1. Types of small businesses that will be affected by the rules.
2. Reporting, bookkeeping and other procedures required for compliance with the rules.
An application form prescribed by the Department must be completed and submitted to the Department.
3. Types of professional skills necessary for compliance with the rules.
No new professional skills are necessary for compliance with the rules.
4. Rules have a significant economic impact on small businesses.
No.
Small business regulatory coordinator
Any inquiries for the small business regulatory coordinator for the Department of Commerce can be directed to Sam Rockweiler, as listed above.
Fiscal Estimate
State fiscal effect
None.
Local government costs
None.
Long-range fiscal implications
None known.
Assumptions used in arriving at fiscal estimate
Although the rules will newly result in review of documentation relating to issuing grants to businesses for outsourcing work to rural municipalities, the number of these reviews and grants is expected to be too small to result in significant changes in the Department's costs for administering its business development programs. Therefore, the proposed rules are not expected to have any significant fiscal effect on the Department.
The proposed rules are not expected to impose any significant costs on the private sector, because the rules address only voluntary submittal of documentation relating to grants for outsourcing work to rural municipalities.
Agency Contact Person
Mary Gage
Wisconsin Department of Commerce
Bureau of Business Finance and Compliance
P.O. Box 7970, Madison, WI 53707-7970
Telephone (608) 266-2766
Notice of Hearing
Government Accountability Board
NOTICE IS HEREBY GIVEN that pursuant to sections
5.05 (1) (f)
,
227.11 (2) (a)
,
227.16
, and
227.24 (4)
, Stats., and interpreting generally Chapter
11
, Stats., the Government Accountability Board will hold a public hearing to consider adoption of an emergency rule to amend section
GAB 1.28
, Wis. Adm. Code, relating to the definition of the term "political purpose."
Hearing Information
The public hearing will be held as follows:
Date and Time:
|
Location:
|
February 16, 2011
1:00 p.m.
|
Government Accountability
Board Office — 3rd Floor
212 E. Washington Avenue
Madison, WI
|
This public hearing site is accessible to people with disabilities. If you have special needs or circumstances that may make communication or accessibility difficult at the hearing, please contact the person listed below.
Submittal of Written Comments
Comments are to be submitted to the Government Accountability Board, Attn: Shane W. Falk, 212 E. Washington Avenue, 3
rd
Floor, P.O. Box 7984, Madison, Wisconsin 53707-7984, no later than
February 16, 2011.
Statement of Emergency Finding
The Government Accountability Board amends s.
GAB 1.28(3)(b)
, Wis. Adm. Code, relating to the definition of the term "political purpose." Section
GAB 1.28
as a whole continues to clarify the definition of "political purposes" found in s.
11.01(16)(a)1.
, Stats., but repeals the second sentence of s.
GAB 1.28(3)(b)
which prescribes communications presumptively susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate.
This amendment to s.
GAB 1.28(3)(b)
is to the rule that was published on July 31, 2010 and effective on August 1, 2010, following a lengthy two year period of drafting, internal review and study, public comment, Legislative review, and consideration of U.S. Supreme Court decisions. Within the context of ch.
11
, Stats, s.
GAB 1.28
provides direction to persons intending to engage in activities for political purposes with respect to triggering registering and reporting obligations under campaign financing statutes and regulations. In addition, the rule provides more information for the public so that it may have a more complete understanding as to who is supporting or opposing which candidate or cause and to what extent, whether directly or indirectly.
Pursuant to §
227.24
, Stats., the Government Accountability Board finds an emergency exists as a result of pending litigation against the Board and two decisions by the United States Supreme Court:
Federal Election Commission (FEC) v. Wisconsin Right to Life, Inc. (WRTL II)
,
550 U.S. 549
(2007) and
Citizens United v. FEC
, 558 U.S. ___, (No. 08-205)(January 21, 2010). Following the effective date of the August 1, 2010 rule, three lawsuits were filed seeking a declaration that the rule was unconstitutional and beyond the Board's statutory authority: one in the U.S. District Court for the Western District of Wisconsin, one in the U.S. District Court for the Eastern District of Wisconsin, and one in the Wisconsin Supreme Court. On August 13, 2010, the Wisconsin Supreme Court temporarily enjoined enforcement of the August 1, 2010 rule, pending further order by the Court.
In the lawsuit in the U.S. District Court for the Western District of Wisconsin, the parties previously executed a joint stipulation asking the Court to permanently enjoin application and enforcement of the second sentence of s.
GAB 1.28 (3) (b)
. On October 13, 2010, the Court issued an Opinion and Order denying that injunction request. In denying the injunction, the Court noted that "G.A.B. has within its own power the ability to refrain from enforcing, or removing altogether, the offending sentence from a regulation G.A.B. itself created" and emphasized that "removing the language—for example, by G.A.B. issuing an emergency rule—would be far more `simple and expeditious' than asking a federal court to permanently enjoin enforcement of the offending regulation."
