Legislative Update: Three Causes to Watch

The second year of Oklahoma’s 53rd legislative session is in full swing, and it’s going to be a busy one for Oklahoma REALTORS®. OAR’s three main legislative priorities are changes to the Broker Relationships Act, clarification to last year’s square footage law and municipalities who require landlord and rental property registration.

Broker Relationships Act

HB2524 by Rep. Steve Martin, R-Bartlesville and Sen. Dan Newberry, R-Tulsa, is the result of a two-year joint effort between OAR and the Oklahoma Real Estate Commission (OREC). Oklahoma switched from the common law of agency to Broker Relationships more than ten years ago, and since that time we’ve had numerous complaints that the law is difficult for consumers and licensees to understand. One of the most common complaints? Licensees acting as single-party brokers when they claim to be operating as transaction brokers. OAR and OREC appointed a dedicated task force to tackle revisions to the law, resulting in HB2524.

The major change in this proposed law is doing away with single-party broker and transaction broker; instead, all licensees will have the same duties and responsibilities to all parties in a transaction. There’s a bigger distinction in this version between duties and responsibilities vs. brokerage services. HB2524 was well received at OAR’s recent Brokers Summit and received unanimous support from OAR’s Board of Directors, as well as consistent support from legislators at the State Capitol.

As of this writing, HB2524 passed the House Economic Development, Tourism & Financial Services Committee with a unanimous vote and passed out of the House with an 86 – 4 vote. The next stop for the bill is a hearing in Senate Committee. The joint task force continues to work on a couple of clarifying amendments to this bill, and we’ll keep you posted as this bill continues through the legislative process.

Square Footage Law

You might recall one of OAR’s legislative goals last year was known as the “square footage law” and clarified a licensee’s responsibilities and liability when disclosing property measurement figures. The new law added “protected sources” for licensees and went into effect last August.

However, after the new law was passed, we realized that the protected sources were mainly used in residential transactions and there might not be sufficient protection when dealing with commercial properties. A suggested amendement was drafted by the Oklahoma REALTORS® Commercial Alliance (RCA) to add ” a plan, drawing or stated square footage provided by the owner or agent of the owner as it relates to commercial buildings or structures for sale or for lease only” to the list of protected sources. This language is in HB2200 by Rep. John Trebilcock, R-Broken Arrow and Sen. David Holt, R-Oklahoma City.

HB2200 also passed unanimously out the House Economic Development, Tourism & Financial Services Committee and awaits a hearing before the complete House of Representatives. It will be heard by the House before March 15.

Landlord and Rental Property Registration

Our final bill deals with a growing problem in Oklahoma:  municipalities requiring landlords to register with the city, sometimes requiring a separate registration fee for each rental property. The most concerning of these regulations require the property owner, if living in a different county, to appoint a “resident manager” within that county. SB1867 by Sen. Newberry and Rep. Lee Denney, R-Cushing, prohibits the registration of real property owners by any municipality and prohibits any ordinance, rule or regulation requiring the registration of residential real property. The bill also prohibits all municipalities from charging a fee to own residential real property or for the lease or rental of property, and would declare any existing ordinances null and void.

The bill received unanimous support from the Senate Business & Commerce Committee, but on March 13 Sen. Newberry requested that rather than moving forward with the bill, the issue be examined by an interim study later this year.

“Due to concern from fellow legislators regarding the potential of unintended consequences associated with Senate Bill 1867, I am proposing we further examine the issue in an interim study,” said Sen. Newberry, R-Tulsa.  “Municipal regulations that adversely affect owners of real property are a growing problem, and I am determined to find a solution in the best interest of all parties.  A study will give the Legislature an opportunity to gain a better understanding of the concerns faced by property owners and municipalities.  I’m confident a thorough study of the issue will yield an effective legislative solution.”

While we’re disappointed that the bill won’t be moving forward this year, we look forward to participating in the interim study and will continue to work toward resolution of this issue.

You can keep up-to-date on these bills and all the other ones we’re watching – including the ones we’re opposed to – by checking out our Legislative Tracking List updated every Friday. Also, be sure to check out InSession, the weekly video blog on the latest legislative activities and the Government Affairs Facebook page and Twitter account.

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