NAR Board of Directors meeting

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2019 NAR President John Smaby presides over the Board of Directors meeting Monday.

NAR Policy Changes Beyond MLS Cooperation

November 12, 2019

While the passage of MLS Statement 8.0, also known as the Clear Cooperation policy, was the big headline out of the National Association of REALTORS®’ Board of Directors meeting Monday during the REALTORS® Conference & Expo in San Francisco, the board took many more actions that affect your membership and business. One of them was an extension of NAR’s Code of Ethics training requirement from every two years to every three years, including an extension of the current Cycle 6 deadline from Dec. 31, 2020, to Dec. 31, 2021. The next cycle, Cycle 7, will begin Jan. 1, 2022, and end Dec. 31, 2024.

The Code of Ethics cycle change was one of several recommendations of a 2019 presidential advisory group established to study the Code training requirement. Prior to the board meeting, NAR’s Leadership Team approved several recommendations of the PAG that didn’t require a board vote:

  • That the learning objectives for the existing-member Code of Ethics training be revised to include content on professional conduct, courtesies, business etiquette, and real-life scenarios.
  • That NAR establish Code of Ethics training equivalency options that members can take to satisfy the Code of Ethics training requirement, and that the Commitment to Excellence endorsement be an equivalency option.
  • That only courses and equivalencies provided by a local, state, or national REALTOR® association can satisfy the Code of Ethics training requirement.
  • That an implementation team be appointed to develop a microsite that compiles all available options for fulfilling the Code of Ethics training requirement, including C2EX ethics modules, NAR-approved online courses, and links to association-approved courses.
  • That the Core Standards requirements be amended to clarify an association’s duties regarding administration of the Code of Ethics training requirement.

In addition to voting on a range of policies, the directors honored REALTORS® Kit Hale of Roanoke, Va., and Ken Libby of Stowe, Vt., as the 2019 recipients of the Distinguished Service Award. The DSA is an honor presented annually to no more than two of the association’s 1.4 million members. Miami Association of REALTORS® CEO Teresa King Kinney was honored as the winner of the William R. Magel Award of Excellence, given to an individual who has demonstrated excellence in REALTOR® association management.

REALTOR® Association Names

Referred back to the Membership Policy and Board Jurisdiction Committee was a proposed policy that would have limited state and local REALTOR® associations to the use of only one alternative business name (DBA), with instructions to create a policy that allows multiple DBAs within an association’s jurisdiction boundaries.

Core Standards

Approved a proposal that NAR adopt customized Core Standards for state associations, effective with the sixth Core Standards Compliance cycle, which begins Jan. 1.

Legal Action

  • Approved legal action funding in two cases: one challenging a real estate brokerage’s classification of its agents as independent contractors and another supporting a lawsuit challenging New York City’s rent control and rent stabilization laws as illegal takings in violation of due process.
  • Voted to purchase a Master Policy for the Professional Liability Insurance Program for NAR, its affiliates, its member associations, and REALTOR® association-owned MLSs for the 2020 policy year.
  • Voted to purchase a Patent Infringement Liability Policy for NAR, REALTOR® association–owned multiple listing services, and state and local associations for the 2020 policy year.

Professional Standards

  • Adopted a new Standard of Practice under Article 3 that REALTORS® may not refuse to cooperate on the basis of a broker’s race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.
  • Deleted Standard of Practice 12-2 and amended Standard of Practice 12-1 as part of an ongoing efforts to review and update the Code of Ethics to ensure adequate protection of consumers, clarity in requirements, and legal defensibility.
  • Extended the California Association of REALTORS® Lateral Discipline Pilot Program, except that the California Association will not be required to make further reports to NAR regarding the program. The scope of the pilot program remains the same as previously approved by the NAR Board of Directors.

Federal Tax Policy

Approved three policy changes:

  • Supported improved reporting and disclosure requirements regarding foreign ownership of U.S. real estate by eliminating the compliance burden on buyers and placing it on sellers and/or their agents.
  • Advocated for a zero capital gains tax rate or a reduced capital gains tax rate for owners of rental single-family homes, townhomes, or condominiums that sell the property to an owner-occupant.
  • Supported policies that provide tax incentives to encourage home buyers to save for the down payment for their first home.

Federal Financing & Housing

Supported a policy that participation in a housing voucher program that receives congressional appropriation should remain voluntary.

Global Business and Alliances

Amended NAR’s policy position on the H-2B Temporary Worker Visa program to encourage all employers who participate in the H-2B Visa Program “to strive for the highest levels of responsibility and accountability to the H-2B visa holders who are in their employ, and comply with all appropriate laws, regulations and guidance associated with the program.”

The directors made additional policy changes to the conventional financing, land use, and real property valuation policy. A complete report on board actions will be available Tuesday on The Hub.

NAR Financial Report

NAR Treasurer John Flor reported that the association is on track not only to meet its new minimum reserve requirement of 50% of operating budget but to hit an ambitious target, set in May, of reaching reserves of 75% of operating budget. Some of that surplus, he said, will be used for important initiatives such as updates to the Chicago building and the association’s membership and ecommerce systems.

Bylaws Change

Directors voted to eliminate Article XI of the NAR bylaws concerning misconduct. The reason: NAR’s updated Code of Conduct and Sexual Harassment Policy, adopted by the board in 2018, sets forth a comprehensive way to ensure complaints of unacceptable behavior are received, investigated, and resolved and, thus, eliminates the usefulness of the bylaw.