Wisconsin Club for Growth, Inc. v. Myse
, No. 10-CV-427, slip op. at 2 (W.D. Wis. Oct. 13, 2010). The Court further noted that staying the case would give the Board time to resolve some or all of the pending issues through further rulemaking.
Id.
, slip op. at 14.
In addition, the Board, through its litigation counsel, has represented to the Wisconsin Supreme Court that it does not intend to defend the validity of the second sentence of s.
GAB 1.28(3)(b)
and that it would stipulate to the entry of an order by that Court permanently enjoining the application or enforcement of that sentence.
This amendment brings s.
GAB 1.28(3)(b)
into conformity with the above stipulation, with the representations that have been made to the Wisconsin Supreme Court, and with the suggestions made in the October 13, 2010, Opinion and Order of the U.S. District Court for the Western District of Wisconsin. The Board finds that the immediate adoption of this amendment will preserve the public peace and welfare by providing a simple and expeditious clarification of the meaning of s.
GAB 1.28
for litigants, for the regulated community, and for the general public and by doing so in advance of the 2011 Spring Election and any other future elections.
Analysis Prepared by the Government Accountability Board
Statute interpreted
Statutory authority
Explanation of agency authority
Under the existing statute, s.
11.01 (16)
, Stats., an act is for "political purposes" when by its nature, intent or manner it directly or indirectly influences or tends to influence voting at an election. Such an act includes support or opposition to a person's present or future candidacy. Further, s.
11.01 (16) (a) 1.
, Stats., provides that acts which are for "political purposes" include "but are not limited to" the making of a communication which expressly advocates the election, defeat, recall or retention of a clearly identified candidate.
Under s.
5.05 (1)
, Stats., the Board is expressly vested with responsibility for the administration of all Wisconsin laws relating to elections and election campaigns, specifically including chapters 5 through 12 of the Wisconsin Statutes. Pursuant to that responsibility, s.
5.05 (1) (f)
, Stats., gives the Board express statutory authority to promulgate administrative rules "for the purpose of interpreting or implementing the laws regulating the conduct of elections or elections campaigns or ensuring their proper administration." Similarly, s.
227.11 (2) (a)
, Stats., grants state agencies — including the Board — the authority to "promulgate rules interpreting the provisions of any statute enforced or administered by it, if the agency considers it necessary to effectuate the purpose of the statute," as long as the rule does not "exceed[] the bounds of correct interpretation." Sections
5.05 (1) (f)
and
227.11 (2) (a)
, Stats., thus give the Board clear and express authority to promulgate rules that interpret and implement the meaning of all Wisconsin laws that regulate or govern the proper administration of election campaigns in this state, including s.
11.01 (16)
, Stats.
Section
GAB 1.28
, as promulgated on August 1, 2010, made a number of changes to the Board's interpretation and implementation of the statutory definition of an act "for political purposes" under s.
11.01 (16)
, Stats. Those changes were fully analyzed and explained in the July 13, 2010, Order of the Government Accountability Board,
CR 09-013
.
The present amendment involves only the repeal of the second sentence of s.
GAB 1.28 (3) (b)
. All other portions of GAB 1.28, including the first sentence of s.
GAB 1.28 (3) (b)
, are unchanged. Moreover, all of the revisions to GAB 1.28 that were effected on August 1, 2010, remain temporarily enjoined pending further order of the Wisconsin Supreme Court. The present amendment has no effect on the continued effectiveness of that injunction.
The first sentence of s.
GAB 1.28 (3) (b)
, provides that any communication that "is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate" is a communication "for political purposes" within the meaning of s.
11.01 (16)
, Stats., and hence is subject to all of the campaign finance regulations under ch.
11
of the Wisconsin Statutes that apply to communications for a political purpose — subject, of course, to any additional requirements or limitations contained in particular statutes.
The second sentence of s.
GAB 1.28 (3) (b)
additionally identifies communications which are susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate. That is, any communications that possess the characteristics enumerated in the second sentence of s.
GAB 1.28 (3) (b)
would automatically be deemed communications for a political purpose and, as a result, would automatically be subject to the applicable campaign finance regulations under ch.
11
of the Wisconsin Statutes.
As a result of litigation challenging the validity of the August 1, 2010, amendments to s.
GAB 1.28
, the Board has entered into a stipulation to refrain from enforcing the second sentence of s.
GAB 1.28 (3) (b)
. The Board, through its litigation counsel, has also represented that it does not intend to defend the validity of that sentence and has sought judicial orders permanently enjoining its application or enforcement. This sentence is removed by this emergency rule.
This amendment does not affect the first sentence of s.
GAB 1.28 (3) (b)
, under which individuals and organizations that raise or spend money to make communications that are susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate, are subject to campaign finance regulation under ch.
