CALIFORNIA ASSOCIATION OF REALTORS®
BOARD OF DIRECTORS
JUNE 7 - 8, 2002

The following is a summary of the significant action items approved by the CALIFORNIA ASSOCIATION OF REALTORS® Board of Directors at its June 2002 meeting.  A complete set of minutes is available for review upon request.  For more information please contact Marleen Schuster at 213-739-8209 or e-mail marleen_schuster@car.org.

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SPECIAL REPORTS

Property Information/MLS Task Force
1. To approve the request of the Property Information/MLS Task Force to appropriate up to $150,000 to establish phase I of the Intelligent Agent Application Development Project.

PUBLIC POLICY

Common Interest Development
1. That C.A.R. "WATCH" AB 555 (Dutra), a bill relating to common interest development managers.
2. That C.A.R. "OPPOSE" AB 643 (Lowenthal), a bill that will require all homeowner associations to be incorporated by January 1, 2003.
3. That C.A.R. "FAVOR" AB 2289 (Kehoe), a bill that allows homeowners the right to dispute unpaid assessments.
4.That C.A.R. "WATCH" AB 2417 (La Suer), a bill that requires the board of directors of a common interest development to note in the minutes, the matters discussed in its executive session.

Land Use and Environmental
1. That C.A.R. join the California Action on Water, a coalition of California-based groups that supports federal reauthorization of, and funding for, the CALFED program, a state-federal partnership working to implement a comprehensive program of water management for the San Francisco Bay Delta.
2. That C.A.R. "OPPOSE UNLESS AMENDED" SB 1521 (Kuehl), a bill which requires the creation of model planning practices at the Governor's Office of Planning and Research.  The amendments would:
--Remove all linkages between the model planning practices and state competitive grant programs for local government.
--Ensure REALTOR® involvement in the Planning Advisory and Assistance Council

Legal Action Fund
1. That the proposed Legal Action Fund bylaws be noticed for vote by the Directors at the next meeting.
2. It was reported for information only that the U.S. Supreme Court has accepted hearing in the Holley v. Meyer case, in which a corporate owner/officer broker was held personally responsible for the fair housing violations of a salesperson employed by the corporate brokerage firm.  Very few cases are accepted for hearing before the highest court -- out of about 6,000 cases every year and only about 1% are accepted for a hearing.  The Holley case was one of two cases accepted that day with 190 rejections.   To our knowledge, C.A.R. and NAR were the only two supporting briefs in the case most likely had a great deal to do with the Court's acceptance the case for review.   The case will now be briefed for consideration of the Court.  The Trustees also authorized an additional $10,000 to assist with preparation for the U.S. Supreme Court.
3. It was reported for information only that the U.S. Supreme Court issued a 39-page decision in the Tahoe Preservation Council v. TRPA case involving a "temporary" building moratorium that started in 1981 and still continues.  The case is a set back and muddies the water on land use takings cases, in effect stating that "temporary" delays prohibiting all economic use of the property does not necessarily constitute a taking, thus not requiring compensation.  The case was postured so that the building moratorium under consideration was for 32 months.  The dissent, lead by Rehnquist and joined by Scalia and Thomas, characterized the facts as a 6-year moratorium, since at the end of the moratorium there was a court ordered injunction in effect.  In reality, the ban on building continues today more than 20 years after people had purchased their retirement lots.  The decision left some openings, such as a hint that a one-year moratorium might be too long (although not applicable in this case), and also hinting that government itself could impose time limits.  This is the first set back in land use cases reversing a trend of favorable decisions in the last decade.
4. It was reported for information only that in Freeman v. San Diego (federal case in the U.S. Court of Appeals), the trial court's summary judgment award to the MLS, Associations and C.A.R. is on appeal to the U.S. Ninth Circuit Court of Appeals.   Oral argument is scheduled for July 10, 2002 in this antitrust action.
5. It was reported for information only that in McHardy v. Charton (unpublished California Appellate decision -- malicious prosecution), the California appellate court upheld the dismissal of a malicious prosecution lawsuit against a lawyer who sued a real estate agent but then dismissed herfrom the case.  Stating that malicious prosecution is a disfavored tort, the court held that as long as the case was properly filed, continuing to maintain the case without cause is not an independent cause for a malicious prosecution lawsuit. The court also applied an objective standard to the matter, rather than the subjective view of the attorney filing the case.  The case is not published and therefore can't be cited as authority. 
6. It was reported for information only that in Oakhill Development v. Tyler, the California Supreme Court did not accept hearing in this case.  The appellate court reversed a specific performance order where a buyer provided a loan prequalification letter to satisfy the purchase-contract condition that the buyer prove ability to perform.  Without asking for more information, the seller cancelled the contract.  The buyer alleged bad faith of the seller and had prevailed at the trial level.

