PART 23. TEXAS REAL ESTATE COMMISSION
CHAPTER 531. CANONS OF PROFESSIONAL ETHICS AND CONDUCT
The Texas Real Estate Commission (TREC) proposes amendments to §531.20, Information About Brokerage Services.
The proposed amendments to §531.20 and the form adopted by reference (the Information About Brokerage Services (IABS) notice) are made as a result of the recent industry changes surrounding broker compensation to clarify to the consumer that any brokerage fees are not set by law and are negotiable.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendment is in effect, there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the section. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendment. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendment. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the section as proposed are in effect, the public benefit anticipated as a result of enforcing the section will be increased consumer awareness regarding brokerage compensation practices.
For each year of the first five years the proposed amendment is in effect the amendment will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability;
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendment is proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102. The amendment is also proposed under Texas Occupations Code, §1101.558, which requires the Commission to prescribe the text of the IABS notice.
The statutes affected by this proposal are Texas Occupations Code, Chapters 1101 and 1102. No other statute, code or article is affected by the proposed amendment.
§531.20.Information About Brokerage Services.
(a) The Commission adopts by reference the Information
About Brokerage Services Notice, TREC No. IABS 1-1 [1-0]
(IABS Notice). The IABS Notice is published by and available from
the Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188,
www.trec.texas.gov.
(b) Each license holder shall provide:
(1) a link to a completed IABS Notice in a readily noticeable place on the homepage of each business website, labeled:
(A) "Texas Real Estate Commission Information About Brokerage Services", in at least 10 point font; or
(B) "TREC Information About Brokerage Services", in at least 12 point font; and
(2) the completed IABS Notice at the first substantive communication as required under §1101.558, Texas Occupations Code.
(c) For purposes of §1101.558, Texas Occupations Code, the completed IABS Notice can be provided:
(1) by personal delivery by the license holder;
(2) by first class mail or overnight common carrier delivery service;
(3) in the body of an email; or
(4) as an attachment to an email, or a link within the body of an email, with a specific reference to the IABS Notice in the body of the email.
(d) The link to a completed IABS Notice may not be in a footnote or signature block in an email.
(e) For purposes of this section, business website means a website on the internet that:
(1) is accessible to the public;
(2) contains information about a license holder's real estate brokerage services; and
(3) the content of the website is controlled by the license holder.
(f) For purposes of providing the link required under subsection (b)(1) on a social media platform, the link may be located on:
(1) the account holder profile; or
(2) a separate page or website through a direct link from the social media platform or account holder profile.
(g) License holders may reproduce the IABS Notice published by the Commission, provided that the text of the IABS Notice is copied verbatim and the spacing, borders and placement of text on the page must appear to be identical to that in the published version of the IABS Notice, except that the Broker Contact Information section may be prefilled.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405374
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
The Texas Real Estate Commission (TREC) proposes new 22 TAC §534.8, Employee Sick and Family Leave Pools, in Chapter 534, General Administration.
The new rule is proposed to address the operation and procedures of both the employee sick and family leave pool required by sections 661.002 and 661.022, Texas Government Code.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the new rule is in effect there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the new rule. There is no significant economic cost anticipated for persons who are required to comply with the proposed new rule. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the section as proposed are in effect, the public benefit anticipated as a result of enforcing the section will be greater legal accuracy and clarity in the rules.
Except as otherwise provided, for each year of the first five years the new rule is in effect, the rule will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability; or
positively or adversely affect the state's economy.
The proposal does create a new regulation; however, the regulation is required by law.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The new rule is proposed under §1101.151, Occupations Code, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102. The new rule is also proposed under sections 661.002 and 661.022, Texas Government Code, which requires a state agency to adopt rules and prescribe procedures relating to the operation of the agency sick and family leave pools.
The statutes affected by this proposal are Chapters 1101 and 1102, Occupations Code. No other statute, code or article is affected by the proposed new rule.
§534.8.Employee Sick and Family Leave Pools.
(a) The Agency's Director of Human Resources is designated as the administrator for both the Agency's sick leave pool and family leave pool.
(b) The Director of Human Resources, with the approval of the Executive Director, will prescribe and implement policies to effectuate the operation of the pools.
(c) The policies and procedures must be consistent with the provisions of Chapter 661, Texas Government Code, and will be included in the Agency's employee handbook.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405385
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
SUBCHAPTER F. REQUIREMENTS FOR EDUCATION PROVIDERS, COURSES AND INSTRUCTORS FOR QUALIFYING EDUCATION
The Texas Real Estate Commission (TREC) proposes amendments to 22 TAC §535.65, Responsibilities and Operations of Providers of Qualifying Courses.
