Chairperson Gale convened a meeting of the Nebraska Real Estate Commission at 9:03 a.m. on August 24, 2006, in the Staybridge Room of the Staybridge Suites, located at 2701 Fletcher Avenue in Lincoln, Nebraska. All of the members of the Real Estate Commission were present. Also present were Director Les Tyrrell, Deputy Director for Education and Licensing Teresa Hoffman, Deputy Director for Enforcement Terry Mayrose, and Administrative Assistant Monica Wade.

Director Tyrrell presented a public notice and proofs of publication thereof relating to this meeting, all of which are attached to and made a part of these minutes. Chairperson Gale reported that all Commissioners had been notified of the meeting simultaneously, in writing, and that a proposed tentative agenda accompanied the notification.

Chairperson Gale pointed out to those in attendance that a public copy of the materials being used during the meeting and a copy of the Open Meetings Act were available to the public on the counsel table in the meeting room, and that the procedures followed were in accordance with the Open Meetings Act. Chairperson Gale asked that guests sign the guest list.

The minutes of the Commission meeting held on June 14, 2006, were considered.

Director Tyrrell presented the Receipts and Expenditures Reports for June and July. Copies of said reports are attached to and made a part of these minutes. Director Tyrrell noted that an explanation page was included in each report.

Regarding the June report, Director Tyrrell noted that any unusual items were set forth on the explanation pages. Director Tyrrell also noted that miscellaneous adjustment account 486500, had been incorrectly adjusted and was reversed and noted on the July explanation page.

The cash fund balance as of June 30, 2006, was $893,555.59, which compared to a cash fund balance of $898,697.82 on June 30, 2005.

The cash fund balance as of July 31, 2006, was $844,242.44, which compared to a cash fund balance of $847,721.28 on July 31, 2005.

Commissioner Grady asked why the postage expense was so high for the month of July. Director Tyrrell explained that the amount included billings for two months, and within those two months were two large mailings, the Commission Comment Newsletter and the continuing education reminder letter. Director Tyrrell also noted that several bills, received earlier than the previous year, were paid earlier than budgeted, such as the ARELLO databank expense and the awards expense.

After discussion, a motion was made by Poskochil and seconded by Bohrer to file the June and July Receipts and Expenditures Reports for audit. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard and Gale voting aye.

Director Tyrrell presented the final Renewal Report, which showed renewals as of June 30, 2006. A copy of said report is attached to and made a part of these minutes.

Commissioner Poskochil noted that the amount of licensees had increased by 200 and inquired as to the amount of licensees in 2004. Director Tyrrell noted there was a difference of approximately 280. Director Tyrrell also noted the percentage of licensees renewing their license each year has been consistent.

No action was necessary on this report.

Director Tyrrell presented the Budget Spread for Fiscal Year 06-07. A copy of said budget spread is attached to and made a part of these minutes.

Director Tyrrell noted that the Commission had a carry-over from Fiscal Year 2005-2006 of approximately $95,000.00. Chairperson Gale asked if a new project would arise, if the money could be used for that project. Director Tyrrell indicated that money could be moved throughout the budget except into Personal Services which consists of staff salaries and per diems. Commissioner Grady asked what happened to the unexpended money at the end of the second year of the biennium. Director Tyrrell noted the money would go back into the cash fund after the A encumbering process@ was completed.

No action was necessary on this report.

Director Tyrrell presented the 2007-2009 Biennium Budget Proposal. A copy of said proposal is attached to and made a part of these minutes.

Director Tyrrell pointed out the account codes which had increased since the prior biennium, and provided explanations in the narrative for each of the accounts. Director Tyrrell noted the Budget and Planning Subcommittee had met earlier in the month and was recommending the proposed budget to be approved.

Director Tyrrell suggested one minor change to the proposed budget. An amount of $360.00 should be moved from Communications Expense into Data Processing Expense, due to the reorganization of the billing agency. Director Tyrrell noted that the expenditure total would not change, the $360.00 would just be placed within the budget to a different account code.

