Chairperson Gale convened a meeting of the Nebraska Real Estate Commission at 9:04 a.m. on September 26, 2008, 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, with the exception of Commissioner Grady, who was absent and excused. 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 Cordova Hearing and the proposed Legislation presentation.

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.

Director Tyrrell noted that agenda items 10a, 10b, 12b and 18c had been added since the tentative agenda was mailed to the Commissioners.

The minutes of the Commission meeting held on August 28-29, 2008, were considered.

Chairperson Gale indicated that the minutes were long, cumbersome and contained too much detail. He indicated that as an example, informal special appearances are open discussions and the minutes do not need to contain the detailed discussion. He felt that the disposition or penalty was significant not the detail. He felt that the detailed minutes put a damper on the open discussion by the Commissioners. He referenced the complaints and felt those minutes were simple to understand and read. He felt that during the Hearings the court reporter transcribes the official record from which appeals are made. He indicated that when discussions are included in the minutes regarding the same proceeding, he was concerned there could be problems if the minutes did not conform with the transcript. He wished to propose to the Commissioners that whether the current minutes are modified or accepted, he would like them to be changed in the future.

Director Tyrrell indicated that, in the past, the Commission had wanted the minutes to include its discussions, such as legislation and special appearances. He indicated that the minutes could be done either in detail or not in detail whichever the Commission desired.

Chairperson Gale did not feel there was an instance where the Commissioners needed the precise discussion.

Chairperson Gale felt that the minutes should include the policy matters discussions and some other matters that are required, otherwise nothing formal. He also felt that perhaps the minutes being presented could be approved as presented but from now on make the minutes less detailed.

It was the consensus of the Commission to have the minutes contain less detail.

After review, a motion was made by Griess and seconded by Leisey to approve the minutes as presented. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

Director Tyrrell presented the Receipts and Expenditures Report for August. A copy of said report is attached to and made a part of these minutes. Director Tyrrell noted that an explanation page was included on the report.

The cash fund balance as of August 31, 2008, was $409,139.03, which compared to a cash fund balance of $596,056.40 on August 31, 2007.

Specialized Registrations

There were no specialized registrations to be presented at the meeting.

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.

Deputy Director Hoffman presented for ratification the August Examination Report, a copy of which is attached to and made a part of these minutes.

Deputy Director Hoffman presented an Amendment to the examination contract with Applied Measurement Professionals (AMP) which would add additional simulation problems to the broker examination. A copy of said Amendment is attached to and made a part of these minutes.

Deputy Director Hoffman explained that the proposed change would go into effect on January 5, 2009.

After discussion, a motion was made by Leisey and seconded by Griess to approve the amendment to the contract as presented. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

Deputy Director Hoffman presented an Amendment to the examination contract with Applied Measurement Professionals (AMP) which would extend the examination contract through June 30, 2011. A copy of said Amendment is attached to and made a part of these minutes.

Deputy Director Hoffman explained that the current contract term was July 1, 2007, through June 30, 2009.

After discussion, a motion was made by Leisey and seconded by Dover to approve the amendment to the contract as presented. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

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 for ratification the Continuing Education Activity Significant Change Report, a copy of which is attached to and made a part of these minutes.

After review, a motion was made by Griess and seconded by Leisey to ratify the three reports. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

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 provided the Commission with an update on the Monica Martin Appeal and the Boyer and Young Appeal.

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 2008-029, Commission vs. Shirley Jean Sellman. A copy of said Order is attached to and made a part of these minutes.

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.

A Hearing was held on September 26, at 9:30 a.m., in the matter of SC2008-002, Commission vs. Jorge A. Cordova. Greg Barton, Special Assistant Attorney General and Counsel to the Commission, appeared for the Complainant. Respondent Cordova was not present and was not represented by Counsel.

After an opening statement, Counsel Barton offered 21 Exhibits, all of which were received by Chairperson Gale. Counsel Barton called Marilyn Masters as a witness.

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

After discussion, a motion was made by Griess and seconded by Leisey to revoke Mr. Cordova’s license. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

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

A motion was made by the Leisey and seconded by Griess to reconsider the previous decision. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

A motion was then made by Griess and seconded by Leisey to find that Mr. Cordova did not complete the three-clock hour class as required under the statutes. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

A motion was then made by Griess and seconded by Leisey to revoke Mr. Cordova’s license. Motion carried with Dover, Griess, Leisey, Rouch and Gale voting aye, with Bohrer and Grady not participating or voting, being absent and excused.

Chairperson Gale directed Counsel Barton to prepare the Order.

Chairperson Gale indicated that the costs incurred for the court reporter and any witness fees would be billed to the Respondent, 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 10:12 a.m.

Director Tyrrell presented exhibits which included: a summary of Mr. Buschelman= s situation; correspondence regarding Mr. Buschelman= s special appearance; and letters of reference. A copy of said exhibit is attached to and made a part of these minutes. Mr. Buschelman was present.