The proposed amendment to §535.65(g)(1)(B)(i) replaces the phrase "check the photo identification" with "verify the identification" of each student to: (i) broaden the language in recognition of technology developments that may allow for this required verification in different ways; (ii) help alleviate concerns about the security of a student's personal data while taking a course; and (iii) make consistent with language used elsewhere in the rule. The remainder of the amendments to §535.65 remove the requirement to have a qualifying course examination proctored and to have a proctor in situations where a course is delivered through the use of technology and there are more than 20 students at a remote site. The proctoring requirements were recommended to be removed out of concerns that: (i) the exam requirement was unnecessary because the licensing examination itself is proctored; and (ii) the requirements generally are overly burdensome. The term "classroom delivery" is added to §535.65(g)(1)(C) to specify that the obligation applies to that type of course. The language in §535.65(h)(5) is reworded for consistency with similar language found in §535.72.
The proposed amendments were recommended by the Education Standards Advisory Committee and the Texas Real Estate Inspector Committee.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendments are in effect there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendments. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendments. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the sections as proposed are in effect, the public benefit anticipated will be improved clarity and integrity in rule and processes for members of the public, including students of qualifying courses, as well as education providers.
For each year of the first five years the proposed amendments are in effect the amendments will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit, or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability; or
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendments are proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102.
The statutes affected by this proposal are Texas Occupations Code, Chapters 1101 and 1102. No other statute, code or article is affected by the proposed amendments.
§535.65.Responsibilities and Operations of Providers of Qualifying Courses.
(a) Responsibility of Providers.
(1) A provider is responsible for:
(A) the administration of each course, including, but not limited to, compliance with any prescribed period of time for any required course topics required by the Act, Chapter 1102, and Commission rules;
(B) maintaining student attendance records and pre-enrollment agreements;
(C) verifying instructor qualification, performance and attendance;
(D) proper examination administration;
(E) validation of student identity acceptable to the Commission;
(F) maintaining student course completion records;
(G) ensuring all advertising complies with subsection (c) of this section;
(H) ensuring that instructors or other persons do not recruit or solicit prospective sales agents, brokers, easement or right-of-way agents, or inspectors during course presentation; and
(I) ensuring staff is reasonably available for public inquiry and assistance.
(2) A provider may not promote the sale of goods or services during the presentation of a course.
(3) A provider may remove a student and not award credit if a student does not participate in class, or disrupts the orderly conduct of a class, after being warned by the provider or the instructor.
(4) If a provider approved by the Commission does not maintain a fixed office in Texas for the duration of the provider's approval to offer courses, the provider shall designate a resident of this state as attorney-in-fact to accept service of process and act as custodian of any records in Texas that the provider is required to maintain by this section. A power-of-attorney designating the resident must be filed with the Commission in a form acceptable to the Commission.
(b) Use of Qualified Instructor.
(1) Except as provided by this subsection, a provider must use an instructor that is currently qualified under §535.63 of this subchapter (relating to Qualifications for Instructors of Qualifying Courses) to teach the specified course.
(2) Each instructor shall be selected on the basis of expertise in the subject area of instruction and ability as an instructor.
(3) A provider shall require specialized training or work experience for instructors teaching specialized subjects such as law, appraisal, investments, taxation or home inspection.
(4) An instructor shall teach a course in substantially the same manner represented to the Commission in the instructor's manual or other documents filed with the application for course approval.
(5) A provider may use the services of a guest instructor who does not meet the instructor qualifications under §535.63 of this subchapter for qualifying real estate, easement or right-of-way, or inspector courses provided that person instructs for no more than 10% of the total course time.
(c) Advertising.
(1) The following practices are prohibited:
(A) using any advertising which does not clearly and conspicuously contain the provider's name on the first page or screen of the advertising;
(B) representing that the provider's program is the only vehicle by which a person may satisfy educational requirements;
(C) conveying a false impression of the provider's size, superiority, importance, location, equipment or facilities, except that a provider may use objective information published by the Commission regarding pass rates if the provider also displays next to the passage rate in a readily noticeable fashion:
(i) A hyperlink to the Commission website's Education Provider Exam Passage Rate page labeled "TREC Provider Exam Pass Rates" for digital media; or
(ii) A URL to the Commission website's Education Provider Exam Passage Rate page labeled "TREC Provider Exam Pass Rates" for non-digital media;
(D) promoting the provider directly or indirectly as a job placement agency, unless the provider is participating in a program recognized by federal, state, or local government and is providing job placement services to the extent the services are required by the program;
(E) making any statement which is misleading, likely to deceive the public, or which in any manner tends to create a misleading impression;
(F) advertising a course under a course name other than the course name approved by the Commission; or
(G) advertising using a name that implies the course provider is the Texas Real Estate Commission, including use of the acronym "TREC", in all or part of the course provider's name.
