Chairperson Gale convened a meeting of the Nebraska Real Estate Commission at 9:04 a.m. on August 28, 2008, in the Meeting 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 Rut. Greg Barton, Special Assistant Attorney General and Counsel to the Commission, was present for the Beyer Hearing.

Chairperson Gale conducted a swearing-in ceremony for recently appointed Commissioner Kathryn Rouch, presented her with her Commission pin, and welcomed her to the Commission.

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 were available to the public on the counsel table in the meeting room; that a copy of the Open Meetings Act was posted on the easel located in the northwest corner of the meeting room by the west entrance; 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 26, 2008, 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.

The cash fund balance as of June 30, 2008, was $544,760.00, which compared to a cash fund balance of $716,287.76 on June 30, 2007.

The cash fund balance as of July 31, 2008, was $472,557.91, which compared to a cash fund balance of $643,984.69 on July 31, 2008.

Director Tyrrell indicated that there had been an amount carried over from fiscal year 07-08 of approximately $125,000.00. The carryover amount included the encumbrances required at the beginning of the fiscal year. The remaining carryover amount included savings from examination fees which were not expended; reduced expenditures in legal fees; and the remaining amounts were miscellaneous savings.

Commissioner Liesey asked for an explanation of the e-mail license fee. Director Tyrrell explained that the State of Nebraska required agencies to change to an A Enterprise E-mail System@ . The system required the change in e-mail addresses to include the first and last name of each employee with the ending of @nebraska.gov. Chairperson Gale explained that all agencies would have to make the change to the A Enterprise E-mail System@ . He indicated that there had been resistance to the change especially when an employee transfers employment from one agency to another agency. Director Tyrrell indicated that he had voiced the same concerns. He also indicated that he was concerned that perhaps the agency from which the person was transferring would not receive important e-mails.

Director Tyrrell presented the Final Renewal Report for 2008. A copy of said report is attached to and made a part of these minutes.

Commissioner Grady asked if the renewal percentage began declining this year or if it had been declining for several years. Director Tyrrell indicated that previous years reflected approximately a ninety-four percent renewal rate. Commissioner Grady noted that it appeared to have declined approximately two-percent more. Director Tyrrell concurred that the percentage declined two percent more this year.

No action was necessary on this report.

Director Tyrrell presented the Budget Spread for Fiscal Year 08-09. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell pointed out the expenditure items of note which included the increase in health insurance and an increase in legal fees. He noted that the approximate $125,000.00 carryover amount had been placed under the IT Consulting expenditure as a lump sum rather than spreading the money throughout the fiscal year, so as not to skew the figures. He explained that he had not anticipated expending the carryover amount but rather he had A parked@ the money in that line item. He also explained that the expenditures had been approved in the last biennium budget. He noted that the personal services limit expense which included employee salaries and per diems included an encumbered amount from last fiscal year due to switching from a monthly payroll to biweekly payroll cycle. He also explained that, due to the switch from monthly to a biweekly pay cycle, a deficit appropriation would be needed in the amount of approximately $5,300.00.

Chairperson Gale asked if the exhibit reflected the fee increases to be discussed. Director Tyrrell indicated that the budget spreadsheet did not include the fee increases. Commissioner Dover asked what cash fund balance would be sufficient. Director Tyrrell indicated that the Commission liked to keep the cash fund balance so it would cover five to six months of expenditures which would be approximately $400,000.00 to $500,000.00. Commissioner Leisey indicated that the cash fund balance should be approximately $475,000.00 to $550,000.00.

Director Tyrrell presented an exhibit in which the Budget and Planning Subcommittee recommended an increase in the application fees, examination fees and broker and salesperson renewal fees and original license fees. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell noted that the Budget Subcommittee recommended an increase of thirty-five dollars for the 2009 renewal fees and a thirty-five dollar increase for application fees and examination fees and new licenses issued to original salesperson and broker licensees effective January 1, 2009.

Commissioner Leisey asked what logic the Budget Subcommittee used to base the increase in fees, if they decided to just raise the fees by thirty-five dollars or if they used the targeted cash fund balance and determined what increases needed to be made in order to reach the desired cash fund balance. Director Tyrrell indicated that they used the targeted cash fund balance target in order to determine the appropriate fee increases. He noted that no increase had been made in the application and examination fees for many years and rather than just raising fees for current licensees the increase was spread over both the applicants and the current licensees. He indicated that at the September meeting he would be presenting a proposal to change the statute to raise the limit on the fees which are all currently at approximately $150.00. The A up to@ limits in the statute have not been raised since 1990.

Commissioner Leisey noted that if the fees were raised by the proposed amount, the cash fund balance would be approximately $454,000.00 which was still under the targeted amount. Commissioner Griess asked if they were projecting that applications would remain static. Director Tyrrell felt that application numbers were about as low as they were going to go and would level off in the next two years. He also indicated there may be increases in fees in the next two years dependent on whether projections hold true.

A motion was made by Dover and seconded by Leisey to approve the fee increases as proposed.

