
Staci Caplan, Santa Barbara
West DeYoung, Pasadena-Foothills
Leslie Dopp, West Contra Costa
Vern Hansen, North Bay
James S. Irving, Paso Robles
Paulina Lee, Arcadia
Anita Martin, Southland Regional
Lee McLeod, Tehama County
Tim Muetterties, Calaveras County
Bobbie Nelson, Santa Cruz
Steven Rice, Greater Antelope Valley
John Schulte, Inland Gateway
Scott Swendiman, Shasta County
Sue Walsh, San Mateo County
Heide Wolf-Reid, Bay East
Yahia Zabdie, Tri Counties
 
2. That the Imperial County Association of REALTORS® be reassigned, per their request, from C.A.R. Region 30 to C.A.R. Region 28, effective immediately.
3. That a special resolution be adopted honoring 2011 President Beth L. Peerce.
4. That a special resolution be adopted honoring 2011 California Distinguished REALTOR® Mary Chatton Brown.
5. It was reported for information only that the proposed PAC Bylaws amendments will be referred to a new task force, to be determined, to report back to the Executive Committee and the Board of Directors at the May 2012 meeting.

Housing
1. In response to proposed regulatory pilot programs addressing GSE and FHA Bulk Sales and Rental Restrictions on GSE and FHA Bulk Sales of REO Properties, C.A.R. allocate staff resources and monetary resources not to exceed $500,000 to lobby the appropriate legislative and regulatory bodies with jurisdiction and authority over said programs with the purpose of stopping or minimizing the negative effects said program may have on local markets within California.  Additional resources and funds to be allocated towards a public media campaign. C.A.R. Staff to determine the appropriate media to be used to address the issue.  Due to the time sensitive nature of the issue, C.A.R. staff to take action within 30 days of the January 2012 BOD meeting.
 
IMPAC Trustees
1. It was reported for information only that the following IMPAC requests were approved.
--Civil Justice Association of California: $40,000 for a Sponsoring Member level membership to the Board of Directors.
--California Association of REALTORS® Association Executive Institute: $7,500 to support a three-day professional development program.
--Orange County Association of REALTORS®: Up to $15,000 in matching contributions toward legal fees to defend REALTORS® against the imposition of business license taxes.
--Orange County Association of REALTORS®: $1,500 toward legal fees to obtain an injunction on the implementation of a new law against private docks over State waterways.
--South Tahoe Association of REALTORS®: $5,000 toward a contract Government Affairs Director to represent REALTORS® before the Tahoe Regional Planning Agency.
--Housing Opportunities Collaborative: $25,000 to help fund public workshops for distressed homeowners in San Diego County.
--Oakland Association of REALTORS®: $15,000 toward legal expenses and educational materials for a new sewer lateral ordinance in Oakland, and approve the request for a total of $5,000 from three interboard solicitations.

Legal Action Fund Trustees
1. It was reported for information only that, since September, the Trustees reviewed several cases and approved filing a brief on one case as follows:
Sandler v. Sanchez.   A corporate real estate brokerage that employed a designated broker officer was alleged to have injured buyers due to misrepresentation and misconduct of a licensee within the firm.   Since neither the corporation nor its owners had any assets, the injured plaintiff sued the designated broker officer to hold him personally and individually responsible for failing to supervise the licensees.   The Trustees authorized a brief to support the position that in civil litigation, although a corporate brokerage has duties to the client, a designated broker officer for a corporate real estate licensee does not individually have a separate fiduciary duty to a buyer to supervise the other licensees and should not therefore be personally liable for the misrepresentation and misconduct of the licensees of the corporation.   The broker officers of a corporate real estate firm have a duty under the licensing law to properly supervise, and risk discipline by the DRE for failing to do so, the brief will argue that it does not follow that civil and personal liability also follow that ignore the usual corporate protections.
 
DBSI Bankruptcy.  The Trustees are not officially involved in this case but are monitoring it.  Many C.A.R. members were sued for past commissions by a bankruptcy trustee under the theory that the bankrupt company knew they had no assets to pay real estate professionals and therefore all such funds should be returned to the Bankruptcy Trustee.  Approximately 90 members have joined the group to save costs in a joint defense.   There have been some settlement discussions with the Bankruptcy Trustee but no settlement has been reached.  Five motions were filed and will be decided by two different courts.   The defendant brokers and salespersons will be waiting for decisions which may come the first half of this year.

