ARIZONA STATE SENATE
Forty-eighth Legislature, First Regular Session
FACT SHEET FOR H.B. 2110
real estate education
Purpose
Permits the Commissioner of the Arizona Department of Real Estate (ADRE) to develop, sponsor or hold educational seminars and workshops and makes various changes to the requirements relating to the approval of real estate schools and courses.
Background
Currently, the Commissioner must prepare and circulate educational matter that is helpful and proper for the guidance and assistance of licensees and the public, and may assess a fee for each educational product to recover production and distribution costs. The monies received from the sale of educational matter and grants for the production of educational products are deposited in the Real Estate Department Revolving Fund (Fund), which is used for printing a compilation of real estate laws and rules and other educational publications, and for other educational efforts as the Commissioner deems helpful and proper. The ADRE must make a full accounting of the Fund’s use to the Arizona Department of Administration (ADOA) annually and, at the end of each fiscal year, all monies in the Fund in excess of $25,000 revert to the state General Fund (A.R.S. § 32-2107).
A school must obtain a certificate of school approval before offering a course of study towards completion of the education requirement for real estate licensure or renewal. Additionally, a school must obtain a certificate of course approval for each course offered for credit and is responsible for the content of its courses. The Commissioner may determine minimal requirements for educational courses and for instructors. An application for a certificate of course approval must be filed with ADRE at least 30 days prior to holding a course of study. Course approval lasts for at least two years from the date the course is first approved for the school making the application if the contents of and instructors for the course remain substantially unchanged. For a currently approved course, the school must submit notice to ADRE at least 14 days before holding the course. If a school proposes to hold a course outside the state, at the discretion of the Commissioner the school must either provide ADRE with a videotape of the course or make arrangements for ADRE to monitor the course (A.R.S. § 32-2135).
An
applicant for an original real estate broker’s license must attend a broker
management clinic before activating the license and all active designated real
estate brokers must attend a broker management clinic once during every two
years of licensing. Currently, broker management clinics must include
instruction on ADRE audits, obligations and responsibilities of
designated brokers, record keeping requirements, trust fund accounts,
advertising and promotions, listing agreements and employee supervision and
broker responsibilities (A.R.S. § 32-2136).
According to ADRE, there is no anticipated fiscal impact associated with this measure.
Provisions
Powers of ADRE
1. Permits the Commissioner, in cooperation with industry educators, content experts and other professionals, to develop, sponsor or hold educational seminars and workshops for the benefit of licensees.
2. Permits monies in the Fund to be used for the Commissioner’s sponsoring and holding of educational seminars or workshops for educators and other licensees.
3. Prohibits ADRE from creating, endorsing or sponsoring any activity that a licensee may legally perform in any way that constitutes competition with the private sector, unless there is no licensee who is capable and willing to create, endorse or sponsor the activity. This does not apply to the license approval process or procedures or educational activities sponsored by the Commissioner for the benefit of licensees.
4. Specifies that the Commissioner may determine minimal content requirements for courses and appropriate professional qualifications for instructors.
5. Permits ADRE to establish by rule additional appropriate requirements for approval of a distance learning course.
6. Specifies that ADRE has ability to withdraw or deny certification or approval of real estate schools, education courses or real estate instructors for any violation of the real estate laws.
School Approval
7. Requires a school to obtain a certificate of renewal before offering a course of study for real estate licensure or renewal.
8. Makes a school responsible for the professional administration and teaching of any course that it offers.
Course Approval
9. Requires live classroom prelicensure education, live classroom continuing education and distance learning continuing education courses to be approved by the Commissioner.
10. Permits a school to advertise a course as pending approval before its approval.
11. Requires an application for renewal of course approval to be filed with ADRE at least 30 days before holding a course of study for completion of educational requirements.
12. Requires an application for approval or renewal of a live classroom course to include a course outline that includes: a) sufficient detail to clearly identify the scope and content of the course and b) a desired instructional outcome for the course.
13. Requires a prelicensure education course outline to be divided into estimated 50-minute instructional segments.
14. Prohibits course approval for a live classroom course from being unreasonably withheld and from being issued later than 30 days after filing with ADRE.
15. Prohibits the issuance of a course approval for a continuing education distance course later than 90 days after filing with ADRE.
16. Approves automatically, on a provisional basis for 180 days, a course for which ADRE does not grant approval within the timeframes prescribed, unless ADRE otherwise notifies the applicant of specific deficiencies or unfulfilled requirements.
17. Permits ADRE to withdraw a provisional approval upon 15 days advance notice if ADRE’s review of the course subsequently reveals course deficiencies or unfulfilled requirements.
18. Requires a provisional course approval, if not withdrawn, to remain approved for the entire course approval period of at least four years.
19. Requires course approval to be for a period of at least four years, as opposed to two years from the date the course was first approved for the school making the application, if the contents of the course remain current.
20. Removes the requirement that the instructors for a course remain substantially unchanged for the course approval to continue.
21. Prohibits a course from being taught if the content ceases to be current or if the course is substantially changed.
22. Specifies that if a school submits notice to ADRE at least 14 days before holding an approved course, the notice is not otherwise subject to review and approval.
23. Permits a school to offer a course that has already been approved by ADRE to be taught at a different school and by a different instructor, without obtaining a certificate of course approval, with the permission of the school that received original approval for the course, and subjects the school only to the 14-day notice requirement before holding the course.
24. Permits the waiver of the course filing timeframes for good cause.
25. Permits ADRE to approve for continuing education credit any course of study proposed by a real estate school to be held outside of the state if it satisfies the Commissioner’s requirements.
26. Removes the requirement that a broker management clinic address record keeping requirements, trust fund accounts, advertising and promotions, listing agreements, contracts, fiduciary duties, material disclosures, department investigations and employee supervision and broker responsibilities, and makes the teaching of these permissible.
27. Permits a broker management clinic to address employment agreements, risk management and other related topics.
Instructor Approval
28. Requires an instructor to file with ADRE an application for instructor approval or renewal.
29. Requires an instructor approval to be: a) for at least four years from the date of approval and b) subject to amendment during the license period only if information material to the instructor’s qualifications has changed.
30. Permits a person holding instructor approval to teach specific subject matter without being subject to additional or duplicate approval requirements during the original approval period.
31. Requires a person holding instructor approval who desires to add an additional instructor competency area during the license period to submit evidence of competency in the additional competency area.
Miscellaneous
32. Requires an applicant for renewal of licensure to file evidence, as opposed to a copy, of the certificates issued by the approved school showing the number of credit hours and course of study required for renewal.
33. Requires ADRE’s approval of a school, school official, instructor or course to be processed in a timeframe consistent with the established timeframes, unless the applicant is subject to a violation or suspected violation for any act inconsistent with the real estate statutes.
34. Makes technical and conforming changes.
35. Becomes effective on the general effective date.
House Action
COM 1/24/07 DPA 10-0-0-0
3rd Read 2/12/07 58-0-2-0
Prepared by Senate Research
February 26, 2007
LB/jas