Chairperson Gale indicated that the Subcommittee focused on what was needed to spread several years of a down market. He felt the Commission had historically been excellent in maintaining fees to ensure the suggested cash fund balance. He explained that since the Commission could not ask the Legislature for additional appropriations they would have to close shop if the cash fund balance became zero. He also explained that most of the revenue was received once a year and the increases needed to be passed now to maintain a level in the cash fund before it shrinks to an unreasonable amount. Commissioner Grady felt it would be good to look at the statute increases and asked if the fee increases could be adjusted in the interim. Director Tyrrell indicated that the Commission had the authority to change fees as long as it was published as an agenda item. He also explained that the best time to change fees was going into a new calendar year, although increases could become effective anytime.

Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented the 2009-2011 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 would increase or decrease over the current year budget amounts and reviewed the explanations in the narrative section of the proposal for each of these accounts. He reviewed all the pages of the proposal. He explained that on the budget report there were Agency issues, which were Agency specific, and Enterprise issues which affected each Agency within State Government. Director Tyrrell noted the Budget and Planning Subcommittee had met several times in the previous months and recommended the proposed budget be approved.

Chairperson Gale indicated that there had been concerns of a possible zero budget increase from the Governor= s Office which would affect the code agencies for fiscal year 2009-2010. He asked what the Commission would have to do should this scenario occur. Director Tyrrell indicated that with a small agency there were few expenditures that could be reduced to accommodate such a plan. But if required, staff would probably have to be reduced to accommodate a zero-based budget. Chairperson Gale indicated that if positions were not replaced that could be a challenge. Director Tyrrell indicated that cash fund agencies do not need to do budget modifications this year and have not for a number of years.

Commissioner Leisey asked if the zero budget would apply to the Real Estate Commission. Chairperson Gale indicated that the Legislature could make it apply to the Commission, which was not fair for the cash fund agencies. However, during tight financial times, two or three years down the road the cash fund could get raided and they could take some of the cash fund for supplemental purposes. Commissioner Leisey indicated that since the Commission was cash funded that process did not seem fair.

Commissioner Grady asked what happens to the left over $125,000.00. Director Tyrrell indicated that the money left over stays in the Cash Fund. Commissioner Grady asked if that money could be used. Director Tyrrell explained that the money could be used, if necessary.

A motion was made by Leisey and seconded by Bohrer to approve the proposed Biennium Budget as presented. Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented a specialized registration report which included the registration for ClubWyndham Access Vacation Ownership Plan (Non-Specific Site). A copy of said report is attached to and made a part of these minutes.

Deputy Director Hoffman presented for ratification the Nonresident 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.

Director Tyrrell presented an update on the renegotiation of the license recognition agreements with other jurisdictions due to the implementation of the pre-license, three-hour class required of license recognition applicants. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell indicated that since the exhibit had been mailed, there were updates to the report. He explained that listed under the Review Options section of the report, Illinois, Indiana and Tennessee were sent addendums to the Agreements with no changes for Nebraska licensees. He explained that he had not received Florida= s decision, but felt that Florida would probably not require any changes for Nebraska licensees. He indicated that New York was still determining what type of class Nebraska licensees would be required to complete. He noted that he was still waiting for a response from Kansas and Montana, so we were still operating under the old Agreement.

Commissioner Leisey indicated that since there were many Nebraska licensees seeking licensure in Iowa, a notice notifying Nebraska licensees of this change would be a good idea. Director Tyrrell indicated that there is an announcement in the Director= s Desk section of the A Commission Comment@ newsletter currently at the print shop which was scheduled to be distributed in mid-September.

No action was necessary on this report.

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.

Commissioner Griess indicated that the examination passing rates appeared to be low. Deputy Director Hoffman agreed that the report reflected a lower than normal passing rate. She had not been notified of any problems with examination performance. Therefore, it was assumed to be student performance. Commissioner Griess asked if schools were reviewed by how their students performed on the examination. Deputy Director Hoffman indicated that the Commission received quarterly school reports from Applied Measurement Professionals. Deputy Director Hoffman indicated that she was cautious in the use of these reports as she found them to be somewhat unreliable due to the percentage of error when students indicated the source of their education when taking the examination. Because students can receive their education from multiple sources, including out-of-state sources, any direct correlation between the pass rate and performance of Nebraska= s pre-license schools is further obscured. Deputy Director Hoffman indicated that she preferred to rely on the students= evaluations of instructors. She had found school administrators to be just as concerned with student evaluations of instructors and responsive to implementing any indicated improvements. She encouraged Commissioners to have concerned persons contact her so that a remedy could be pursued.

Commissioner Grady asked if the Commission had received feedback regarding online courses and the passing percentage of these students. Deputy Director Hoffman indicated that students who take these courses appear to view them positively and also appear to be surprised that the courses are as difficult as they are. Students taking the examination are not polled as to whether their education was online or not and, until now, there had not been a school that exclusively offers enough online courses to meet the full education requirement, so passing statistics for online students were not available. Deputy Director Hoffman indicated that extensive studies by Pennsylvania State University had determined that there was no significant difference in student outcomes between distance education courses and live classroom courses.

Deputy Director Hoffman presented for ratification the Pre-License Education Provider Approval Report, a copy of which is 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.

