Agenda Summary 2007 State And Local Issues Committee National Association of REALTORS® Midyear Legislative Meetings & Trade Expo Marriott Wardman Park Marriott Balcony C&D Wednesday, May 16, 2007 & Sunday, April 1, 2007 10:00 AM - 12:01 PMChair: Ken Jackson (SC) Vice Chair: Phil McGinnis (DE) Committee Liaison: Joanne Poole (MD) Committee Executive: Bob McNamara (DC)
I. Call To Order
A. Opening Statement and Conflict of Interest Disclosure - Ken Jackson Ownership Disclosure Policy
1. When NAR has an ownership interest in an entity and a member has an ownership interest* in that same entity, such member must disclose the existence of his or her ownership interest prior to speaking to a decision making body on any matter involving that entity.
2. If a member has personal knowledge that NAR is considering doing business with an entity in which a member has any financialinterest**, or with an entity in which the member serves in a decision-making capacity, then such member must disclose the existence of his or her financial interest or decision making role prior to speaking to a decision making body about the entity.
3. If a member has a financial interest in, or serves in a decision-making capacity for, any entity that the member knows is offering competing products and services as those offered by NAR, then such member must disclose the existence of his orher financial interest or decision-making role prior to speaking to a decision making body about an issue involving those competing products and services.
After making the necessary disclosure, a member may participate in the discussion and vote on the matter unless that member has a conflict of interest as defined below.
Conflict of Interest Policy
A member of any of NAR’s decision making bodies will be considered to have a conflict of interest whenever that member:
1. Is a principal, partner or corporate officer of a business providing products or services to NAR or in a business being considered as a provider of products or services ("Business"); or
2. Holds a seat on the board of directors of the Business unless the person’s only relationship to the Business is service on such board of directors as NAR’s representative; or
3. Holds an ownership interest of more than 1 percent of the Business.
Members with aconflict of interest must immediately disclose their interest at the outset of any discussions by a decision making body pertaining to the Business or any of its products or services. Such members may not participate in the discussion relating to that Business other than to respond to questions asked of them by other members of the body. Furthermore, no member with a conflict of interest may vote on any matter in which the member has a conflict of interest, including votes to block or alter the actions ofthe body in order to benefit the Business in which they have an interest. ________________________________________ *Ownership interest is defined as the cumulative holdings of the member, the member’s spouse, children, siblings and to anytrust, corporation or partnership in which any of the foregoing individuals is an officer or director, or owns, in the aggregate, at least 50% of the (a) beneficial interest (if a trust), (b) stock (if a corporation) or (c) partnership interests (if a partnership).
**Financial interest means any interest involving money, investments, credit or contractual rights.
Purpose: To assist REALTORS® in understanding the connections among, “smart growth,” quality of life issues, and fiscal policy; - To assist REALTORS® to act as spokespersons in their communities on quality of life issues; - To monitor state and local tax laws and other budget activities; -To monitor the government financing and construction of infrastructure, including transportation, water and sewer, and education facilities; - To assist REALTORS® in promoting fiscal responsibility in state and local government; - To assist REALTORS® in promoting the construction of and the equitable financing of infrastructure to accommodate new growth; - To work for the reduction and more equitable distribution of the tax burden.
The Committee evaluates and makes policy recommendations on programs that build infrastructure, such as transportation and school construction, on community development and economic development programs, on taxation at the state and local levels, and on other smart growth issues. The Committee shares ideas on how to effectively analyze, lobby, and advocate REALTOR® policies at the state and local level, and stays abreast of trends in Smart Growth.
Goal # 1: The Committee will monitor and advise staff on the implementation of a Public Education Award Program in conjunction with the Council of Educational Facility Planners International (CEFPI).
Background: The Committee is working on implementing the last of the recommendations of the Public Education Working Group, i.e., a national award program that will encourage REALTORS® to participate in facilities design projects in local public schools. NAR has partnered withthe Council of Educational Facility Planners International (CEFPI) and the Committee is working to arrange funding for the first national school design competition in April, 2007.