Legislative
1. That C.A.R. take a "NOT REAL ESTATE RELATED" position on proposition (Number Pending). Prohibits Political Contributions by Payroll Deduction. Prohibitions on Contributions to Candidates. Initiative Constitutional Amendment. for the November 2012 state ballot.
 
Note: C.A.R. has previously taken the following positions on upcoming 2012 state ballot propositions:
An as yet unnumbered Proposition for the June 2012 ballot entitled Legislative Term Limits Reform Act of 2012. Initiative Constitutional Amendment. “NOT REAL ESTATE RELATED”
An as yet unnumbered Proposition for the June 2012 ballot entitled HOPE 2010: California Cancer Research Act. Initiative Constitutional Amendment.  “NOT REAL ESTATE RELATED”
An as yet unnumbered Proposition for the November 2012 ballot entitled Safe, Clean, and Reliable Drinking Water Supply Act.  “NEUTRAL”
An as yet unnumbered Proposition for the November 2014 ballot entitled State Budget. Changes California Budget Process. Limits State Spending. Increases “Rainy Day” Budget Stabilization Fund. “NOT REAL ESTATE RELATED”


Membership
3. That the following applicants be granted C.A.R. Honorary Member-for-Life status:
 
Bay East AOR
Henry Bettencourt
Richard Reis

Berkeley AOR
Estelle Kent
Maya Trilling

Big Bear AOR
Richard Reif

Burbank AOR
Mario Iacobellis

California Desert AOR
Elaine Leib
Pehgee Morris

Chico AOR
Rita Allen
Rod Minkler
John Parker

Citrus Valley AOR
Philip Yeager

Conejo Simi Moorpark AOR
Marietta Baer
John Butler
Janet Ritts
Shirley Taylor

East San Diego County AOR
Carole Chufo
Jack Hawkins
Donavan Truesdale

East Valley AOR
Jan Sherman

Fresno AOR
Jim Tekunoff

Malibu AOR
Beverley Higgins

Monterey County AOR
John Mahoney

Newport Beach AOR
Stephen Queale

Orange Belt BOR
Mary Pacheco
Ronald Warner

Orange County AOR
Randy Clark
Marilyn David
Robert Edwards
Bobbi Krone
Helen Malloy
Nancy Mitchell
Anne Moell
Jo Ann Petrick

Oroville AOR
Nora Williams

Pacific West AOR
Ellen Paulsen
Don Rea

Paradise AOR
Patricia Jesiolowski

Pasadena-Foothills AOR
Joan Bothast
Norma Burnett
Nino Corradi
Kay Davis
Kay Fife
Carol Hess
G.B. Jones
Ann Kirsch-Korff
Shirley Knuth
Lorie MacKenzie
Joanne Martin
Georgia Rutherford
Billie Rae Schmitz
Margaret Sedenquist
Bonnie Simons
Nancy Wyman
Pismo Coast AOR
Oma Winkler

Sacramento AOR
Karla Oppliger

San Diego AOR
Karl Mortensen

San Francisco AOR
Kelly Husbands
John F McCloskey Jr.

Silicon Valley AOR
Harry Block
Richard E Bocks
Delano Damron

Southland Regional AOR
Sally Collom

Southwest Los Angeles AOR
Lyda Hurst
Earl Lawson

Tehachapi Area AOR
Jack Williams

Tulare County AOR
Peter Salierno

Tuolumne County AOR
Richard Bacon
Kenneth Crabtree

Victor Valley AOR
Charles Moore

West San Gabriel Valley AOR
Lucinda Don
Florence Huey

MLS/ Computer and Business Technology
1. That, upon final approval by NAR, C.A.R. Model MLS Rules be revised and placed into Tier One of the C.A.R. Model Citation Policy as set forth below:

7.27 REO Disclosure.  Participants and Subscribers submitting foreclosure, bank-owned, or real estate owned (“REO”) listings to the service shall disclose said status on the service.

2. That C.A.R. petition NAR to re-examine its Lockbox Policy Statement 7.31 to better enable an MLS to enforce a rule requiring use of an MLS designated or authorized lockbox on listings submitted to the MLS.

Nominating
1. It was reported for information only that the C.A.R. Nominating Committee will continue to follow the existing selection criteria to recommend the “most qualified” candidates for the position of NAR Director.  The criteria utilized in the evaluation process to determine the most qualified candidates will continue to include, but not be limited to, special expertise on relevant issues, individual skills and abilities, the overall composition of the California delegation of NAR Directors (teamwork), the Regional diversity of the California delegation, leadership development, and past attendance at NAR meetings.
 
