01-27 12:28 H.B. 337
1
Property Manager Requirements
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Jordan D. Teuscher
Senate Sponsor:
2
3
LONG TITLE
4
General Description:
5
This bill modifies the Utah Real Estate Licensing and Practices Act.
6
Highlighted Provisions:
7
This bill:
8
▸ defines terms;
9
▸ grants the Real Estate Commission (commission) authority to make administrative rules
10
relating to property managers;
11
▸ requires an individual to hold a license as a property manager before engaging in property
12
management;
13
▸ exempts certain individuals from licensure under this act;
14
▸ requires that the commission and Division of Real Estate determine the qualifications and
15
requirements for an applicant for a property manager license;
16
▸ allows an individual with an active broker, associate broker, or sales agent license to
17
obtain a property manager license without meeting certain examination and education
18
requirements;
19
▸ requires that an applicant for a property manager license pay a licensing fee;
20
▸ exempts a licensed property manager from affiliating with a principal broker;
21
▸ repeals provisions authorizing certain individuals to act as a property manager;
22
▸ prohibits the Division of Real Estate from requiring that an individual licensed as a
23
property manager be affiliated with a principal broker;
24
▸ authorizes a property manager to fill out any form or document related to property
25
management;
26
▸ provides parameters for what a property manager may do when engaging in property
27
management;
28
▸ requires that a property manager associate with a real estate trust account;
29
▸ exempts a property manager with a security bond that protects at least 30% of estimated
30
client funds from the requirement to associate with a real estate trust account;
H.B. 337 H.B. 337 01-27 12:28
31
▸ provides limitations on the penalties the commission may impose on a property manager;
32
▸ authorizes the commission to issue other non-financial penalties to a property manager
33
and rules relating to a property manager's ownership interests; and
34
▸ makes technical and conforming changes.
35
Money Appropriated in this Bill:
36
None
37
Other Special Clauses:
38
None
39
Utah Code Sections Affected:
40
AMENDS:
41
61-2f-102, as last amended by Laws of Utah 2024, Chapter 227
42
61-2f-103, as last amended by Laws of Utah 2022, Chapter 204
43
61-2f-201, as renumbered and amended by Laws of Utah 2010, Chapter 379
44
61-2f-202, as last amended by Laws of Utah 2022, Chapter 204
45
61-2f-203, as last amended by Laws of Utah 2022, Chapter 204
46
61-2f-204, as last amended by Laws of Utah 2022, Chapter 204
47
61-2f-206, as last amended by Laws of Utah 2022, Chapter 204
48
61-2f-302, as last amended by Laws of Utah 2010, Chapter 184 and renumbered and
49
amended by Laws of Utah 2010, Chapter 379
50
ENACTS:
51
61-2f-202.5, Utah Code Annotated 1953
52
61-2f-307, Utah Code Annotated 1953
53
61-2f-411, Utah Code Annotated 1953
54
55
Be it enacted by the Legislature of the state of Utah:
56
Section 1. Section 61-2f-102 is amended to read:
57
61-2f-102 . Definitions.
58
As used in this chapter:
59
(1) "Associate broker" means an individual who is:
60
(a) employed or engaged as an independent contractor by or on behalf of a principal
61
broker to perform an act described in Subsection [(20) ] (19) for valuable
62
consideration; and
63
(b) licensed or is required to be licensed under this chapter as an associate broker.
64
(2) "Branch broker" means an associate broker who manages a principal broker's branch
- 2 - 01-27 12:28 H.B. 337
65
office under the supervision of the principal broker.
66
(3) "Branch office" means a principal broker's real estate brokerage office that is not the
67
principal broker's main office.
68
(4) "Business day" means a day other than:
69
(a) a Saturday;
70
(b) a Sunday; or
71
(c) a federal or state holiday.
72
(5) "Business opportunity" means the sale, lease, or exchange of any business that includes
73
an interest in real estate.
74
(6) "Commission" means the Real Estate Commission established under this chapter.
75
(7) "Concurrence" means the entities given a concurring role must jointly agree for action
76
to be taken.
77
(8) "Condominium homeowners' association" means the condominium unit owners acting
78
as a group in accordance with declarations and bylaws.
79
(9)(a) "Condominium hotel" means one or more condominium units that are operated as
80
a hotel.
81
(b) "Condominium hotel" does not mean a hotel consisting of condominium units, all of
82
which are owned by a single entity.
83
(10) "Condominium unit" means the same as that term is defined in Section 57-8-3.
84
(11) "Director" means the director of the Division of Real Estate.
85
(12) "Division" means the Division of Real Estate.
86
[(13) "Dual broker" means a principal broker of a real estate sales brokerage who obtains
87
from the division a dual broker license in order to function as the principal broker of a
88
property management company that is a separate entity from the real estate sales
89
brokerage.]
90
[(14)] (13) "Entity" means:
91
(a) a corporation;
92
(b) a partnership;
93
(c) a limited liability company;
94
(d) a company;
95
(e) an association;
96
(f) a joint venture;
97
(g) a business trust;
98
(h) a trust; or
- 3 - H.B. 337 01-27 12:28
99
(i) any organization similar to an entity described in Subsections [(14)(a)] (13)(a)
100
through (h).
101
[(15)] (14) "Executive director" means the director of the Department of Commerce.
102
[(16)] (15) "Foreclosure rescue" means, for compensation or with the expectation of
103
receiving valuable consideration[, to:] :
104
[(a) engage, or offer to engage, in ]
105
(a) an act that:
106
(i) the person represents will assist a borrower in preventing a foreclosure; and
107
(ii) relates to a transaction involving the transfer of title to residential real property; or
108
(b) as an employee or agent of another person:
109
(i) [solicit, or offer] a solicitation or an offer that the other person will engage in an
110
act described in Subsection [(16)(a)] (15)(a); or
111
(ii) [negotiate] negotiation of the terms in relationship to an act described in
112
Subsection [(16)(a)] (15)(a).
113
[(17)] (16) "Loan modification assistance" means, for compensation or with the expectation
114
of receiving valuable consideration[, to]:
115
(a) [act,] an act, or an offer to act, on behalf of a person to:
116
(i) obtain a loan term of a residential mortgage loan that is different from an existing
117
loan term including:
118
(A) an increase or decrease in an interest rate;
119
(B) a change to the type of interest rate;
120
(C) an increase or decrease in the principal amount of the residential mortgage
121
loan;
122
(D) a change in the number of required period payments;
123
(E) an addition of collateral;
124
(F) a change to, or addition of, a prepayment penalty;
125
(G) an addition of a cosigner; or
126
(H) a change in persons obligated under the existing residential mortgage loan; or
127
(ii) a substitute of a new residential mortgage loan for an existing residential
128
mortgage loan; or
129
(b) as an employee or agent of another person:
130
(i) [solicit, or offer] a solicitation or an offer that the other person will engage in an
131
act described in Subsection [(17)(a)] (16)(a); or
132
(ii) [negotiate] negotiation of the terms in relationship to an act described in
- 4 - 01-27 12:28 H.B. 337
133
Subsection [(17)(a)] (16)(a).