11
of the Wisconsin Statutes. As previously noted however, all of the August 1, 2010, amendments to s.
GAB 1.28
— including the first sentence of s.
GAB 1.28 (3) (b)
— are currently subject to the August 13, 2010, temporary injunction by the Wisconsin Supreme Court.
Related statute(s) or rule(s)
Plain language analysis
The revised rule will subject to regulation communications that are "susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate." The revised rule will subject communications meeting this criterion to the applicable campaign finance regulations and requirements of ch.
11
, Stats. The scope of regulation will be subject to the United States Supreme Court Decision,
Citizens United vs. FEC
(No. 08-205), permitting the use of corporate and union general treasury funds for independent expenditures.
Summary of, and comparison with, existing or proposed federal regulations
The United States Supreme Court upheld regulation of political communications called "electioneering communications" in its December 10, 2003 decision:
McConnell et al. v. Federal Election Commission, et al.
(No.02-1674), its June 25, 2007 decision of:
Federal Election Commission (FEC) v. Wisconsin Right to Life, Inc. (WRTL II)
, (No.06-969and 970), and pursuant to its January 21, 2010 decision of:
Citizens United vs. FEC
(No. 08-205).
The
McConnell
decision is a review of relatively recent federal legislation — The Bipartisan Campaign Reform Act of 2002 (BCRA) — amending, principally, the Federal Election Campaign Act of 1971 (as amended). A substantial portion of the
McConnell
Court's decision upholds provisions of BCRA that establish a new form of regulated political communication — "electioneering communications" – and that subject that form of communication to disclosure requirements as well as to other limitations, such as the prohibition of corporate and labor contributions for electioneering communications in BCRA ss. 201, 203. BCRA generally defines an "electioneering communication" as a broadcast, cable, or satellite advertisement that "refers" to a clearly identified federal candidate, is made within 60 days of a general election or 30 days of a primary and, if for House or Senate elections, is targeted to the relevant electorate.
In addition, the Federal Election Commission (FEC) promulgated regulations further implementing BCRA (generally
11 CFR Parts 100
-
114
) and made revisions incorporating the
WRTL II
decision by the United States Supreme Court (generally
11 CFR Parts 104
,
114
.) The FEC regulates "electioneering communications."
Comparison with rules in adjacent states
Illinois:
Pursuant to Public Act 96-0832, Illinois revised its "electioneering communication" statute in 2009, effective July 1, 2010, to include the "no reasonable interpretation other than an appeal to vote for or against" test, among other revisions. Subject to some delineated exemptions found in 10 ILCS 5/9-1.14, the statute now defines an "electioneering communication" as any broadcast, cable or satellite communication, including radio, television, or internet communication, that:
1)
refers to a clearly identified candidate or candidates who will appear on the ballot, a clearly identified political party, or a clearly identified question of public policy that will appear on the ballot,
2)
is made within 60 days before a general election or 30 days before a primary election,
3)
is targeted to the relevant electorate, and
4)
is susceptible to no reasonable interpretation other than an appeal to vote for or against a clearly identified candidate, a political party, or a question of public policy.
As a result of the adoption of Public Act 96-0832, Illinois is undergoing a substantial revision of its administrative code with respect to campaign finance and disclosure rules. (See proposed Illinois Administrative Code, Title 26, Chapter
1
, Part 100, Campaign Financing, JCAR260100-101389r01). In the context of excluding "independent expenditures" from the term "contribution," Section
100.10(b)(3)
G., of the proposed rules include both electioneering and express advocacy communications as forms of independent expenditures.
Iowa:
Iowa's Administrative Code defines "express advocacy" as including a communication that uses any word, term, phrase, or symbol that exhorts an individual to vote for or against a clearly identified candidate or the passage or defeat of a clearly identified ballot issue. (Chapter
351
—4.53(1), Iowa Administrative Code.)
Michigan:
Michigan statutes define a "contribution" as anything of monetary value made for the purpose of influencing the nomination or election of a candidate or the qualification, passage or defeat of a ballot question. (s.
169.204(1)
, Mich. Stats.) "Expenditure" is defined as a payment of anything of monetary value in assistance of or opposition to the nomination or election of a candidate or the qualification, passage or defeat of a ballot question. (s.
169.206(1)
, Mich. Stats.) Michigan does not have any additional rules defining political purposes.
Minnesota:
Minnesota statutes define a "campaign expenditure" or "expenditure" as the purchase or payment of money or anything of value, or an advance of credit, made or incurred for the purpose of influencing the nomination or election of a candidate or for the purpose of promoting or defeating a ballot question. (s. 10A.01, Subd. 9, Minn. Stats.) "Independent expenditure" is defined as an expenditure expressly advocating the election or defeat of a clearly identified candidate, if the expenditure is not coordinated with any candidate or any candidate's principal campaign committee or agent. (s. 10A.01, Subd. 18, Minn. Stats.) Minnesota does not have any additional rules defining political purposes.