Local Governmental Relations
1. It was reported for information only that the LGR Committee will create a Working Group to investigate alternatives to inclusionary zoning.  The Working Group will report its findings to the LGR, Housing Affordability and Land Use Committees.
2. It was reported for information only that the LGR Committee will form a REALTOR®/GAD Working Group.  This group will serve as a strike force to assist Local Associations on a statewide basis, with proactive anti-rent control and just cause for eviction strategies.  In conjunction with C.A.R., this body will also serve as a clearinghouse of information available to all Local Associations.

Manufactured Housing
1. That C.A.R. "SUPPORT" Senate Bill 1564 (Polanco), which requires the Department of Housing and Community Development to convene a task force to develop strategies designed to reduce the cost of financing manufactured housing.
2. It was reported for information only that the Manufactured Housing Committee will create a working group to study and develop recommendations concerning the financing of manufactured housing and the potential funding of a statewide task force on the same topic.  The working group will report back to the Manufactured Housing Committee at the October 2002 Board of Directors Meetings.

Property Management
1. That C.A.R. "OPPOSE" AB 2330 (Migden), a bill that would: require the payment of interest on security deposits; mandate a pre-inspection of the rental unit prior to the tenant vacating that unit; and prohibit a landlord from deducting from the security deposit any damage caused by the tenant as long as the damage occurred through "every day usage."
2. That C.A.R. change its position from "OPPOSE" to "NOT FAVOR" on SB 1403 (Kuehl), if it is amended to:
--Delete the proposed amendment that would delay showing of rental property for sale
--Permit a seller or buyer the right to give a thirty-day notice to terminate a tenancy if a single-family home (including a condominium) is to be owner occupied
--Eliminate objectionable changes to the "Ellis Act," the right of an owner to go out of business.
--Require a statewide 60-day notice to terminate a residential tenancy.

Real Estate Finance
1. That C.A.R. adopt a "FOR" position on the November 2002 ballot concerning the $2.1 billion Housing Bond measure.
2. That C.A.R. "SPONSOR" a bill next year to require creditors to correct inaccurate information within thirty days or less if requested to do so by a consumer.
3. That C.A.R., in conjunction with N.A.R., oppose any public-private mortgage risk-sharing proposal that places an undue or indeterminate financial burden onthe federal government.
4. That C.A.R, in conjunction with N.A.R., support the creation of an FHA 40-year fixed rate single-family mortgage loan product.

Taxation
1. That C.A.R. take a "NEUTRAL" position on the Kindergarten-University Public Education Act of 2002, which would authorize $13.05 billion in statewide general obligation bonds for school facilities.
2. That C.A.R. take a "WATCH" position on AB 2878 (Wiggins), which seeks to exchange a portion of local sales and use tax funds for a similar portion of property tax funds, AND seeks to replace the Vehicle License Fee backfill to local governments with a similar portion of property tax dollars.
3. That C.A.R. "OPPOSE" SCA 10 (Speier), which would reduce the vote threshold from 2/3 majority to 55% majority, for local general obligation bonds to fund public library facilities.
4. That C.A.R. "OPPOSE" SCA 13 (Alarcon), which would: reduce the vote threshold from 2/3 majority to 55% majority for any local special tax that funds transportation, open-space land acquisition, or affordable housing incentives·reduce the vote threshold from 2/3 majority to 50% majority for any local general obligation bond that funds affordable housing construction.

BUSINESS

MLS/ Computer & Business Technology
1. A motion from the MLS/Computer & Business Technology Committee, consisting of the following three parts, was referred to a task force to be appointed in order to explore strategies to address problems related to lockbox systems.
a. That C.A.R. in conjunction with other state Associations, continue to investigate the research and development of a REALTOR® owned lockbox system.
b. That C.A.R. develop a budget to explore possible joint legal action regarding potential unfair business practices by SUPRA, for consideration at the fall 2002 business meetings.
c. That C.A.R. in possible conjunction with NAR pursue the purchase of SUPRA and RISCO lockbox systems.