A motion was made by Shepard and seconded by Johnson to approve and submit the budget proposal after making the appropriate changes to the Communication Expense and Data Processing Expense accounts.

Commissioner Grady inquired about the Personal Services Expense being requested for the next biennium. Director Tyrrell noted that agencies are not allowed to anticipate an increase in salaries. Collective bargaining between the State and NAPE/AFSCME determined the salary increases for the Biennium and that increase along with any other general increases are added to agency budgets during the legislative session.

Commissioner Shepard noted that it appeared Director Tyrrell had anticipated the amount of renewals to stay the same. Director Tyrrell explained that even though the Commission is receiving more application fees and examination fees than previous years, the renewals have been steady for a number of years with the number of licenses renewed each year staying at approximately 93%. Commissioner Shepard asked if the amount of new applicants each year is increasing. Director Tyrrell noted he had projected an approximate 2% decline each year in the amount of application and examination fees received. Director Tyrrell also noted he projected the number of salespersons licensed to decrease approximately 2% per year while new broker licensees would remain approximately the same.

Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard and Gale voting aye.

Director Tyrrell presented an exhibit regarding the potential fee reduction impact. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell noted a $10.00 reduction in license fees would reduce income approximately $76,130.00 per fiscal year. Commissioner Gale noted that if the change goes into effect for 2007 the $76,130.00 would impact the current fiscal year= s budget. Commissioner Poskochil expressed concern about having to raise the fees in the future. Director Tyrrell speculated that it would not be likely that a major increase would have to occur in a one-year period and perhaps the amount could remain the same for a year or two to stabilize. Commissioner Poskochil noted the fund balance kept growing despite the $10.00 reduction in preceding years, and this year the fund balance appeared to break even.

A motion was made by Griess and seconded by Johnson to approve the $10.00 reduction in the salesperson and the broker renewal fee for 2007 and the salesperson and the broker original license fee beginning January 1, 2007. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard, and Gale voting aye.

Director Tyrrell presented a report which included an amendment to a time-share registration for Fairfield Orlando at Bonnet Creek, and an amendment to a time-share registration for Private Quarters at Porto Cima, A Condominium. A copy of said report is attached to and made a part of these minutes.

Following discussion, a motion was made by Johnson and seconded by Grady to approve the amendments as presented. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard, and Gale voting aye.

Deputy Director Hoffman presented for ratification the Non-Resident Licenses and Resident Licenses Issued to Persons Holding Licenses in Other Jurisdictions Report, a copy of which is attached to and made a part of these minutes.

Examination Report - June and July

Deputy Director Hoffman presented for ratification the June and July Examination Reports, copies of which are attached to and made a part of these minutes.

Deputy Director Hoffman presented for ratification the Pre-License Education Instructor Approval Report, a copy of which is attached to and made a part of these minutes.

Deputy Director Hoffman presented for ratification the Continuing Education Activity Approval Report, a copy of which is attached to and made a part of these minutes.

Deputy Director Hoffman presented for ratification the Continuing Education Instructor Approval Report, a copy of which is attached to and made a part of these minutes.

Deputy Director Hoffman presented an exhibit regarding a continuing education activity significant change, a copy of which is attached to and made a part of these minutes.

After review, a motion was made by Shepard and seconded by Grady to ratify the reports. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard and Gale voting aye.

Deputy Director Hoffman presented an exhibit regarding a continuing education activity rejection, a copy of which is attached to and made a part of these minutes.

No action was necessary on this report.

Chairperson Gale asked if Commission documents needed to be provided in alternative languages. Deputy Director Hoffman noted that it was her understanding that all legal documents needed to be executed in English. She also indicated that she was unaware of any requests to Commission staff for language accommodation.

Commissioner Grady asked if pre-license internet courses were being created. Deputy Director Hoffman indicated that she was unaware of any.

Director Tyrrell presented a summary report of the pending complaints, which included a list of licensees presently under disciplinary action or on appeal. This report indicated that a licensee had been suspended under the License Suspension Act for not being current with child support payments. Director Tyrrell answered questions regarding this action and the License Suspension Act. A copy of said report is attached to and made a part of these minutes.

