LEGISLATIVE UPDATE
from
Teresa Ramos
RANM President
&
Richard Randals
Chairman RANM Legislative Committee
March 4, 2011
With only a little more than two weeks remaining in the 50th Session of the New Mexico Legislature and with over 1500 bills to consider, activity is expected to reach a frenzied pace.
The hot buttons so far have included the budget, eliminating driver licenses for illegal immigrants, movie tax credits and education.
The House of Representatives, on a 35-34 vote, passed a $5.4 billion budget plan. Known as the General Appropriations Act, the budget represents a decrease from last fiscal year’s budget including cuts in public school funding. The bill has been referred to the Senate where it will face further scrutiny.
Another cut may come in the form of the film production tax credit. The House voted 53-17 to limit to $45 million the amount of money the state provides as part of the film production rebates. Governor Susana Martinez had sought a reduction of the tax credit for movie makers from 25 to 15 percent and the cap represents a compromise hammered out in committee. Rebates have reportedly been as much as $78 million in past years. The bill has been referred to the Senate.
While the budget for education continues to be debated, other education measures are being considered including a measure to end “social promotion” of students and grading schools. The House Education Committee passed a bill that would prevent third graders from being promoted to the fourth grade if they cannot read.
Following six hours of debate, the House of Representatives is scheduled to vote on a measure to prohibit the issuing of driver licenses to illegal immigrants. HB 78 would require all applicants for driver licenses to provide a social security number.
On the real estate front, RANM is actively tracking over 200 bills that have a direct or indirect impact on RANM members. These bills are being watched closely by the RANM Legislative Committee, made up of REALTORS from around the state; RANM’s Executive Director, Steve Anaya; RANM’s Lobbyist, Nancy King; and, RANM’s Attorney, Ashley Strauss-Martin.
Of major interest to RANM members is Senate Bill 561 that authorizes a licensed real estate broker to prepare and collect a fee for a Broker’s Price Opinion (BPO). The bill was introduced by Senator Phil Griego of Santa Fe. A call to action was sent out requesting members to contact the members of the Senate Corporations and Transportation Committee in support of the bill. It was passed without recommendation and was referred to the Senate Consumer and Public Affairs Committee. RANM has been working with appraisers to identify the parameters of BPOs.
Senate Bill 504 (Griego D39), The Prohibition of Transfer Fee Covenants Act, passed the Senate Conservation Committee and is before the Senate Judiciary Committee. SB504prohibits transfer fee covenants on real property transfers. It proposes that a transfer fee covenant, or any lien to the extent that it claims to secure the payment of a transfer fee, is not binding on or enforceable against the affected real property or any subsequent owner, purchaser, or mortgagee of any interest in the property.
RANM is also involved in a Land Grant controversy in northern New Mexico. Taos County has surfaced as a new battle ground involving real estate sales following the filing of land grant claims on thousands of lots. Land patent claims and warranty deeds recently were filed in the county clerk’s office by heirs and trustees of two land grant associations there and from title companies, at least one that has refused to provide insurance thus affecting real estate deals. Representative Roberto Gonzales (D42) introduced House Bill 653, The Real Property False Claims Act, which would “prohibit the filing and recording of false documents of title or fraudulent court records affecting real property.” The bill is now before the House Labor & Human Resources Committee.
Other bills of interest include:
SB105, Real Estate Broker Licensing, (Eichenberg D15), which was amended and passed by the Senate Corporations and Transportation Committee (see the RANM e-mail sent to you on Feb. 17), also passed in the Senate Judiciary Committee and now heads for the Senate Floor.
It appears Senate Bill 320, the Real Estate Installment Contract Act may not make it out of committee, rendering it dead. This legislation would have impacted property owners desiring to use seller financing.
House Bill 9, the Homeowner Association Act (Stewart D21) passed on a 65-2 House vote and is now before the Senate. HB9 provides extensive rules and regulations for all Home Owner Associations. The bill has been referred to two Senate committees, Conservation and Judiciary.
Senate Bill 183, Amending the Condominium Act (McSorley D18), Several amendments were made in the Judiciary Committee to mirror language in HB9. This bill has been placed on the Senate calendar for a vote.
Senate Bill 30 (Keller D17; Taylor, T. R1), Requirement of Agency Rulemaking, has been passed by the Senate Rules and Judiciary Committees and is expected to be placed on the Senate calendar for a vote. This bill would provide an extensive revision to the State Rules Act by requiring all state agencies, including the New Mexico Real Estate Commission, to ensure more publication notice and public participation.