Standard Forms Advisory
1. It was reported for information only that the Standard Forms Advisory Committee hosted two panel discussions on the Residential Purchase Agreement (RPA) proposed revision with members of the RPA study group.  Over 700 drafts along with a summary of changes were distributed.  Eleven of the sixteen RPA study group members were in attendance to answer questions and receive member input.  The study group members also visited regional caucus meetings.  The study group has received a significant amount of positive feedback and many good comments and suggestions.The study group will meet again in July and will carefully review the comments received with particular attention to the following areas:
Pest control:
--Including the scope of the pest report to indicate what structures are to be inspected.
--Adding instructive language on section 1 & 2 work to the Buyer's Inspection Advisory and possibly the Seller's Advisory.
Loan contingency removal:
--Adding an option to modify or modifying the timeframe for removal of the loan contingency to have it remain in effect until funding.
--Cooperating broker compensation:
--Consider either removing the clause entirely or eliminating any reference to specific compensation and instead referring to the MLS or separate written agreement.

The study group will continue to share its progress with membership as it moves forward, utilizing:
C.A.R. communication vehicles as appropriate (C.A.R. Online and C.A.R. newsletters)
Regional Forum on Forms
Legal outreaches
Continued discussion at regional and office meetings, meetings with colleagues and counsel.

The Committee also reports that it has reviewed the Proposed Policy for the Inclusion of Non-C.A.R. Produced Forms in WINForms that has been developed by a study group and recommends that the policy be adopted with the following modifications:
--In item III, that the San Diego AOR library be included in the local AOR form libraries excluded from the General Policy.
--That the annual review fee be clarified that the fee is to cover a review by C.A.R.
--That the non-endorsement language be modified to allow either a pop-up window in WINForms (if technology permits) or on face of form and that the language be modified so that the local AOR library endorses the form.
--That the excluded libraries in item III be those in the library as of June 7, 2002.

POLITICAL

CREPAC Trustees
1. It was reported for information only that the CREPAC Nominating Committee met on Tuesday, May 28, 2002, and selected the following individuals as nominees for CREPAC Trustee and CREPAC Alternate.  Per the Bylaws, the following slate of candidates is duly noticed, for approval in October 2002.  Trustees serve for a three-year term.  Alternates may be selected to fill the remainder of a vacant term during the year.

NOMINEES FOR CREPAC TRUSTEE
(November 2002- November 2005)
Paula Colombo, Region 3
Diane Hardie, Region 13
Terry Fenske, Region 15
Sharon Bowler, Region 16
Melanie Hildebrand, Region 25

NOMINEES FOR CREPAC ALTERNATE
(November 2002 - November 2003)
Dawn O'Rourke, Region 1
Susanna Schlendorf, Region 5
Judy Jarvis Ellis, Region 9
Suzanne Yost, Region 10
Wendy Furth, Region 18
Stephen Goddard, Region 21
LeFrancis Arnold, Region 22
Nancy Hunt, Region 32

IMPAC Trustees
1. It was reported for information only that the IMPAC Trustees approved the following contributions:
--California Natural Resources Group (CNRG), an advocacy/education coalition focused on endangered species and critical habitat issues...$10,000.
--The Community Renewal Project for its Community Renewal Summit, a one-day conference for individuals fostering renewal of their communities...$5,000.
--Ventura County HOME Program, an advocacy/education effort for affordability and availability of housing in Ventura County...$20,000.
--C.A.R. GAD Institute 2002, a C.A.R.-sponsored educational event for local government affairs directors...Up to $9,000.
--Californians for Local Coastal Planning (CLCP), to fight the California Coastal Commission's land use plan forthe City of Malibu...$50,000, and up to an additional $25,000 pursuant to the raising of non-REALTOR® matching funds (as requested by the Malibu Association of REALTORS®).
--Recreation and Land Use Preservation Foundation (RECLUPF), to fight the California Coastal Commission's land use plan for the City of Malibu...$12,500, and up to an addition $12,500 pursuant to the raising of non-REALTOR® matching funds (as requested by the Malibu Association of REALTORS®).
--The Malibu Association of REALTORS® was authorized to conduct an Interboard Solicitation for the purpose of fighting the California Coastal Commission's land use plan for the City of Malibu.

2. It was reported for information only that the IMPAC Nominating Committee met on Tuesday, May 28, 2002, and selected the following individuals as nominees for IMPAC Trustee and IMPAC Alternate. Per the Bylaws, the following slate of candidates is duly noticed, for approval in October 2002. Trustees serve for a three-year term. Alternates may be selected to fill the remainder of a vacant term during the year.

