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First Substitute H.B. 223

Representative Gage Froerer proposes the following substitute bill:


             1     
EXEMPTION FROM LICENSURE BY

             2     
DIVISION OF REAL ESTATE

             3     
2008 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Mark W. Walker

             6     
Senate Sponsor: ____________

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies provisions related to state and local governments and licensure by the
             11      Division of Real Estate.
             12      Highlighted Provisions:
             13          This bill:
             14          .    exempts from licensure certain regular salaried employees of a county when acting
             15      on behalf of the county;
             16          .    exempts from licensure certain agents of the Department of Transportation;
             17          .    expands the activities government employees may engage in without being licensed;
             18      and
             19          .    makes technical changes.
             20      Monies Appropriated in this Bill:
             21          None
             22      Other Special Clauses:
             23          None
             24      Utah Code Sections Affected:
             25      AMENDS:


             26          10-3-1110, as enacted by Laws of Utah 2007, Chapter 325
             27          61-2-3, as last amended by Laws of Utah 2007, Chapter 325
             28          72-5-116, as enacted by Laws of Utah 2007, Chapter 325
             29      ENACTS:
             30          17-50-106, Utah Code Annotated 1953
             31     
             32      Be it enacted by the Legislature of the state of Utah:
             33          Section 1. Section 10-3-1110 is amended to read:
             34           10-3-1110. Exemption from state licensure by Division of Real Estate.
             35          In accordance with Section 61-2-3 , an employee of a municipality is exempt from
             36      licensure under Title 61, Chapter 2, Division of Real Estate:
             37          (1) when engaging in an act on behalf of the municipality in accordance with:
             38          (a) this title [and]; or
             39          (b) Title 11, Cities, Counties, and Local Taxing Units; and
             40          (2) if the act described in Subsection (1) is related to one or more of the following [is
             41      exempt from licensure under Title 61, Chapter 2, Division of Real Estate]:
             42          [(1)] (a) acquiring real property, including by eminent domain;
             43          [(2)] (b) disposing of real property; [or]
             44          [(3)] (c) providing services that constitute property management, as defined in Section
             45      61-2-2 [.]; or
             46          (d) leasing real property.
             47          Section 2. Section 17-50-106 is enacted to read:
             48          17-50-106. Exemption from state licensure by Division of Real Estate.
             49          In accordance with Section 61-2-3 , an employee of a county is exempt from licensure
             50      under Title 61, Chapter 2, Division of Real Estate:
             51          (1) when engaging in an act on behalf of the county in accordance with:
             52          (a) this title; or
             53          (b) Title 11, Cities, Counties, and Local Taxing Units; and
             54          (2) if the act described in Subsection (1) is related to one or more of the following:
             55          (a) acquiring real property, including by eminent domain;
             56          (b) disposing of real property;


             57          (c) providing services that constitute property management, as defined in Section
             58      61-2-2 ; or
             59          (d) leasing real property.
             60          Section 3. Section 61-2-3 is amended to read:
             61           61-2-3. Exempt persons and transactions.
             62          (1) (a) Except as provided in Subsection (1)(b), a license under this chapter is not
             63      required for:
             64          (i) [any] a person who as owner or lessor performs the acts described in Subsection
             65      61-2-2 (12) with reference to property owned or leased by that person;
             66          (ii) a regular salaried employee of the owner or lessor of real estate who, with reference
             67      to nonresidential real estate owned or leased by the employer, performs the acts enumerated in
             68      Subsections 61-2-2 (12)(a) and (b);
             69          (iii) a regular salaried employee of the owner of real estate who performs property
             70      management services with reference to real estate owned by the employer, except that the
             71      employee may only manage property for one employer;
             72          (iv) a person who performs property management services for the apartments at which
             73      that person resides in exchange for free or reduced rent on that person's apartment;
             74          (v) a regular salaried employee of a condominium homeowners' association who
             75      manages real property subject to the declaration of condominium that established the
             76      homeowners' association, except that the employee may only manage property for one
             77      condominium homeowners' association; and
             78          (vi) a regular salaried employee of a licensed property management company who
             79      performs support services, as prescribed by rule, for the property management company.
             80          (b) Subsection (1)(a) does not exempt from licensing:
             81          (i) an employee engaged in the sale of properties regulated under:
             82          (A) Title 57, Chapter 11, Utah Uniform Land Sales Practices Act; and
             83          (B) Title 57, Chapter 19, Timeshare and Camp Resort Act;
             84          (ii) an employee engaged in the sale of cooperative interests regulated under Title 57,
             85      Chapter 23, Real Estate Cooperative Marketing Act; or
             86          (iii) [any] a person whose interest as an owner or lessor is obtained by that person or
             87      transferred to that person for the purpose of evading the application of this chapter, and not for


