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First Substitute H.B. 290

This document includes House Committee Amendments incorporated into the bill on Mon, Feb 4, 2013 at 11:50 AM by lerror. -->

Representative Gage Froerer proposes the following substitute bill:


             1     
DIVISION OF REAL ESTATE AMENDMENTS

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Gage Froerer

             5     
Senate Sponsor: J. Stuart Adams

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies provisions relating to real estate.
             10      Highlighted Provisions:
             11          This bill:
             12          .    modifies the entity with which a subdivider files an effective statement of record, in
             13      accordance with federal law;
             14          .    modifies a provision regarding addresses provided to the Division of Real Estate;
             15          .    modifies a provision relating to criminal background checks of applicants for a
             16      license to transact the business of residential mortgage loans;
             17          .    modifies lending manager licensing provisions;
             18          .    increases the period of reinstatement of an expired registration;
             19          .    exempts from the licensing requirements described in Title 61, Chapter 2f, Real
             20      Estate Licensing and Practices Act an individual who engages in isolated real estate
             21      services, if the individual holds a duly executed power of attorney from a property
             22      owner;
             23          .    modifies a provision relating to the determination of a license examination fee; and
             24          .    authorizes the Division of Real Estate to terminate the registration of an entity if the
             25      entity's registration with the Division of Corporations and Commercial Code has


             26      been expired for a specified period and the entity's license has been inactive for a specified
             27      period.
             28      Money Appropriated in this Bill:
             29          None
             30      Other Special Clauses:
             31          None
             32      Utah Code Sections Affected:
             33      AMENDS:
             34          57-11-4, as last amended by Laws of Utah 2009, Chapter 352
             35          61-2c-106, as last amended by Laws of Utah 2012, Chapter 166
             36          61-2c-202, as last amended by Laws of Utah 2011, Chapter 289
             37          61-2c-206, as last amended by Laws of Utah 2012, Chapter 166
             38          61-2e-204, as last amended by Laws of Utah 2012, Chapter 166
             39          61-2f-202, as last amended by Laws of Utah 2011, Chapters 289 and 398
             40          61-2f-204, as last amended by Laws of Utah 2011, Chapter 289
             41          61-2f-206, as last amended by Laws of Utah 2011, Chapter 289
             42     
             43      Be it enacted by the Legislature of the state of Utah:
             44          Section 1. Section 57-11-4 is amended to read:
             45           57-11-4. Exemptions.
             46          (1) Unless the method of disposition is adopted for the purpose of evasion of this
             47      chapter or the federal act, this chapter does not apply to an offer or disposition of an interest in
             48      land:
             49          (a) by a purchaser of subdivided lands for the person's own account in a single or
             50      isolated transaction;
             51          (b) (i) on a unit of which there is a residential, commercial, or industrial building; or
             52          (ii) on a unit of which there is a legal obligation on the part of the seller to complete
             53      construction of a residential, commercial, or industrial building within two years from date of
             54      disposition;
             55          (c) unless a person who acquires land for one of the following purposes sells that land
             56      to one or more individuals as unimproved lots with no legal obligation on the part of the seller


             57      to construct a residential, commercial, or industrial building on that lot within two years from
             58      the date of disposition:
             59          (i) if the person acquires an interest in the land for use in the business of constructing
             60      residential, commercial, or industrial buildings; or
             61          (ii) if the person acquires the type of land described in Subsection (1)(c)(i) for the
             62      purpose of disposition to a person engaged in the business of constructing residential,
             63      commercial, or industrial buildings;
             64          (d) pursuant to court order;
             65          (e) by a government or government agency;
             66          (f) (i) if the interest lies within the boundaries of a city or a county which:
             67          (A) has a planning and zoning board using at least one professional planner;
             68          (B) enacts ordinances that require approval of planning, zoning, and plats, including
             69      the approval of plans for streets, culinary water, sanitary sewer, and flood control; and
             70          (C) will have the improvements described in Subsection (1)(f)(i)(B) plus telephone and
             71      electricity; and
             72          (ii) if at the time of the offer or disposition the subdivider furnishes satisfactory
             73      assurance of completion of the improvements described in Subsection (1)(f)(i)(C);
             74          (g) in an industrial park;
             75          (h) as cemetery lots; or
             76          (i) if the interest is offered as part of a camp resort as defined in Section 57-19-2 or a
             77      timeshare development as defined in Section 57-19-2 .
             78          (2) Unless the method of disposition is adopted for the purpose of evasion of this
             79      chapter or the provisions of the federal act, this chapter, except as specifically designated, does
             80      not apply to an offer or disposition of:
             81          (a) indebtedness secured by a mortgage or deed of trust on real estate;
             82          (b) a security or unit of interest issued by a real estate investment trust regulated under
             83      any state or federal statute;
             84          (c) subject to Subsection (5), subdivided lands registered under the federal act and
             85      which the division finds to be in the public interest to exempt from the registration
             86      requirements of this chapter;
             87          (d) a security currently registered with the Division of Securities; or