(2) Any written advertisement by a provider that includes a fee that the provider charges for a course must display any additional fees that the provider charges for the course in the same place in the advertisement and with the same degree of prominence.
(3) The provider shall advertise a course for the full clock hours of time for which credit is awarded.
(4) The provider is responsible for and subject to sanctions for any violation of this subsection by any affiliate or other third party marketer or web hosting site associated with or used by the provider.
(d) Pre-enrollment agreements for approved providers.
(1) Prior to a student enrolling in a course, a provider approved by the Commission shall provide the student with a pre-enrollment agreement that includes all of the following information:
(A) the tuition for the course;
(B) an itemized list of any fees charged by the provider for supplies, materials, or books needed in course work;
(C) the provider's policy regarding the refund of tuition and other fees, including a statement addressing refund policy when a student is dismissed or withdraws voluntarily;
(D) the attendance requirements;
(E) the acceptable makeup procedures, including any applicable time limits and any fees that may be charged for makeup sessions;
(F) the procedure and fees, if applicable, associated with exam proctoring;
(G) the procedure and fees for taking any permitted makeup final examination or any permitted re-examination, including any applicable time limits; and
(H) the notices regarding potential ineligibility for a license based on criminal history required by §53.152, Texas Occupations Code.
(2) A pre-enrollment agreement must be signed by a representative of the provider and the student prior to commencement of the course.
(e) Refund of fees by approved provider.
(1) A provider shall establish written policies governing refunds and contingency plans in the event of course cancellation.
(2) If a provider approved by the Commission cancels a course, the provider shall:
(A) fully refund all fees collected from students within a reasonable time; or
(B) at the student's option, credit the student for another course.
(3) The provider shall inform the Commission when a student requests a refund because of a withdrawal due to the student's dissatisfaction with the quality of the course.
(4) If a provider fails to give the notice required by subsection (d)(1)(H) of this section, and an individual's application for a license is denied by the Commission because the individual has been convicted of a criminal offense, the provider shall reimburse the individual the amounts required by §53.153, Texas Occupations Code.
(f) Course materials.
(1) Before the course starts, a provider shall give each student copies of or, if a student has online access, provide online access to any materials to be used for the course.
(2) A provider shall update course materials to ensure that current and accurate information is provided to students as provided for under §535.62 of this subchapter (relating to Approval of Qualifying Courses).
(g) Presentation of courses.
(1) Classroom Delivery.
(A) The location for the course must:
(i) be conducive to instruction, such as a classroom, training room, conference room, or assembly hall that is separate and apart from work areas;
(ii) be adequate for the class size;
(iii) pose no threat to the health or safety of students; and
(iv) allow the instructor to see and hear each student and the students to see and hear the instructor, including when offered through the use of technology.
(B) The provider must:
(i) verify [check] the [photo]
identification of each student at class sign up and when signing in
for each subsequent meeting of the class;
(ii) ensure the student is present for the course for the hours of time for which credit is awarded;
(iii) provide a 10 minute break per hour at least every two hours; and
(iv) not have daily course segments that exceed 12 hours.
(C) For [If the course is] a
qualifying or non-elective continuing education classroom delivery course
delivered through the use of technology where [and]
there are more than 20 students registered for the course, the provider
will also use [:]
[(i)]
a monitor [at the broadcast origination
site] to verify identification of each student, monitor active
participation of each student and facilitate questions for the instructor. [;
and]
[(ii) a proctor at each remote site
with more than 20 students to verify identification of each student,
monitor active participation of each student and proctor any on-site examination].
(D) Makeup Session for Classroom Courses.
(i) A provider may permit a student who attends at least two-thirds of an originally scheduled qualifying course to complete a makeup session to satisfy attendance requirements.
(ii) A member of the provider's staff must approve the makeup procedure to be followed. Acceptable makeup procedures are:
(I) attendance in corresponding class sessions in a subsequent offering of the same course; or
(II) the supervised presentation by audio or video recording of the class sessions actually missed.
(iii) A student shall complete all class makeup sessions no later than the 90th day after the date of the completion of the original course.
(iv) A student who attends less than two-thirds of the originally scheduled qualifying course is not eligible to complete a makeup session. The student shall automatically be dropped from the course with no credit.
(2) Distance Education Delivery. The provider must ensure that:
(A) the student taking all topics of the course and completing all quizzes and exercises is the student receiving credit for the course through a student identity verification process acceptable to the Commission;
(B) a qualified instructor is available to answer students' questions or provide assistance as necessary in a timely manner;
(C) a student has completed all instructional modules and attended any hours of live instruction required for a given course; and
(D) a qualified instructor is responsible for providing answers and rationale for the grading of the course work.