After review, a motion was made by Bohrer and seconded by Griess to ratify the three reports. Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented a summary report of the pending complaints, which included a list of licensees presently under disciplinary action or on appeal. A copy of said report is attached to and made a part of these minutes.

Director Tyrrell indicated that the Boyer/Young complaint was still on appeal. He noted that the Monica Martin matter had been appealed.

No action was necessary on this report.

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

Deputy Director Mayrose presented a Stipulation and Consent Order in the matter of Complaint 2007-061, Christin Pruess and R.E.L.M. Investors LLC vs. Kenneth Alan Muckey. 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. Muckey. The Order specified a 180-day suspension with 30-days served on suspension and the remaining 150-days served on probation plus six hours of additional continuing education, with three hours being in the area of contracts and three hours in the area of ethics, to be completed within 180 days of the date of the Order.

Commissioner Griess felt Mr. Muckey had committed forgery and did not feel the punishment was appropriate. Commissioner Leisey felt that the punishment suggestion given to Staff had been adequate. Commissioner Dover felt that if the Commission did not suggest an appropriate punishment then the Stipulation and Consent Order needed to be changed. Commissioner Griess felt that Mr. Muckey had not admitted he did anything wrong.

A general discussion was held regarding not accepting Stipulation and Consent Orders for which guidance had been given as to terms and conditions. No action was taken as a result of the discussion.

A Hearing was held on August 28, at 9:30 a.m., in the matter of Complaint 2008-008, Commission vs. Sally Joanne Beyer. Greg Barton, Special Assistant Attorney General and Counsel to the Commission, appeared for the Complainant. Respondent Beyer was not present, but was represented by Counsel Edward F. Pohren of Omaha.

After Opening Statements, Counsel Barton offered two Exhibits which were received by Chairperson Gale. Counsel Barton called Terry Mayrose as a witness. Counsel Pohren offered one exhibit which was received by Chairperson Gale.

After closing arguments had been presented, Chairperson Gale declared the Hearing concluded and gathered the original exhibits.

Prior to any motion the following discussion occurred:

Chairperson Gale indicated that Neb. Rev. Stat. ' 81-885.24(28) made reference directly to felonies or a guilty plea of a felony charge as opposed to subsection 29, which allowed for a broad interpretation of any of the preceding twenty-eight subsections to be of the same or different in character. He indicated that the Commission had considered in the past misdemeanors and other convictions since the Commission had to protect the public safety and professional conduct.

Commissioner Leisey was bothered when he read both subsections 28 and 29, since subsection 28 specified felonies but not misdemeanors. He wondered why felonies were listed and did not know if the Commission had the right to go back and say the subsection 29 was a A catch-all@ . He also felt that the wording in this law should be changed.

Commissioner Griess felt that a license may be revoked automatically for a felony under subsection 28. However, in subsection 29, it could be broader than just a felony.

Commissioner Grady wondered what happened to the misappropriated money. He indicated that if she had taken the homeowners= money and they did not have title insurance, he felt the crime would have been more severe than a misdemeanor and under subsection 29, which referred to unworthiness, he felt she was.

Commissioner Leisey indicated that it could not be determined what had happened but felt that she had bad business practices. He indicated that the Commission had no evidence or facts on the case and was uncomfortable jumping to conclusions. He noted that she gave up her insurance license. He did not know if the felony verbiage was appropriate. He also explained that both Counsel Barton and Counsel Pohren read the statutes two different ways and was unsure what the actual interpretations were since the Counsels argued both sides intelligently.

Commissioner Griess felt that Ms. Beyer had done more that just give up her insurance license, she had agreed to wrongdoing by signing the Stipulation and Consent Order which was problematic and very serious.

Chairperson Gale felt that subsection 28 regarding any felony may be automatic grounds for revocation, not just misappropriations, whether it bears on real estate or not. He felt this would be included as part of subsection 29 since there was evidence of financial misappropriations. He felt that the Commission= s duty was to protect the public, under the same or different character, the Legislature gave the Commission that authority. He indicated that the Commission was relying on a negotiated Order between the Department of Insurance and Ms. Beyer, which does not tell the whole story, or give direct evidence and does not spell out precise details. He indicated that the Commission knew that she did something involving money which should have been given to someone else. However, there was no evidence that criminal charges were filed. The Commission just knew that the money did not get where it was supposed to and the since the Order did not specify that restitution would need to be made then the Commission did not know if the money was still missing.

Commissioner Dover indicated that they should not draw conclusions and felt that Ms. Beyer displayed unworthiness.

Commissioner Bohrer indicated that in his opinion Subsection 29 regarding unworthiness was broad enough for the Commission to protect the public from financial risk or physical risk. He also felt the Consent Order signed by Ms. Beyer was sufficient evidence and in it she admitted to the misappropriation.

Commissioner Grady indicated that the Commission did not know the extent of damage Ms. Beyer had done, but she had admitted to the misappropriations.

Commissioner Bohrer felt the Consent Order provided enough evidence.

Chairperson Gale felt that the Commission did not know all of the facts that resulted in the revocation of her Insurance license and she was not present to tell her story. However, she did something wrong in order the get her Insurance license revoked.

Commissioner Bohrer felt she had put homeowners and/or the underwriter at risk.

