SECTION 12 removes the title of a provision because the provision is moved to a prior section.
SECTION 13 renumbers a provision and adds a writing requirement for licensees to disclose compensation they received, or interest they have, when referring clients to another person or entity. It also clarifies the statutory authority by referencing the exemption in a separate sentence.
SECTION 14 repeals and recreates a provision to emphasize the need for prior written consent from a client when a licensee discloses any compensation received, or incentives, from a listing broker. This clarifies the standards for licensees.
SECTION 15 includes a writing requirement to disclosures in this subsection to clarify standards for licensees.
SECTION 16 repeals and recreates a provision to clarify the required statutory disclosure form and the written consent requirements for parties to transactions of one to 4 dwelling units. The rule also creates the ethical requirements that a broker not negotiate on behalf of a non-client.
SECTION 17 adds two standards for brokers in providing services to clients: the first does not allow the broker to negotiate for a client without the statutory required disclosure form; and the second requires the client in a transaction for a one to 4 family dwelling to sign an acknowledgement that they received a statutory disclosure form statement.
SECTION 18 changes “another licensee" to “listing broker." It also specifies that any change in the licensee's representation comply with the statutory disclosure requirements of initial disclosure, clarifying the duties of the licensee.
SECTION 19 amends the rule to encompass “agency agreements" instead of “listing contracts," and refers to “brokers" instead of “listing brokers." Therefore, the broker has the duty to explain to their clients the responsibilities of buyer's and seller's agents and subagents before entering into this agreement. These disclosure requirements protect the client.
This SECTION also amends “listing broker" requirements to encompass any “broker" or broker's salesperson. It imposes the requirement that they receive authorization before acting as a subagent.
Finally, this SECTION amends specific contracts to encompass “written documents," a definition of which is included in the amended rules. It clarifies the duty of the licensee to include whom they represent in the written agreement.
SECTION 21 repeals two sections and recreates them to clarify the requirements for listing brokers and licensees.
The first section recreates a provision to require a listing broker to include the statutory disclosure requirements and clarify when a disclosure form is required by splitting the section into four parts: (1) a disclosure form is required for a listing broker when the negotiations are conducted directly with the buyer; (2) a broker is required to provide a disclosure form if negotiations are conducted directly with the seller; (3) a subagent is required to provide a disclosure form to a customer with whom they are working, but not to the principle broker; and (3) a broker does not need to require a broker disclosure form to their subagent's customer.
The second section recreates a provision to include the statutory disclosure requirements and clarify license requirements when negotiating terms of a lease and entering into listings for lease or property management contracts.
SECTION 22 amends a provision to expand the licensee's ethical requirements by forbidding them to mislead in three additional areas: “rented, purchased, or optioned" real estate. It also expands “listing contract" to an “agency agreement," an amended definition of which is included in the proposed rules.
SECTION 23 amends five provisions. The first four are amended to include “written proposals" in lieu of “offers." “Written proposal" is defined in the proposed amendments. In addition to the “written proposals" proposed amendments, the terminology in these five sections was amended for clarification.
The first section changes the terminology to “other party," so a written proposal should not be used if it would be contrary to instructions of the other party. The second section changes the terminology so the licensee should promptly present written proposals to the licensee's client or customer. The third section changes the terminology so that the objective and unbiased manner of presentation should be to the licensee's clients and customers. The fourth section broadens the terminology of “buyer" to “clients and customers" and “written proposal" to that a licensee must inform their clients and customers after any action on a written proposal. The fifth section is amended to add “lease or negotiate." This requirement means a licensee must negotiate with the broker who has an exclusive right to sell, lease or negotiate in these areas. Finally, the Note at the end of this section is updated to reflect the correct form, WB-36.
SECTION 24 amends a provision to allow rules of the department to be “readily available" instead of maintained on file, expanding the way in which rules can be maintained.
SECTION 25 amends a provision requiring a licensee to report offenses. The requirements remove an exemption for certain motor vehicle offenses, and require a licensee to send information about their crime to the department within 48 hours.
