Missouri Realtors Lobbyist Notes

[Dan Bowers, CMI]

4-22-11

Below is a communication from Sam Liklider (Missouri Realtor Lobbyist) to various realtors or others regarding last weeks legislative hearings in Jefferson City. Thought you might like to see this.

Same BS stuff we saw in KS / Without licensing a Consumer has no recourse if anything goes wrong; EVERYONE but Home Inspectors is under state or federal oversight; MASSIVE amounts of complaints to MAR or MREC about HI's but without licensing they can't help anybody; ABOUT 2,310 of us roaming around Missouri (if you thought bus was slow now put 2,310 of us out there in Missouri and start crying (don't know what they put in these folks Kool-Aid but its wild).

See Lobbyists Communication Below










Date: Fri, 22 Apr 2011 18:10:49 -0700
From: danbowers1@yahoo.com
Subject: Fwd: MAR Legislative Update 041811
To: dl_rambo@hotmail.com



--- On Mon, 4/18/11, CRRM <crrmriskmanagers@gmail.com> wrote:

From: CRRM <crrmriskmanagers@gmail.com>
Subject: Fwd: MAR Legislative Update 041811
To: danbowers1@yahoo.com
Date: Monday, April 18, 2011, 4:32 PM


FYI: HEARING SUMMARY ATTACHED


---------- Forwarded message ----------
From: Sam Licklider <samlicklider@morealtor.com>
Date: Mon, Apr 18, 2011 at 11:00 AM
Subject: MAR Legislative Update 041811
To: kcforeclosures.net@gmail.com


<IMG border=0> Home Inspectors:
A number of REALTORS® from Kansas City, as well as two from the Lake of the Ozarks, got an initiation by fire when they arrived April 13 to testify at the hearing on HB 553, regulation of home inspectors. The hearing, scheduled for the noon adjournment, didn’t take place until much later because the House didn’t break for lunch and worked straight through until, approximately, 4 p.m.
They used their time well, however, and spent much of the afternoon covering the issue with committee members in the 3rd floor hall. I’m indebted to Derek Ramsay, the lobbyist for KCRAR, who produced an excellent summary report of the committee hearing, which is included in this report. I had a previously scheduled event outside the building at 6:30, so I left the session in his capable hands—again, my thanks to Derek.
“Fair Tax” Debate:
Last week the House, once again, took up HJR 8, “Fair Tax.” A number of pointed questions were raised about the whole system, both current and projected, which Rep. Koenig handled rather well. It’s been pointed out that one point I’ve failed to raise is that the “Fair Tax” system would repeal the current Missouri income tax system. In fairness, it does, but it would replace it with a massive expanded sales tax, including, in this version at least, a new tax on rents and leases, plus a possible tax on land sales for new residential structures.
Several proponents have argued that it does away with the IRS; not so, since it only affects Missouri. In fact, because of the changeover and expansion of individual tax collectors—every member of this association would become one—it would probably force the Department of Revenue to significantly expand, and if the “prebate” is included, it would expand the department even further.
Given the number of members of the House who have told me they would vote “No” on the proposal, I think we are in relatively good shape insofar as the General Assembly is concerned—the initiative—that’s another matter.
Campaign Finance:
Judge Dan Green has issued an order staying a portion of his ruling on the constitutionality of SB 844—last session’s 11th-hour changes to the campaign finance and lobby reporting legislation. The stay had been requested by the Attorney General’s office, pending an appeal. The order regarding corporate contributions remains in effect. This has no net impact on the operations of RPAC-Missouri, since we are continuing to follow the law (pending a final determination by the Supreme Court).
HB 108, sponsored by Rep. Jason Smith, has been reported out of the Senate Rules, Joint Rules, Resolutions and Ethics Committees with one amendment. Our interest in this bill is limited to the change that allows committee agents additional time to report to PAC on contributions received by the agent. Current law allows only five days and, at times, it’s very difficult to achieve.
Report on Hearing on HB 553 by Derek Ramsay—Vice President of Government Affairs, KCRAR
Hearing on HB 553, Registration of Home Inspectors
House Professional Registration & Licensing Committee
April 13th, 2011

Proponents testifying:
Rep. Bob Nance
Sam Licklider
John Younghanz Jr
Lynn Farrell
Karie Jacobs
Gary Derks
Cecil Lovett

Opponents testifying:
Pat Strater, MOHIA
Harry Morrill, MOHIA Pres, ASHI
Paul McNeil, StL ASHI Pres
Jerry Lesch,PE, Ballwin, MO, Nat’l ASHI Past Pres
Dwight Janssen, ASHI, Glendale MO

