NAR Approves Core Organizational Standards

May 17, 2014

The roughly 1,400 REALTOR® associations operating in the United States, as well as Puerto Rico, the Virgin Islands, and Guam will be required to operate under unified, core standards passed Saturday by the Board of Directors of the National Association of REALTORS®.  The Board also approved a streamlining of the election process for elected leadership posts with NAR.

In the weeks leading up to today’s vote, NAR President Steve Brown has called the standards essential to the organization’s long-term ability to thrive as a trade association and advocate for its members and the industry. The board vote came on the concluding day of the REALTOR® Party Convention and Trade Expo, where 8,800 REALTORS® gathered to discuss key issues with legislators and congressional staff.

The standards are meant to ensure that REALTORS® get a solid value proposition for their dues dollar. Under the new rules, every association needs to maintain standards in the following areas:

  • Code of Ethics. Local associations are expected to have a viable, easy-to-navigate professional standards process for enforcing disputes.
  • Advocacy. Local associations are expected to strive for RPAC “fair share” contributions through dues billing or other means and to participate in state Calls for Action.
  • Consumer Outreach. Associations wil be asked to demonstrate their role as the Voice for Real Estate® in their communities through plans to share market data with the public, issue press releases, or sponsor community-building activities.
  • Unification and Support of the REALTOR® Organization.  Associations need to adopt a business or strategic plan with an advocacy component; maintain corporate documents, policies, and procedures; and enforce dues billing.
  • Technology.  Every association needs the ability to communicate using contemporary electronic resources, including a website with links to the other levels of the REALTOR® organization.
  • Financial Solvency.  An annual review or audit by a certified public accountant is expected to ensure each association’s financial health.

“This is an issue of professionalism in our industry,” said Andrea Bushnell, executive vice president of the North Carolina Association of REALTORS®, and chair of the presidential advisory group that wrote the standards. It is not, however, an issue of size, she said, echoing assurances that Brown and NAR CEO Dale Stinton have made amid speculation of upcoming consolidation.

“We want to ensure unity within—and the long-term viability of—the 100-year-old REALTOR® organization,” Bushnell said in a presentation to state presidents in April. “All three levels of the organization must thrive together as a true and strong association, rather than acting as group of independent but federated organizations.”

According to NAR, roughly 1,100 local associations have fewer than 300 members, and many will have no difficulty meeting the standards, Bushnell said.

The directors today approved up to $20 million to support implementation of the standards: $5 million to help associations create or update their business or strategic plan; $3 million to assist states with compliance; and $12 million to assist associations that chose to merge, consolidate, dissolve, or become a chapter or council of another association.

New Election Rules

The Board also approved a new process and timetable for the election of leaders. The new process will go into effect Jan. 1, 2015, upon approval of any necessary constitutional amendments by the Delegate Body. The new guidelines, developed by a presidential advisory group chaired by Pat V. Combs, would:

  • Shorten the election cycle to the 10-month period from August to the following May, compared to campaign periods that have sometimes stretched to three or four years.
  • Rename NAR’s Nominating Committee, which reviews candidates for leadership positions, the Credentials and Campaign Rules Committee.
  • Set specific eligibility criteria for those interested in running for elected office. The criteria include the absence of personal bankruptcies or foreclosures within the prior seven years; a credit score above the baseline required for a mortgage backed by the FHA; and no current delinquent tax filings or payments.
  • Prevent candidates from seeking endorsements from their state or local association until Jan. 1 of the year before the election will be held.
  • Require sitting NAR officers and qualified candidates for office to submit a quarterly report verifying any changes to their financial, criminal, or legal status.

The new election system also includes a complaint, sanctions, and appeals process. The Delegate Body will vote on constitutional changes in November during the REALTORS® Conference & Expo in New Orleans.

Other meeting highlights:

  • The Board elected officers for 2015, including President-Elect Tom Salomone of Coral Springs, Fla., and First Vice President Bill Brown of Oakland, Calif. The slate joins Chris Polychron of Hot Springs, Ark., who will be 2015 NAR president, and Mike McGrew of Lawrence, Kansas, who will be in the second-year of a two-year term. Charlie Oppler of Tenafly, N.J., and Mike Ford of West Memphis, Ark. were appointed as vice presidents.
  • With the increased use of automated valuation methods (AVMs) for valuing property, the Board voted to require MLSs to make available to brokers and agents the information necessary to develop automated valuation models so that those AVMs can be developed and shared with clients and customers. MLS participants are subject to payment of the costs of adding or enhancing the systems needed to meet this requirement. An amendment, proposed by Utah REALTORS® on the floor, would have made the requirement apply only in states where disclosure of sales price is mandated by state law, but that proposal was defeated by the board.
  • National dues of $120 will remain the same for 2015.

—By Wendy Cole, REALTOR® Magazine

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