             88      any other legitimate business reason.
             89          (2) A license under this chapter is not required for:
             90          (a) an isolated transaction by a person holding a duly executed power of attorney from
             91      the owner;
             92          (b) services rendered by an attorney in performing the attorney's duties as an attorney;
             93          (c) a receiver, trustee in bankruptcy, administrator, executor, or [any] a person acting
             94      under order of any court;
             95          (d) a trustee or employee of a trustee under a deed of trust or a will;
             96          (e) [any] a public utility, officer of a public utility, or regular salaried employee of a
             97      public utility, unless performance of any of the acts set out in Subsection 61-2-2 (12) is in
             98      connection with the sale, purchase, lease, or other disposition of real estate or investment in
             99      real estate unrelated to the principal business activity of that public utility;
             100          (f) a regular salaried employee or authorized agent working under the oversight of the
             101      Department of Transportation when performing an act on behalf of the Department of
             102      Transportation in connection with one or more of the following:
             103          (i) the acquisition of real property pursuant to Section 72-5-103 ;
             104          (ii) the disposal of real property pursuant to Section 72-5-111 ; [or]
             105          (iii) services that constitute property management; or
             106          (iv) the leasing of real property;
             107          (g) a regular salaried employee of a county, city, or town when performing an act on
             108      behalf of the county, city, or town:
             109          (i) in accordance with:
             110          (A) if a regular salaried employee of a city or town:
             111          (I) Title 10, Utah Municipal Code; [and] or
             112          (II) Title 11, Cities, Counties, and Local Taxing Units; and
             113          (B) if a regular salaried employee of a county:
             114          (I) Title 11, Cities, Counties, and Local Taxing Units; and
             115          (II) Title 17, Counties; and
             116          (ii) in connection with one or more of the following:
             117          (A) the acquisition of real property, including by eminent domain;
             118          (B) the disposal of real property; [or]


             119          (C) services that constitute property management[.]; or
             120          (D) the leasing of real property.
             121          (3) A license under this chapter is not required for [any] a person registered to act as a
             122      broker-dealer, agent, or investment advisor under the Utah and federal securities laws in the
             123      sale or the offer for sale of real estate if:
             124          (a) (i) the real estate is a necessary element of a "security" as that term is defined by the
             125      Securities Act of 1933 and the Securities Exchange Act of 1934; and
             126          (ii) the security is registered for sale:
             127          (A) pursuant to the Securities Act of 1933; or
             128          (B) by Title 61, Chapter 1, Utah Uniform Securities Act; or
             129          (b) (i) it is a transaction in a security for which a Form D, described in 17 C.F.R. Sec.
             130      239.500, has been filed with the Securities and Exchange Commission pursuant to Regulation
             131      D, Rule 506, 17 C.F.R. Sec. 230.506; and
             132          (ii) the selling agent and the purchaser are not residents of this state.
             133          Section 4. Section 72-5-116 is amended to read:
             134           72-5-116. Exemption from state licensure.
             135          In accordance with Section 61-2-3 , an employee or authorized agent working under the
             136      oversight of the department when engaging in an act on behalf of the department related to one
             137      or more of the following is exempt from licensure under Title 61, Chapter 2, Division of Real
             138      Estate:
             139          (1) acquiring real property pursuant to Section 72-5-103 ;
             140          (2) disposing of real property pursuant to Section 72-5-111 ; [or]
             141          (3) providing services that constitute property management, as defined in Section
             142      61-2-2 [.]; or
             143          (4) leasing of real property.


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