Several “tax lightning” bills have been introduced in this year’s legislative session. When this is the case, one bill usually will take precedent and that bill could be Senate Bill 108 (Eichenberg D15). The original bill was amended and the Committee Substitute bill was given a “do pass” by two Senate Committees; Corporations & Transportation and Finance, and is expected to be placed on the Senate Calendar for a vote. The amended bill maintains the three percent annual limitation on increases to residential property valuations but goes one step further by providing for a reduction in residential property value in the year a property has a change of ownership or is valued as new construction.
The list below includes some of the other legislation RANM is tracking. The information includes whether the legislation was introduced in the House (H) or Senate (S); the type of legislation (B-Bill, M-Memorial, JM-Joint Memorial, R-Resolution), the name of the lawmaker who introduced it along with their party affiliation and the district they represent. If you want to read the bill yourself you can go to the NM Legislature website at www.nmlegis.gov/lcs. Click on “Legislation” (upper left hand of page) and then click on “Bill Finder”.
HB59-Stewart (D21)
UNEMPLOYMENT COMPENSATION TEMPORARY EMPLOYER RATE INCREASE This bill passed a full House vote. It increases the present rates of employer contribution to the Unemployment Compensation Fund in the event the fund becomes insolvent. The amount employers would pay would increase from 3.3% to 3.6%. The bill is now before the Senate Public Affairs and Senate Finance Committees.
HB171- Stewart (D21)
PROHIBITING DEFICIENCY JUDGMENTS
House Bill 171 seeks to prohibit deficiency judgments in a foreclosure for proceedings instituted on or after July 1, 2011. Reported “do pass” as written by House Consumer & Public Affairs Committee and is now before the House Judiciary Committee.
HB174- Egoff (D47)
FORECLOSURE FAIRNESS ACT This bill passed the House on a 64-5 vote. The original bill was substituted in committee. The substitute narrows the focus of the bill to specify that a court shall award reasonable attorney fees and costs to a defendant prevailing in a foreclosure action on a mortgage note secured by the defendant’s primary residence (not merely any foreclosure action, as provided in the original). A further proviso, absent in the original: an award of fees and costs does not apply where the plaintiff in such an action is an individual bringing the claim on the individual’s own behalf or on behalf of a sole proprietorship owned by the plaintiff.
As in the original, a defendant who exercises the defendant’s right of reinstatement or redemption shall not be considered a prevailing party. The bill is now in the Senate Public Affairs and the Senate Judiciary Committees.
HB219-Cook (R56)
TRUST PROPERTY AND RULE AGAINST PERPETUITIES House Bill 219 passed a House vote, 64-4. The bill designates a new section to the statutory rule against perpetuities for interests held by trusts. Those interests generally would not be subject to the standard 90 year expiration period for conveyance to a beneficiary. This new exemption carves out interests in real property, water or water rights held by a trust, which interests under HB 219 shall expire 110 years from either the date on which the interest is added to or purchased by the trust or the date the trust become irrevocable, whichever is later. HB 219 codifies how those interests are to be distributed at the end of the 110 year period. This bill is now before the Senate Conservation and Senate Judiciary Committees.
HB220-Cook (R56)
STATE REDEMPTION PERIOD ON MORTGAGED PROPERTY This bill was passed in a 68-0 vote in House and has been sent to the Senate. HB 220 gives the same rights to the State as those provided all other persons in matters of judicial sales made pursuant to judgment in a suit in which the State is a party for the purpose of a quiet title, a foreclosure of a mortgage, or another lien upon real estate or personal property. The Bill shortens from nine months to one month the period of time the State has to exercise a right of redemption on the judicial sale of real property on which the State has a lien or other encumbrance. The bill empowers a district court to extend the period up to nine months upon sufficient showing by the State that such extension is warranted. The bill will be considered in the Senate Corporations & Transportation and Senate Judiciary Committees.
HB221-Cook (R56) CHANGES TO THE DEED OF TRUST ACT The bill shortens the period of time for which a trustee must wait before selling real estate and shortens the amount of time a trustee has to provide notice of any such sale after the sale has occurred. The power of sale of trust real estate conferred upon the trustee shall not be exercised before the expiration of 30 days from the latter of the recording of the notice of the sale or the last publication of the notice of sale. Current law is 90 days. Bill has passed House Consumer and Public Affairs Committee and is now before the House Judiciary Committee.
HB441-Gutierrez
(D33)EXPANDING THE DEFINITION OF AFFORDABLE HOUSING The proposed definition of “affordable housing” in HB 441 would read, “any housing development built primarily to benefit persons of low or moderate income”. The bill strikes the wording “those whose income is at or below eighty percent of the area median income and who will pay no more than thirty percent of their gross monthly income towards such housing”. The measure is before the House Health and Government Affairs Committee.