             88          (e) an interest in oil, gas, or other minerals or a royalty interest in these assets if the
             89      offer or disposition of the interest is regulated as a security by the federal government or by the
             90      Division of Securities.
             91          (3) (a) Notwithstanding the exemptions in Subsections (1) and (2), a person making an
             92      offer or disposition of an interest in land that is located in Utah shall apply to the division for
             93      an exemption before the offer or disposition is made if:
             94          (i) the person is representing, in connection with the offer or disposition, the
             95      availability of culinary water service to or on the subdivided land; and
             96          (ii) the culinary water service is provided by a water corporation as defined in Section
             97      54-2-1 .
             98          (b) A subdivider seeking to qualify under this exemption shall file with the division a
             99      filing fee of $50 and an application containing:
             100          (i) information required by the division to show that the offer or disposition is exempt
             101      under this section;
             102          (ii) a statement as to what entity will be providing culinary water service and the nature
             103      of that entity; and
             104          (iii) (A) a copy of the entity's certificate of convenience and necessity issued by the
             105      Public Service Commission; or
             106          (B) evidence that the entity providing water service is exempt from the jurisdiction of
             107      the Public Service Commission.
             108          (4) (a) The director may by rule or order exempt a person from a requirement of this
             109      chapter if the director finds that the offering of an interest in a subdivision is essentially
             110      noncommercial.
             111          (b) For purposes of this section, the bulk sale of subdivided lands by a subdivider to
             112      another person who will become the subdivider of those lands is considered essentially
             113      noncommercial.
             114          (5) (a) A subdivider seeking to qualify under the exemption described in Subsection
             115      (2)(c) shall file with the division:
             116          (i) a copy of an effective statement of record filed with the [secretary of the
             117      Department of Housing and Urban Development] Consumer Financial Protection Bureau; and
             118          (ii) a filing fee of $100.


             119          (b) If a subdivider does not qualify under the exemption described in Subsection (2)(c),
             120      the division shall credit the filing fee described in Subsection (5)(a) to the filing fee required
             121      for registration under this chapter.
             122          (c) Nothing in this Subsection (5) exempts a subdivider from:
             123          (i) Sections 57-11-16 and 57-11-17 ; or
             124          (ii) the requirement to file an annual report with the division under Section 57-11-10 .
             125          (6) Notwithstanding an exemption under this section, the division:
             126          (a) retains jurisdiction over an offer or disposition of an interest in land to determine
             127      whether or not the exemption continues to apply; and
             128          (b) may require compliance with this chapter if an exemption no longer applies.
             129          Section 2. Section 61-2c-106 is amended to read:
             130           61-2c-106. Addresses provided the division.
             131          (1) (a) A person shall provide a physical location or street address when the person
             132      provides the nationwide database an address required by the division.
             133          (b) The following when provided to and maintained within the division under this
             134      chapter is public information:
             135          (i) a business address; or
             136          (ii) a mailing address other than a home address, unless the person provides no other
             137      address.
             138          (2) A licensee is considered to have received a notification that is mailed to the last
             139      mailing address furnished to the nationwide database by:
             140          (a) the individual, if the licensee is an individual; or
             141          (b) the lending manager who is designated within the nationwide database to act as the
             142      principal lending manager for the entity, if the licensee is an entity.
             143          Section 3. Section 61-2c-202 is amended to read:
             144           61-2c-202. Licensure procedures.
             145          (1) To apply for licensure under this chapter an applicant shall in a manner provided by
             146      the division by rule:
             147          (a) if the applicant is an entity, submit a licensure statement that:
             148          (i) lists any name under which the entity will transact business in this state;
             149          (ii) lists the address of the principal business location of the entity;