(3) A provider is not required to present topics in the order outlined for a course on the corresponding course approval form.
(4) The periods of time prescribed to each unit of a topic for a qualifying course as outlined on the corresponding course approval form are recommendations and may be altered to allow instructors flexibility to meet the particular needs of their students.
(5) Notwithstanding subsections (3) - (4) of this section, all units must be presented within the prescribed topic.
(h) Course examinations.
(1) The final examination given at the end of each course must be given in the manner submitted to and approved by the Commission. All final examinations must be closed book.
(2) Final examination questions must be kept confidential and be significantly different from any quiz questions and exercises used in the course.
(3) A provider shall not permit a student to view or take a final examination before the completion of regular course work and any makeup sessions required by this section.
(4) A provider must rotate all versions of the examination
required by §535.62(b)(7) of this subchapter throughout the approval
period for a course in a manner acceptable to the Commission and [examinations
] must:
[(A)] require an unweighted passing score of 70%. [; and]
[(B) be proctored by a member of the
provider faculty or staff, or third party proctor acceptable to the
Commission, who:]
[(i) is present at the test site or able to monitor the student through the use of technology acceptable to the Commission; and]
[(ii) has positively identified that the student taking the examination is the student registered for and who took the course.]
(5) A provider must administer the examination
under conditions that ensure the student taking the examination is
the student who registered for and took the course. [The
following are examples of acceptable third party proctors:]
[(A) employees at official testing
or learning/tutoring centers;]
[(B) librarians at a school, university, or public library;]
[(C) college or university administrators, faculty, or academic advisors;]
[(D) clergy who are affiliated with a specific temple, synagogue, mosque, or church; and]
[(E) educational officers of a military installation or correctional facility.]
(6) A provider may not give credit to a student who fails a final examination and a subsequent final examination as provided for in subsection (i) of this section.
(i) Subsequent final course examination.
(1) If a student fails a final course examination, a provider may permit the student to take a subsequent final examination only after the student has completed any additional course work prescribed by the provider.
(2) A student shall complete the subsequent final examination no later than the 90th day after the date the original class concludes. The subsequent final examination must be a different version of the original final examination given to the student and must comply with §535.62(b)(8) of this subchapter and subsection (h) of this section.
(3) If a student fails to timely complete the subsequent final examination as required by this subsection, the student shall be automatically dropped from the course with no credit.
(4) A student who fails the final course examination a second time is required to retake the course and the final course examination.
(j) Course completion certificate.
(1) Upon successful completion of a qualifying course, a provider shall issue a course completion certificate. The course completion certificate shall include:
(A) the provider's name and approval number;
(B) the instructor's name;
(C) the course title;
(D) course numbers;
(E) the number of classroom credit hours;
(F) the course delivery method;
(G) the dates the student began and completed the course; and
(H) the printed name and signature of an official of the provider on record with the Commission.
(2) A provider may withhold any official completion documentation required by this subsection from a student until the student has fulfilled all financial obligations to the provider.
(3) A provider shall maintain adequate security against forgery for official completion documentation required by this subsection.
(k) Instructor and course evaluations.
(1) A provider shall provide each student enrolled in a course with an instructor and course evaluation form or provide a link to an online version of the form that a student can complete and submit any time after course completion.
(2) An instructor may not be present when a student is completing the evaluation form and may not be involved in any manner with the evaluation process.
(3) When evaluating an instructor or course, a provider shall use all of the questions from the evaluation form approved by the Commission, in the same order as listed on that form. A provider may add additional questions to the end of the Commission evaluation questions or request the students to also complete the provider's evaluation form.
(4) A provider shall maintain any comments made by the provider's management relevant to instructor or course evaluations with the provider's records.
(5) At the Commission's request, a provider shall produce instructor and course evaluation forms for inspection by Commission staff.
(l) Maintenance of records for a provider of qualifying courses.
(1) A provider shall maintain records of each student enrolled in a course for a minimum of four years following completion of the course, including course and instructor evaluations and student enrollment agreements.
(2) A provider shall maintain financial records sufficient to reflect at any time the financial condition of the school.
(3) A school's financial statement and balance sheets must be available for audit by Commission staff, and the Commission may require presentation of financial statements or other financial records.
(4) All records may be maintained electronically but must be in a common format that is legible and easily printed or viewed without additional manipulation or special software.
(m) Changes in ownership or operation of an approved provider of qualifying courses.
(1) An approved provider shall obtain the approval of the Commission at least 30 days in advance of any material change in the operations of the provider by submitting the Qualifying Education Provider Supplement Application, including but not limited to changes in:
(A) operations or records management; and
(B) the location of the main office and any other locations where courses are offered.