A motion was made by Grady and seconded by Griess in Complaint 2008-008, that Sally Joanne Beyer violated Neb. Rev. Stat. ' 81-885.24(29). Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Chairperson Gale opened the past disciplinary action envelope. It showed no prior disciplinary action against the Respondent.

The Commissioners then discussed the penalty to be assessed.

A motion was made by Dover and seconded by Bohrer that Ms. Beyer= s real estate license be revoked.

Commissioner Leisey asked if there had been enough evidence to revoke her license or if instead a long suspension should be issued to Ms. Beyer. Commissioner Bohrer felt that the violations were serious and she had signed the Consent Order to what had been stipulated.

Chairperson Gale indicated that Ms. Beyer felt the hearing had been a legal issue and that the Commission did not have jurisdiction. He felt that the Commission did not know if Ms. Beyer had temporarily delayed forwarding the money or if it had been an extended delay, but either way there had been theft of money. Whether she deposited it in her own account or if money had been spent, it showed financial irresponsibility, which happened in two separate cases with different companies. However, the Commission did not know if restitution had been ordered or made.

Commissioner Dover felt that the Order indicated that she failed to remit the money to the title company and a charge was filed with the State of Nebraska. Therefore, he felt a revocation was appropriate. He also did not understand why anyone would not want to defend their reputation of these allegations. Commissioner Leisey indicated that Ms. Beyer= s Counsel told her not to come. He also indicated that some financial irresponsibility comes without bad intentions.

Commissioner Griess felt that Ms. Beyer had a fiduciary duty to appropriately place the money, not to decide which bills to pay. She indicated real estate licensees had a fiduciary duty to take care of the money received and keep it separate.

Commissioner Bohrer did not feel that the Commission should speculate about Ms. Beyer= s typical course of conduct, but should limit their consideration to the specific matter. He felt that the Commission held licensees to a standard of professionalism and felt that Ms. Beyer had put too much at risk. She had not met the minimum standard of professionalism, especially with regard to financial standards. However, he did not know if Ms. Beyer had ill intent.

Motion carried with Bohrer, Dover, Grady, Griess, Rouch and Gale voting aye, with Leisey voting nay.

With the consent of the Respondent= s Counsel, Chairperson Gale directed Counsel Barton to prepare the Order.

Chairperson Gale notified the Respondent that the costs incurred for the court reporter and any witness fees would be billed to the Respondents, as provided for in 305 NAC Chapter 4, and that the Respondent would have thirty days from the date of the Order to reimburse the Commission for said costs.

Chairperson Gale announced that all exhibits related to this hearing would be retained in the Commission office.

The Hearing was adjourned at 11:08 a.m.

After the hearing had adjourned, Commissioner Leisey suggested legal counsel look into changing the language of the Statute or give the Commissioners better directions. Director Tyrrell indicated that most attorneys use the excuse of A no jurisdiction@ since Neb. Rev. Stat. ' 84-885.24 (29) was so broad. He explained that the Statute was very broad and that the Supreme Court had upheld past Commission decisions in reference to that Statute. He indicated he would refer the issue to Commission Counsel if the Commission wanted. It was determined that would not be necessary.

Director Tyrrell presented an exhibit which included: a summary of Mr. Denny= s situation; correspondence regarding Mr. Denny= s special appearance; the United States District Court of the District of Wyoming filing and transcript of sentencing proceedings; Notice of Discharge from the United States Probation Office District of Wyoming; a copy of the Settlement Agreement and Stipulation; Mr. Denny= s criminal history report; and his broker application form. A copy of said exhibit is attached to and made a part of these minutes. Mr. Denny was not present.

Director Tyrrell indicated that Mr. Denny resided in Wyoming and chose not to appear before the Commission in person but had requested to appear by exhibit. He explained that he was found guilty of felony embezzlement, due to a child support check which had been more than his account balance. He also indicated that he had made restitution and received three years of probation. He noted that Mr. Denny had received a real estate license from Wyoming, and after being sentenced, he received a three-year suspension of his real estate license.

Chairperson Gale indicated that he received the felony conviction approximately fifteen years ago, and felt he had rehabilitated himself. Commissioner Grady felt that he was perhaps a victim of the Board of Directors and the amount of six-hundred dollars was not much compared to the amount heard today during the Beyer Hearing.

Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented an exhibit which included: correspondence regarding Mr. Laney= s special appearance; a letter from Mr. Laney requesting to appear by exhibit; a summary of Mr. Laney= s situation; Douglas County District Court Docket filing; District Court of Douglas County Order Re-Payment of Funds; District Court of Douglas County Satisfaction of Judgement and Sentence Early Release; District Court of Douglas County Order; Mr. Laney= s criminal history report; and his salesperson application form. A copy of said exhibit is attached to and made a part of these minutes. Mr. Laney was not present.

Director Tyrrell indicated that Mr. Laney chose not to appear before the Commission in person but had requested to appear by exhibit. He also indicated that Mr. Laney currently was employed by Union Pacific Railroad which had scheduled him to be out of town. He explained that in 1989 Mr. Laney had taken stolen money and deposited the funds into his own bank account which resulted in a felony conviction. He made restitution and spent four years on probation. He also suggested the Commissioner= s review the Exhibit which set out his accomplishments.