134
[(18)] (17) "Main office" means the address [which] that a principal broker designates with
135
the division as the principal broker's primary brokerage office.
136
[(19)] (18) "Person" means an individual or entity.
137
[(20)] (19) "Principal broker" means an individual who[ ] :
138
(a) is licensed or required to be licensed as a principal broker under this chapter[ who:] ;
139
and
140
[(a)] (b)(i) sells or lists for sale real estate, including real estate being sold as part of a
141
foreclosure rescue, or a business opportunity with the expectation of receiving
142
valuable consideration;
143
[(b)] (ii) buys, exchanges, or auctions real estate, an option on real estate, a business
144
opportunity, or an improvement on real estate with the expectation of receiving
145
valuable consideration;
146
[(c)] (iii) advertises, offers, attempts, or otherwise holds the individual out to be
147
engaged in the business described in Subsection [(20)(a) ] (19)(a) or (b)(ii);
148
[(d)] (iv) is employed by or on behalf of the owner of real estate or by a prospective
149
purchaser of real estate and performs an act described in Subsection [(20)(a), ]
150
(19(b)(i), whether the individual's compensation is at a stated salary, a
151
commission basis, upon a salary and commission basis, or otherwise;
152
[(e)] (v) with the expectation of receiving valuable consideration, manages property
153
owned by another person;
154
[(f)] (vi) advertises or otherwise holds the individual out to be engaged in property
155
management;
156
[(g)] (vii) with the expectation of receiving valuable consideration, assists or directs in
157
the procurement of prospects for or the negotiation of a transaction listed in
158
Subsections [(20)(a)] (19)(b)(i) and [(e)] (v);
159
[(h)] (viii) except for a mortgage lender, title insurance producer, or an employee of a
160
mortgage lender or title insurance producer, assists or directs in the closing of a
161
real estate transaction with the expectation of receiving valuable consideration;
162
[(i)] (ix) engages in foreclosure rescue; or
163
[(j)] (x) advertises, offers, attempts, or otherwise holds the person out as being
164
engaged in foreclosure rescue.
165
[(21)] (20)(a) "Property management" means [engaging in] the management of real estate
166
owned by another person, with the expectation of receiving valuable consideration,[
- 5 - H.B. 337 01-27 12:28
167
the management of real estate owned by another person] or advertising or otherwise
168
claiming to be engaged in [property management] the management of real estate
169
owned by another person, by:
170
(i) advertising for, arranging, negotiating, offering, or otherwise attempting or
171
participating in a transaction calculated to secure the rental or leasing of real estate;
172
(ii) collecting, agreeing, offering, or otherwise attempting to collect rent for the real
173
estate[ and accounting for and disbursing the money collected]; or
174
(iii) [authorizing expenditures for repairs to the real estate] signing a lease agreement
175
or an addendum with a tenant.
176
(b) "Property management" does not include:
177
(i) hotel or motel management;
178
(ii) rental of tourist accommodations, including hotels, motels, tourist homes,
179
condominiums, condominium hotels, mobile home park accommodations,
180
campgrounds, or similar public accommodations for a period of less than 30
181
consecutive days, and the management activities associated with these rentals; or
182
(iii) the leasing or management of surface or subsurface minerals or oil and gas
183
interests, if the leasing or management is separate from a sale or lease of the
184
surface estate.
185
[(22) "Property management sales agent" means a sales agent who:]
186
[(a) is affiliated with a dual broker through the dual broker's property management
187
company; and]
188
[(b) is designated by the dual broker as a property management sales agent.]
189
(21) "Property manager" means an individual who:
190
(a) is licensed or required to be licensed as a property manager under this chapter; and
191
(b)(i) engages in property management; or
192
(ii) advertises or otherwise holds the individual out to be engaged in property
193
management.
194
[(23)] (22) "Real estate" includes leaseholds and business opportunities involving real
195
property.
196
[(24)] (23)(a) "Regular salaried employee" means an individual:
197
(i) who performs a service for wages or other remuneration[,] ; and
198
(ii) whose employer withholds federal employment taxes under a contract of hire,
199
written or oral, express or implied.
200
(b) "Regular salaried employee" does not include an individual who performs services
- 6 - 01-27 12:28 H.B. 337
201
on a project-by-project basis or on a commission basis.
202
[(25)] (24) "Reinstatement" means [restoring] the restoration of a license that has expired or
203
has been suspended.
204
[(26)] (25) "Reissuance" means the process by which [a licensee] an individual may obtain a
205
license following revocation of the license.
206
[(27)] (26) "Renewal" means [extending] the extension of a license for an additional
207
licensing period on or before the date the license expires.
208
[(28)] (27) "Sales agent" means an individual who is:
209
(a) affiliated with a principal broker, either as an independent contractor or an employee
210
as provided in Section 61-2f-303, to perform for valuable consideration an act
211
described in Subsection [(20)] (19); and
212
(b) licensed, or required to be licensed, under this chapter as a sales agent.
213
[(29)] (28) "Vulnerable adult" means the same as that term is defined in Section 26B-6-201.
214
Section 2. Section 61-2f-103 is amended to read:
215
61-2f-103 . Real Estate Commission.
216
(1) There is created within the division a Real Estate Commission.