(2) An approved provider requesting approval of a change in ownership shall provide all of the following information or documents to the Commission:
(A) an Education Provider Application reflecting all required information for each owner and the required fee;
(B) a Principal Information Form for each proposed new owner who holds at least 10% interest in the school;
(C) financial documents to satisfy standards imposed by §535.61 of this subchapter (relating to Approval of Providers of Qualifying Courses), including a $20,000 surety bond for the proposed new owner; and
(D) business documentation reflecting the change.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405388
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
The Texas Real Estate Commission (TREC) proposes amendments to 22 TAC §535.70, Definitions, and §535.72, Approval of Non-elective Continuing Education Courses.
The proposed amendment to §535.70 removes the definition of "proctor." The proposed amendments to §535.72(g)(3)(B) remove the proctoring requirement for inspector non-elective continuing education course examinations for distance education delivery and make clarifying changes for rule consistency. Both changes were recommended out of concerns that: (i) the exam proctoring requirement was unnecessary; and (ii) the requirements generally are overly burdensome.
The proposed amendments were recommended by the Education Standards Advisory Committee and the Texas Real Estate Inspector Committee.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendments are in effect there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendments. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendments. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the sections as proposed are in effect, the public benefit anticipated will be improved clarity and integrity in rule and processes for members of the public, including students, as well as education providers.
For each year of the first five years the proposed amendments are in effect the amendments will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability; or
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendments are proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102.
The statutes affected by this proposal are Texas Occupations Code, Chapters 1101 and 1102. No other statute, code or article is affected by the proposed amendments.
§535.70.Definitions.
The following words and terms, when used in Subchapter G of this chapter, shall have the following meanings, unless the context clearly indicates otherwise.
(1) Broker Responsibility Course--The course required by §1101.458 of the Act.
(2) CE--Continuing education.
(3) CE instructor--A person chosen by a provider to teach continuing education courses.
(4) CE provider--Any person approved by the Commission; or specifically exempt by the Act, Chapter 1102, Texas Occupation Code, or Commission rule; that offers a course for which continuing education credit may be granted by the Commission to a license holder or applicant.
(5) Classroom delivery--A method of course delivery where the instructor and students interact face to face and in real time, in either the same physical location, or through the use of technology.
(6) Distance education delivery--A method of course delivery other than classroom delivery, including online and correspondence delivery.
(7) Combination delivery--A combination of classroom and distance education where at least 50% of the course is offered through classroom delivery.
(8) Elective CE course--A continuing education course, other than a Non-elective CE course, approved by the Commission as acceptable to fulfil the continuing education hours needed to renew a license.
(9) Non-elective CE course--A continuing education course, for which the subject matter of the course is specifically mandated by the Act, Chapter 1102, or Commission rule, that a license holder is required to take prior to renewal of a license.
(10) Legal Update Courses--Required courses created for and approved by the Texas Real Estate Commission to satisfy the eight hours of continuing education required by §1101.455 of the Act.
(11) Person--Any individual, partnership, corporation, or other legal entity, including a state agency or governmental subdivision.
[(12) Proctor--A person who monitors
a final examination for a course offered by a provider under the guidelines
contained in this section. A proctor may be a course instructor, the
provider, an employee of a college or university testing center, a
librarian, or other person approved by the Commission.]
§535.72.Approval of Non-elective Continuing Education Courses.
(a) General requirements.
(1) The non-elective continuing education courses must be conducted as prescribed by the rules in this subchapter.
(2) Elective continuing education courses are approved and regulated under §535.73 of this subchapter (relating to Approval of Elective Continuing Education Courses).
(b) Application for approval to offer non-elective real estate or inspector CE courses.
(1) A CE provider seeking to offer a specific non-elective real estate or inspector CE course as outlined in this section shall:
(A) for a non-elective real estate course:
(i) submit a Real Estate Non-Elective Continuing Education CE Course Application to the Commission; and
(ii) pay the fee required by §535.101 of this chapter (relating to Fees); and
(B) for a non-elective real estate inspection course:
(i) submit an Inspector Non-Elective Continuing Education CE Course Application to the Commission; and
(ii) pay the fee required by §535.210 of this chapter (relating to Fees).
(2) A provider may file a single application for a CE course offered through multiple delivery methods. A fee is required for content review of each CE course and for each distinct delivery method utilized by a provider for that course.
(3) A provider who seeks approval of a new delivery method for a currently approved CE course must submit a new application, and pay all required fees, including a fee for content review.
(4) The Commission may:
(A) request additional information be provided to the Commission relating to an application; and
(B) terminate an application without further notice if the applicant fails to provide the additional information not later than the 60th day after the Commission mails the request.