Commissioner Grady asked if Director Tyrrell had requested letters of reference. Director Tyrrell indicated that he had not requested letters of reference since the felony had occurred a long time ago. Commissioner Leisey asked if there had been any other issues on Mr. Laney= s record since the felony. Director Tyrrell indicated that nothing else appeared on Mr. Laney= s criminal background check.

Chairperson Gale asked if Mr. Laney had asked for a pardon to restore his rights. Director Tyrrell indicated that he would suggest getting a pardon to Mr. Laney.

Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented an exhibit which included: correspondence regarding this special appearance; a letter of explanation from Mr. Abboud; a request for additional information from the Real Estate Commission; a letter from Mr. Abboud explaining his employment history and additional information requested; Mr. Abboud= s criminal history report; character reference letters; information regarding Mr. Abboud= s previous special appearances in June 2007, September 2003 and October 2002 and a cancelled appearance on November 2, 2006. A copy of said exhibit is attached to and made a part of these minutes. Mr. Abboud was present.

Chairperson Gale reviewed the procedure for informal special appearances.

Director Tyrrell summarized Mr. Abboud= s background and prior informal special appearances. He noted that in September 2003, Mr. Abboud had been allowed to sit for the salesperson examination and instructed to reappear before the Commission should he seek a broker license. He was further instructed to notify his employing broker of his criminal history and notify the Commission staff immediately if he had any further contact with law enforcement which could result in jail time during the first two years of licensure. He explained that in January 2004, Mr. Abboud had been arrested for a felony, which he failed to report to the Commission until July 2004. He then noted that in September of 2004 the Commission filed a complaint on its own motion for failure to report on the arrest. When Mr. Abboud did not renew his salesperson license for 2005, the Commission lost jurisdiction since he no longer had a real estate license. Mr. Abboud requested an informal special appearance in October 2006 and had been scheduled to appear before the Commission on November 2, 2006, which appearance was cancelled. Mr. Abboud appeared before the Commission for an informal special appearance in June 2007, at which his request was denied. At that time it had been suggested to Mr. Abboud to wait at least a year before reappearing to allow time for him to remain free from contact with law enforcement. Director Tyrrell noted that should the Commission allow Mr. Abboud to apply and sit for the salesperson examination regardless of the felony conviction, the Commission would need to determine if there were any conditions of licensure and whether or not to go forward with the complaint filed by the Commission in September 2006.

Chairperson Gale asked Mr. Abboud to give the Commission an update since his last informal special appearance.

Mr. Abboud indicated that he currently was unemployed. He noted that since his last special appearance he had been released from probation and waited one year as suggested and provided the reference letters as requested. He indicated that he had taken pre-license education courses while in the correctional system. He further explained that real estate was an area which he enjoyed. He liked to sell and felt he was fair in his practices. He noted that the felony in 2004 had taken place in a bar in which he used self defense. However, the jury did not see it that way. He also indicated that he had since married, had three children and toned down his lifestyle substantially. He felt he was well versed in the area of real estate, both in education and through practice. He did not foresee any future problems. He also noted that he had not been charged with the felony until late in the first quarter of 2004 and had reported it a few months later. He felt that perhaps he should have reported it sooner. He indicated that he would like to take the examination and had business opportunities waiting for him.

Chairperson Gale asked Mr. Abboud to explain the relationships he had with the individuals who offered the letters of reference. Mr. Abboud explained the relationships as requested. Chairperson Gale appreciated the background on those letters. He asked if Mr. Abboud had since been involved with law enforcement. Mr. Abboud indicated that other than a traffic citation, he had no further contact with law enforcement. He also indicated that he spent a lot of time at home with his children which kept him busy.

Chairperson Gale indicated that under the law, licenses were granted for good reputation and behavior, which was the standard for licensees who practiced in the industry. He indicated that Mr. Abboud= s shocking record had dated back a long time, and even though some allegations had been dismissed they colored his entire record. Mr. Abboud understood he had a lengthy history and tainted past, but felt that he had been honest and had integrity. He indicated that he had not cheated in business and was honest to his word. He also noted that from a business standpoint, he had the best interest in mind for those he had represented.

Chairperson Gale asked if Mr. Abboud had attempted to get a pardon to clean up his record for the past convictions such as in 1983, 1984 or 2000. Mr. Abboud felt that asking for a pardon may be premature due to the assault in 2004, but would look into receiving a pardon in the future.

Commissioner Grady referred to a letter of reference written by a gentleman at Omaha State Bank and had been unclear as to the experience Mr. Abboud had during the time he had a real estate license. He asked Mr. Abboud what volume and experience he had conducting real estate activities. Mr. Abboud indicated that he had not conducted real estate activities without a real estate license, but the transactions were individual. Mr. Abboud explained that he would buy properties and either resell or lease them as private transactions that did not require a real estate license. Commissioner Grady asked how long Mr. Abboud had a real estate license. Mr. Abboud thought he had a license for approximately one year. Commissioner Grady asked how many transactions Mr. Abboud had been involved in. Mr. Abboud thought perhaps twenty or so that had closed.