217
(2) The commission shall:
218
(a) subject to concurrence by the division and in accordance with Title 63G, Chapter 3,
219
Utah Administrative Rulemaking Act, make rules for the administration of this
220
chapter that are not inconsistent with this chapter, including:
221
(i) licensing of:
222
(A) a principal broker;
223
(B) an associate broker;[ and]
224
(C) a sales agent; and
225
(D) a property manager;
226
(ii) registration of:
227
(A) an entity;
228
(B) an assumed name under which a person conducts business;
229
(C) a branch office; and
230
(D) a property management company;
231
(iii) prelicensing and postlicensing education curricula;
232
(iv) examination procedures;
233
(v) the certification and conduct of:
234
(A) a real estate school;
- 7 - H.B. 337 01-27 12:28
235
(B) a course provider; or
236
(C) an instructor;
237
(vi) proper handling of money received by a licensee under this chapter;
238
(vii) brokerage office procedures and recordkeeping requirements;
239
(viii) property management;
240
(ix) standards of conduct for a licensee under this chapter;
241
(x) if the commission, with the concurrence of the division, determines necessary, a
242
rule as provided in Subsection 61-2f-306(3) regarding a legal form;
243
(xi) the qualification and designation of an acting principal broker in the event a
244
principal broker dies, is incapacitated, or is unable to perform the duties of a
245
principal broker, as described in Section 61-2f-202; and
246
(xii) giving or paying an inducement gift or a closing gift to a buyer or seller in a real
247
property transaction;
248
(b) establish, with the concurrence of the division, a fee provided for in this chapter,
249
except a fee imposed under Part 5, Real Estate Education, Research, and Recovery
250
Fund Act;
251
(c) conduct an administrative hearing not delegated by the commission to an
252
administrative law judge or the division relating to the:
253
(i) licensing of an applicant;
254
(ii) conduct of a licensee;
255
(iii) the certification or conduct of a real estate school, course provider, or instructor
256
regulated under this chapter; or
257
(iv) violation of this chapter by any person;
258
(d) with the concurrence of the director, impose a sanction as provided in Section
259
61-2f-404;
260
(e) advise the director on the administration and enforcement of a matter affecting the
261
division and the real estate sales and property management industries;
262
(f) advise the director on matters affecting the division budget;
263
(g) advise and assist the director in conducting real estate seminars; and
264
(h) perform other duties as provided by this chapter.
265
(3)(a) Except as provided in Subsection (3)(b), a state entity may not, without the
266
concurrence of the commission, make a rule that changes the rights, duties, or
267
obligations of buyers, sellers, or persons licensed under this chapter in relation to a
268
real estate transaction between private parties.
- 8 - 01-27 12:28 H.B. 337
269
(b) Subsection (3)(a) does not apply to a rule made:
270
(i) under Title 31A, Insurance Code, or Title 7, Financial Institutions Act; or
271
(ii) by the Department of Commerce or any division or other rulemaking body within
272
the Department of Commerce.
273
(4)(a) The commission [shall be comprised] consists of five members appointed by the
274
governor and approved by the Senate in accordance with Title 63G, Chapter 24, Part
275
2, Vacancies.
276
(b) Four of the commission members shall:
277
(i) have at least five years' experience in the real estate business; and
278
(ii) hold an active principal broker, associate broker, or sales agent license.
279
(c) One commission member shall be a member of the general public.
280
(d) The governor may not appoint a commission member described in Subsection (4)(b)
281
who, at the time of appointment, resides in the same county in the state as another
282
commission member.
283
(e) At least one commission member described in Subsection (4)(b) shall at the time of
284
an appointment reside in a county that is not a county of the first or second class.
285
(5)(a) Except as required by Subsection (5)(b), as terms of current commission members
286
expire, the governor shall appoint each new member or reappointed member to a
287
four-year term ending June 30.
288
(b) [Notwithstanding the requirements of Subsection (5)(a), the] The governor shall, at
289
the time of appointment or reappointment, adjust the length of terms to ensure that
290
the terms of commission members are staggered so that approximately half of the
291
commission is appointed every two years.
292
(c) Upon the expiration of the term of a member of the commission, the member of the
293
commission shall continue to hold office until a successor is appointed and qualified.
294
(d) A commission member may not serve more than two consecutive terms.
295
(e) Members of the commission shall annually select one member to serve as chair.
296
(6) When a vacancy occurs in the membership for any reason, the governor, with the advice
297
and consent of the Senate, shall appoint a replacement for the unexpired term.
298
(7) A member may not receive compensation or benefits for the member's service, but may
299
receive per diem and travel expenses in accordance with:
300
(a) Section 63A-3-106;
301
(b) Section 63A-3-107; and
302
(c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
- 9 - H.B. 337 01-27 12:28
303
63A-3-107.
304
(8)(a) The commission shall meet at least monthly.
305
(b) The director may call additional meetings:
306
(i) at the director's discretion;
307
(ii) upon the request of the chair; or
308
(iii) upon the written request of three or more commission members.
309
(9) Three members of the commission constitute a quorum for the transaction of business.
310
(10) A member of the commission shall comply with the conflict of interest provisions
311
described in Title 63G, Chapter 24, Part 3, Conflicts of Interest.
312
Section 3. Section 61-2f-201 is amended to read:
313
61-2f-201 . License required.
314
(1) Unless a person is licensed under this chapter, it is unlawful for the person to do the
315
following with respect to real estate located in this state:
316
(a) engage in the business of a principal broker, associate broker, or sales agent;
317
(b) act in the capacity of a principal broker, associate broker, or sales agent;
318
(c) advertise or assume to act as a principal broker, associate broker, or a sales agent[.] ;
319
or
320
(d) engage in property management.
321
(2) Except as provided in Section 61-2f-202, an individual is required to be licensed as a
322
principal broker, associate broker, or a sales agent if the individual performs, offers to
323
perform, or attempts to perform one act for valuable consideration of:
324
(a) buying, selling,[ leasing, managing,] or exchanging real estate for another person; or
325
(b) offering for another person to buy, sell, [lease, manage, ]or exchange real estate.
326
(3) Except as provided in Section 61-2f-202.1, unless an individual is licensed as a property
327
manager, an individual may not, for consideration:
328
(a) engage in property management; or
329
(b) offer to engage in property management on behalf of another person.
330
Section 4. Section 61-2f-202 is amended to read:
331
61-2f-202 . Exempt persons and transactions.
332
(1)(a)[(a)] Except as provided in Subsection (1)(b), a license under this chapter is not
333
required for:
334
(i) a person who as owner or lessor performs an act described in Subsection [
335
61-2f-102(20)] 61-2f-102(19) with reference to real estate owned or leased by that
336
person;
- 10 - 01-27 12:28 H.B. 337
337
(ii) a regular salaried employee of the owner or lessor of real estate who, with
338
reference to nonresidential real estate owned or leased by the employer, performs
339
an act described in Subsection [61-2f-102(20)(b)] 61-2f-102(19)(b) or (c);
340
(iii) a regular salaried employee of the owner of real estate who performs property
341
management services with reference to real estate owned by the employer, except
342
that the employee may only manage real estate for one employer;
343
(iv) an individual who performs property management services for the apartments at
344
which that individual resides in exchange for free or reduced rent on that
345
individual's apartment;
346
(v) a regular salaried employee of a condominium homeowners' association who
347
manages real estate subject to the declaration of condominium that established the
348
condominium homeowners' association, except that the employee may only
349
manage real estate for one condominium homeowners' association;
350
(vi) a regular salaried employee of a licensed property management company or real
351
estate brokerage who performs support services, as prescribed by rule, for the
352
property management company or real estate brokerage; or
353
(vii) in the event a principal broker dies, is incapacitated, or is unable to perform the
354
duties of a principal broker, an individual qualified and designated as the
355
commission determines by rule made in accordance with Title 63G, Chapter 3,
356
Utah Administrative Rulemaking Act, with the concurrence of the division, as an
357
acting principal broker:
358
(A) in relation to each transaction pending on the day on which the principal
359
broker dies, becomes incapacitated, or becomes unable to perform the duties of
360
a principal broker, including the distribution of compensation for each
361
transaction; and
362
(B) until the day on which each transaction described in Subsection (1)(a)(vii)(A)
363
is completed.