No action was necessary on this report.

The following sworn complaints and investigative matters were presented to the Commission:

Complaint #2006-005,
Commission vs. David Emerson Jeffers

Deputy Director Mayrose presented a Stipulation and Consent Order in the matter of Complaint #2006-005, Commission vs. David Emerson Jeffers. A copy of said order is attached to and made a part of these minutes.

Deputy Director Mayrose reviewed the circumstances involved and noted the provisions of the Order, which had been signed by Mr. Jeffers. The Order specified a censure plus three hours of additional continuing education in the area of ethics, to be completed within 90 days of the date of the Order.

Complaint #2006-061 and #2006-062,
Charles W. Concannon vs. Mark A. Nichols

Deputy Director Mayrose presented a Stipulation and Consent Order in the matter of Complaints #2006-061 and #2006-062, Charles W. Concannon vs. Mark A. Nichols. A copy of said order is attached to and made a part of these minutes.

Deputy Director Mayrose reviewed the circumstances involved and noted the provisions of the Order, which had been signed by Mr. Nichols. The Order specified a 90-day suspension beginning no later than August 31, 2006, plus 12 hours of additional continuing education with three hours being in the area of license law, three hours in the area of agency, three hours in the area of disclosures, and three hours in the area of ethics, to be completed within 120 days of the date of the Order.

Complaint #2006-039,
Commission vs. Ronald A. Henn

Deputy Director Mayrose presented a Stipulation and Consent Order in the matter of Complaint #2006-039, Commission vs. Ronald A. Henn. A copy of said Order is attached to and made a part of these minutes.

Deputy Director Mayrose reviewed the circumstances involved and noted the provisions of the Order, which had been signed by Mr. Henn. The Order specified a one-year suspension to begin on or before September 1, 2006, four months served on suspension, with the remainder served on probation, plus 12 hours of additional continuing education with three hours being in the area of agency, three hours in the area of license law, three hours in the area of disclosures, and three hours in the area of ethics, to be completed on or before January 31, 2007.

Informal Special Appearances - none

Director Tyrrell presented an exhibit which consisted of the proposed errors and omissions insurance contract renewal rates. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell noted that some wording changed in the policy but the policy coverage did not change. Director Tyrrell also noted that an information sheet provided by Williams Underwriting Group, Inc., noting the changes in the wording of the policy, will be sent out with each renewal.

A motion was made by Bohrer and seconded by Johnson to approve renewing the errors and omissions insurance contract with Williams Underwriting Group, Inc. for 2007. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard, and Gale voting aye.

Director Tyrrell reported he had researched whether the Commission could establish a recognition program similar to those established in other jurisdictions. He was advised that expenditures for such programs could not be funded using monies collected from license fees.

No report was necessary for this item.

Director Tyrrell indicated that modifying the renewal period could be done numerous ways, however, the different renewal periods all have certain problems. Current staff members indicated they would prefer do keep it as it is.

Commissioner Griess indicated that perhaps the sending or faxing of continuing education certificates to the office prior to renewal has helped. Director Tyrrell agreed that it had helped. As had sending out the continuing education reminder in May of each year.

No report was necessary for this item.

Director Tyrrell presented two resolutions commemorating service to the Commission by Harold Johnson and James Strand. A copy of each resolution is attached to and made a part of these Minutes.

A motion was made by Poskochil and seconded by Shepard that the resolution for Harold Johnson be adopted. Motion carried with Bohrer, Grady, Griess, Poskochil, Shepard, and Gale voting aye, and with Johnson recusing.

A motion was made by Poskochil and seconded by Shepard that the resolution for James Strand be adopted. Motion carried with Bohrer, Grady, Griess, Johnson, Poskochil, Shepard, and Gale voting aye.

Director Tyrrell presented the Final Report regarding the 2005-2006 objectives. A copy of said report is attached to and made a part of these minutes.

No action was necessary on this report.

An exhibit regarding examination development, a copy of which is attached to and made a part of these minutes, was made available to the Commission by Larry Fabrey, PhD, of Applied Measurement Professionals (AMP).