             150          (iii) identifies the principal lending manager of the entity;
             151          (iv) contains the signature of the principal lending manager;
             152          (v) identifies the one or more control persons for the entity;
             153          (vi) identifies the jurisdictions in which the entity is registered, licensed, or otherwise
             154      regulated in the business of residential mortgage loans;
             155          (vii) discloses any adverse administrative action taken by an administrative agency
             156      against:
             157          (A) the entity; or
             158          (B) any control person for the entity;
             159          (viii) discloses any history of criminal proceedings involving any control person for the
             160      entity; and
             161          (ix) includes any information required by the division by rule;
             162          (b) if the applicant is an individual:
             163          (i) submit a licensure statement that identifies the entity with which the applicant is
             164      sponsored;
             165          (ii) authorize [a] periodic criminal background [check] checks through the nationwide
             166      database, at times provided by rule that the division makes in accordance with Title 63G,
             167      Chapter 3, Utah Administrative Rulemaking Act, accessing:
             168          (A) the Utah Bureau of Criminal Identification, if the nationwide database is able to
             169      obtain information from the Utah Bureau of Criminal Identification; and
             170          (B) the Federal Bureau of Investigation;
             171          (iii) submit evidence using a method approved by the division by rule of having
             172      successfully completed approved prelicensing education in accordance with Section
             173      61-2c-204.1 ;
             174          (iv) submit evidence using a method approved by the division by rule of having
             175      successfully passed any required licensing examination in accordance with Section
             176      61-2c-204.1 ; [and]
             177          (v) submit evidence using a method approved by the division by rule of having
             178      successfully registered in the nationwide database, including paying a fee required by the
             179      nationwide database; and
             180          (vi) authorize the division to obtain independent credit reports:


             181          (A) through a consumer reporting agency described in Section 603(p) of the Fair Credit
             182      Reporting Act, 15 U.S.C. Sec. 1681a; and
             183          (B) at times provided by rule that the division makes in accordance with Title 63G,
             184      Chapter 3, Utah Administrative Rulemaking Act; and
             185          (c) pay to the division:
             186          (i) an application fee established by the division in accordance with Section 63J-1-504 ;
             187      and
             188          (ii) the reasonable expenses incurred by the division in processing the application for
             189      licensure.
             190          (2) (a) Upon receiving an application, the division, with the concurrence of the
             191      commission, shall determine whether the applicant:
             192          (i) meets the qualifications for licensure; and
             193          (ii) complies with this section.
             194          (b) If the division, with the concurrence of the commission, determines that an
             195      applicant meets the qualifications for licensure and complies with this section, the division
             196      shall issue the applicant a license.
             197          (c) If the division, with the concurrence of the commission, determines that the
             198      division requires more information to make a determination under Subsection (2)(a), the
             199      division may:
             200          (i) hold the application pending further information about an applicant's criminal
             201      background or history related to adverse administrative action in any jurisdiction; or
             202          (ii) issue a conditional license:
             203          (A) pending the completion of a criminal background check; and
             204          (B) subject to probation, suspension, or revocation if the criminal background check
             205      reveals that the applicant did not truthfully or accurately disclose on the licensing application a
             206      criminal history or other history related to adverse administrative action.
             207          (3) (a) The commission may delegate to the division the authority to:
             208          (i) review a class or category of application for an initial or renewed license;
             209          (ii) determine whether an applicant meets the qualifications for licensure;
             210          (iii) conduct a necessary hearing on an application; and
             211          (iv) approve or deny a license application without concurrence by the commission.