(c) Commission approval of non-elective course materials. Every two years, the Commission shall approve subject matter and course materials to be used for the following non-elective continuing education courses:
(1) a four-hour Legal Update I: Laws, Rules and Forms course;
(2) a four-hour Legal Update II: Agency, Ethics and Hot Topics course;
(3) a six-hour Broker Responsibility course; and
(4) an eight-hour Inspector Legal and Ethics and Standards of Practice Review course.
(d) Course expiration.
(1) Each legal update course expires on December 31 of each odd-numbered year.
(2) Each broker responsibility course expires on December 31 of each even-numbered year.
(3) Each Inspector Legal and Ethics and Standards of Practice Review course expires on August 31 of each odd-numbered year.
(e) Delivery method. Non-elective CE courses must be delivered by one of the following delivery methods:
(1) classroom delivery;
(2) distance education delivery; or
(3) a combination of (1) and (2) of this subsection if at least 50% of the combined course is offered by classroom delivery.
(f) Except as provided in this section, non-elective CE courses must meet the presentation requirements of §535.65(g) of this chapter (relating to Responsibilities and Operations of Providers of Qualifying Courses). The provider must submit a course completion roster in accordance with §535.75(d) of this subchapter (relating to Responsibilities and Operations of Continuing Education Providers). Non-elective real estate courses are designed by the Commission for interactive classroom delivery. Acceptable demonstration of methods to engage students in interactive discussions and activities to meet the course objectives and time requirements are required for approval.
(g) Course examinations. A provider must administer a final examination promulgated by the Commission for non-elective CE courses.
(1) Real estate non-elective CE courses. The examination will be included in course instruction time. Each student will complete the examination independently followed by a review of the correct answers by the instructor. There is no minimum passing grade required to receive credit.
(2) Inspector non-elective CE courses for classroom delivery.
(A) The examination will be given as a part of class instruction time with each student answering the examination questions independently followed by a review of the correct answers by the instructor.
(B) A student is not required to receive a passing grade on the examination to receive course credit.
(3) Inspector non-elective CE courses for distance education delivery.
(A) An examination is required after completion of regular course work.
(B) The examination must be:
[(i) proctored by a member of the
provider faculty or staff, or third party proctor set out in §535.65(h)(5)
of this chapter, who is present at the test site and has positively
identified that the student taking the examination is the student
who registered for and took the course; or]
(i) [(ii)] administered [using
a computer] under conditions [that satisfy the Commission]
that ensure the student taking the examination is the student
who registered for and took the course; and
(ii) [(iii)] kept confidential.
(C) A provider may permit a student to take one subsequent final examination if the student fails the initial final examination. The subsequent final examination must be:
(i) different from the initial final examination; and
(ii) completed no later than the 30th day after the date the original course concludes.
(D) Credit will not be awarded to a student for a course where the student receives a pass rate on a final examination or subsequent final exam below 70%.
(E) A student who fails the subsequent final course examination is required to retake the course and the final course examination.
(h) Approval of currently approved courses by a secondary provider.
(1) If a CE provider wants to offer a course currently approved for another provider, that secondary provider must:
(A) submit the CE course application supplement form(s);
(B) submit written authorization to the Commission from the provider for whom the course was initially approved granting permission for the subsequent provider to offer the course; and
(C) pay the fee required by §535.101 of this chapter or §535.210 of this chapter.
(2) If approved to offer the currently approved course, the secondary provider is required to:
(A) offer the course as originally approved, assume the original expiration date, include any approved revisions, use all materials required for the course; and
(B) meet the requirements of §535.75 of this subchapter.
(i) Approval notice. A CE Provider shall not offer non-elective continuing education courses until the provider has received written notice of the approval from the Commission.
(j) Required revision of a currently approved non-elective CE course. Providers are responsible for keeping current on changes to the Act and Commission rules and must supplement materials for approved non-elective CE courses to present the current version of all applicable statutes and rules on or before the effective date of those changes.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405390
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
The Texas Real Estate Commission (TREC) proposes amendments to 22 TAC §535.191, Schedule of Administrative Penalties, in Chapter 535, General Provisions.
The amendment is proposed to: (i) clarify that a person may only pay an administrative penalty in an authorized manner; and (ii) add that if an online payment is authorized, such a payment may be subject to fees set by the Department of Information Resources that are in addition to the administrative penalty assessed by the Commission.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendment is in effect, there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendment. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendment. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the section as proposed is in effect, the public benefit anticipated as a result of enforcing the section will be greater clarity in the rules.
For each year of the first five years the proposed amendments are in effect the amendment will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability;
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendment is proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102. The amendment is also proposed under Texas Occupations Code, §1101.702, which requires the Commission adopt by rule a schedule of administrative penalties.