Summary of factual data and analytical methodologies
The factual data and analytical methodologies underlying the adoption of the August 1, 2010 amendments to s.
GAB 1.28
have been described in the July 13, 2010, Order of the Government Accountability Board,
CR 09-013
. The adoption of the present amendment to s.
GAB 1.28 (3) (b)
is predicated on the same data and methodologies and also on developments related to several court cases challenging the validity of the August 1, 2010 amendments to s.
GAB 1.28
. These developments were discussed by the Board in a closed session meeting with its litigation counsel on December 14, 2010. These developments are also being discussed in an open session, public meeting of the Board on December 22, 2010.
Analysis and supporting documentation used to determine effect on small businesses
The rule will have no effect on small business, nor any economic impact.
Effect on Small Business
The creation of this rule does not affect business.
Fiscal Estimate
The creation of this rule has minimal fiscal effect. There may be additional registrants filing reports with the Board and potentially additional enforcement actions that may require staff action. The extent of this potential fiscal impact is undetermined.
Text of Proposed Rule
Pursuant to the authority vested in the State of Wisconsin Government Accountability Board by ss.
5.05 (1) (f)
,
227.11 (2) (a)
and
227.24
, Stats., the Government Accountability Board hereby adopts an emergency rule amending GAB 1.28, Wis. Adm. Code, interpreting ch.
11
, Stats., as follows:
SECTION 1. GAB 1.28 (3) (b) is amended to read:
(b) The communication is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate.
A communication is susceptible of no other reasonable interpretation if it is made during the period beginning on the 60th day preceding a general, special, or spring election and ending on the date of that election or during the period beginning on the 30th day preceding a primary election and ending on the date of that election and that includes a reference to or depiction of a clearly identified candidate and:
1. Refers to the personal qualities, character, or fitness of that candidate;
2. Supports or condemns that candidate's position or stance on issues; or
3. Supports or condemns that candidate's public record.
Agency Contact Person
Shane W. Falk, Staff Counsel
Government Accountability Board
212 E. Washington Avenue, 3
rd
Floor
P.O. Box 7984, Madison, WI 53707-7984
Phone : (608) 266-2094
Notice of Hearing
Regulation and Licensing
NOTICE IS HEREBY GIVEN that pursuant to authority vested in the Department of Regulation and Licensing in sections
15.08 (5) (b)
,
51.30
,
146.82
,
227.11 (2)
and
440.04
, Stats., and interpreting section
440.03
, Stats., the Department of Regulation and Licensing will hold a public hearing at the time and place indicated below to consider an order to revise Chapters
RL 80
to
86
, relating to licensure and certification requirements if licensed in another state or territory, approved instructors for educational programs and continuing education, examination requirements, rules of professional conduct, and "FIRREA" and AQB criteria.
Hearing Information
The public hearing will be held as follows:
Date and Time:
|
Location:
|
February 23, 2011
9:30 a.m.
|
1400 East Washington Avenue
Room 121A
Madison, WI
|
Appearances at the Hearing and Submittal of Written Comments
Interested persons are invited to present information at the hearing. Persons appearing may make an oral presentation but are urged to submit facts, opinions and argument in writing as well. Facts, opinions and argument may also be submitted in writing without a personal appearance by mail addressed to the Department of Regulation and Licensing, Division of Board Services, P.O. Box 8935, Madison, WI 53708 or by email to
Kristine1.Anderson@wisconsin.gov
. Written comments must be received by
February 18, 2011
, to be included in the record of rule-making proceedings.
Copies of Proposed Rule
Copies of this proposed rule are available upon request to Kris Anderson, Paralegal, Department of Regulation and Licensing, Division of Board Services, 1400 East Washington Avenue, P.O. Box 8935, Madison, Wisconsin 53708, or by email at
Kristine1.Anderson@wisconsin.gov
.
Analysis Prepared by the Department of Regulation and Licensing
Statutes interpreted
Statutory authority
Explanation of agency authority
The Department of Regulation and Licensing is granted rule-making authority pursuant to s.
227.11
, Stats., and is specifically granted rule-making authority pursuant to ss.
458.03
,
458.06
,
458.08
,
458.085
,
458.13
and
458.24
, Stats.
Related statute or rule
There are no other statutes and rules other than those listed.
Plain language analysis
Changes are being made as delineated to be consistent with "FIRREA" and AQB Criteria, to clarify department references, to clarify certification scopes, to simplify the process for applying for licensure and certification in Wisconsin if licensed in another state or territory, to expand the approved instructors for educational programs and continuing education courses, to clarify credit for such courses, and to expand the rules of professional conduct.