Proponents

SL testimony:
All other parts of transaction are state or federally regulated.
Currently no requirements to call yourself a HI in MO.
RealtorsÒ in tough situation not being able to recommend a HI, no state list of qualified HI’s, Realtors® can’t interpret HI findings.
Attorneys often don’t take cases involving faulty inspections, often not enough money involved, leaving buyers w no recourse if problems arise that were not disclosed.
RealtorsÒ and their clients rely on professional opinion of HI’s.
Questions from committee:
1. Does bill include registration included for termite and radon tests?
No.
2. Bill grandfather existing HI’s?
No, but willing to consider with minimum competency proof (ex; # of completed inspections)
3. Why only $2k insurance required?
Trying to make affordable for HI’s, number is negotiable.
4. Why require liability and e&o insurance, surety bond, $10k escrow, etc?
Better coverage & more options for HI’s. Again negotiable.
5. How many HI’s in MO?
Don’t know, have tried to get number. That’s part of the problem w no registration. Est 300-350
6. Fiscal Note estimates 2,310 HI’s would be registered. Where does that number come from?
No idea.
7. Are contractors required to register?
Only if they purport to be HI’s and collect fees as such.
8. Are governmental inspectors required to register?
No.
9. Why use KS bill? Is it working?
Is a successful registration program, could tweak bill to work more effectively in MO.

JY testimony:
As former MREC commissioner, MREC often hear complaints about HI’s, but no jurisdiction and no recourse for buyers against faulty HI.
Presented committee members with many written examples of problems with HI’s from Realtors® and an Inspector & PE in support.
35 of 50 states require HI’s to be state regulated.
KS registration started with under $20k, working well.
Questions:
1. We’re inspectors involved in crafting the bill?
Not in MO.
2. Is this the same bill/statute as program in KS?
Yes.
3. Did HI’s in KS go out of business b/c of registration requirement?
Is not aware of any, shouldn’t be.
4. Why not regulate government inspectors also?
?????
5. Would Realtors® be satisfied to accept ASHI/NACHI certifications?
Yes.

LF testimony:
Opposed to grandfathering, problem exists with current inspectors.
HI’s in rural areas (like Ozarks) are not regulated, few if any ASHI members, so no standards. (rural members of the committee really picked up on this point).

CJ testimony:
Low income buyers hurt most by trusting quality of home based on inspection, then can’t afford major repairs not caught by HI’s.
Faulty inspections can lead to deaths.

GD testimony:
Registration program working in KS, should be extended into MO.
Q: How many HI’s registered in KS? (need to get this number)

CL testimony:
Contracts, repairs, etc are negotiated based on findings in HI reports.
Buyers rely on these professional opinions.
Specific example where mold was missed, buyer sued everyone involved, HI refunded amt of inspection and walked away, everyone else paid $1,000’s.



Opposition

PS testimony:
HI’s have testified in favor of state regulations for HI’s in the past.
KS bill is flawed, many problems.
Estimate 325 HI’s in MO.

HM testimony:
Not against licensing
ASHI already has standards
Too many different ways required to obtain insurance in this bill, confusing.

PM testimony:
If bill passes, costs will go up, HI’s will go out of business.
If insurance is required, insurance rates will go up.
Fees established in the bill are too high, will force good HI’s out of business.

JL testimony:
No need for state licensing, only 447 complaints nationally against HI’s (according to who?). Complaints not tracked in MO (according to JL).
ASHI already requires education, experience, ethics, etc.
Inspection of 3+ components should not equal a home inspection, should require full inspection to be counted, per ASHI standards.

DJ testimony:
HI’s should not be responsible for cracked foundations.
HI’s, who normally conduct 3hr inspections, shouldn’t be liable for future problems in home. Need to limit time for liability.
This bill would make him consider getting out of the business

Nance: We’re more than happy to meet with HI’s to craft workable bill, and look forward to the opportunity.

Questions:
1. What is cost to join ASHI?
In StL, $550/yr for National and local
2. Are there any ASHI members in SW MO?
Not that the HI’s were aware of.




Information:
Luann Madsen, MATA

LM testimony:
MATA not have position, but statute of limitations should be 12 months from discovery, rather than 12 months from inspection, to be consistent w other MO statute of limitations laws.