NOMINEES FOR IMPAC TRUSTEE:
(November 2002-November 2005)
Vicky Lynn Campbell, Region 5
Richard Otterstrom, Region 17
Dennis Pantano, Region 25
Shirley Long, Region 32

NOMINEES FOR IMPAC ALTERNATE:
(November 2002- November 2003)
Aida Dimejian, Region 13
Karen O'Brien, Region 15
Patricia O'Neill, Region 17
Steve White, Region 18
Greg Haas, Region19
Jeanne St. Clair, Region 23
Mark Marchand, A.E., Region 30

OPERATIONS

C.A.R. Scholarship Foundation
1. It was reported for information only that various scholarships were awarded by the Trustees, and that funds were being raised for scholarships in memory of longtime C.A.R. Director Byron Brawley.

California REALTOR® EXPO Advisory
1. It was reported for information only that the California REALTOR® EXPO 2002 will be held in Long Beach from October 8 - 10, 2002.

Executive
1. That effective January 2003, the Desert Communities Association of REALTORS® (currently in Region 28) be assigned, per their request, to C.A.R. Region 15.
2. That John Maquar, Southland Regional AOR, be appointed to complete the remainder of a term on the 2002 Executive Committee.

Membership
1. That the following applicants be granted C.A.R. Honorary-Member-For-Life status:

Arcadia AOR
Alvin Little

Bay East AOR
Lyman Harms

Beverly Hills/Greater Los Angeles AOR
Helen Weiss

Burbank AOR
Dominic Agatiello
Bart Caldarell
Rocco Delurgio
Richard Mortimer
Dominic Rondinella
James Woodburn

Contra Costa AOR
Suzanne Johnson
Al Kaplan
John Paulino
Joseph P. Roberts
Gene Ross

Fresno AOR
Jim Burgess

Humboldt AOR
Bud Forbes
Wesley Olsen
Lucy Stipek

Inland Valleys AOR
Irene F. De Moss
James Paul Langsjoen
Jane H. Richardson

Monterey County AOR
Robert Chapman
Jocelyn Chilton
Adorjan DeGalffy
Muriel Dobry
Lee Ish
Barbara Munziq
Bettigene Tubman

North Bay AOR
Herbert Bundesen
Vance Davids
Eugene Giovannoni
Harry Lockwood Jr.
Caryl Weis

Orange County AOR
E.J. Campbell
James Sauls

Pacific West AOR
Jim Abraham
Patricia D. Deturk 
Harvey Miller

Pasadena-Foothills AOR
Helen G. McNeish

Placer County AOR
Geneva Baker
Harry Clark
Nick Kern
Ellen Peter

San Luis Obispo AOR
Elvin Dale Arnett
Donald Wilbur Patrick

Santa Clara AOR
Joseph S. Beatty Jr.
Bette Hager Smith

Shasta AOR
Faye Cottrell-Collins

Solano AOR
Bob Pace
Fredrick Sessler

Southland Regional AOR
Donald W. Long
GloriaJ. Mikeler

Ventura County Coastal AOR
Robert Hosley

Yosemite Gateway AOR
Donald H. Williams

2. That the following C.A.R. member be approved for Honorary Member for Life status with C.A.R dues being waived beginning January 2002:

Philip Louis Spiegl
Monterey County AOR

Nominating
1. That C.A.R. allow candidates to use the e-mails of C.A.R. Directors, in addition to AE's, but that any use include adequate security procedures that:
a) Do not transfer control or access or possession of the e-mails
b) Mask the identity of the e-mails so they cannot be copied. 
Further, that the e-mails contain a disclaimer to make it clear that the e-mails do not include an implied endorsement of the candidate by virtue of the origination e-mail address.  Finally, that the candidates bear the costs, if any, necessary to provide this service while still keeping the e-mails secure.  An opt out feature will be provided.
2. That the "Guidelines for Conduct of Campaigns for C.A.R. Elected Office" be amended as follows:
Campaign Timing
Candidates may announce their intention at any time.  A campaign steering committee may be formed at any time, with the number of members of such committee not to exceed the number of C.A.R. Regions.  Formal campaign activities may not begin until the day following after the Nominating Committee's has made its recommendations for Officers for the following year at the June C.A.R. Business Meetings and one year prior to the election for the Office being sought, with the exception of endorsements from the candidate's own Region and/or own local Association.