SECTION 1 amends the rule to clarify the meaning of "mass appraisal."
SECTIONS 2, 3, 4, 10, 12 and 16 amend the Notes relating to where applications and information is available.
SECTION 5 creates a rule to simplify the process for applying for licensure or certification in Wisconsin if the applicant is already licensed in another state or territory.
SECTION 6 amends rules to clarify the scope of practice of certified general appraisers and certified residential appraisers.
SECTION 7 amends rules to clarify the requirements for examination.
SECTION 8 amends rules to change the experience requirements.
SECTION 9 creates rules to clarify what standards experience must comply with.
SECTION 11 creates rules to simplify the licensing and certification process for applicants who are licensed or certified in other states or territories.
SECTION 13 creates rules to expand available educational instructors and educational courses and to clarify the granting of credit for such courses.
SECTION 14 repeals and recreates rules to clarify the educational course requirements to become a licensed appraiser, a certified residential appraiser, and a certified general appraiser.
SECTION 15 adds a comma in the first sentence.
SECTION 17 creates rules to expand who is qualified to teach continuing education courses and approval for courses already approved by another state or territory, and clarifies credit for courses that qualify for both continuing education and certification.
SECTION 18 amends the rules of professional conduct to shorten the time to respond to investigation requests and to clarify a reference to state.
SECTION 19 creates rules of professional conduct adding three new circumstances which may be considered unprofessional conduct.
Summary of, and comparison with, existing or proposed federal regulation
Federal Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ("FIRREA")
The Federal Institutions Reform, Recovery, and Enforcement Act ("FIRREA"),
12 U.S.C. 3331
et seq., (Title XI) was enacted in 1989. Under FIRREA, insured financial institutions and insured credit unions are required to obtain the services of a State certified or licensed appraiser for appraisals conducted in connection with "federally related transactions."
Under FIRREA, the Appraisal Subcommittee of the Federal Financial Institutions Examination Council is required to monitor state appraiser certifying and licensing agencies for the purpose of determining whether a state agency's policies, practices, and procedures are consistent with the federal law. The Appraisal Subcommittee may not recognize appraiser certifications and licenses from states whose appraisal policies, practices and procedures are found to be inconsistent with FIRREA. Before refusing to recognize a state's appraiser certifications or licenses, the Appraisal Subcommittee must provide that state's certifying and licensing agency with a written notice of its intention not to recognize the state's certified or licensed appraisers and ample opportunity to provide rebuttal information or to correct the conditions causing the refusal. A decision of the Subcommittee to refuse to recognize a state's appraiser certifications or licenses is subject to judicial review.
12 U.S.C. 3331
et seq.
In 1997, the Appraisal Subcommittee adopted the
Policy Statements Regarding State Certification and Licensing of Real Estate Appraisers
, which all states must comply with. [The Appraisal Subcommittee's Policy Statements are available at:
http://www.asc.gov
.]
Appraisal Qualifications
Under FIRREA, the state criteria for the qualifications of
certified
real estate appraisers must meet the minimum qualifications criteria for certification established by the Appraiser Qualifications Board (AQB) of the Appraisal Foundation. The minimum qualifications criteria established by the AQB are set forth in the
Real Property Appraiser Qualification Criteria and Interpretations of the Criteria
("Criteria"). The AQB Criteria includes the minimum experience, examination, qualifying education and continuing education requirements that must be satisfied by an individual in order to obtain and maintain a certified appraiser credential. [The AQB Criteria is available on the Internet at
http://www.appraisalfoundation.org
.]
Under FIRREA, the states may establish their own qualifications and requirements for
licensed
appraiser credentials. The states are not obligated to adopt the minimum experience, examination, education and continuing education requirements recommended by the AQB for the
licensure
of real estate appraisers. However, the Appraisal Subcommittee recommends that all states adopt the AQB Criteria established for the licensure of real estate appraisers.
Comparison with rules in adjacent states
The Federal Institutions Reform, Recovery, and Enforcement Act ("FIRREA"),
12 U.S.C. 3331
et seq., (Title XI) was enacted in 1989. Under FIRREA, insured financial institutions and insured credit unions are required to obtain the services of a state certified or licensed appraiser for appraisals conducted in connection with "federally related transactions."
Under FIRREA, all states, including Illinois, Iowa, Indiana, Michigan and Minnesota, that certify real estate appraisers for purposes of conducting appraisals in federally related transactions must assure compliance with the AQB Criteria. In addition, the Appraisal Subcommittee recommends that all states assure compliance with the AQB Criteria for the licensure of real estate appraisers.
Summary of factual data and analytical methodologies
The board reviewed the current federal statutes as well as the rules in adjacent states. The board determined that the current rules needed to be aligned with FIRREA as well as comply with the AQB Criteria for licensure of real estate appraisers. The board considered the suggestions of the Appraisal Subcommittee and board legal counsel to make changes to the current rules.
