Dept. of Real Estate Is on the Block
By Stephen Sutherland, president of the Newport Beach Board of Realtors.
A recent release from the California Association of Realtors (CAR) reports that Gov. Brown’s newly proposed budget includes “sweeping changes in regulatory agencies, including the Department of Real Estate (DRE) and dramatic cuts to various state programs in order to respond to California’s on- going budget deficit.”
The outcome would cause the DRE to become just another bureau within the Department of Consumer Affairs.
I am reminded of a time some years ago, after the S&L meltdown, when many politicians thought it might be a good idea to bundle real estate firms into banks rather than allow stand- alone businesses. The outcry against this proposal was a roar that brought it down.
The governor’s new proposal raises many questions, including how would this correct the budget deficit? During a state-sponsored town hall meeting, a questioner pointed out that the DRE is a “cash cow.” Why dismantle a department that not only pays for itself, but boasts budget reserves? These dollars are from real estate licensees and are not a taxpayer burden.
Additionally, regulation of mortgage loan originators would be transferred into a newly created department. This would rob the DRE of a sizable sum. Will all these fees disappear into the General Fund? In the past CAR “defended DRE budget reserves against ‘raids’…and will be equally vigorous in resisting any transfer” of DRE reserves under the new state budget.
Who will now handle fraud prevention?
Will the bureau members be political appointees? Will they possess the same knowledge required by present DRE employees to supervise our very complicated industry?
I fear this could, as often happens with government become a case of “be careful what you wish for.”
When presenting his proposed budget, Gov. Brown suggested he would return control of the schools to local government. He said we should trust them to do their own oversight. He should also be encouraged to trust our local and state associations in cooperation with the DRE to handle new oversight measures with Realtor members.
“I have major concerns with the proposal and its negative impact on the funding and regulation of California’s real estate industry,” Don Faught, C.A.R. 2012 President-elect commented. “Because of these concerns we have opposed similar efforts in the past and will do so at this point as well.”
There is an old CAR slogan, “get involved in politics or get out of the business.” One way to do this is through the Realtor Party of California. It is a movement of real estate professionals fighting to keep homeownership alive. The Realtor Party also supports private property rights, free enterprise and responsible government.
Members will vote, act and invest. Let’s all exercise our right to vote. Let us respond to CAR Red Alerts and NAR’s Calls for Action. And let’s donate to the Realtor Action Fund and consider it an investment in promoting Realtor values.
Whatever your personal political bent, support the Realtor Party and help us make Sacramento hear our roar.