             212          (b) If the commission delegates to the division the authority to approve or deny an
             213      application without concurrence by the commission and the division denies an application for
             214      licensure, the applicant who is denied licensure may petition the commission for a de novo
             215      review of the application.
             216          (c) An applicant who is denied licensure under Subsection (3)(b) may seek agency
             217      review by the executive director only after the commission reviews the division's denial of the
             218      applicant's application.
             219          (d) Subject to Subsection (3)(c) and in accordance with Title 63G, Chapter 4,
             220      Administrative Procedures Act, an applicant who is denied licensure under this chapter may
             221      submit a request for agency review to the executive director within 30 days following the day
             222      on which the commission order denying the licensure is issued.
             223          Section 4. Section 61-2c-206 is amended to read:
             224           61-2c-206. Lending manager licenses.
             225          (1) To qualify for licensure as a lending manager under this chapter, an individual
             226      shall:
             227          (a) meet the standards in Section 61-2c-203 ;
             228          (b) successfully complete the following education:
             229          (i) mortgage loan originator prelicensing education as required by federal licensing
             230      regulations; and
             231          (ii) 40 hours of Utah-specific prelicensing education for a lending manager that is
             232      approved by the division under Section 61-2c-204.1 ;
             233          (c) successfully complete the following examinations:
             234          (i) the mortgage loan originator licensing examination as approved by the nationwide
             235      database; and
             236          (ii) the lending manager licensing examination approved by the commission under
             237      Section 61-2c-204.1 ;
             238          (d) submit proof, on a form approved by the division, of three years of full-time active
             239      experience as a mortgage loan originator licensed in any state in the five years preceding the
             240      day on which the application is submitted, or equivalent experience as approved by the
             241      commission pursuant to rule that the division makes in accordance with Title 63G, Chapter 3,
             242      Utah Administrative Rulemaking Act;


             243          (e) submit an application in a manner established by the division by rule;
             244          (f) establish sponsorship with an entity licensed under this chapter;
             245          (g) [if the individual is not registered in the nationwide database as a mortgage loan
             246      originator at the time of application,] submit to the criminal background check required by
             247      Subsection 61-2c-202 (1)(b); and
             248          (h) pay a fee determined by the division under Section 63J-1-504 .
             249          (2) A lending manager may not:
             250          (a) engage in the business of residential mortgage loans on behalf of more than one
             251      entity at the same time;
             252          (b) be sponsored by more than one entity at the same time; or
             253          (c) act simultaneously as the principal lending manager and branch lending manager
             254      for the individual's sponsoring entity, if the entity operates from more than one office [located
             255      within the state].
             256          (3) An individual who is a lending manager may:
             257          (a) transact the business of residential mortgage loans as a mortgage loan originator;
             258      and
             259          (b) be designated within the nationwide database to act for the individual's sponsoring
             260      entity as the principal lending manager, an associate lending manager, or a branch lending
             261      manager.
             262          Section 5. Section 61-2e-204 is amended to read:
             263           61-2e-204. Renewal of a registration.
             264          (1) (a) A registration under this chapter expires two years from the day on which the
             265      registration is filed.
             266          (b) Notwithstanding Subsection (1)(a), the time period of a registration may be
             267      extended or shortened by as much as one year to maintain or change a renewal cycle
             268      established by rule by the division.
             269          (2) To renew a registration under this chapter, before the day on which the registration
             270      expires, an appraisal management company shall:
             271          (a) file with the division a renewal registration application on a form prescribed by the
             272      division;
             273          (b) pay to the division a fee determined in accordance with Section 63J-1-504 ; and


             274          (c) file with the division a certificate evidencing that the appraisal management
             275      company has secured and will maintain a surety bond with one or more corporate sureties
             276      authorized to do business in the state in the amount of at least $25,000, as the division provides
             277      by rule.
             278          (3) A renewal registration application shall include substantially similar information to
             279      the information required under Section 61-2e-202 , except that for an individual described in
             280      Subsection 61-2e-202 (2)(e) or (g), the entity is required to report whether the individual has
             281      had:
             282          (a) (i) a conviction of a criminal offense;
             283          (ii) the entry of a plea in abeyance to a criminal offense; or
             284          (iii) the potential resolution of a criminal case by:
             285          (A) a diversion agreement; or
             286          (B) another agreement under which a criminal charge is held in suspense for a period
             287      of time;
             288          (b) a filing of personal bankruptcy or bankruptcy of a business that transacts the
             289      appraisal management services;
             290          (c) the suspension, revocation, surrender, cancellation, or denial of a professional
             291      license or certification, whether the license or registration is issued by this state or another
             292      jurisdiction; or
             293          (d) the entry of a cease and desist order or a temporary or permanent injunction:
             294          (i) against the individual by a court or government agency; and
             295          (ii) on the basis of:
             296          (A) conduct or a practice involving the business of appraisal management services; or
             297          (B) conduct involving fraud, misrepresentation, or deceit.
             298          (4) A registration expires if it is not renewed on or before its expiration date, except
             299      that for a period of [30 days] one year after the expiration date, the registration may be
             300      reinstated upon compliance with this section, including payment of a renewal fee and a late fee
             301      determined by the division and the board.
             302          (5) Notwithstanding Subsection (4), the division may extend the term of a license that
             303      would expire under Subsection (4) except for the extension if:
             304          (a) (i) the person complies with the requirements of this section to renew the


