88R13270 TYPED     By: King of Hemphill H.B. No. 3878       A BILL TO BE ENTITLED   AN ACT   relating to the Texas Real Estate Research Center, the Real Estate   Research Advisory Committee, the Texas Real Estate Commission, and   the Texas Appraiser Licensing and Certification Board.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  The heading to Subchapter C, Chapter 86,   Education Code, is amended to read as follows:   SUBCHAPTER C. TEXAS REAL ESTATE RESEARCH CENTER          SECTION 2.  Section 86.51, Education Code, is amended to   read as follows:          Sec. 86.51.  TEXAS REAL ESTATE RESEARCH CENTER. The Texas   Real Estate Research Center [There] is established at Texas A&M   University [a Real Estate Research Center, hereinafter referred to   as the center.] The operating budget, staffing, and activities of   the center shall be approved by the board of regents of The Texas   A&M University System.          SECTION 3.  Section 86.52, Education Code, is amended by   amending Subsections (c), (d), (e), (f), (h), (i), (j), (k), and (l)   and adding Subsection (m) to read as follows:          (c)  Members [Except for the initial appointees, members] of   the advisory committee hold office for staggered terms of six   years, with the terms of three members expiring on January 31 of   each odd-numbered year. [In making the initial appointments, the   governor shall designate three members, including two   representatives of the real estate industry and one representative   of the general public, for terms expiring in 1973, three for terms   expiring in 1975, and three for terms expiring in 1977.] Any vacancy   shall be filled by appointment for the unexpired portion of the   term. Each member shall serve until the member's [his] successor is   qualified.          (d)  The presiding officer [chairman] of the Texas Real   Estate Commission, or a member of the commission designated by the   presiding officer [him], shall serve as an ex officio, nonvoting   member of the advisory committee.          (e)  The advisory committee shall elect a presiding officer   and an assistant presiding officer from the committee's [its]   membership, and each officer shall serve for a term of one year.          (f)  [The first meeting of the advisory committee shall be   called by the president of Texas A & M University or his designated   representative.] The advisory committee shall meet not less than   semiannually, and in addition on call of the committee's presiding   officer [its chairman], or on petition of any six of the committee's   [its] members, or on call of the executive director of the center   [president of Texas A & M University] or their [his] designated   representative.          (h)  The executive director of the center [president of Texas   A & M University] or their [his] designated representative shall   submit to the advisory committee in advance of each fiscal year a   proposed budget for expenditures of all funds provided for the   center in a form that is related to the proposed schedule of   activities for the review and approval of the advisory committee.   For informational purposes only, a copy of the final [The proposed]   budget approved by the advisory committee shall be forwarded with   the comments of the committee to the board of directors of The Texas   A&M [A & M] University System prior to its action on the proposed   budget, and the board of directors of The Texas A & M University   System shall not authorize any expenditure that has not had the   prior approval of the advisory committee.          (i)  The president of Texas A & M University or their [his]   designated representative shall submit to the advisory committee   for its review and approval a research agenda at the beginning of   each fiscal year and shall continuously inform the advisory   committee of changes in its substance and scheduling.          (j)  Each member of the advisory committee [board] is   entitled to a per diem as provided in the center's budget [set by   legislative appropriation] for each day that the member engages in   the business of the committee [board]. A member may not receive any   compensation for travel expenses, including expenses for meals and   lodging, other than transportation expenses. A member is entitled   to compensation for transportation expenses as provided in   [prescribed by] the center's budget [General Appropriations Act].          (k)  Except as provided by Subsection (l), the [The] advisory   committee is subject to Chapter 551, Government Code, Chapter 2001,   Government Code, and the provisions of Chapter 572, Government   Code.          (l)  The advisory committee may conduct a meeting by   conference call or virtually through a third-party Internet   application as long as members of the general public are able to   participate in the meeting, and any discussions during the meeting,   if the meeting is not permitted to be conducted as a closed meeting   under Chapter 551, Government Code.          (m)  The financial transactions of the center are subject to   audit by the state auditor in accordance with Chapter 321,   Government Code.          