Chairperson Gale reviewed the procedure for informal special appearances.

Mr. Buschelman explained the situation of his past criminal history and his accomplishments since the occurrences.

Director Tyrrell presented an exhibit which included: correspondence regarding Mr. Tweeton= s special appearance; e-mail correspondence explaining Mr. Tweeton’s situation; a Certificate of original instruments duly filed and/or recorded with the Clerk of the District Court in Lancaster County and the corresponding filings; Mr. Tweeton= s criminal history report; and his salesperson application form. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell indicated that Mr. Tweeton resided in Fort Collins, Colorado and requested not to appear before the Commission in person but to appear by exhibit. He explained Mr. Tweeton’s past criminal history and summarized verbal and written communications he had with Mr. Tweeton.

After discussion, a motion was made by Dover and seconded by Leisey to allow Mr. Tweeton to be issued a license after providing all the materials required for licensure. After further discussion, motion carried with Bohrer, Dover, Griess, Leisey, Rouch and Gale voting aye, with Grady not participating or voting, being absent and excused.

A general discussion was held regarding the wording of question number twelve on the salesperson application form with regard to pardoned and/or expunged convictions. Director Tyrrell indicated he would consult with legal counsel regarding the possible rewording of the question.

Deputy Director Hoffman reviewed the pre-license education program; the license examination utilized; the license issuance process; the continuing education program; and the license renewal requirement with the Commission. She pointed out what she observed to be strengths of Nebraska's education and licensing processes and answered questions from the Commission.

No action was necessary on this report.

Director Tyrrell presented the Final Report regarding the 2007-2008 objectives. A copy of said report is attached to and made a part of these minutes.

No action was necessary on this report.

Director Tyrrell presented an exhibit regarding the proposed 2008-2009 objectives of the Commission. A copy of said exhibit is attached to and made a part of these minutes.

Chairperson Gale asked for three items to be added to the 2008-2009 objectives which included consideration of legislation to authorize the Commission to fine licensees; consideration of implementation of a new commissioner orientation program; and consideration of implementation of an annual strategy and planning session for Commissioners at the end of each fiscal year. Commissioner Leisey asked that the legislation to allow designated brokers to manage branch offices also be added to the 2008-2009 objectives.

No action was necessary on this report.

The Nebraska Realtors Association was represented by Janet Palmtag; Herbert Freeman and Tonia Novak. Special Assistant Attorney General and Counsel to the Commission Greg Barton was also present for the presentation.

The Nebraska Realtors Association presented an exhibit regarding the proposed legislation to institute fining authority for the Commission. A copy of said exhibit is attached to and made a part of these minutes.

Ms. Palmtag indicated that the Nebraska Realtors Association wanted to institute the fining authority as a potential tool to uphold professionalism in the real estate industry. She also indicated that the goal in instituting fining authority was to give the Commission more flexibility in punishments so that the punishment fit the crime. She also welcomed any changes in wording from the Commissioners.

Director Tyrrell asked if the Nebraska Realtors Association would be moving the legislation forward through the Legislature if the Commission approved of the proposed changes. Ms. Palmtag indicated that the Nebraska Realtors Association would take legislation forward.

Chairperson Gale asked how other states handle the fining authority such as a minimum or maximum allowed either by violation or complaint and if the word "order" assumes that there was guilt. Ms. Novak indicated that the legislation was written with the amount of the fine "capped" on a per complaint basis and the issuance of an order assumed finding of guilt.

Counsel Barton indicated that he thought fining was a good idea since there was not any middle ground in the law between censure and suspension. However, he felt that the language should be clear so there were no assumptions in the statutes. Chairperson Gale indicated that the Commission needed to agree on the concept of fining not the language so that the legislation can move forward.

Ms. Novak described the fining authority in the surrounding states. She indicated that there had been language added regarding the collection issues and the consequences if the fines were not paid. She also indicated that an amendment could be made to the proposed legislation to allow for liens on personal property if fines were not paid. She noted that the fines collected would go to the school district where the violation occurred.

Commissioner Leisey asked if fines should be assessed for individual violations or on a complaint basis. Mr. Freeman indicated that the Commission would have the capability of fining up to the maximum limit on each complaint. Chairperson Gale felt that fines should be used in conjunction with current disciplinary actions taken such as license censure, probation or continuing education. Ms. Novak felt that the combinations discussed were the intent of the proposed legislation. Chairperson Gale felt that the Commission fell under a big void and that while continuing education may not change a licensee’s behavior, a fine may. Commissioner Leisey felt that the Commission had the authority to suspend or revoke a license and if a licensee receives a two-month suspension, they are out of work without income which was more harsh than a fine that the company may pay. Commissioner Dover felt that adding continuing education to a penalty was beneficial to the licensees so they can learn from their wrong doing. Chairperson Gale indicated that the fining was not in the Commission’s self interest since the fine would not go into the cash fund. Mr. Freeman felt that while suspension was a financial penalty, it would make more sense to have the option of suspension, probation and fining and also felt that the Nebraska Realtors Association would rely on the judgment of the Commission on how to assess fines. Commissioner Leisey indicated that a suspension would put a licensee out of business and if a fine also was imposed that would be significant.