364
(b) Subsection (1)(a) does not exempt from licensing:
365
(i) an employee engaged in the sale of real estate regulated under:
366
(A) Title 57, Chapter 11, Utah Uniform Land Sales Practices Act; or
367
(B) Title 57, Chapter 19, Timeshare and Camp Resort Act;
368
(ii) an employee engaged in the sale of cooperative interests regulated under Title 57,
369
Chapter 23, Real Estate Cooperative Marketing Act; or
370
(iii) an individual whose interest as an owner or lessor is obtained by that individual
- 11 - H.B. 337 01-27 12:28
371
or transferred to that individual for the purpose of evading the application of this
372
chapter, and not for another legitimate business reason.
373
(2) A license under this chapter is not required for:
374
(a) an isolated transaction or service by an individual holding an unsolicited, duly
375
executed power of attorney from a property owner;
376
(b) subject to Subsection 61-2f-401(5), services rendered by an attorney admitted to
377
practice law in this state in performing the attorney's duties as an attorney;
378
(c) a receiver, trustee in bankruptcy, administrator, executor, or an individual acting
379
under order of a court;
380
(d) a trustee or employee of a trustee under a deed of trust or a will;
381
(e) a public utility, officer of a public utility, or regular salaried employee of a public
382
utility, unless performance of an act described in Subsection [61-2f-102(20)]
383
61-2f-102(19) is in connection with the sale, purchase, lease, or other disposition of
384
real estate or investment in real estate unrelated to the principal business activity of
385
that public utility;
386
(f) a regular salaried employee or authorized agent working under the oversight of the
387
Department of Transportation when performing an act on behalf of the Department of
388
Transportation in connection with one or more of the following:
389
(i) the acquisition of real estate pursuant to Section 72-5-103;
390
(ii) the disposal of real estate pursuant to Section 72-5-111;
391
(iii) services that constitute property management; or
392
(iv) the leasing of real estate; and
393
(g) a regular salaried employee of a county, city, or town when performing an act on
394
behalf of the county, city, or town:
395
(i) in accordance with:
396
(A) if a regular salaried employee of a city or town:
397
(I) Title 10, Utah Municipal Code; or
398
(II) Title 11, Cities, Counties, and Local Taxing Units; and
399
(B) if a regular salaried employee of a county:
400
(I) Title 11, Cities, Counties, and Local Taxing Units; and
401
(II) Title 17, Counties; and
402
(ii) in connection with one or more of the following:
403
(A) the acquisition of real estate, including by eminent domain;
404
(B) the disposal of real estate;
- 12 - 01-27 12:28 H.B. 337
405
(C) services that constitute property management; or
406
(D) the leasing of real estate.
407
(3) A license under this chapter is not required for an individual registered to act as a
408
broker-dealer, agent, or investment adviser under the Utah and federal securities laws in
409
the sale or the offer for sale of real estate if:
410
(a)(i) the real estate is a necessary element of a "security" as that term is defined by
411
the Securities Act of 1933 and the Securities Exchange Act of 1934; and
412
(ii) the security is registered for sale in accordance with:
413
(A) the Securities Act of 1933; or
414
(B) Title 61, Chapter 1, Utah Uniform Securities Act; or
415
(b)(i) it is a transaction in a security for which a Form D, described in 17 C.F.R. Sec.
416
239.500, has been filed with the Securities and Exchange Commission pursuant to
417
Regulation D, Rule 506, 17 C.F.R. Sec. 230.506; and
418
(ii) the selling agent and the purchaser are not residents of this state.
419
(4) Except as otherwise provided by statute or rule, the following individuals may engage in
420
the practice of an occupation or profession regulated by this chapter, subject to the stated
421
circumstances and limitations, without being licensed under this chapter:
422
(a) an individual licensed under the laws of this state, other than under this chapter, to
423
practice or engage in an occupation or profession, while engaged in the lawful,
424
professional, and competent practice of that occupation or profession;
425
(b) an individual serving in the armed forces of the United States, the United States
426
Public Health Service, the United States Department of Veterans Affairs, or any other
427
federal agency while engaged in activities regulated under this title as a part of
428
employment with that federal agency if the individual holds a valid license to practice
429
the regulated occupation or profession issued by any other state or jurisdiction
430
recognized by the department; and
431
(c) the spouse of an individual serving in the armed forces of the United States while the
432
individual is stationed within this state, if:
433
(i) the spouse holds a valid license to practice the regulated occupation or profession
434
issued by any other state or jurisdiction recognized by the department; and
435
(ii) the license is current and the spouse is in good standing in the state or jurisdiction
436
of licensure.
437
(5) As used in this section, "owner" does not include:
438
(a) a person who holds an option to purchase real property;
- 13 - H.B. 337 01-27 12:28
439
(b) a mortgagee;
440
(c) a beneficiary under a deed of trust;
441
(d) a trustee under a deed of trust; or
442
(e) a person who owns or holds a claim that encumbers any real property or an
443
improvement to the real property.
444
(6) The commission, with the concurrence of the division, may provide, by rule made in
445
accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
446
circumstances under which a person or transaction qualifies for an exemption that is
447
described in this section.
448
Section 5. Section 61-2f-202.5 is enacted to read:
449
61-2f-202.5 . Exempt individuals and transactions involving property
450
management.
451
A license under this chapter is not required for:
452
(1) an individual who, as an owner or lessor, performs an act described in Subsection
453
61-2f-102(20) in connection to real estate owned or leased by that individual;
454
(2) an individual who is part of a property owner's immediate family, if the individual
455
performs an act described in Subsection 61-2f-102(20) in connection to real estate
456
owned by the property owner;
457
(3) an unlicensed or remote assistant of a property manager;
458
(4) an individual who exclusively performs the following tasks:
459
(a) maintenance and repairs on real property; or
460
(b) bookkeeping and accounting; or
461
(5) a regional manager or a corporate official of a rental agency who does not engage in an
462
act described in Subsection 61-2f-102(20).