Analysis and supporting documents used to determine effect on small business
The proposed changes will have an effect on small business. The rule will have a positive impact on small businesses that would like to bring in a real estate appraiser currently licensed in another state. Instead of verifying all of their reports with Wisconsin, the applicant will now be able to have written verification sent from their state of licensure. The businesses will benefit from the increased efficiency of the licensure process which outweighs the additional cost of requesting the verification.
Additionally, the changes will make it easier for licensed appraisers and trainees to meet their educational requirements. These changes increase the number of approved courses and instructors available to licensed appraisers as well as individuals pursuing their licensure. It also lowers the educational requirements for a licensed appraiser or certified residential appraiser to become a certified general appraiser. These educational changes will make it easier for those seeking licensure or to expand their licensure to do so.
The other proposed changes in the rule clarify or eliminate unnecessary sections of the current rules. Therefore, the proposed changes will have little effect, if not a positive effect, on small business.
Section
227.137
, Stats., requires an "agency" to prepare an economic impact report before submitting the proposed rule-making order to the Wisconsin Legislative Council. The Department of Regulation and Licensing is not included as an "agency" in this section.
Anticipated costs incurred by private sector
The department finds that this rule has no significant fiscal effect on the private sector.
Effect on Small Business
These proposed rules were reviewed by the department's Small Business Review Advisory Committee to determine if the rules will have a significant economic impact on a substantial number of small businesses, as defined in s.
227.114 (1)
, Stats. It was determined that the rules will not have a significant economic impact on a substantial number of small businesses.
The Department's Regulatory Review Coordinator, John Murray, may be contacted by email at
John.Murray@wisconsin.gov
, or by calling 608-266-2112.
Fiscal Estimate
Ongoing cost:
These rule changes will increase reciprocal discipline and thus caseloads with the following additional impact to the department:
520 Attorney hours @ $59 per hour
= $30,680
595 Paralegal hours @ $33 per hour
= $19,635
520 Investigator hours @ $31 per hour
= $16,120
520 LTE appraiser hours @ $35 per hour
= $18,200
35 Operations Program Assoc. hours @ $31 per hour
= $ 1,085
4 Program Associate Supervisor hours @ $23 per hour
= $ 92
Total ongoing costs:
$85,812
Agency Contact Person
Kris Anderson, Paralegal
Department of Regulation and Licensing
Division of Board Services
1400 East Washington Avenue, Room 116
P.O. Box 8935, Madison, WI 53708
Phone: 608-261-2385
Notice of Hearing
Regulation and Licensing
NOTICE IS HEREBY GIVEN that pursuant to authority vested in the Department of Regulation and Licensing in sections
15.08 (5) (b)
,
51.30
,
146.82
,
227.11 (2)
and
440.04
, Stats., and interpreting section
440.03
, Stats., the Department of Regulation and Licensing will hold a public hearing at the time and place indicated below to consider an order to revise Chapter
RL 24
, relating to definitions, duties of brokers, broker disclosure requirements, written proposals, ethical requirements, and educational requirements.
Hearing Information
The public hearing will be held as follows:
Date and Time:
|
Location:
|
February 17, 2011
10:30 a.m.
|
1400 East Washington Avenue
Room 121A
Madison, WI
|
Appearances at the Hearing and Submittal of Written Comments
Interested persons are invited to present information at the hearing. Persons appearing may make an oral presentation but are urged to submit facts, opinions and argument in writing as well. Facts, opinions and argument may also be submitted in writing without a personal appearance by mail addressed to the Department of Regulation and Licensing, Division of Board Services, P.O. Box 8935, Madison, Wisconsin 53708 or by email to
Kristine1.Anderson@wisconsin.gov
.. Written comments must be received by
February 14, 2011
, to be included in the record of rule-making proceedings.
Copies of Proposed Rule
Copies of this proposed rule are available upon request to Kris Anderson, Paralegal, Department of Regulation and Licensing, Division of Board Services, 1400 East Washington Avenue, P.O. Box 8935, Madison, Wisconsin 53708, or by email at
Kristine1.Anderson@wisconsin.gov
.
Analysis Prepared by the Department of Regulation and Licensing
Statutes interpreted
Statutory authority
Explanation of agency authority
The Department of Regulation and Licensing is granted the authority under s.
452.07
, Stats., to promulgate rules to define professional conduct and unethical practices and to establish guidance for the real estate profession.
Related statute or rule
There are no other statutes or rules other than those listed above.
Plain language analysis
This proposed rule-making order clarifies the rules relating to the ability to retain records in an electronic format, updates and clarifies the rules to reflect statutory changes and clarifies licensees' duties. This rule-making also proposes to update the rules for conduct and ethical practices for real estate licensees, and creates discipline for licensees who do not respond to information requests from the board or department. This encourages the submission of requested information during an investigation.