             305      registration; and
             306          (ii) the renewal application remains pending at the time of the extension; or
             307          (b) at the time of the extension, there is pending under this chapter a disciplinary
             308      action.
             309          Section 6. Section 61-2f-202 is amended to read:
             310           61-2f-202. Exempt persons and transactions.
             311          (1) (a) Except as provided in Subsection (1)(b), a license under this chapter is not
             312      required for:
             313          (i) an individual who as owner or lessor performs an act described in Subsection
             314      61-2f-102 (18) with reference to real estate owned or leased by that individual;
             315          (ii) a regular salaried employee of the owner or lessor of real estate who, with reference
             316      to nonresidential real estate owned or leased by the employer, performs an act described in
             317      Subsection 61-2f-102 (18)(a) or (b);
             318          (iii) a regular salaried employee of the owner of real estate who performs property
             319      management services with reference to real estate owned by the employer, except that the
             320      employee may only manage real estate for one employer;
             321          (iv) an individual who performs property management services for the apartments at
             322      which that individual resides in exchange for free or reduced rent on that individual's
             323      apartment;
             324          (v) a regular salaried employee of a condominium homeowners' association who
             325      manages real estate subject to the declaration of condominium that established the
             326      condominium homeowners' association, except that the employee may only manage real estate
             327      for one condominium homeowners' association; and
             328          (vi) a regular salaried employee of a licensed property management company who
             329      performs support services, as prescribed by rule, for the property management company.
             330          (b) Subsection (1)(a) does not exempt from licensing:
             331          (i) an employee engaged in the sale of real estate regulated under:
             332          (A) Title 57, Chapter 11, Utah Uniform Land Sales Practices Act; or
             333          (B) Title 57, Chapter 19, Timeshare and Camp Resort Act;
             334          (ii) an employee engaged in the sale of cooperative interests regulated under Title 57,
             335      Chapter 23, Real Estate Cooperative Marketing Act; or


             336          (iii) an individual whose interest as an owner or lessor is obtained by that individual or
             337      transferred to that individual for the purpose of evading the application of this chapter, and not
             338      for another legitimate business reason.
             339          (2) A license under this chapter is not required for:
             340          (a) H. [ [ ] an [ ] ] .H isolated H. [ [ ] transaction [ ] ] [ transactions ] .H or
             340a      H. [ services ] service .H by an individual holding a duly
             341      executed power of attorney from [an] a property owner;
             342          (b) services rendered by an attorney admitted to practice law in this state in performing
             343      the attorney's duties as an attorney;
             344          (c) a receiver, trustee in bankruptcy, administrator, executor, or an individual acting
             345      under order of a court;
             346          (d) a trustee or employee of a trustee under a deed of trust or a will;
             347          (e) a public utility, officer of a public utility, or regular salaried employee of a public
             348      utility, unless performance of an act described in Subsection 61-2f-102 (18) is in connection
             349      with the sale, purchase, lease, or other disposition of real estate or investment in real estate
             350      unrelated to the principal business activity of that public utility;
             351          (f) a regular salaried employee or authorized agent working under the oversight of the
             352      Department of Transportation when performing an act on behalf of the Department of
             353      Transportation in connection with one or more of the following:
             354          (i) the acquisition of real estate pursuant to Section 72-5-103 ;
             355          (ii) the disposal of real estate pursuant to Section 72-5-111 ;
             356          (iii) services that constitute property management; or
             357          (iv) the leasing of real estate; and
             358          (g) a regular salaried employee of a county, city, or town when performing an act on
             359      behalf of the county, city, or town:
             360          (i) in accordance with:
             361          (A) if a regular salaried employee of a city or town:
             362          (I) Title 10, Utah Municipal Code; or
             363          (II) Title 11, Cities, Counties, and Local Taxing Units; and
             364          (B) if a regular salaried employee of a county:
             365          (I) Title 11, Cities, Counties, and Local Taxing Units; and
             366          (II) Title 17, Counties; and