463
Section 6. Section 61-2f-203 is amended to read:
464
61-2f-203 . Licensing requirements.
465
(1)(a)(i) The division shall determine whether an applicant with a criminal history
466
qualifies for licensure.
467
(ii) If the division, acting under Subsection (1)(a)(i), denies or restricts a license or
468
places a license on probation, the applicant may petition the commission for de
469
novo review of the application.
470
(b) Except as provided in Subsection (6), the commission shall determine all other
471
qualifications and requirements of an applicant for:
472
(i) a principal broker license;
- 14 - 01-27 12:28 H.B. 337
473
(ii) an associate broker license;[ or]
474
(iii) a sales agent license[.] ; or
475
(iv) a property manager license.
476
(c) The division, with the concurrence of the commission, shall require and pass upon
477
proof necessary to determine the honesty, integrity, truthfulness, reputation, and
478
competency of each applicant for an initial license or for renewal of an existing
479
license.
480
(d)(i)(A) Except as provided in Subsection (1)(d)(i)(B), the division, with the
481
concurrence of the commission, shall require an applicant for a sales agent
482
license to complete a division-approved educational program consisting of not
483
less than 120 hours, as designated by rule the commission makes in accordance
484
with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, with the
485
concurrence of the division.
486
(B) If on the day on which an applicant for a sales agent license applies for the
487
license the applicant is licensed as a real estate sales agent in another state, the
488
division may require the applicant to complete a division-approved,
489
state-specific educational program consisting of the number of hours
490
designated by rule the commission makes in accordance with Title 63G,
491
Chapter 3, Utah Administrative Rulemaking Act, with the concurrence of the
492
division.
493
(ii)(A) Except as provided in Subsection (1)(d)(ii)(B), the division, with the
494
concurrence of the commission, shall require an applicant for an associate
495
broker or a principal broker license to complete a division-approved
496
educational program consisting of not less than 120 hours, as designated by
497
rule the commission makes in accordance with Title 63G, Chapter 3, Utah
498
Administrative Rulemaking Act, with the concurrence of the division.
499
(B) If on the day on which an applicant for an associate broker or a principal
500
broker license applies for the license the applicant is licensed as a real estate
501
broker in another state, the division may require the applicant to complete a
502
division-approved, state-specific educational program consisting of the number
503
of hours designated by rule the commission makes in accordance with Title
504
63G, Chapter 3, Utah Administrative Rulemaking Act, with the concurrence of
505
the division.
506
(iii)(A) Except as provided in Subsection (1)(d)(iii)(B), the division shall require
- 15 - H.B. 337 01-27 12:28
507
that an applicant for a property manager license complete the educational
508
program described in Subsection (1)(d)(iv).
509
(B) If, on the day on which an applicant for a property manager license applies for
510
the license, the applicant is licensed as a property manager in another state, the
511
division may require the applicant to complete a division-approved,
512
state-specific educational program consisting of the number of hours
513
designated by rule the commission makes in accordance with Title 63G,
514
Chapter 3, Utah Administrative Rulemaking Act, with the concurrence of the
515
division.
516
(iv) The division shall create an educational program for a property manager license
517
that:
518
(A) requires at least 24 hours of training;
519
(B) covers subjects the division determines necessary for the program; and
520
(C) establishes the proportion of hours allocated for each subject in the program.
521
[(iii)] (v) An hour required by this section means 50 minutes of instruction in each 60
522
minutes.
523
[(iv)] (vi) The maximum number of program hours available to an individual is eight
524
hours per day.
525
(e)(i) Except as provided in Subsection (1)(e)(ii), the division, with the concurrence
526
of the commission, shall require an applicant to pass an examination approved by
527
the commission covering:
528
(A) the fundamentals of the English language;
529
(B) the fundamentals of arithmetic;
530
(C) the fundamentals of bookkeeping;
531
(D) the fundamentals of real estate principles and practices;
532
(E) this chapter;
533
(F) the rules established by the commission with the concurrence of the division;
534
and
535
(G) any other aspect of Utah real estate license law considered appropriate.
536
(ii) If on the day on which an applicant applies for a license the applicant is licensed
537
as a real estate broker or a sales agent in another state, the division may, with the
538
concurrence of the commission, require the applicant to pass a division-approved,
539
state-specific examination rather than the examination required under Subsection
540
(1)(e)(i).
- 16 - 01-27 12:28 H.B. 337
541
(iii) Subject to Subsection (1)(e)(iv), the division, with the concurrence of the
542
commission, may modify the length and material of an examination for a property
543
manager license under this chapter if:
544
(A) an applicant is licensed as a property manager in another state;
545
(B) the division determines an applicant's prior experience warrants a modification
546
of the examination; or
547
(C) the division determines the applicant has good cause for the modification of
548
the examination.
549
(iv) An examination for a property manager license shall:
550
(A) cover the topics that appear in the educational program described in
551
Subsection (1)(d)(iv); and
552
(B) match the proportion of questions for each topic to the proportion of hours
553
designated by the division in accordance with Subsection (1)(d)(iv)(C).
554
(f)(i) Three years' full-time experience as a sales agent or [its] the equivalent is
555
required before an applicant may apply for, and secure a principal broker or
556
associate broker license in this state.
557
(ii) The commission shall establish by rule made in accordance with Title 63G,
558
Chapter 3, Utah Administrative Rulemaking Act, subject to concurrence by the
559
division, the criteria by which the commission will accept experience or special
560
education in similar fields of business in lieu of the three years' experience.
561
(2)(a) The division, with the concurrence of the commission, may require an applicant to
562
furnish a sworn statement setting forth evidence satisfactory to the division of the
563
applicant's reputation and competency as set forth by rule.
564
(b) The division shall require an applicant to provide the applicant's social security
565
number, which is a private record under Subsection 63G-2-302(1)(i).
566
(3)(a) An individual who is not a resident of this state may be licensed in this state if the [
567
person] individual complies with this chapter.
568
(b) An individual who is not a resident of this state may be licensed as an associate
569
broker or sales agent in this state by:
570
(i) complying with this chapter; and
571
(ii) being employed or engaged as an independent contractor by or on behalf of a
572
principal broker who is licensed in this state, regardless of whether the principal
573
broker is a resident of this state.
574
(4) The division, with the concurrence of the commission, may enter into a reciprocal
- 17 - H.B. 337 01-27 12:28
575
licensing agreement with another jurisdiction for the licensure of a principal broker, an
576
associate broker, or a sales agent, if the jurisdiction's requirements and standards for the
577
license are substantially similar to those of this state.
