The Texas Real Estate Commission (TREC) proposes new §535.71, concerning mandatory continuing education: approval of providers, courses and instructors, §535.72, concerning mandatory continuing education: presentation of courses, advertising and records, and §535.73, concerning compliance and enforcement.

The proposed rules require all licensees to take a three hour legal update course and a three hour legal ethics course created for and approved by TREC to satisfy the 6 legal hours of mandatory continuing education required by Occupations Code §1101.455 (the Act). Instructors who teach the legal courses must be certified to teach the courses by attending an instructor training course to be offered by the Real Estate Center at Texas A&M University (the Center); instructors must be pre-approved by the Commission prior to attending the instructor training course and obtaining certification to teach the required courses. The required legal update and ethics courses will be replaced at the end of every odd numbered year (3 years for the first set of courses, every 2 years after). The required courses may be modified by certified instructors to supplement the courses with additional material, to create distance learning legal courses or to combine the legal courses with elective courses. Elective courses to be used as credit for the remaining 9 hours required by §1101.455 of the Act must be presentations of relevant issues that impact the practice of real estate or which increase or support the development of skill and competence; providers will be required to register all courses with the Commission. Core and mandatory continuing legal education courses may be accepted for satisfying MCE elective credit only. Correspondence and alternate delivery method courses may be registered to satisfy elective and required legal credit subject to certain conditions. A provider may grant partial credit to a student who attends less than the complete course registered with the commission only if the segments of the course for which partial credit may be granted are not less than one hour in length and the student attends the full class hour to get credit for attendance for that hour. Thus if a student is away or late for any portion of a 50 minute class hour the student may not receive credit for that hour except as provided in circumstances described in §535.72(c). The student will receive credit for any other full hours of that course that the student attends. Instructor applicants must satisfy the commission as to the applicant's honesty, trustworthiness and integrity; providers will be responsible for ensuring that instructors are competent to teach a particular subject. The proposed rules also propose to adopt by reference 13 MCE new or revised application forms that are consistent with the proposed rules; the forms have also been changed to reference the cites to Chapter 1101 Occupations Code and have been reformatted for style and consistency with other TREC forms.

The effective date of the new rules if adopted will be January 1, 2005. Distance learning courses may be offered for required legal course credit on or after July 1, 2005. Licensees on active status will be required to take the required legal update and legal ethics courses for their next and all subsequent renewals of their license after January 1, 2005. Thus a licensee may, but is not required to attend the required legal courses for his or her first renewal after the effective date, but the licensee is required to take the courses for the next and all subsequent renewals. For licenses granted after the effective date, the licensee must attend the required courses to renew a license on active status.

Loretta R. DeHay, general counsel, has determined that for the first five-year period the proposed revisions to the sections are in effect there will be no fiscal implications for the state as a result of enforcing or administering the sections. There are no anticipated fiscal implications for units of local government. There will be no impact on small businesses, micro businesses or local or state employment as a result of implementing the sections.

Ms. DeHay also has determined that for each year of the first five years the sections as proposed are in effect the public benefit anticipated as a result of enforcing the sections will be increased knowledge of current real estate related case law and statutory provisions due to the proposed requirements to attend commission created legal mandatory continuing education courses. There is no anticipated economic cost to persons who are required to comply with the proposed sections.

Comments on the proposal may be submitted to Loretta R. DeHay, General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.

The new sections are proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to make and enforce all rules and regulations necessary for the performance of its duties and to establish standards of conduct and ethics for its licensees in keeping with the purpose and intent of the Act to insure compliance with the provisions of the Act.

The statute affected by this proposal is Texas Occupations Code, Chapter 1101. No other statute, code or article is affected by the proposed new sections.