Chairperson Gale had been concerned that when Mr. Abboud first appeared he had been granted a license with a two-year restriction which resulted in a complaint being filed by the Commission. Then Mr. Abboud did not renew his real estate license, which made him unsure if this was in order to A duck@ the complaint. He explained that Mr. Abboud= s license was granted with the restriction to remain clean of involvement with law enforcement. He had also failed to report the felony in a reasonable time. He did not feel that Mr. Abboud kept good faith with the Commission and asked Mr. Abboud to explain. Mr. Abboud indicated that he had not been arrested in November 2003, there had been no citation issued or arrest made until March or April of 2004. He indicated that he had not notified the Commission during the investigation of the charges since he had always viewed the situation as self defense since he had been out numbered.

Chairperson Gale indicated that the Commission had heard the story during a previous special appearance and wanted to know why Mr. Abboud chose not to renew his license or drop his license which avoided the Commission asking these questions as part of the complaint process, and now had decided to try and get a real estate license again. Mr. Abboud indicated that he wanted to see what the outcome of the trial was. He felt that in retrospect it may have been a bad decision on his part, but at the time felt confident that he would not be found guilty. He felt that was his perspective back then and felt it was better now to come in front of the Commission to explain the situation. Chairperson Gale asked if dropping the real estate license had been easier for Mr. Abboud then confronting the Commission during the complaint process. Mr. Abboud again indicated that he wanted to see the outcome of the trial.

Commissioner Grady asked what the nature of the traffic violation had been. Mr. Abboud indicated that he had received a citation for speeding ten miles over the limit and had attended a diversion class. Commissioner Grady asked if the class was in lieu of the fine. Director Tyrrell indicated that Mr. Abboud had attended the S.T.O.P program.

Commissioner Dover expressed concern regarding Mr. Abboud= s comment on his integrity and felt that Mr. Abboud had violated the law. He explained that the Commission= s decisions were based on the law and whether a potential applicant had been living up to the laws. Mr. Abboud explained that he had not violated any moral issues or another individual= s rights or trust as opposed to violating a particular law. He indicated that he had appeared before the Commission for the assault violation rather than cheating someone out of something which had been his point previously.

Commissioner Grady indicated that in Mr. Abboud= s letter he had stated he had been unemployed for a large portion of last year. He asked Mr. Abboud if he had turned down opportunities. Mr. Abboud indicated that it had been difficult to get a job with job security given his prior record. He viewed himself as an entrepreneur which was difficult to do with a family to support. He indicated that as an entrepreneur in previous years he felt it had been easier to bounce back. He indicated that while unemployed he had the opportunity to spend time with his children.

Chairperson Gale reviewed the different police reports and felt that whatever the disposition had been, his report had been disturbing with serious arrests. Mr. Abboud indicated that the most recent entries on his report were assaults which were not multiple assaults but all related to the same incident. He also noted that some of the report findings had been dismissed in late 1980's and felt that the Commission had reviewed the report previously. Chairperson Gale indicated that a license would be based on his entire record since there could be issues involved in real estate which may not show Mr. Abboud having a good reputation.

Commissioner Grady asked Director Tyrrell what the recommendation would be for the unresolved issue of not reporting the 2004 crime. Director Tyrrell indicated that would be the Commission= s decision since the complaint was still pending. He explained that the main allegation in the complaint had been that he had not reported the 2004 charge and arrest in a timely manner. The provisional license was granted and required him to report any encounters with law enforcement immediately. He indicated that when Mr. Abboud had interactions with law enforcement in November 2003 and did not notify the Commission until June 2004, that had not been timely notification in the Commission= s opinion. It did not seem logical to him that Mr. Abboud be allowed to become licensed only to go forward with the complaint and then discipline him as a licensee. If that was going to be the decision, then Mr. Abboud should just not be allowed to sit for the examination. Commissioner Grady felt that due to the short time which had lapsed he did not feel he could approve Mr. Abboud to sit for the examination at this time.

Chairperson Gale explained to the Commissioners that no further questions could be asked of Mr. Abboud since they were in the deliberation phase.

Commissioner Bohrer felt that Mr. Abboud had complied with the 2007 requests of the Commission. However, he felt that Chairperson Gale had made some good points. He felt that the character references submitted by Mr. Abboud were positive and felt he had reacted well to the unfolding of his prior convictions. He did not know how long it would take Mr. Abboud to overcome his past prior to being approved for a real estate license. He did not disagree with the pending motion.

Commissioner Leisey felt that the decision to reject Mr. Abboud= s request to sit for the examination should be final and not request his reappearance if the Commission was not going to reconsider.

Commissioner Griess reviewed the letters of reference which were submitted and had conflicting feelings whether he had turned his life around.

Commissioner Rouch felt there were several positive reference letters.

Chairperson Gale indicated that the Commissioners had a duty to protect the public and Mr. Abboud= s history of unlawful involvement showed a constant involvement with the law. He felt the Commission had given Mr. Abboud a second chance when he had been approved to sit for the examination in 2003. He explained that after he had received the assault conviction, he had dropped his license and went to prison for five years without probation. He felt that there were a lot of jobs available and he had a wife and family to take care of and did not feel that Mr. Abboud had been making attempts to help himself. He had not received any pardons and did not feel he appeared trustworthy. He also felt that the Commission would look foolish if they granted Mr. Abboud a license. He indicated that there were a lot of opportunities out there for Mr. Abboud without receiving a real estate license.