578
(5)(a) The division and commission shall treat an application to be relicensed of an
579
applicant whose real estate license is revoked as an original application.
580
(b) In the case of an applicant for a new license as a principal broker or associate broker,
581
the applicant is not entitled to credit for experience gained before the revocation of a
582
real estate license.
583
(6)(a) Notwithstanding Subsection (1)(b), the commission may delegate to the division
584
the authority to:
585
(i) review a class or category of applications for initial or renewed licenses;
586
(ii) determine whether an applicant meets the licensing criteria in Subsection (1); and
587
(iii) approve or deny a license application without concurrence by the commission.
588
(b)(i) If the commission delegates to the division the authority to approve or deny an
589
application without concurrence by the commission and the division denies an
590
application for licensure, the applicant who is denied licensure may petition the
591
commission for de novo review of the application.
592
(ii) An applicant who is denied licensure pursuant to this Subsection (6) may seek
593
agency review by the executive director only after the commission has reviewed
594
the division's denial of the applicant's application.
595
(7) An individual with an active broker, associate broker, or sales agent license may obtain
596
a property manager license without:
597
(a) meeting the education requirement described in Subsection (1)(d)(iii); or
598
(b) passing an exam required for a property manager license under Subsection (1)(e).
599
Section 7. Section 61-2f-204 is amended to read:
600
61-2f-204 . Licensing fees and procedures -- Renewal fees and procedures.
601
(1)(a) Upon filing an application for an examination for a license under this chapter, the
602
applicant shall pay a nonrefundable fee established in accordance with Section
603
63J-1-504 for admission to the examination.
604
(b) An applicant for a principal broker, associate broker, [or ]sales agent, or property
605
manager license shall pay a nonrefundable fee as determined by the commission with
606
the concurrence of the division under Section 63J-1-504 for issuance of an initial
607
license or license renewal.
608
(c) [A license issued under this Subsection (1) shall be issued] The division shall issue a
- 18 - 01-27 12:28 H.B. 337
609
license under this Subsection (1) for a period of not less than two years as the
610
division determines with the concurrence of the commission.
611
(d)(i) Each of the following applicants shall comply with this Subsection (1)(d):
612
(A) a new sales agent applicant;
613
(B) a principal broker applicant;[ and]
614
(C) an associate broker applicant[.] ; and
615
(D) a property manager applicant.
616
(ii) An applicant described in this Subsection (1)(d) shall at the time the [licensee]
617
applicant files an application:
618
(A) submit to the division fingerprint cards in a form acceptable to the Department
619
of Public Safety;
620
(B) submit to the division a signed waiver in accordance with Subsection
621
53-10-108(4), acknowledging the registration of the applicant's fingerprints in
622
the Federal Bureau of Investigation Next Generation Identification System's
623
Rap Back Service[ beginning January 1, 2020];
624
(C) consent to a criminal background check by the Utah Bureau of Criminal
625
Identification and the Federal Bureau of Investigation; and
626
(D) pay the fee the division establishes in accordance with Subsection [(1)(d)(vi)]
627
(1)(d)(iv).
628
(iii) The Bureau of Criminal Identification shall:
629
(A) check the fingerprints an applicant submits under Subsection (1)(d)(ii) against
630
the applicable state, regional, and national criminal records databases, including[
631
, beginning January 1, 2020,] the Federal Bureau of Investigation Next
632
Generation Identification System;
633
(B) report the results of the background check to the division;
634
(C) maintain a separate file of fingerprints that applicants submit under Subsection
635
(1)(d) for search by future submissions to the local and regional criminal
636
records databases, including latent prints;
637
(D) request that[ beginning January 1, 2020,] the fingerprints be retained in the
638
Federal Bureau of Investigation Next Generation Identification System's Rap
639
Back Service for search by future submissions to national criminal records
640
databases, including the Next Generation Identification System and latent
641
prints; and
642
(E) ensure that the division only receives notifications for an individual with
- 19 - H.B. 337 01-27 12:28
643
whom the division maintains permission to receive notifications.
644
(iv)(A) The division shall assess an applicant who submits fingerprints under this
645
Subsection (1)(d) or (2)(f) a fee in an amount that the division sets in
646
accordance with Section 63J-1-504 for services that the division and the
647
Bureau of Criminal Identification or another authorized agency provide under
648
this Subsection (1)(d) or (2)(f).
649
(B) The Bureau of Criminal Identification may collect from the division money
650
for services provided under this section.
651
(v) Money paid to the division by an applicant for the cost of the criminal
652
background check is nonlapsing.
653
(vi) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
654
and with the concurrence of the division, the commission may make rules for the
655
administration of this Subsection (1)(d) and Subsection (2)(f) regarding criminal
656
background checks with ongoing monitoring.
657
(e)(i) A license issued under Subsection (1)(d) is conditional, pending completion of
658
the criminal background check.
659
(ii) If a criminal background check discloses that an applicant fails to accurately
660
disclose a criminal history, the division:
661
(A) shall review the application; and
662
(B) in accordance with rules made by the division pursuant to Title 63G, Chapter
663
3, Utah Administrative Rulemaking Act, may:
664
(I) place a condition on a license;
665
(II) place a restriction on a license;
666
(III) revoke a license; or
667
(IV) refer the application to the commission for a decision.
668
(iii)(A) [A person] An individual whose conditional license is conditioned,
669
restricted, or revoked under Subsection (1)(e)(ii) may have a hearing after the
670
action is taken to challenge the action.
671
(B) The division shall conduct a hearing described in Subsection (1)(e)(iii)(A) in
672
accordance with Title 63G, Chapter 4, Administrative Procedures Act.
673
(iv) The director shall designate one of the following to act as the presiding officer in
674
a hearing described in Subsection (1)(e)(iii)(A):
675
(A) the division; or
676
(B) the division with the concurrence of the commission.
- 20 - 01-27 12:28 H.B. 337
677
(v) The presiding officer shall decide whether to grant relief from an action under this
678
Subsection (1)(e)[ is granted].
679
(vi) If a license is revoked or a revocation under this Subsection (1)(e) is upheld after
680
a hearing, the individual may not apply for a new license until at least 12 months
681
after the day on which the license is revoked.
682
(2)(a)(i) A license expires if [it] the license is not renewed on or before the expiration
683
date of the license.
684
(ii) As a condition of renewal, an active licensee shall demonstrate competence by
685
completing 18 hours of continuing education within a two-year renewal period
686
subject to rules made by the commission, with the concurrence of the division.