SECTION 4.  Section 5.086, Property Code, is moved to   Subchapter A and renumbered as Section 5.____ and amended to read as   follows:          Sec. 5.____.  EQUITABLE INTEREST DISCLOSURE. Before   entering into a contract to sell an option or assign an interest in   a contract to purchase real property, a person [selling an option or   assigning an interest in a contract to purchase real property] must   disclose, in writing, to:                (1)  any [potential} buyer that the person is selling   only an option or assigning an interest in a contract and that the   person does not have legal title to the real property; and                (2)  the seller of the real property that the person [is   selling only] intends to sell an option or [assigning] assign an   interest in a contract [and that the person does not have legal   title to the real property].          SECTION 5.  Section 1101.0045, Occupations Code, is amended   to read as follows:          Sec. 1101.0045.  EQUITABLE INTERESTS IN REAL PROPERTY. (a)   A person may acquire an option or an interest in a contract to   purchase real property and then sell or offer to sell the option or   assign or offer to assign the contract without holding a license   issued under this chapter if the person:                (1)  does not use the option or contract to purchase to   engage in real estate brokerage; and                (2)  discloses the nature of the equitable interest, in   writing, to any [potential] buyer or seller.          (b)  A person selling or offering to sell an option or   assigning or offering to assign an interest in a contract to   purchase real property without disclosing the nature of that   interest as provided by Subsection (a)(2) [to a potential buyer] is   engaging in real estate brokerage.          SECTION 6.  Section 1101.054, Occupations Code, is amended   to read as follows:          Sec. 1101.054.  OFFICIAL OATH. Not later than the 15th   calendar day after the date of appointment, each appointee must   take the constitutional oath of office.          SECTION 7.  Section 1101.152, Occupations Code, is amended   by amending subsection (a) and adding new subsection (c) to read as   follows:          (a)  The commission shall adopt rules to charge and collect   fees in amounts reasonable and necessary to cover the costs of   administering this chapter, including a fee for:                (1)  filing an original application for a broker   license;                (2)  renewal of a broker license;                (3)  filing an original application for a sales agent   license;                (4)  renewal of a sales agent license;                (5)  registration as an easement or right-of-way agent;                (6)  filing an application for a license examination;                (7)  filing a request for a change of place of business,   change of name, return to active status, or change of sponsoring   broker;                (8)  filing a request to replace a lost or destroyed   license or certificate of registration;                (9)  filing an application for approval of an education   program under Subchapter G;                (10)  annual operation of an education program under   Subchapter G;                (11)  transcript evaluation;                (12)  preparing a license or registration history;                (13)  filing a request for a determination of fitness   to engage in a profession the commission regulates; [and]                (14)  conducting a criminal history check for issuing   or renewing a license; and                (15)  registration of a business entity.          (c)  The commission shall adopt rules to set and collect fees   in amounts reasonable and necessary to cover the costs of   implementing the real estate recovery trust account as required   under this chapter.          SECTION 8.  Section 1101.154(a), Occupations Code, is   amended to read as follows:          (a)  The fee for the issuance or renewal of a:                (1)  broker license is the amount of the fee set under   Section 1101.152 and for each year of the term for which the license   is renewed, an additional $70 fee;                (2)  sales agent license is the amount of the fee set   under Section 1101.152 and for each year of the term for which the   license is issued or renewed, an additional $20 fee; and                (3)  certificate of registration is the amount of the   fee set under Section 1101.152 and for each year of the term for   which the certificate is issued or renewed, an additional $20 fee.          SECTION 9.  Section 1101.355, Occupations Code, is amended   by adding Subsections (d) and (e) to read as follows:          (d)  Notwithstanding Subsection (c) or any other law, a   business entity is not required to be licensed under this chapter if   the business entity:                (1)  receives compensation on behalf of a broker or   sales agent licensed under this chapter that is earned by the   license holder while engaged in real estate brokerage;                (2)  performs no other acts of a broker;                (3)  is:                      (A)  a limited liability company as defined by   Section 101.001, Business Organizations Code; or                      (B)  an S corporation as defined by 26 U.S.C.   