The statute affected by this proposal is Texas Occupations Code, Chapter 1101. No other statute, code or article is affected by the proposed amendment.
§535.191.Schedule of Administrative Penalties.
(a) The Commission may suspend or revoke a license or take other disciplinary action authorized by the Act in addition to or instead of assessing the administrative penalties set forth in this section.
(b) The administrative penalties set forth in this section take into consideration all of the criteria listed in §1101.702(b) of the Act.
(c) An administrative penalty range of $100 - $1,500 per violation per day may be assessed for violations of the following sections of the Act and Rules:
(1) §1101.552;
(2) §1101.652(a)(3);
(3) §1101.652(a)(8);
(4) §1101.652(a-1)(3);
(5) §1101.652(b)(23);
(6) §1101.652(b)(29);
(7) §1101.652(b)(33);
(8) 22 TAC §535.21(a);
(9) 22 TAC §535.53;
(10) 22 TAC §535.65;
(11) 22 TAC §535.91(d);
(12) 22 TAC §535.121;
(13) 22 TAC §535.154;
(14) 22 TAC §535.155;
(15) 22 TAC §535.157; and
(16) 22 TAC §535.300.
(d) An administrative penalty range of $500 - $3,000 per violation per day may be assessed for violations of the following sections of the Act and Rules:
(1) §§1101.652(a)(4) - (7);
(2) §1101.652(a-1)(2);
(3) §1101.652(b)(1);
(4) §§1101.652(b)(7) - (8);
(5) §1101.652(b)(12);
(6) §1101.652(b)(14);
(7) §1101.652(b)(22);
(8) §1101.652(b)(28);
(9) §§1101.652(b)(30) - (31);
(10) §1101.654(a);
(11) 22 TAC §531.18;
(12) 22 TAC §531.20;
(13) 22 TAC §535.2;
(14) 22 TAC §535.6(c) - (d);
(15) 22 TAC §535.16;
(16) 22 TAC §535.17; and
(17) 22 TAC §535.144.
(e) An administrative penalty range of $1,000 - $5,000 per violation per day may be assessed for violations of the following sections of the Act and Rules:
(1) §1101.351;
(2) §1101.366(d);
(3) §1101.557(b);
(4) §1101.558;
(5) §§1101.559(a) and (c);
(6) §1101.560;
(7) §1101.561(b);
(8) §1101.615;
(9) §1101.651;
(10) §1101.652(a)(2);
(11) §1101.652(a-1)(1);
(12) §§1101.652(b)(2) - (6);
(13) §§1101.652(b)(9) - (11);
(14) §1101.652(b)(13);
(15) §§1101.652(b)(15) - (21);
(16) §§1101.652(b)(24) - (27);
(17) §1101.652(b)(32);
(18) 22 TAC §535.141(f);
(19) 22 TAC §§535.145 - 535.148; and
(20) 22 TAC §535.156.
(f) The Commission may assess an additional administrative penalty of up to two times that assessed under subsections (c), (d) and (e) of this section, subject to the maximum penalties authorized under §1101.702(a) of the Act, if a person has a history of previous violations.
(g) Payment of an administrative penalty must be submitted in a manner acceptable to the Commission. Payments authorized to be submitted online may be subject to fees set by the Department of Information Resources that are in addition to the administrative penalty assessed by the Commission.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405391
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
The Texas Real Estate Commission (TREC) proposes amendments to 22 TAC §535.219, Schedule of Administrative Penalties, in Chapter 535, General Provisions.
The amendment is proposed to: (i) clarify that a person may only pay an administrative penalty in an authorized manner; and (ii) add that if an online payment is authorized, such a payment may be subject to fees set by the Department of Information Resources that are in addition to the administrative penalty assessed by the Commission.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendment is in effect, there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the section. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendment. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendment. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the section as proposed is in effect, the public benefit anticipated as a result of enforcing the section will be greater clarity in the rules.
For each year of the first five years the proposed amendments are in effect, the amendment will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability;
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendment is proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102. The amendment is also proposed under Texas Occupations Code, §1102.403, which allows the Commission to impose an administrative penalty as provided by Subchapter O, Chapter 1101, pursuant to that section.
The statute affected by this proposal is Texas Occupations Code, Chapter 1102. No other statute, code or article is affected by the proposed amendment.
§535.219.Schedule of Administrative Penalties.
(a) The Commission may suspend or revoke a license or take other disciplinary action authorized by Chapter 1102 in addition to or instead of assessing the administrative penalties set forth in this section.
(b) The administrative penalties set forth in this section consider the criteria listed in §1101.702(b) of the Act.