Chairperson Gale indicated to Ms. Novak that Counsel Barton would be able to assist with finalizing the proposed language.

The Nebraska Realtors Association presented an exhibit regarding the proposed legislation to allow designated brokers to manage branch offices. A copy of said exhibit is attached to and made a part of these minutes.

Ms. Palmtag indicated that the designated broker of a company should be capable of managing multiple branch offices if the associate brokers are able to do so. She felt this had been an oversight which should be corrected. Director Tyrrell indicated that this statutory language had not been an oversight. It had been a specific amendment, the old language indicated that a branch manager could only supervise one office and the current language clarified that the branch manager had to be an associate broker and did not contain the one office limit. Commissioner Griess asked why the previous change did not include designated brokers. Director Tyrrell did not think designated brokers had been discussed. Commissioner Leisey felt that designated brokers were more responsible than associate brokers. Director Tyrrell felt that designated brokers had not been discussed due to the fact that they have more responsibility and did not have time to keep track of multiple offices. Commissioner Leisey felt that if an associate broker can run multiple offices then a designated broker should be able to as well.

After discussion of both legislative proposals was completed, a motion was made by Dover and seconded by Leisey to endorse the concept of fining as expressed in the proposed legislation.

Director Tyrrell asked if the Commissioners wanted to review the proposals prior to being introduced in the Legislature. Chairperson Gale felt that the final draft could be reviewed. Director Tyrrell noted that if the final draft was finished by the October or December Meeting then the Commissioners would be able to finalize their support prior to introduction. Commissioner Dover felt that the final draft should be reviewed for support.

A friendly amendment was made by Leisey to include that the proposed legislation be brought back for support approval. It was accepted by Commissioner Dover. The motion as amended carried with Bohrer, Dover, Griess, Leisey, Rouch and Gale voting aye, with Grady not participating or voting, being absent and excused.

A motion was made by Leisey and seconded by Dover to support the proposed legislation which would allow designated brokers to manage branch offices and a final draft need not be brought back for review. Motion carried with Bohrer, Dover, Griess, Leisey, Rouch and Gale voting aye, with Grady not participating or voting, being absent and excused.

Director Tyrrell presented an exhibit regarding the proposed legislation to increase the "up-to" limit on fees charged by the Commission. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrell indicated that the current statute had not been changed since 1990. He indicated that the current maximum fees would be increased by one hundred dollars. He also noted that the legislation proposed to delete obsolete language and to add language dealing with electronic payments that were not honored. He recommended the Commission go forward with the proposed legislation in the upcoming Legislative Session.

A motion was made by Leisey and seconded by Bohrer to move legislation forward. Motion carried with Bohrer, Dover, Griess, Leisey, Rouch and Gale voting aye, with Grady not participating or voting, being absent and excused.

Deputy Director Mayrose indicated that he attended the workshop in Baltimore, Maryland. He felt that the workshop had been informative.

No action was necessary on this report.

Director Tyrrell noted that Commissioners Dover, Grady, and Rouch, and Director Tyrrell and Deputy Director Hoffman will be attending the ARELLO Annual Conference.

No action was necessary on this report.

Director Tyrrell presented an exhibit regarding the recent financial issues surrounding AIG. A copy of said exhibit is attached to and made a part of these minutes.

Director Tyrrell noted that a subsidiary of AIG was the carrier for the state-offered Errors and Omissions (E & O) Insurance program. The information contained in the exhibit was received from Williams Underwriting Group, Inc., the E & O Insurance Plan Administrator, and the Nebraska Department of Insurance website. It dealt with AIG’s financial status. He indicated that the Commissioners could share the information contained in the exhibit with licensees or refer them to the Nebraska Department of Banking and Finance’s website.

No action was necessary on this report.

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

At 9:05 a.m., Commissioner Dover joined the meeting.

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

At 10:12 a.m., Chairperson Gale declared a brief recess, and reconvened the meeting at 10:30 a.m.

At 11:00 a.m., Commissioner Bohrer joined the meeting.

At 12:03 p.m., Chairperson Gale declared a recess for lunch, and reconvened the meeting at 12:57 p.m.

I, Les Tyrrell, Director of the Nebraska Real Estate Commission, do hereby certify that the foregoing minutes of the September 26, 2008 meeting of the Nebraska Real Estate Commission were available for inspection on October 2, 2008, in compliance with Section 84-1413(5) R.R.S. 1943, of Nebraska.

Respectfully submitted,
Les Tyrrell
Director

Bryan Fraser, CBSHOME Real Estate, Omaha

Ernest R. Faubion, NP Dodge Co, Omaha

Kristen Anderson, Nebraska REALTORS7 Association, Lincoln

Tammy Brookhouser, Nebraska REALTORS7 Association, Lincoln