HB573-Gentry (R30)
MORTGAGE COMPANIES REQUIREMENT TO MAINTAIN AN OFFICE IN THE STATE Bill 573 amends the Mortgage Loan Company Act calling for a mortgage loan company qualified manager to be a resident of the state, maintain a registered office in the state, ensure records are maintained in the office and in digital format, and adds a new section to the law of registered office required exemptions. Bill is currently before the House Business and Industry and House Judiciary Committees.
HB602-Strickler (R2); Baldonado (R8)
TAX BREAKS FOR MANUFACTURED HOMES House Bill 602 would allow county treasurers to authorize a 90-day amnesty period to encourage owners of manufactured homes to make payment on delinquent property taxes provided the 90-day amnesty occurs in FY12. The bill would also provide a $5,000 reduction in assessed value on all manufactured homes. The measure is before the House Health and Government Affairs Committee.
SB69-Keller (D17); O’Neill(D15)
SPOT REZONING IN LARGER CITIES Amendment would allow cities of 30,000+ (changed from 60,000+) to change zoning of a parcel of land because of error or changed neighborhood conditions. Bill was passed in the Senate Conservation Committee and is now before the Senate Judiciary Committee.
SB406 Sanchez, M.(D29)
ENACTING THE MORTGAGE FAIR FORECLOSURE ACT The bill, which passed through two committees with amendments and is pending a Senate vote, states that home owners should be given reasonable notice prior to the loss of their home and afforded a meaningful opportunity to participate in loss mitigation to prevent the loss of homeownership. SB406 further states consumers and businesses operating in New Mexico should be used to facilitate whenever possible, the cure of any default on residential mortgage loans and thereby preserve homeownership.
The amendments to the original bill include:
Changes from 45 days to 30 days the notice required by a creditor to a debtor prior to accelerating a mortgage obligation and commencing a foreclosure or other legal action.
Expands the contact information required in a notice by a creditor to a debtor.
Species that upon a request for loss mitigation, a creditor shall designate a person with authority to modify the debtor’s obligation, and shall provide to the debtor the contact information for that person.
Provides that after the commencement of a foreclosure proceeding, a debtor may request loss mitigation, upon which the court may in its discretion, stay the foreclosure proceedings or the sale of the property until the loss mitigation is completed.
Expands the sanctions available to the court in a case of material violation of the Mortgage Fair Foreclosure Act to include ordering any relief provided by law.
Specifies that the Mortgage Fair Foreclosure Act shall not apply to any mortgage on which a default occurs within 120 days of execution of the mortgage.
SB442-Cisneros (D6)
BUILDING ENERGY DISCLOSURE ACT This bill requires the state to disclose the energy efficiency of state, city, county, and school-owned buildings 5,000 sq. ft. or more; owners of nonresidential buildings to measure and disclose energy performance; utilities to release consumption data to building owners; and the Energy, Minerals and Natural Resources Department to promulgate rules to carry out the provisions of the act. The amount of energy a building uses could have an impact on the sale of a building as an inefficient energy building could be harder to sell in a competitive market. The bill was introduced in Senate Conservation Committee and also referred to Senate Judiciary Committee.
SB447-Ortiz y Pino(D12)
CONDOMINIUM DISCLOSURE ACT This “consumer friendly” bill provides that a disclosure statement may be delivered to a purchaser prior to the recordation of the condominium declaration. This bill has not made it out of the Senate Corporations and Transportation or the Senate Public Affairs Committee.
SB570-Griego(D39)
ADDING A DEFINITION TO THE MANUFACTURED HOUSING AND ZONING ACT; ALLOWING SINGLE-SECTION MANUFACTURED HOMES IN CERTAIN ZONES SB570 amends the Manufactured Housing and Zoning Act to include new terminology for what was considered a “mobile home” or “trailer” and is now known as a “single-section manufactured home” that is constructed in a factory to the standards of the U.S. Department of Housing and Urban Development (HUD). The bill would require that single-section manufactured homes be treated the same as mobile homes under the act. The bill is before the Senate Corporations & Transportation and the Senate Judiciary Committees.
SJM14- Boitano (R18); Baldonado (R8)
ENCOURAGING MORTGAGE LENDING REGULATORS TO REASSESS AND AMEND THEIR CREDIT POLICIES TO ALLOW MORE QUALIFIED HOME-BUYERS TO OBTAIN MORTGAGE FINANCING Copies of the memorial shall be sent to the board of governors of the Federal Reserve System, commissioner of the Federal Housing Administration, chief executive officers of Fannie Mae and Freddie Mac, Secretary of Veterans Affairs, and New Mexico’s Congressional Delegation. This Joint Memorial is pending a Senate vote after favorable recommendations from the Senate Rules and Senate Corporations .
Realtors Association of New Mexico | 2201 Brothers Rd | Santa Fe | NM | 87505
___________________________________________________________________