(c) An administrative penalty range of $100 - $1,500 per violation per day may be assessed for violations of the following sections of Chapter 1101, Chapter 1102 and this subchapter:
(1) §1101.652(a)(8);
(2) §1102.118;
(3) §1102.305;
(4) 22 TAC §535.216(c);
(5) 22 TAC §535.217;
(6) 22 TAC §535.220(a) - (d) and (g);
(7) 22 TAC §535.221; and
(8) 22 TAC §535.223.
(d) An administrative penalty range of $500 - $3,000 per violation per day may be assessed for violations of the following sections of Chapter 1101, Chapter 1102 and this subchapter:
(1) §§1101.652(a)(3) - (4);
(2) §1102.301;
(3) 22 TAC §535.222;
(4) 22 TAC §535.226(d) - (e); and
(5) 22 TAC §§535.227 - 535.233.
(e) An administrative penalty of $1,000 - $5,000 per violation per day may be assessed for violations of the following sections of Chapter 1101, Chapter 1102 and this subchapter:
(1) §§1101.652(a)(2), (5) - (6);
(2) §1102.101;
(3) §1102.102;
(4) §1102.103;
(5) §1102.302;
(6) §1102.303;
(7) §1102.304;
(8) 22 TAC §535.208(e)(2);
(9) 22 TAC §535.211;
(10) 22 TAC §535.215;
(11) 22 TAC §535.220(e)(1), (3) - (7); and
(12) 22 TAC §535.224(b)(1) - (2).
(f) The Commission may assess an administrative penalty of up to two times that outlined under subsections (c), (d), and (e) of this section, subject to the maximum penalties authorized under §1101.702(a) of the Act, if a person has a history of previous violations.
(g) Payment of an administrative penalty must be submitted in a manner acceptable to the Commission. Payments authorized to be submitted online may be subject to fees set by the Department of Information Resources that are in addition to the administrative penalty assessed by the Commission.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405392
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057
The Texas Real Estate Commission (TREC) proposes amendments to 22 TAC §537.45, Standard Contract Form TREC No. 38-7, Notice of Buyer's Termination of Contract, in Chapter 537, Professional Agreements and Standard Contracts.
Texas real estate license holders are generally required to use forms promulgated by TREC when negotiating contracts for the sale of real property. These forms are drafted and recommended for proposal by the Texas Real Estate Broker-Lawyer Committee, an advisory body consisting of six attorneys appointed by the President of the State Bar of Texas, six brokers appointed by TREC, and one public member appointed by the governor. The Texas Real Estate Broker-Lawyer Committee recommended revisions to Paragraph 2 of the Notice of Buyer's Termination of Contract to ensure that the buyer has delivered the lender's written statement to the seller in accordance with the recent changes to Paragraph 2A, Buyer Approval, of the Third Party Financing Addendum.
Abby Lee, Deputy General Counsel, has determined that for the first five-year period the proposed amendment is in effect, there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no adverse economic effect anticipated for small businesses, micro-businesses, rural communities, or local or state employment as a result of implementing the proposed amendment. There is no significant economic cost anticipated for persons who are required to comply with the proposed amendment. Accordingly, no Economic Impact Statement or Regulatory Flexibility Analysis is required.
Ms. Lee also has determined that for each year of the first five years the section as proposed is in effect, the public benefits anticipated as a result of enforcing the section as proposed will be improved clarity and greater transparency for members of the public and license holders who use these contract forms.
For each year of the first five years the proposed amendment is in effect, the amendment will not:
create or eliminate a government program;
require the creation of new employee positions or the elimination of existing employee positions;
require an increase or decrease in future legislative appropriations to the agency;
require an increase or decrease in fees paid to the agency;
create a new regulation;
expand, limit or repeal an existing regulation;
increase or decrease the number of individuals subject to the rule's applicability; or
positively or adversely affect the state's economy.
Comments on the proposal may be submitted through the online comment submission form at https://www.trec.texas.gov/rules-and-laws/comment-on-proposed-rules, to Abby Lee, Deputy General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.
The amendment is proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102. The amendment is also adopted under Texas Occupations Code, §1101.155, which authorizes the Commission to adopt rules in the public's best interest that require license holders to use contract forms prepared by the Texas Real Estate Broker-Lawyer Committee and adopted by the Commission.
The statute affected by this amendment is Texas Occupations Code, Chapter 1101. No other statute, code or article is affected by the amendment.
§537.45.Standard Contract Form TREC No. 38-8 [38-7], Notice of Buyer's Termination of Contract.
The Texas Real Estate Commission (Commission) adopts by reference
standard contract form TREC No. 38-8 [38-7]
approved by the Commission in 2025 [2021] for
mandatory use as a buyer's notice of termination of contract.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on November 7, 2024.
TRD-202405394
Abby Lee
Deputy General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: December 22, 2024
For further information, please call: (512) 936-3057