SECTION 1 clarifies the definition of "agency agreement" by removing the statutory reference and adding a definition that encompasses any written agreement where a client authorizes a broker to provide brokerage services. Additionally, the statutory reference included in "brokerage service" is amended to encompass the entire statutory definition of "broker."
SECTION 2 repeals a note at the end of a section because the statutory reference no longer exists in the rules.
SECTION 3 amends the definition of "builder" to encompass any contract to build with or without a buyer. It removes speculation and contact homes from the definition of "builder" because these definitions are repealed. Additionally, "buyer's broker" is clarified by including the defined term of "agency agreement."
SECTION 4 repeals the definition of "contract home" because it is no longer included in the rules.
SECTION 5 amends the definition of "party" by referencing "transaction" which is defined in the rules.
SECTION 6 repeals the definition of "speculation home" because it is no longer included in the rules.
SECTION 7 creates a definition for "written proposal," which is used in the amended language of the rules and includes a broad range of documents used in the transactions, including notices, offers, counteroffers, and amendments.
SECTION 8 repeals a provision about a licensee's duties to clients because the amended rules include licensee duties to clients.
SECTION 9 amends the title to "disclosure of compensation and interests" to clarify the content of the rules. The SECTION is amended to read "compensation" to clarify the content of the SECTION.
SECTION 10 extends the licensee's ability to accept a fee or compensation to the licensee's principal broker as well as the client.
SECTION 11 removes the requirement for a licensee to obtain prior written consent before engaging in a transaction on his or her own behalf.
SECTION 12 removes the title of a provision because the provision is moved to a prior section.
SECTION 13 renumbers a provision and adds a writing requirement for licensees to disclose compensation they received, or interest they have, when referring clients to another person or entity. It also clarifies the statutory authority by referencing the exemption in a separate sentence.
SECTION 14 repeals and recreates a provision to emphasize the need for prior written consent from a client when a licensee discloses any compensation received, or incentives, from a listing broker. This clarifies the standards for licensees.
SECTION 15 includes a writing requirement to disclosures in this subsection to clarify standards for licensees.
SECTION 16 repeals and recreates a provision to clarify the required statutory disclosure form and the written consent requirements for parties to transactions of one to 4 dwelling units. The rule also creates the ethical requirements that a broker not negotiate on behalf of a non-client.
SECTION 17 adds two standards for brokers in providing services to clients: the first does not allow the broker to negotiate for a client without the statutory required disclosure form; and the second requires the client in a transaction for a one to 4 family dwelling to sign an acknowledgement that they received a statutory disclosure form statement.
SECTION 18 changes "another licensee" to "listing broker." It also specifies that any change in the licensee's representation comply with the statutory disclosure requirements of initial disclosure, clarifying the duties of the licensee.
SECTION 19 amends the rule to encompass "agency agreements" instead of "listing contracts," and refers to "brokers" instead of "listing brokers." Therefore, the broker has the duty to explain to their clients the responsibilities of buyer's and seller's agents and subagents before entering into this agreement. These disclosure requirements protect the client.
This SECTION also amends "listing broker" requirements to encompass any "broker" or broker's salesperson. It imposes the requirement that they receive authorization before acting as a subagent.
Finally, this SECTION amends specific contracts to encompass "written documents," a definition of which is included in the amended rules. It clarifies the duty of the licensee to include whom they represent in the written agreement.
SECTION 21 repeals two sections and recreates them to clarify the requirements for listing brokers and licensees.
The first section recreates a provision to require a listing broker to include the statutory disclosure requirements and clarify when a disclosure form is required by splitting the section into four parts: (1) a disclosure form is required for a listing broker when the negotiations are conducted directly with the buyer; (2) a broker is required to provide a disclosure form if negotiations are conducted directly with the seller; (3) a subagent is required to provide a disclosure form to a customer with whom they are working, but not to the principle broker; and (3) a broker does not need to require a broker disclosure form to their subagent's customer.
The second section recreates a provision to include the statutory disclosure requirements and clarify license requirements when negotiating terms of a lease and entering into listings for lease or property management contracts.
SECTION 22 amends a provision to expand the licensee's ethical requirements by forbidding them to mislead in three additional areas: "rented, purchased, or optioned" real estate. It also expands "listing contract" to an "agency agreement," an amended definition of which is included in the proposed rules.
SECTION 23 amends five provisions. The first four are amended to include "written proposals" in lieu of "offers." "Written proposal" is defined in the proposed amendments. In addition to the "written proposals" proposed amendments, the terminology in these five sections was amended for clarification.