Professional Standards
1. It was reported for information only that a system will be developed by staff to create a database that contains all final findings of a member’s Code of Ethics and membership duty violations within the last three (3) years, and whether the member has any unfulfilled sanctions, for use by local Associations in making their decision on membership applications.

Standard Forms Advisory
1.  There were 12 Regional Representatives reports given to the Standard Forms Advisory Committee (SFAC) meeting.  The committee received comments on many drafts including the Septic Addendum (SWPI) form and the Short Sale Addendum (SSA) form.
 
The SFAC reviewed 5 drafts scheduled for release April 2012:
-Carbon Monoxide Detector Notice (COD) – new form
-Office Management Agreement (OMA) – new form
-Parking and Storage Disclosure (PSD) – new form
-Contingency for Sale or Purchase of Other Property (COP) – revised form
-Septic Well Inspection, Property Monument and Allocation of Cost Addendum (SWPI) – revised form

Considerable discussion was had on the carbon monoxide detector form and whether to make the installation of the device a contractual obligation.  The SFAC opted against this direction for the time being.  Additionally, a decision was made to change the initials of the Carbon Monoxide Detector form to CMD.  There were also some other minor modifications to the form. 

The SFAC decided to remove the Broker signature from the Addendum (ADM) form and release this revision in April 2012 and to also create a separate addendum form for Brokers to use with their buyer or seller client.  A draft of this new form will be presented at the May business meetings.
 
A report was made on behalf of the Distressed Properties Task Force regarding the Short Sale Addendum (SSA), the Authorization to Receive and Convey Information (ARC) and the Agent Visual Inspection Disclosure (AVID).  The committee considered their concerns and as a result, an SSA draft will be presented in May 2012.  More discussion on their recommendations will take place in an upcoming SFAC conference call.

The SFAC also received updates regarding the following sub-committees/study groups:
-Property Management
-CARSF Subcommittee
-Probate Study Group
-zipForm/SFAC Joint Initiative

The committee also received an update regarding the local forms library pilot program.  Finally, the SFAC reviewed 21 of the 100 comments received and will have a conference call to review the balance of comments.
 
Strategic Planning and Finance
1. That the Statement of Income and Expenses by program for the eleven months ending November 30, 2011 be approved.
Total C.A.R.
Revenue of $24,798,200
Expenses of $22,401,700
An excess of income (including investment income) over expenses of $2,396,500
 
Political Activities Fund
An excess of income over expenses of $1,664,200
 
Issues Action Fund
An excess of income over expenses of $955,700
 
REALTOR® Action Assessment
An excess of income over expenses of $7,301,200
 
The C.A.R. Balance Sheet as of November 30, 2011
Total assets of $65,253,700 (of which $50,512,500 are current assets)
Total liabilities of $5,279,100 (of which $5,268,900 are current liabilities)
C.A.R. Fund Balance of $59,974,600
 
2. That the Projected Statement of Income and Expenses by program for the year ending December 31, 2011 be approved.
 
Total C.A.R.
Revenue of $25,808,700
Expenses of $25,361,200
An excess of income (including investment income) over expenses of $447,500
 
Political Activities Fund
An excess of income over expenses of $1,483,200
 
Issues Action Fund
An excess of income over expenses of $878,800, this amount will be allocated to IMPAC as approved by the Directors.
 
REALTOR® Action Assessment
An excess of income over expenses of $7,039,000, this amount will be allocated to PACs.
 
3. To increase the meeting reimbursement for Past Presidents from $1,100 per meeting to $1,500 beginning with the January 2012 business meeting (additional cost $18,000).
 
Transaction and Regulatory
1. That C.A.R. “SUPPORT” SB__ (Corbett) that would protect refinanced purchase debt from deficiency liability.  Note: The Senate Bill number is pending at this time.
2. That C.A.R., in conjunction with NAR, “SUPPORT” the extension of the Home Affordable Refinance Program (HARP) to allow for the government sponsored enterprises (GSE) to refinance non-GSE loans under the program.
3. That C.A.R. “SUPPORT” legislation that would prohibit "dual tracking" of foreclosure and short sale actions by lenders when there is a valid short sale in process.
4. That C.A.R. “SUPPORT” a Real Estate Fraud Prevention surcharge increase on real estate recordings from $3 to $10 provided that it does not apply to documents related to escrow and the transfer of property.

Revised: January 27, 2012
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