Dr. Fabrey reviewed the exhibit, and the new simulation testing method. Also explained was the process used to develop the examination. Dr. Fabrey demonstrated a sample of the broker test simulation. Deputy Director Hoffman asked if simulation testing has proven more difficult than multiple choice testing. Dr. Fabrey noted that with performance statistics now available the two methods are comparable.

Director Tyrrell asked if and when the examination would be certified by ARELLO. Dr. Fabrey noted the certification is for AMP, not for the type of examination method. Dr. Fabrey also noted there could be a hybrid examination with both multiple choice and simulation questions.

Commissioner Poskochil asked Dr. Fabrey how long it takes a candidate to complete the examination. Dr. Fabrey indicated that three and a half hours has been more than adequate to complete the examination.

Commissioner Griess asked Dr. Fabrey if the simulation testing method would be appropriate for the salesperson examination. Dr. Fabrey noted it would not be appropriate at this time.

The Commission thanked Dr. Fabrey for the update on the examination program and the explanation and demonstration of the new simulation examination.

No action was necessary on this report.

Director Tyrrell presented information regarding the costs of sending Deputy Director for Enforcement Mayrose to the ARELLO Advanced Investigator Workshop in Honolulu, HI, on November 13-17, 2006. A copy of said exhibit is attached to and made a part of these minutes. Total cost was expected to be approximately $2,423.00.

After discussion, a motion was made by Johnson and seconded by Poskochil to approve the travel request. Motion carried with Bohrer, Griess, Grady, Johnson, Poskochil, Shepard, and Gale voting aye.

Deputy Director Hoffman noted that the Commission has selected an employee of the year. Since Melanie Patrick-Heather started employment with the Nebraska Real Estate Commission office, she has had two promotions and consistently performs well. Melanie Patrick-Heather will be recognized in October at a ceremony in the Capitol.

No action was necessary on this report.

Director Tyrrell presented an exhibit regarding a recent Consumer Federation of America Study. A copy of said exhibit is attached to and made a part of these minutes.

No action was necessary on this report.

Director Tyrrell presented the Trust Account Examination Evaluation Report - Second Quarter 2006. A copy of said report is attached to and made a part of these minutes.

Director Tyrrell reviewed some of the comments received.

No action was necessary on this report.

Commissioner Johnson expressed the great job Oklahoma had done setting up for the meeting, how good the people were, also how good the meeting itself was. Commissioner Johnson also noted the new Chief Executive Officer for ARELLO is Debbie Campagnola from Colorado and that ARELLO headquarters will be moving from Alabama to Colorado.

Commissioner Shepard concurred with Commissioner Johnson. He felt, however, that mortgage fraud had been discussed enough. Commissioner Johnson indicated that the midwest states do not see a lot of mortgage fraud. Commissioner Griess noted that after speaking with new real estate licensees, mortgage fraud may be sneaking up and some are just not aware of it yet. Commissioner Shepard noted that mortgage fraud is in the midwest states and individuals need to be educated to recognize it. Director Tyrrell believed that ARELLO repetitively speaks about the mortgage fraud issue since many Real Estate Commissions and Boards regulate mortgage brokers, whereas Nebraska= s mortgage brokers are regulated by the Nebraska Department of Banking & Finance.

No action was necessary on this report.

Director Tyrrell noted that Commissioners Bohrer, Griess, Grady, and Shepard and Deputy Director Hoffman plan on attending the upcoming ARELLO Annual Meeting.

No action was necessary on this report.

At 10:17 a.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 10:40 a.m.

At 11:55 a.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 12:05 p.m.

At 1:05 p.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 1:14 p.m.

At 2:40 p.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 2:45 p.m.

I, Les Tyrrell, Director of the Nebraska Real Estate Commission, do hereby certify that the foregoing minutes of the August 24, 2006, meeting of the Nebraska Real Estate Commission were available for inspection on August 30, 2006, in compliance with Section 84-1413(5) R.R.S. 1943, of Nebraska.

Respectfully submitted,
Les Tyrrell
Director