687
(iii) In making a rule described in Subsection (2)(c)(ii), the division and commission
688
shall consider:
689
(A) evaluating continuing education [on the basis of] based on competency, rather
690
than course time;
691
(B) allowing completion of courses in a significant variety of topic areas that the
692
division and commission determine are valuable in assisting an individual
693
licensed under this chapter to increase the individual's competency; and
694
(C) allowing completion of courses that will increase a licensee's professional
695
competency in the area of practice of the licensee.
696
(iv) The division may award credit to a licensee for a continuing education
697
requirement of this Subsection (2)(a) for a reasonable [period of time] time period
698
upon a finding of reasonable cause, including:
699
(A) military service; or
700
(B) if an individual is elected or appointed to government service, the individual's
701
government service during which the individual spends a substantial time
702
addressing real estate issues subject to conditions established by rule made in
703
accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
704
(b) For a period of 30 days after the day on which a license expires, [the license may be
705
reinstated] the division may reinstate the license:
706
(i) if the applicant's license was inactive on the day on which the applicant's license
707
expired, upon payment of a renewal fee and a late fee determined by the
708
commission with the concurrence of the division under Section 63J-1-504; or
709
(ii) if the applicant's license was active on the day on which the applicant's license
710
expired, upon payment of a renewal fee and a late fee determined by the
- 21 - H.B. 337 01-27 12:28
711
commission with the concurrence of the division under Section 63J-1-504, and
712
providing proof acceptable to the division and the commission of the licensee
713
having:
714
(A) completed the hours of education required by Subsection (2)(a); or
715
(B) demonstrated competence as required under Subsection (2)(a).
716
(c) After the 30-day period described in Subsection (2)(b), and until one year after the
717
day on which an active or inactive license expires, the division may reinstate the
718
license [may be reinstated by] if the applicant:
719
(i) [paying] pays a renewal fee and a late fee determined by the commission with the
720
concurrence of the division under Section 63J-1-504; and
721
(ii) [providing] provides proof acceptable to the division and the commission of the
722
licensee having:
723
(A) completed the hours of education required by Subsection (2)(a); or
724
(B) demonstrated competence as required under Subsection (2)(a).
725
(d) The division shall relicense [a person] an individual who does not renew that [person's]
726
individual's license within one year as prescribed for an original application.
727
(e) Notwithstanding Subsection (2)(a), the division may extend the term of a license that
728
would expire under Subsection (2)(a) except for the extension if:
729
(i)(A) the [person] individual complies with the requirements of this section to
730
renew the license; and
731
(B) the renewal application remains pending at the time of the extension; or
732
(ii) at the time of the extension, there is pending a disciplinary action under this
733
chapter.
734
(f) [Beginning January 1, 2020, each] Each applicant for renewal or reinstatement of a
735
license to practice as a sales agent, principal broker, [or ]associate broker, or a
736
property manager, who is not already subject to ongoing monitoring of the
737
individual's criminal history shall, at the time the application for renewal or
738
reinstatement is filed:
739
(i) submit fingerprint cards in a form acceptable to the Department of Public Safety;
740
(ii) submit to the division a signed waiver in accordance with Subsection
741
53-10-108(4), acknowledging the registration of the applicant's fingerprints in the
742
Federal Bureau of Investigation Next Generation Identification System's Rap
743
Back Service;
744
(iii) consent to a fingerprint background check by the Utah Bureau of Criminal
- 22 - 01-27 12:28 H.B. 337
745
Identification and the Federal Bureau of Investigation; and
746
(iv) pay the fee the division establishes in accordance with Subsection (1)(d)(iv).
747
(3)(a) As a condition for the activation of an inactive license that was in an inactive
748
status at the time of the licensee's most recent renewal, the licensee shall supply the
749
division with proof of:
750
(i) successful completion of the respective sales agent or principal broker licensing
751
examination within six months before the day on which the licensee applies to
752
activate the license; or
753
(ii) the successful completion of the hours of continuing education that the licensee
754
would have been required to complete under Subsection (2)(a) if the license had
755
been on active status at the time of the licensee's most recent renewal.
756
(b) The commission may, in accordance with Title 63G, Chapter 3, Utah Administrative
757
Rulemaking Act, subject to concurrence by the division, establish by rule:
758
(i) the nature or type of continuing education required for reactivation of a license;
759
and
760
(ii) how long before reactivation the continuing education must be completed.
761
Section 8. Section 61-2f-206 is amended to read:
762
61-2f-206 . Registration of person or branch office -- Certification of education
763
providers and courses -- Specialized licenses.
764
(1)(a) A person may not engage in an activity described in Section 61-2f-201, unless the
765
person is registered with the division.
766
(b) To register with the division under this Subsection (1), a person shall submit to the
767
division:
768
(i) an application in a form required by the division;
769
(ii) subject to Subsection (1)(d), evidence of an affiliation with a principal broker;
770
(iii) evidence that the person is registered and in good standing with the Division of
771
Corporations and Commercial Code; and
772
(iv) a registration fee established by the commission with the concurrence of the
773
division under Section 63J-1-504.
774
(c) The division may terminate a person's registration if:
775
(i) the person's registration with the Division of Corporations and Commercial Code
776
has been expired for at least three years; and
777
(ii) the person's license with the division has been inactive for at least three years.
778
(d) An individual licensed as a property manager is not required to affiliate with a
- 23 - H.B. 337 01-27 12:28
779
principal broker.
780
(2)(a) A principal broker shall register with the division each of the principal broker's
781
branch offices.
782
(b) To register a branch office with the division under this Subsection (2), a principal
783
broker shall submit to the division:
784
(i) an application in a form required by the division; and
785
(ii) a registration fee established by the commission with the concurrence of the
786
division under Section 63J-1-504.
787
(3)(a) In accordance with rules made by the commission with the concurrence of the
788
division and in accordance with Title 63G, Chapter 3, Utah Administrative
789
Rulemaking Act, the division shall certify:
790
(i) a real estate school;
791
(ii) a course provider; or
792
(iii) an instructor.
793
(b) In accordance with rules made by the commission in accordance with Title 63G,
794
Chapter 3, Utah Administrative Rulemaking Act, subject to concurrence by the
795
division, the division shall certify a continuing education course that is required
796
under this chapter.
797
(4) Except as provided under this chapter or by rule the commission makes in accordance
798
with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, a principal broker may
799
not be responsible for more than one registered entity at the same time.
800
(5) A principal broker:
801
(a) shall exercise active and reasonable supervision of the principal broker's main office
802
in accordance with this chapter and rules the commission makes in accordance with
803
Title 63G, Chapter 3, Utah Administrative Rulemaking Act; and
804
(b) may supervise a branch office affiliated with the principal broker at the same time
805
the principal broker exercises the supervision required under Subsection (5)(a).