Summary
Committee members were very favorable to the idea that inspectors should be regulated, that their professional opinions should have some weight behind them, and they should not be the only ones involved in the transaction not liable for their actions.
The bill as presented has problems, and both groups should work together for a compromise.
ASHI is a good standard, perhaps all HI’s in MO should be ASHI certified. (wouldn’t that be great).
Multiple options/requirements for insurance of HI’s is confusing, and the limit needs to be qualified.
Much concern was expressed that in some areas of MO, especially rural, no ASHI are practicing, and no regulation of HI’s exists at all.
No one knows how many HI’s there are in MO.
Inspectors all testified that they didn’t oppose state registration of some kind, but opposed this particular bill.
ASHI has great national standards, including ethics, education, experience, etc.
Many questions still exist about the $125k fiscal note. Could possibly set up a non-autonomous board and share staff w other regulated industries to save costs, no need for 2 FTE’s to run HI board.
HI’s must be involved in crafting future legislation.

DR.

[James E. Braun, CMI]

It is nice to know that even Dirty Harry is not stupid enough to support this bill.

[Dale Duffy]

5. Would Realtors® be satisfied to accept ASHI/NACHI certifications?

Yes.

Hard to believe someone is asking a Realtor if they WOULD BE SATISFIED accepting-------------

Hard to believe the state legislature is so freaking insane to understand the used house salesman should have NOT have ANY SAY in what is involved in a Home Inspection, or the Process...........!

Doesn't the Legislature understand this is damn conflict of interest?

[Dan Bowers, CMI]

Dale -

You can not believe how many legislators up here think that MAR and MREC control ANYTHING to do with real estate. The appraisers are under the real estate board / Seems logical to them HI's should be also.

[Steven J. Wessler]

Dan and James,
Statement: ASHI is a good standard, perhaps all HI’s in MO should be ASHI certified. (wouldn’t that be great).
When is InterNACHI and other memberships going to be recognized. And,
who the He.....ll makes ASHI the Standard. Not bashing ASHI but why is NACHI left out. I know, maybe because the only voice of NACHI in Missouri are the Inspectors that belong. Missouri is almost wide open in the rural areas.
When is NICK going to get involved (or is this going to fall on deaf ears like KC)?
in MISSOURI! Take a stand Nick, show us, before the State of Missouri makes ASHI Standards HI Standards.

[Steven J. Wessler]

I'm curious. How are ASHI members regulated in Missouri opposed to NACHI and other memberships?

[James E. Braun, CMI]

Nick will not get involved unless Missouri members ask him to. With Nick's history with licensing in other states, I do not see Nick being ask to help. I think he means well but just does not understand. Mainly because he spends a lot of time up on that mountain.
When I got involved in licensing, MAR did not even acknowledge NACHI. It too at lot of work just to get that far by several of our members.
Most A$HI inspectors are known by Realtors to write the reports their way and not to alarm the home buyer. The obvious evidence is by reading Active Rain posts, Realtors praise A$HI members for doing just that in these posts.
Sad but true.

[Gary Farnsworth]

It is still amazing to me that agents want licensing, so they can implement basic, minimum standards, and have all state licensed home inspectors perform basic, minimum reports, by law, and if there is a problem, then the liability is on the home inspector.

To all Missouri Lawmakers:

You all just do not get it. All you have to do is call the TREC, Texas Real Estate Commission, who regulates home inspectors in Texas, and ask them how many lawsuits they have to handle because their laws limit home inspections.

If you license home inspectors, all repair persons involved in the RE transaction should also all be licensed, have educational requirements, and carry insurance. This in itself, can cause a major lawsuit, and can empty the coffer of the Missouri board in one swoop. The state then will have to cough up funds for this type of litigation.

People are now very careful in Kansas due to this situation.

All that should be done, if you wake up, is for a home inspector to be a member of a national association, carry some kind of insurance, pay a fee, done. No standards of practice or rules or regulations are needed, since they will abide by their association standards.

But, no. Agents want their own, so they can hire cheap inspectors at $199, as in Florida and many other states, so the reports will be basic, and soft.

Remember lawmakers, do you want to hire a home inspector, that by law, needs to only check one outlet, one window, one wall, one switch per room, no appliances, and does not have to remove or touch any electrical, attic, or accessible panel?

You must think about this. It is ruining the integrity of the home inspector, and the home buyer is not being properly informed about the property that they will live in for years. This all harms the consumers of Kansas and Missouri. This is nothing but a national ploy by agents to get home inspectors out of the way, or if the buyer wants a home inspection, to write soft, basic reports so the agents will sell houses and make commissions. ASHI contributes funding to agent associations, another conflict of interest.

Wake up people. How many consumers are complaining? How many news articles to you hear about bad home inspectors? Zero. We are the only ones left who will truthfully and honestly inform the home buyer of the only home they are likely to purchase in their lifetime. Licensing will only create minimum, basic standards that the agents will love.

Feel free to call me anytime. 913-219-2062