Commissioner Bohrer felt that Mr. Abboud had been heading in the right direction.

A general discussion on possible suggestions for a future appearance, but no guidelines were established.

Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell indicated that it had been requested by the Commissioners that a presentation be made of the different processes of the Commission. He noted that Mr. Barton had reviewed the prehearing process at a previous Meeting. He had requested Deputy Director Mayrose review the investigative and hearing process on how the Commission operated.

Chairperson Gale asked if these processes needed to be adopted. Director Tyrrell explained that Deputy Director Mayrose would just be reviewing how the processes work, much like the examination and application process which Deputy Director Hoffman intended on reviewing at a future meeting. He noted that while going through the processes, the Commission= s suggestions would be incorporated into the processes if changes were needed. Chairperson Gale asked if Staff would change these processes without the Commission knowing about the changes. Director Tyrrell noted that these processes were informal and any changes were approved by the Commission.

Deputy Director Mayrose began describing the processes. Chairperson Gale asked Deputy Director Mayrose to tell the Commissioners only the changes. Director Tyrrell explained that the processes had been updated on a continuing basis as the processes changed and Staff had not brought a document which indicated the exact changes to the narrative. Chairperson Gale reviewed the changes to the narrative as determined by his Staff as it would be helpful for the Commissioners to know the exact changes.

Commissioner Grady asked if the trust account portion of these processes should be sent to the licensed real estate brokers. Director Tyrrell indicated that every real estate broker receives a Trust Account Manual which includes much more detail. The document only provided a broad overview for Commissioners as part of their Manual. Commissioner Grady thought that if a real estate broker had been in business for an extended period of time then they should be notified of changes to the trust account process. Director Tyrrell noted that the Trust Account Manuals were updated much like the License Manual and the updates are mailed out. He explained that this was a narrative, a general description for the Commissioners on how the processes work. He indicated that an example would be that the prehearing conference procedures changed. Therefore, the overview which appears in the Commissioner Manual had been updated. Chairperson Gale felt that if the changes were substantive then the Commission should discuss those changes. Director Tyrrell noted that the changes had been discussed and changed by the Commissioners, such as the pre-hearing conferences which had been done three to four months ago. He explained that these were general descriptions which had been updated to reflect the Commission= s policies.

Chairperson Gale indicated that he was uncomfortable with the prehearing procedures since he did not feel they reflected what the Commission was trying to do. He indicated that in the procedures it indicates that a prehearing was only conducted at the request of one of the parties. He indicated that the purpose of the prehearing conference was to assist him and the other Commissioners to be prepared for trial, not if one party or the other requested it. He indicated that the issues needed to be in the prepared briefs. He indicated that for the most recent Hearing, the attorneys did not follow the procedures since the information had not been received in a timely fashion and felt the procedures needed to be binding language.

Director Tyrrell indicated that these general descriptions were not the binding language, rather the Chairperson= s Order was the binding language regarding pre-hearing conferences. He explained that the general descriptions were not binding but rather descriptions of the processes and while the Commissioner Manual could be viewed by the public, the only people who normally reviewed these narratives were the Commissioners.

Director Tyrrell also noted that while the Chairperson= s reasons for a prehearing conference were true, one of the attorneys normally initiates the request. Chairperson Gale felt that Director Tyrrell= s statement had not been correct, since he could order a prehearing conference and had spent a lot of time wording the Order. He noted that the language in the descriptions would be fine if it did not mislead anyone since that was not the way it worked. Director Tyrrell noted that the narrative would be redrafted and a new draft sent out to the Commissioners. Commissioner Leisey felt that only one category needed to be changed if Chairperson Gale requested a prehearing conference. Chairperson Gale indicated that Deputy Director Mayrose contacted him and asked which prehearing officer could be appointed, if one of the parties requests a prehearing conference. Deputy Director Mayrose indicated that when he received a motion from an attorney requesting a prehearing conference, he contacted Chairperson Gale to request a prehearing officer. Chairperson Gale indicated that Deputy Director Mayrose needed to call regardless of receiving an Order. Director Tyrrell indicated that he would check the wording in the Order and ask Counsel Barton to amend the Order to include the proper language if necessary. Chairperson Gale did not feel that the Commission had been prepared properly for the most recent Hearing.

Commissioner Griess asked if there was a procedure by which one of the parties requested the strict rules of evidence. Chairperson Gale indicated that it was up to the parties to follow the strict rules of evidence, which changed the dimensions of a hearing. Director Tyrrell noted that if one of the parties wished to invoke the strict rules of evidence, proper notification three days in advance of the hearing was required. Commissioner Grady was not familiar with the strict rules of evidence. Chairperson Gale indicated that strict rules of evidence was long, involved and complicated. He explained that strict rules of evidence enhanced the level, quality and standards of a hearing and eliminated hearsay and opinions.

No action was necessary on this report.