Section 1361;                (4)  is registered with the commission; and                (5)  is at least 51 percent owned by the license holder   on whose behalf the entity receives compensation.          (e)  The commission shall adopt rules providing for the   registration of a business entity described by Subsection (d).          SECTION 10.  Section 1101.356, Occupations Code, is amended   by amending Subsections (a) and (b-1) to read as follows:          (a)  An applicant for a broker license must provide to the   commission satisfactory evidence that the applicant:                (1)  has had at least four years of active experience   [in this state] as a license holder during the 60 months preceding   the date the application is filed; and                (2)  has successfully completed the number of hours   prescribed by commission rule, not to exceed [at least] 60 semester   hours, or equivalent classroom hours, of qualifying real estate   courses or related courses [postsecondary education, including:                      (A)  at least 18 semester hours or equivalent   classroom hours of qualifying real estate courses, two semester   hours of which must consist of a real estate brokerage course   completed not more than two years before the application date; and                      (B)  at least 42 semester hours of qualifying real   estate courses or related courses accepted by the commission].          (b-1)  The commission by rule shall establish what   constitutes active experience for purposes of this section [and   Section 1101.357].          SECTION 11.  Section 1101.358, Occupations Code, is amended   by amending Subsection (a) to read as follows:          (a)  An applicant for a sales agent license must provide to   the commission satisfactory evidence that the applicant has   completed at least 12 semester hours, or equivalent classroom   hours, of [postsecondary] education consisting of:                (1)  at least four semester hours of qualifying real   estate courses on principles of real estate; and                (2)  at least two semester hours of each of the   following qualifying real estate courses:                      (A)  agency law;                      (B)  contract law;                      (C)  contract forms and addendums; and                      (D)  real estate finance.          SECTION 12.  Section 1101.451(d) is amended to read as   follows:          (d)  Except as provided by Subsection (e), a renewal fee for   a license under this chapter may not exceed, calculated on an annual   basis, the amount of the sum of the fees established under Sections   1101.152 and[,]1101.154[, and 1101.603].          SECTION 13.  Section 1101.603, Occupations Code, is amended   to read as follows:          Sec. 1101.603.  PAYMENTS INTO TRUST ACCOUNT. (a) [In   addition to other fees required by this chapter, the commission   shall collect a fee of $10 to deposit to the credit of the trust   account from an applicant for an original license or certificate of   registration.          (b)  Repealed by Acts 2015, 84th Leg., R.S., Ch. 1158 , Sec.   92, eff. January 1, 2016.          (c)]  Notwithstanding any other law, the commission shall   deposit to the credit of the trust account or the real estate   inspection recovery fund, as determined by the commission, an   administrative penalty collected under Subchapter O for a violation   by a person licensed under this chapter or Chapter 1102.          (b) [(d)]  Notwithstanding any other law, an administrative   penalty collected under Subchapter O for a violation by a person who   is not licensed under this chapter or Chapter 1102 shall be   deposited to the credit of the trust account or the real estate   inspection recovery fund, as determined by the commission.          (c)  [(e)  On a determination by the commission at any time   that the balance in the trust account is less than $1 million, each   license or certificate holder at the next renewal must pay, in   addition to the renewal fee, an additional fee of $10. The   commission shall deposit the additional fee to the credit of the   trust account.          (f)]  To ensure the availability of a sufficient amount to   pay anticipated claims on the trust account, the commission by rule   may provide for the collection of fees or assessments to deposit to   the credit of the trust account from an applicant for an original   license or certificate of registration or license or certificate   holder at the next renewal [at different times and under conditions   other than those specified by this chapter].          SECTION 14.  Section 1101.610, Occupations Code, is amended   by amending Subsections (a) and (b) to read as follows:          Sec. 1101.610.  