SECTION 26 creates a provision requiring the licensees to respond to departmental requests for information within 30 days to encourage compliance with requests.
SECTION 27 amends a provision relating to the educational programs for applicants for licenses. The number of hours a program would be if it were in a classroom was amended from a minimum of 36 hours to a minimum of 72 hours. The second section updates a reference to a rule.
Summary of, and comparison with, existing or proposed federal regulation
None.
Comparison with rules in adjacent states
Illinois:
Broker Pre-License Education: Section 1450.60 Educational Requirements to Obtain a Broker's or Salesperson's License: 120 credit hours of instruction in approved courses or a baccalaureate degree including courses involving real estate or related material are required for broker applicants.
http://www.ilga.gov/commission/jcar/admincode/068/068014500/C00600R.html
Iowa:
Broker Pre-License Education: 54315(8) and 193E-sub rule 16.3(1), an applicant for licensure as a real estate broker shall complete at least 72 classroom hours of commission-approved real estate education within 24 months prior to taking the broker examination. This education shall be in addition to the required salesperson pre-license course (60 hours).
http://www.legis.state.ia.us/ACO/IAChtml/193e.htm#rule_193e_4_1
Michigan:
Conduct and Ethical Practice for Real Estate Licensees: The various regulations of professional practice and conduct are found in Administrative Rules for Real Estate Brokers and Salespersons, Occupational Code, Article 25, Parts 3 and 4.
http://www.michigan.gov/documents/dleg/rebook_217577_7.pdf
Broker Pre-License Education: Rule 203. (1) An applicant for a broker or associate broker license shall have completed 90 clock hours of qualifying pre-licensure education of which 9 clock hours shall be on civil rights law and fair housing law, as defined in section 2504(1) of the code. The broker pre-licensure education shall be completed not more than 36 months before the date of application, unless the applicant has held a license as a salesperson for that intervening period.
http://www.state.mi.us/orr/emi/admincode.asp?AdminCode=Single&Admin_Num=33922101&Dpt=LG&RngHigh=
Minnesota:
Broker Pre-License Education: 82.29 Sub.8(b) An applicant for a broker's license must successfully complete a course of study in the real estate field consisting of 30 hours of instruction approved by the commissioner, of which three hours shall consist of training in state and federal fair housing laws, regulations, and rules. The course must have been completed within 12 months prior to the date of application for the broker's license.
https://www.revisor.leg.state.mn.us/statutes/?id=82.29
Summary of factual data and analytical methodologies
The information received from the states listed in this analysis was obtained directly from a review of the applicable regulations and rules.
Analysis and supporting documents used to determine effect on small business
Data was obtained from the department's credentialing division regarding the number of licensees that would be affected by this regulatory change. As of June 15, 2010, there are 47,823 licensed real estate salespersons and 52,465 licensed real estate brokers. There are 8,539 licensed real estate business entities. The majority of real estate licensees work in small business environments; however, the change in rules regarding professional conduct of licensees will not have a significant impact on their cost of doing business. The rule change seeks to clarify current ethical practices that already exist within the Wisconsin real estate industry.
Section
227.137, Stats., requires an “agency" to prepare an economic impact report before submitting the proposed rule-making order to the Wisconsin Legislative Council. The Department of Regulation and Licensing is not included as an “agency" in this section.
Anticipated costs incurred by private sector
The department finds that this rule has no significant fiscal effect on the private sector.
Effect on Small Business
These proposed rules were reviewed by the department's Small Business Review Advisory Committee and it was determined that the proposed rules will not have a significant economic impact on a substantial number of small businesses, as defined in s.
227.114 (1), Stats.
The Department's Regulatory Review Coordinator, John Murray, may be contacted by email at
John.Murray@Wisconsin.gov, or by calling (608) 266-2112.
Fiscal Estimate
The department estimates that this rule will have costs of $128 to create forms and update the department's website.
Agency Contact Person
Kris Anderson
Department of Regulation and Licensing
Division of Board Services
1400 East Washington Avenue, Room 116
P.O. Box 8935, Madison, WI 53708
Phone: 608-261-2385