Director Tyrrell presented an e-mail regarding the proposed errors and omissions insurance contract renewal for 2009. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell noted that there were no changes proposed in the terms and conditions of the policy The premium for the Commission-offered Plan was proposed to be raised from $135.00 to $150.00. The policy would still be with AIG Insurance. He explained that the rates reflect an increase of eleven percent over 2008. He also explained that Williams Underwriting Group would be offering a Personal Identity Theft Coverage endorsement as well, which was not part of the Commission-offered Plan but an enhancement for licensees for which licensees would pay separately if they wanted this coverage.

A motion was made by Bohrer and seconded by Leisey to renew the errors and omissions insurance contract with Williams Underwriting Group, Inc. for 2009. Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell presented a resolution commemorating service on the Commission by Michael Poskochil. A copy of said resolution is attached to and made a part of these Minutes.

A motion was made by Grady and seconded by Dover that the resolution for Michael Poskochil be adopted. Motion carried with Bohrer, Dover, Grady, Griess, Leisey, Rouch and Gale voting aye.

Director Tyrrell reminded the Commissioners that the ARELLO Annual Conference would be held October 18-20. He noted that the Commissioner College would be offered at this meeting at no additional charge. He also indicated that the registration forms needed to be sent into the office by September 18.

Chairperson Gale asked if the expenses for the ARELLO Annual Conference had been included in the budget. Director Tyrrell indicated that the expenses had been included in the budget. He expressed the importance of making the hotel accommodations as quickly as possible since they were now booking rooms in the overflow hotel. Deputy Director Hoffman indicated that the overflow hotel would be charging the same price as the original hotel. She noted that the overflow hotel was one to four blocks away from the Conference Hotel.

Director Tyrrell asked which Commissioners were planning to attend the Annual Conference. Commissioners Bohrer, Dover, Grady, Leisey and Rouch indicated they planned on attending. Commissioner Griess had not yet decided. Chairperson Gale indicated that he would not be attending the Conference .

No action was necessary on this report.

Director Tyrrell noted that Commissioners Bohrer, Dover and Griess and Director Tyrrell and Deputy Director Hoffman attended the ARELLO Annual Meeting.

Commissioner Griess indicated that she had enjoyed the ARELLO District Meeting and found the most interesting speaker to be an economist from Saint Louis, MO. She felt better that the Midwest was in less of a jam than the rest of the country according to the speaker. She felt the speaker was very interesting. Chairperson Gale asked if the speaker had a written speech which was handed out. Commissioner Bohrer indicated that the power point presentation had been distributed. He indicated that there had been a lot of discussion about mortgage fraud and while reviewing the agenda for the annual conference the topic would be discussed again. He felt the conference was good overall. Commissioner Dover concurred with the general discussion.

Director Tyrrell agreed that the mortgage fraud discussions were the best of those heard at an ARELLO meeting so far. He noted that next year= s District meeting would be in Louisville, Kentucky. He also noted that Deputy Director Hoffman had been nominated to continue on the ARELLO Board of Directors. Deputy Director Hoffman agreed that the speakers had been well chosen and she had found them enlightening.

No action was necessary on this report.

Commissioner Griess asked if the attendance at the meeting had decreased. Deputy Director Hoffman felt that the attendance was good, but there had been discussions about having future meetings at less expensive locations. She noted that the Real Estate Educators Association Meeting would be in Portland, Oregon next year.

No action was necessary on this report.

Director Tyrrell presented the Trust Account Examination Evaluation Report - Second Quarter 2008. A copy of said report is attached to and made a part of these minutes.

Director Tyrrell reviewed some of the comments received.

Commissioner Grady asked if there had been less expenditures regarding the trust account examinations. Director Tyrrell indicated that there had not been a reduction in trust account examination related expenditures.

No action was necessary on this report.

September 26, 2008 - Staybridge Suites, Lincoln
October 30-31, 2008 - Staybridge Suites, Lincoln
December 4-5, 2008 - Staybridge Suites, Lincoln
January 22-23, 2009 - Hampton Inn - Airport, Lincoln
February 19-20, 2009 - Staybridge Suites, Lincoln
March 19-20, 2009 - Staybridge Suites, Lincoln
May 21-22, 2009 - Staybridge Suites, Lincoln

Recesses and Adjournment

At 9:06 a.m., Chairperson Gale declared a brief recess to allow pictures to be taken, and reconvened the meeting at 9:08 a.m.

At 9:25 a.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 9:30 a.m.

At 11:08 a.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 11:30 a.m.

At 2:51 p.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 3:04 p.m.

At 3:27 p.m. on August 28, Chairperson Gale recessed the meeting for the day.

At 9:06 a.m. on August 29, Chairperson Gale reconvened the meeting.

At 10:16 a.m. on August 29, Chairperson Gale declared a brief recess, and reconvened the meeting at 10:22 a.m.

At 11:06 a.m. on August 29, Chairperson Gale was excused from the meeting.

I, Les Tyrrell, Director of the Nebraska Real Estate Commission, do hereby certify that the foregoing minutes of the August 28-29, 2008, meeting of the Nebraska Real Estate Commission were available for inspection on September 11, 2008, in compliance with Section 84-1413(5) R.R.S. 1943, of Nebraska.

Respectfully submitted,
Les Tyrrell
Director