             367          (ii) in connection with one or more of the following:
             368          (A) the acquisition of real estate, including by eminent domain;
             369          (B) the disposal of real estate;
             370          (C) services that constitute property management; or
             371          (D) the leasing of real estate.
             372          (3) A license under this chapter is not required for an individual registered to act as a
             373      broker-dealer, agent, or investment adviser under the Utah and federal securities laws in the
             374      sale or the offer for sale of real estate if:
             375          (a) (i) the real estate is a necessary element of a "security" as that term is defined by the
             376      Securities Act of 1933 and the Securities Exchange Act of 1934; and
             377          (ii) the security is registered for sale in accordance with:
             378          (A) the Securities Act of 1933; or
             379          (B) Title 61, Chapter 1, Utah Uniform Securities Act; or
             380          (b) (i) it is a transaction in a security for which a Form D, described in 17 C.F.R. Sec.
             381      239.500, has been filed with the Securities and Exchange Commission pursuant to Regulation
             382      D, Rule 506, 17 C.F.R. Sec. 230.506; and
             383          (ii) the selling agent and the purchaser are not residents of this state.
             384          Section 7. Section 61-2f-204 is amended to read:
             385           61-2f-204. Licensing fees and procedures -- Renewal fees and procedures.
             386          (1) (a) Upon filing an application for an examination for a license under this chapter,
             387      the applicant shall pay a nonrefundable fee [as determined by the commission with the
             388      concurrence of the division under] established in accordance with Section 63J-1-504 for
             389      admission to the examination.
             390          (b) An applicant for a principal broker, associate broker, or sales agent license shall
             391      pay a nonrefundable fee as determined by the commission with the concurrence of the division
             392      under Section 63J-1-504 for issuance of an initial license or license renewal.
             393          (c) A license issued under this Subsection (1) shall be issued for a period of not less
             394      than two years as determined by the division with the concurrence of the commission.
             395          (d) (i) Any of the following applicants shall comply with this Subsection (1)(d):
             396          (A) a new sales agent applicant;
             397          (B) a principal broker applicant; or


             398          (C) an associate broker applicant.
             399          (ii) An applicant described in this Subsection (1)(d) shall:
             400          (A) submit fingerprint cards in a form acceptable to the division at the time the license
             401      application is filed; and
             402          (B) consent to a criminal background check by the Utah Bureau of Criminal
             403      Identification and the Federal Bureau of Investigation regarding the application.
             404          (iii) The division shall request the Department of Public Safety to complete a Federal
             405      Bureau of Investigation criminal background check for each applicant described in this
             406      Subsection (1)(d) through the national criminal history system or any successor system.
             407          (iv) The applicant shall pay the cost of the criminal background check and the
             408      fingerprinting.
             409          (v) Money paid to the division by an applicant for the cost of the criminal background
             410      check is nonlapsing.
             411          (e) (i) A license issued under Subsection (1)(d) is conditional, pending completion of
             412      the criminal background check.
             413          (ii) A license is immediately and automatically revoked if the criminal background
             414      check discloses the applicant fails to accurately disclose a criminal history involving:
             415          (A) the real estate industry; or
             416          (B) a felony conviction on the basis of an allegation of fraud, misrepresentation, or
             417      deceit.
             418          (iii) If a criminal background check discloses that an applicant fails to accurately
             419      disclose a criminal history other than one described in Subsection (1)(e)(ii), the division:
             420          (A) shall review the application; and
             421          (B) in accordance with rules made by the division pursuant to Title 63G, Chapter 3,
             422      Utah Administrative Rulemaking Act, may:
             423          (I) place a condition on a license;
             424          (II) place a restriction on a license;
             425          (III) revoke a license; or
             426          (IV) refer the application to the commission for a decision.
             427          (iv) A person whose conditional license is automatically revoked under Subsection
             428      (1)(e)(ii) or whose license is conditioned, restricted, or revoked under Subsection (1)(e)(iii)