The first section changes the terminology to "other party," so a written proposal should not be used if it would be contrary to instructions of the other party. The second section changes the terminology so the licensee should promptly present written proposals to the licensee's client or customer. The third section changes the terminology so that the objective and unbiased manner of presentation should be to the licensee's clients and customers. The fourth section broadens the terminology of "buyer" to "clients and customers" and "written proposal" to that a licensee must inform their clients and customers after any action on a written proposal. The fifth section is amended to add "lease or negotiate." This requirement means a licensee must negotiate with the broker who has an exclusive right to sell, lease or negotiate in these areas. Finally, the Note at the end of this section is updated to reflect the correct form, WB-36.
SECTION 24 amends a provision to allow rules of the department to be "readily available" instead of maintained on file, expanding the way in which rules can be maintained.
SECTION 25 amends a provision requiring a licensee to report offenses. The requirements remove an exemption for certain motor vehicle offenses, and require a licensee to send information about their crime to the department within 48 hours.
SECTION 26 creates a provision requiring the licensees to respond to departmental requests for information within 30 days to encourage compliance with requests.
SECTION 27 amends a provision relating to the educational programs for applicants for licenses. The number of hours a program would be if it were in a classroom was amended from a minimum of 36 hours to a minimum of 72 hours. The second section updates a reference to a rule.
Summary of, and comparison with, existing or proposed federal regulation
None.
Comparison with rules in adjacent states
Illinois:
Broker Pre-License Education:
Section 1450.60 Educational Requirements to Obtain a Broker's or Salesperson's License: 120 credit hours of instruction in approved courses or a baccalaureate degree including courses involving real estate or related material are required for broker applicants.
http://www.ilga.gov/commission/jcar/admincode/068/068014500/C00600R.html
Iowa:
Broker Pre-License Education:
54315(8) and 193E-sub rule 16.3(1), an applicant for licensure as a real estate broker shall complete at least 72 classroom hours of commission-approved real estate education within 24 months prior to taking the broker examination. This education shall be in addition to the required salesperson pre-license course (60 hours).
http://www.legis.state.ia.us/ACO/IAChtml/193e.htm#rule_193e_4_1
Michigan:
Conduct and Ethical Practice for Real Estate Licensees:
The various regulations of professional practice and conduct are found in Administrative Rules for Real Estate Brokers and Salespersons, Occupational Code, Article 25, Parts 3 and 4.
http://www.michigan.gov/documents/dleg/rebook_217577_7.pdf
Broker Pre-License Education:
Rule 203. (1) An applicant for a broker or associate broker license shall have completed 90 clock hours of qualifying pre-licensure education of which 9 clock hours shall be on civil rights law and fair housing law, as defined in section 2504(1) of the code. The broker pre-licensure education shall be completed not more than 36 months before the date of application, unless the applicant has held a license as a salesperson for that intervening period.
http://www.state.mi.us/orr/emi/admincode.asp?AdminCode=Single&Admin_Num=33922101&Dpt=LG&RngHigh
=
Minnesota:
Broker Pre-License Education:
82.29 Sub.8(b) An applicant for a broker's license must successfully complete a course of study in the real estate field consisting of 30 hours of instruction approved by the commissioner, of which three hours shall consist of training in state and federal fair housing laws, regulations, and rules. The course must have been completed within 12 months prior to the date of application for the broker's license.
https://www.revisor.leg.state.mn.us/statutes/?id=82.29
Summary of factual data and analytical methodologies
The information received from the states listed in this analysis was obtained directly from a review of the applicable regulations and rules.
Analysis and supporting documents used to determine effect on small business
Data was obtained from the department's credentialing division regarding the number of licensees that would be affected by this regulatory change. As of June 15, 2010, there are 47,823 licensed real estate salespersons and 52,465 licensed real estate brokers. There are 8,539 licensed real estate business entities. The majority of real estate licensees work in small business environments; however, the change in rules regarding professional conduct of licensees will not have a significant impact on their cost of doing business. The rule change seeks to clarify current ethical practices that already exist within the Wisconsin real estate industry.
Section
227.137
, Stats., requires an "agency" to prepare an economic impact report before submitting the proposed rule-making order to the Wisconsin Legislative Council. The Department of Regulation and Licensing is not included as an "agency" in this section.
Anticipated costs incurred by private sector
The department finds that this rule has no significant fiscal effect on the private sector.
Effect on Small Business
These proposed rules were reviewed by the department's Small Business Review Advisory Committee and it was determined that the proposed rules will not have a significant economic impact on a substantial number of small businesses, as defined in s.
227.114 (1)
, Stats.
The Department's Regulatory Review Coordinator, John Murray, may be contacted by email at
John.Murray@Wisconsin.gov
, or by calling (608) 266-2112.
Fiscal Estimate
The department estimates that this rule will have costs of $128 to create forms and update the department's website.
Agency Contact Person
Kris Anderson
Department of Regulation and Licensing
Division of Board Services
1400 East Washington Avenue, Room 116
P.O. Box 8935, Madison, WI 53708
Phone: 608-261-2385