PAYMENT LIMITS; ATTORNEY'S FEES. (a)   Payments from the trust account for claims, including attorney's   fees, interest, and court costs, arising out of a single   transaction may not exceed a total of $125,000 [$50,000],   regardless of the number of claimants.          (b)  Payments from the trust account for claims based on   judgments against a single license or certificate holder may not   exceed a total of $250,000 [$100,000] until the license or   certificate holder has reimbursed the trust account for all amounts   paid.          SECTION 15.  Subdivision (6), Section 1103.003, Occupations   Code, is amended to read as follows:                (6)  Executive Director ["Commissioner"] means the   executive director [commissioner] of the Texas Appraiser Licensing   and Certification Board.          SECTION 16.  Subsection (d), Section 1103.0545, Occupations   Code, is amended to read as follows:          (d)  The executive director [commissioner] shall create a   training manual that includes the information required by   Subsection (b). The executive director [commissioner] shall   distribute a copy of the training manual annually to each member of   the board. Each member of the board shall sign and submit to the   executive director [commissioner] a statement acknowledging that   the member received and has reviewed the training manual.          SECTION 17.  Subsection (c), Section 1103.057, Occupations   Code, is amended to read as follows:          (b)  If the executive director [commissioner] has knowledge   that a potential ground for removal of an appointed board member   exists, the executive director [commissioner] shall notify the   presiding officer of the board of the potential ground. The   presiding officer shall immediately notify the governor and the   attorney general that a potential ground for removal exists. If the   potential ground for removal involves the presiding officer, the   executive director [commissioner] shall notify the next highest   ranking officer of the board, who shall immediately notify the   governor and the attorney general that a potential ground for   removal exists.          SECTION 18.  The heading to Subchapter C, Chapter 1103,   Occupations Code, is amended to read as follows:   SUBCHAPTER C. EXECUTIVE DIRECTOR [COMMISSIONER] AND OTHER BOARD   PERSONNEL          SECTION 19.  Section 1103.101, Occupations Code, is amended   to read as follows:          Sec. 1103.101.  EXECUTIVE DIRECTOR [COMMISSIONER]. (a) The   executive director [administrator] of the Texas Real Estate   Commission shall serve as executive director [commissioner].          (b)  The board may delegate to the executive director   [commissioner] the responsibility for administering this chapter   and Chapter 1104, including the approval of consent orders and   agreements.          SECTION 20.  Section 1103.102, Occupations Code, is amended   to read as follows:          Sec. 1103.102.  OTHER BOARD PERSONNEL. In addition to the   executive director [commissioner], the board may employ other   officers and employees as necessary to administer this chapter and   Chapter 1104.          SECTION 21.  Section 1103.103, Occupations Code, is amended   to read as follows:          Sec. 1103.103.  SALARIES. The executive director   [commissioner] shall determine the salaries of the officers and   employees of the board.          SECTION 22.  Section 1103.104, Occupations Code, is amended   to read as follows:          Sec. 1103.104.  DUTIES OF EXECUTIVE DIRECTOR   [COMMISSIONER]. The executive director [commissioner] shall:                (1)  disseminate information;                (2)  administer rules adopted by the board under this   chapter or Chapter 1104;                (3)  review each application for a certificate or   license and make a recommendation for final action to the board;                (4)  review and make recommendations to the board   regarding the adoption of rules relating to:                      (A)  the examination required by Subchapter F;                      (B)  education and experience requirements for   issuance of certificates and licenses;                      (C)  continuing education for a certified or   licensed appraiser;                      (D)  standards of professional practice and   ethics for a certified or licensed appraiser;                      (E)  standards for a real estate appraisal   performed by a certified or licensed appraiser; and                      (F)  the fees established by the board under   Section 1103.156 or Section 1104.052;                (5)  collect fees established by the board;                (6)  manage the staff and employees of the board; and                (7)  perform any other duty prescribed by the board   under this chapter or Chapter 1104.          SECTION 23.  Section 1103.105, Occupations Code, is amended   to read as follows:          Sec. 1103.105.  DIVISION OF RESPONSIBILITIES. The board   shall develop and implement policies that clearly separate the   policymaking responsibilities of the board and the management   responsibilities of the executive director [commissioner] and the   staff of the board.          