             429      may have a hearing after the action is taken to challenge the action. The hearing shall be
             430      conducted in accordance with Title 63G, Chapter 4, Administrative Procedures Act.
             431          (v) The director shall designate one of the following to act as the presiding officer in a
             432      hearing described in Subsection (1)(e)(iv):
             433          (A) the division; or
             434          (B) the division with the concurrence of the commission.
             435          (vi) The decision on whether relief from an action under this Subsection (1)(e) will be
             436      granted shall be made by the presiding officer.
             437          (vii) Relief from an automatic revocation under Subsection (1)(e)(ii) may be granted
             438      only if:
             439          (A) the criminal history upon which the division based the revocation:
             440          (I) did not occur; or
             441          (II) is the criminal history of another person;
             442          (B) (I) the revocation is based on a failure to accurately disclose a criminal history; and
             443          (II) the applicant has a reasonable good faith belief at the time of application that there
             444      was no criminal history to be disclosed; or
             445          (C) the division fails to follow the prescribed procedure for the revocation.
             446          (viii) If a license is revoked or a revocation under this Subsection (1)(e) is upheld after
             447      a hearing, the individual may not apply for a new license until at least 12 months after the day
             448      on which the license is revoked.
             449          (2) (a) (i) A license expires if it is not renewed on or before its expiration date.
             450          (ii) As a condition of renewal, an active licensee shall demonstrate competence by
             451      completing 18 hours of continuing education within a two-year renewal period subject to rules
             452      made by the commission, with the concurrence of the division.
             453          (iii) In making a rule described in Subsection (2)(c)(ii), the division and commission
             454      shall consider:
             455          (A) evaluating continuing education on the basis of competency, rather than course
             456      time;
             457          (B) allowing completion of courses in a significant variety of topic areas that the
             458      division and commission determine are valuable in assisting an individual licensed under this
             459      chapter to increase the individual's competency; and


             460          (C) allowing completion of courses that will increase a licensee's professional
             461      competency in the area of practice of the licensee.
             462          (iv) The division may award credit to a licensee for a continuing education requirement
             463      of this Subsection (2)(a) for a reasonable period of time upon a finding of reasonable cause,
             464      including:
             465          (A) military service; or
             466          (B) if an individual is elected or appointed to government service, the individual's
             467      government service during which the individual spends a substantial time addressing real estate
             468      issues subject to conditions established by rule made in accordance with Title 63G, Chapter 3,
             469      Utah Administrative Rulemaking Act.
             470          (b) For a period of 30 days after the expiration date of a license, the license may be
             471      reinstated upon:
             472          (i) payment of a renewal fee and a late fee determined by the commission with the
             473      concurrence of the division under Section 63J-1-504 ; and
             474          (ii) providing proof acceptable to the division and the commission of the licensee
             475      having:
             476          (A) completed the hours of education required by Subsection (2)(a); or
             477          (B) demonstrated competence as required under Subsection (2)(a).
             478          (c) After the 30-day period described in Subsection (2)(b), and until six months after
             479      the expiration date, the license may be reinstated by:
             480          (i) paying a renewal fee and a late fee determined by the commission with the
             481      concurrence of the division under Section 63J-1-504 ;
             482          (ii) providing to the division proof of satisfactory completion of six hours of continuing
             483      education:
             484          (A) in addition to the requirements for a timely renewal; and
             485          (B) on a subject determined by the commission by rule made in accordance with Title
             486      63G, Chapter 3, Utah Administrative Rulemaking Act; and
             487          (iii) providing proof acceptable to the division and the commission of the licensee
             488      having:
             489          (A) completed the hours of education required under Subsection (2)(a); or
             490          (B) demonstrated competence as required under Subsection (2)(a).