Actions to be Taken by the Committee to Achieve Goal: - Committee will review budget for the program and consider funding sources. - Committee will monitor implementation of the award program. Expected Outcome: - Identification of a permanent funding source for the program.
Goal # 2: The Committee will consider what policy, if any, NAR should adopt regarding the reauthorization of the No Child Left Behind Act. Background: The No Child Left Behind Act (NCLB) will be due for reauthorization in 2007. The President has indicated that this will be a top priority for his administration. NCLB does not address educational facilities. There are currently nofederal programs to assist public school facility construction. NCLB is focused on academic performance but does not make a connection between performance and adequacy of facilities. Reauthorization is an opportunity to put all education issues on the table. NAR’s current public school policy does not address the federal role.
Actions to be Taken by Committee to Achieve Goal: - Committee may appoint a working group to consider NCLB reauthorization issues.
Expected Outcome: - Committee may make recommendations regarding NAR policy.
Goal #3: The Committee will discuss ways to encourage greater understanding among Realtors® of Smart Growth issues and to assist Realtors® to become spokespersons in their communities on quality of life issues.
Background: NAR offers a number of products in support of this goal including “toolkits” on transportation, public schools, and Smart Growth. A Smart Growth training course in underdevelopment by the University of Maryland under contract to NAR.
Actions to be Taken by Committee to Achieve Goal: - Committee will consider other resources that may be necessary. - Committee will explore funding and implementationof Smart Growth training.
Expected Outcome: - Committee will make recommendations to the Smart Growth Advisory Group.
IV. Unfinished Business
A. School of the Future Design Competition B. Smart Growth Update C. Smart Growth Website Demo - Gerry Allen D. Eminent Domain Blight Report - Brian Blaesser
V. New Business
A. Effects of Foreclosure on State/Local Govt. Budgets B. Federal Advocacy C. ICC Sprinkler Code D. Private Transfer Taxes - Transfer fees based on a percentage of the sales price of a home are increasingly being imposed by developers on home buyers. Generally, these fees must be paid every time each home in a development is sold.Fees totaling 1.75 percent of a home’s sales price have been seen; however, there is no upper limit on the percentage of a home’s sales price at which a transfer fee can be established. In addition, such transfer fees can be imposed by a developer for an unlimited number of years. Generally, the minimum length of time these transfer fees are being imposed ranges from 20 to 25 years; however, many are imposed in perpetuity. Finally, the funds generated by these transfer fees can be used to pay for projects that do not directly benefit the development or the immediately surrounding community.
In 2006, C.A.R. established a task force to study the imposition of the transfer fees, as well as the options available for addressing the problems posed by the fees. At one meeting of the task force, Jim Burling of the Pacific Legal Foundation noted that while property owner rights should be protected, future generations should have the same freedom to use their property. In other words, a current landowner’s propertyrights should not be advantaged over a future landowner’s property rights.The use of private transfer taxes may gain in popularity with developers and environmentalist organizations. Both developers and “no growth” supporters are likely attracted to agreeing to imposition of a transfer fee because it avoids potentially protracted and costly legal battles and allows the developer to proceed with the project. Also, the cost of any environmental mitigation that may cut into the developer’s profit margin is put off onto subsequent buyers – buyers the developer may not even deal with since, in many cases, the developer deals with the only the first buyer of a home in the project and that buyer doesn’t pay the transfer.Absent any response, it is likely that these transfer fees will gain in popularity because they allow developers and “no growth” advocates to achieve their ends on the backs of home buyers that neither will have to deal with directly – those home buyers will enter the picture far after the developer has decided to impose the transfer fee.Prohibiting such transfer fees appears to be the only viable option available for addressing the problems presented by the imposition of these fees. Among the public policy arguments supporting adoption of such legislation is that developers and environmental organizations are usurping a role that is more properly held by local government. As matters stand, there is no public accountability with regard to the decisions on how the monies generated by the transfer are spent on the homeowners’ behalf – decisions that if the transfer fee was imposed by a local government would be accompanied by publicly noticed hearings.