SECTION 24.  Subsection (e), Section 1103.209, Occupations   Code, is amended to read as follows:          (e)  An applicant for a certificate or license under this   chapter who is not a resident of this state must submit with the   application an irrevocable consent that states that service of   process in an action against the applicant arising out of the   applicant's activities as a certified or licensed appraiser in this   state may be made by delivery of the process to the executive   director [commissioner] if the plaintiff in the action, using due   diligence, cannot obtain personal service on the applicant. If   process is served as provided by this subsection, the executive   director [commissioner] shall immediately send a copy of the   material served on the executive director [commissioner] to the   certified or licensed appraiser at the appraiser's address of   record.          SECTION 25.  Subsections (b) and (c), Section 1103.452,   Occupations Code, are amended to read as follows:          (b)  An investigator designated by the executive director   [commissioner] shall investigate each allegation or formal   complaint.          (c)  If the board determines at any time that an allegation   or formal complaint is inappropriate or without merit, the board or   the executive director [commissioner] shall dismiss the complaint   and may not take further action.          SECTION 26.  Subsection (c), Section 1103.458, Occupations   Code, is amended to read as follows:          (c)  A consent order must be:                (1)  approved by the board; and                (2)  signed by the executive director [commissioner]   and the appraiser or appraiser trainee who is the subject of the   complaint.          SECTION 27.  Subsection (c), Section 1103.459, Occupations   Code, is amended to read as follows:          (c)  A consent agreement must be:                (1)  approved by the board; and                (2)  signed by the executive director [commissioner]   and the appraiser or appraiser trainee who is the subject of the   complaint.          SECTION 28.  Section 1103.5011, Occupations Code, is amended   to read as follows:          Sec. 1103.5011.  NOTICE OF VIOLATION AND PENALTY. (a) The   executive director [commissioner] may send an appraiser against   whom a complaint has been filed a notice of violation including:                (1)  a summary of the alleged violation;                (2)  the recommended sanction, including the amount of   any administrative penalty sought; and                (3)  a conspicuous notice that the respondent has the   right to a hearing to contest the alleged violation, the   recommended sanction, or both.          (b)  Not later than the 20th day after the date the person   receives the notice under Subsection (a), the person may:                (1)  accept the executive director's [commissioner's]   determination, including the recommended sanction; or                (2)  request in writing a hearing, to be held under   Chapter 2001, Government Code, on the occurrence of the violation,   the sanction, or both.          SECTION 29.  Section 1103.5012, Occupations Code, is amended   to read as follows:          Sec. 1103.5012.  PENALTY TO BE PAID OR HEARING REQUESTED. If   the person accepts the executive director's [commissioner's]   determination, or fails to respond in a timely manner to the notice,   the board by order shall approve the determination and order   payment of the recommended penalty, impose the recommended   sanction, or both.          SECTION 30.  Subsection (a), Section 1103.507, Occupations   Code, is amended to read as follows:          (a)  The executive director [commissioner] shall issue a   subpoena to compel the attendance of a witness or the production of   records or other evidence if:                (1)  a party to the proceeding requests the subpoena   orally or in writing;                (2)  the request specifies each item of evidence sought   and the full name and address of each witness sought; and                (3)  the party shows reasonable cause.          SECTION 31.  Subsection (a), Section 1103.521, Occupations   Code, is amended to read as follows:          (a)  The administrative law judge shall file the judge's   final decision in a contested case hearing with the executive   director [commissioner].          SECTION 32.  The following provisions are repealed:                (1)  Section 1101.357, Occupations Code;                (2)  Section 1101.360(a), Occupations Code;                (3)  Section 1101.361, Occupations Code;                (4)  Section 1101.406, Occupations Code;                (5)  Section 1101.604(d), Occupations Code; and                (6)  Section 1103.259, Occupations Code.          SECTION 33.  Section 1101.154(a), Occupations Code, as   amended by this Act, applies only to the issuance or renewal of a   license or certificate of registration under Chapter 1101,   Occupations Code, on or after the effective date of this Act.          SECTION 34.  This Act takes effect January 1, 2024.