806
(6)(a) A principal broker may designate a branch broker to supervise a branch office
807
affiliated with the principal broker.
808
(b) A branch broker shall exercise active and reasonable supervision, in accordance with
809
this chapter and rules the commission makes in accordance with Title 63G, Chapter
810
3, Utah Administrative Rulemaking Act, of each branch office the principal broker
811
designates the branch broker to supervise.
812
[(7)(a) In addition to issuing a principal broker license, associate broker license, or sales
- 24 - 01-27 12:28 H.B. 337
813
agent license authorizing the performance of an act set forth in Section 61-2f-201, the
814
division may issue a specialized sales license or specialized property management
815
license with the scope of practice limited to the specialty.]
816
[(b) An individual may hold a specialized license in addition to a license as a principal
817
broker, associate broker, or a sales agent.]
818
[(c) A sales agent who is affiliated with a dual broker may act as a property management
819
sales agent if:]
820
[(i) the dual broker designates the sales agent as a property management sales agent;
821
and]
822
[(ii) the sales agent pays to the division a property management sales agent
823
designation fee in an amount determined by the division in accordance with
824
Section 63J-1-504.]
825
[(d) A property management sales agent may simultaneously provide both property
826
management services and real estate sales services under the supervision of a dual
827
broker as provided by the commission with the concurrence of the division by rule
828
made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.]
829
[(8) The commission may determine, by rule made in accordance with Title 63G, Chapter
830
3, Utah Administrative Rulemaking Act, subject to concurrence by the division,
831
licensing requirements related to this section for a principal broker, associate broker,
832
sales agent, dual broker, property management sales agent, or for a specialized license
833
described in Subsection (7), including:]
834
[(a) prelicensing and postlicensing education requirements;]
835
[(b) examination requirements;]
836
[(c) affiliation with real estate brokerages or property management companies;]
837
[(d) property management sales agent:]
838
[(i) designation procedures;]
839
[(ii) allowable scope of practice; and]
840
[(iii) division fees;]
841
[(e) what constitutes active and reasonable supervision for:]
842
[(i) a principal broker when supervising a branch broker or sales agent; and]
843
[(ii) a branch broker when supervising a sales agent; and]
844
[(f) other licensing procedures.]
845
Section 9. Section 61-2f-302 is amended to read:
846
61-2f-302 . Affiliation with a principal broker.
- 25 - H.B. 337 01-27 12:28
847
(1)(a) [An] Except as provided in Subsection (1)(b), an individual who is not a principal
848
broker may not engage in an act described in Section 61-2f-201 unless the individual
849
is affiliated with a principal broker as:
850
[(a)] (i) an associate broker; or
851
[(b)] (ii) a sales agent.
852
(b)(i) The division may not require an individual licensed as a property manager
853
under Section 61-2f-201 to affiliate with a principal broker.
854
(ii) An individual licensed as a property manager may engage in an act described in
855
Subsection 61-2f-201(20) without affiliating with a principal broker.
856
(2)(a) An inactive associate broker or sales agent may not conduct a real estate
857
transaction until the inactive associate broker or sales agent becomes affiliated with a
858
principal broker and submits the required documentation to the division.
859
(b) An inactive principal broker may not conduct a real estate transaction until the
860
principal broker's license is activated with the division.
861
(3) A sales agent or associate broker may not affiliate with more than one principal broker
862
at the same time.
863
(4) An individual may not be a principal broker of an entity and a sales agent or associate
864
broker for a different entity at the same time.
865
(5) An owner, purchaser, lessor, or lessee who engages the services of a principal broker
866
may designate which sales agents or associate brokers affiliated with that principal
867
broker will also represent that owner, purchaser, lessor, or lessee in the purchase, sale,
868
lease, or exchange of real estate, or in exercising an option relating to real estate.
869
Section 10. Section 61-2f-307 is enacted to read:
870
61-2f-307 . Rights and privileges of a property manager to fill out a form or
871
document.
872
A property manager may fill out any form, contract, or lease agreement associated with
873
the renting and management of real property.
874
Section 11. Section 61-2f-411 is enacted to read:
875
61-2f-411 . Enforcement related to a property manager.
876
(1) Nothing in this section applies to an individual:
877
(a) buying, selling, or exchanging real estate for another person; or
878
(b) offering to buy, sell, or exchange real estate for another person.
879
(2) When engaging in property management, a property manager may:
880
(a) solicit referrals for clients, owners, customers, and renters;
- 26 - 01-27 12:28 H.B. 337
881
(b) pay a finder's fee or exchange valuable consideration to an unlicensed person for
882
referring a prospective client;
883
(c) accept a referral fee from an individual, whether licensed or unlicensed;
884
(d) contract for services, pay bills, and act on behalf of an owner as provided in a
885
management agreement; and
886
(e) advertise properties for rent or lease.
887
(3) Except as provided in Subsection (4), a property manager shall associate with at least
888
one real estate trust account in a bank or credit union:
889
(a) located within the state;
890
(b) that, unless otherwise modified by a contract for property management, one or more
891
property managers use for the purpose of securing:
892
(i) tenant security deposits;
893
(ii) rent;
894
(iii) money tendered by a property owner as a reserve fund or for payment of an
895
unexpected expense; and
896
(iv) any other purpose designated by the commission; and
897
(c) that is non-interest bearing, unless the parties to a property management contract:
898
(i) agree in writing to deposit the funds in an interest-bearing account;
899
(ii) designate in writing the individuals to whom the parties will pay the interest on
900
completion or failure of the property management contract; and
901
(iii) ensure that the parties and trust account comply with any other rules established
902
by the commission or division.
903
(4) A property manager who obtains and holds a security bond that protects at least 30% of
904
the estimated client funds the property manager holds in the property manager's bank
905
accounts is not required to be associated with a trust account.
906
(5) The commission:
907
(a) may not impose financial penalties for conduct that violates an existing division rule,
908
if:
909
(i) a court has adjudicated and issued a final judgment relating to the conduct; or
910
(ii) all parties involved in the conduct settled privately;
911
(b) may suspend, revoke, reprimand, or otherwise issue non-financial penalties to a
912
property manager, regardless of whether a court has adjudicated and issued a final
913
judgment relating to the conduct; and
914
(c) may adopt a rule requiring a property manager to disclose ownership interests to a
- 27 - H.B. 337 01-27 12:28
915
renter or prospective tenant.
916
Section 12. Effective Date.
917
This bill takes effect on May 7, 2025.
- 28 -