             491          (d) After the six-month period described in Subsection (2)(c), and until one year after
             492      the expiration date, the license may be reinstated by:
             493          (i) paying a renewal fee and a late fee determined by the commission with the
             494      concurrence of the division under Section 63J-1-504 ;
             495          (ii) providing to the division proof of satisfactory completion of 24 hours of continuing
             496      education:
             497          (A) in addition to the requirements for a timely renewal; and
             498          (B) on a subject determined by the commission by rule made in accordance with Title
             499      63G, Chapter 3, Utah Administrative Rulemaking Act; and
             500          (iii) providing proof acceptable to the division and the commission of the licensee
             501      having:
             502          (A) completed the hours of education required by Subsection (2)(a); or
             503          (B) demonstrated competence as required under Subsection (2)(a).
             504          (e) The division shall relicense a person who does not renew that person's license
             505      within one year as prescribed for an original application.
             506          (f) Notwithstanding Subsection (2)(a), the division may extend the term of a license
             507      that would expire under Subsection (2)(a) except for the extension if:
             508          (i) (A) the person complies with the requirements of this section to renew the license;
             509      and
             510          (B) the renewal application remains pending at the time of the extension; or
             511          (ii) at the time of the extension, there is pending a disciplinary action under this
             512      chapter.
             513          (3) (a) As a condition for the activation of an inactive license that was in an inactive
             514      status at the time of the licensee's most recent renewal, the licensee shall supply the division
             515      with proof of:
             516          (i) successful completion of the respective sales agent or principal broker licensing
             517      examination within six months before applying to activate the license; or
             518          (ii) the successful completion of the hours of continuing education that the licensee
             519      would have been required to complete under Subsection (2)(a) if the license had been on active
             520      status at the time of the licensee's most recent renewal.
             521          (b) The commission may, in accordance with Title 63G, Chapter 3, Utah


             522      Administrative Rulemaking Act, establish by rule:
             523          (i) the nature or type of continuing education required for reactivation of a license; and
             524          (ii) how long before reactivation the continuing education must be completed.
             525          Section 8. Section 61-2f-206 is amended to read:
             526           61-2f-206. Registration of entity or branch office -- Certification of education
             527      providers and courses -- Specialized licenses.
             528          (1) (a) An entity may not engage in an activity described in Section 61-2f-201 , unless it
             529      is registered with the division.
             530          (b) To register with the division under this Subsection (1), an entity shall submit to the
             531      division:
             532          (i) an application in a form required by the division;
             533          (ii) evidence of an affiliation with a principal broker;
             534          (iii) evidence that the entity is registered and in good standing with the Division of
             535      Corporations and Commercial Code; and
             536          (iv) a registration fee established by the commission with the concurrence of the
             537      division under Section 63J-1-504 .
             538          (c) The division may terminate an entity's registration if:
             539          (i) the entity's registration with the Division of Corporations and Commercial Code has
             540      been expired for at least three years; and
             541          (ii) the entity's license with the division has been inactive for at least three years.
             542          (2) (a) A principal broker shall register with the division each of the principal broker's
             543      branch offices.
             544          (b) To register a branch office with the division under this Subsection (2), a principal
             545      broker shall submit to the division:
             546          (i) an application in a form required by the division; and
             547          (ii) a registration fee established by the commission with the concurrence of the
             548      division under Section 63J-1-504 .
             549          (3) (a) In accordance with rules made by the commission, the division shall certify:
             550          (i) a real estate school;
             551          (ii) a course provider; or
             552          (iii) an instructor.


             553          (b) In accordance with rules made by the commission, and with the concurrence of the
             554      commission, the division shall certify a continuing education course that is required under this
             555      chapter.
             556          (4) (a) Except as provided by rule, a principal broker may not be responsible for more
             557      than one registered entity at the same time.
             558          (b) (i) In addition to issuing a principal broker license, associate broker license, or sales
             559      agent license authorizing the performance of an act set forth in Section 61-2f-201 , the division
             560      may issue a specialized sales license or specialized property management license with the
             561      scope of practice limited to the specialty.
             562          (ii) An individual may hold a specialized license in addition to a license as a principal
             563      broker, associate broker, or a sales agent.
             564          (iii) The commission may adopt rules pursuant to Title 63G, Chapter 3, Utah
             565      Administrative Rulemaking Act, for the administration of this Subsection (4), including:
             566          (A) prelicensing and postlicensing education requirements;
             567          (B) examination requirements;
             568          (C) affiliation with real estate brokerages or property management companies; and
             569          (D) other licensing procedures.


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