Formal campaign activities include, but are not limited to:
Buttons
Brochures
Caucus Visits
Lunches
Cocktail Parties
Web Sites
Endorsements
Use of e-mails to C.A.R. Directors and AE's

3. That the following be designated to serve as N.A.R. Directors for a term ending November 2005.
Robert J. Bailey, Santa Cruz
Steve Goddard, South Bay
Ben Heinrich, Monterey County
Maxine Jennings, Bay East
Bob Kulick, Santa Clara County
Jim Liptak, Paso Robles
Ann Pettijohn, Pacific West
Rick Snyder, San Diego
Judy Zeigler, California Desert

Alternates  (priority order)
Jeanne Radsick, Bakersfield
Richard Sax, San Francisco
Carolyn D'Agosta, North San Diego
Beth Sommer, Southland Regional
David Silver-Westrick, Orange County

4. That the following be elected as Directors for Life of the CALIFORNIA ASSOCIATION OF REALTORS®:
Evelyn Arnold, Rancho Southeast
Sharon Bowler, Citrus Valley
Judy Zeigler, California Desert

5. That Joel Singer be elected Executive Vice President/State Secretary for the year 2003.
6. That Ann Pettijohn be elected President-elect for the year 2003.
7. It was reported for information only that President-Elect Toby Bradley will become President for the year 2003, and that Treasurer Jim Hamilton will continue to serve a two year term as Treasurer for 2002 - 2003.
8. The following motions from the report of the N.A.R. Director Selection Working Group were considered by the Nominating Committee and the Board of Directors.
Recommendation #1 -- Adopted
That, subject to approval of C.A.R. Legal Counsel, the Association mandate the use of a Confidentiality Agreement for all members of the Nominating Committee including Alternates and all participants in the nominating process.
Recommendation #2 -- Postponed to October 2002 meeting
That, for implementation in 2003, the large local Associations and the large firms/franchises entitled to N.A.R. Director(s) provide to C.A.R. the name(s) of their N.A.R. Director selection by June 1st of the calendar year in order for their appointed Director(s) to receive reimbursement by C.A.R.
Recommendation #3 -- Adopted
That C.A.R. suggest to the large local Associations (via letter from the C.A.R. President) thattheir N.A.R. Director appointee(s) should be someone who is familiar with N.A.R. issues and concerns and has been involved in the C.A.R. committee structure and has had prior attendance at N.A.R. meetings and/or N.A.R. committee involvement.
Recommendation #4 -- Adopted
That the Strategic Planning & Finance Committee review the enforcement of the funding policy for the large firm/franchise N.A.R. Directors as it relates to attendance and participation at C.A.R. and N.A.R.

Strategic Planning and Finance
1. That the Association's audited Financial Statements as of December 31, 2001 be approved:
--The Statement of Income and Expenses by program for the twelve months ending December 31, 2001.
Total C.A.R.
-Revenue of $14,883,400
-Expenses of $14,202,600 (including federal income tax).
-An excess of income over expenses of $680,800
Political Activities Fund
-An excess of income over expenses of $267,200.
Issue Action Fund
-An excess of income over expenses of $455,400

2. That the Association's Financial Statements as of April 30, 2002 be approved:
--The Statement of Income and Expenses by program for the four months ending April 30, 2002
Total C.A.R
-Revenue of $12,825,100
-Expenses of $4,983,500 (including federal income tax)
-An excess of income over expense of $7,841,600
Political Activities Fund
-An excess of income over expenses of  $799,000.
Issue Action Fund
An excess of income over expenses of $794,600.
--The C.A.R.Balance Sheet as of April 30, 2002
-Total assets of $25,543,300 (of which $17,441,100 are current assets.)
-Total liabilities of $3,017,300 (of which $2,761,800 are current liabilities)
-C.A.R. Fund Balance of $22,526,000

3. That the Projected Statements of Income and Expense by program for the year ending December 31, 2002 be approved.
Total C.A.R
-Revenue of $17,988,400
-Expenses of $16,264,700 (including federal income tax)
-An excess of income over expense of $1,723,700
Political Activities Fund
An excess of income over expenses of  $245,100.
Issue Action Fund
An excess of income over expenses of $407,900. 
This amount will be allocated to IMPAC as approved by the Directors.

4. To approve a program augmentation to add the position of Web Developer.  The total cost for 2002 is $37,100 (annualized $74,200).
5. To approve a Capital Budget augmentation to upgrade financial software $63,700 (2002 Depreciation cost $9,400).