Maryland HB 239: State Real Estate Commission - Property Managers - Registration

Bill Text

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0239*

HOUSE BILL 239
C2 1lr1426
HB 929/20 – ECM (PRE–FILED) CF SB 73
By: Delegate Rogers
Requested: October 30, 2020
Introduced and read first time: January 13, 2021
Assigned to: Economic Matters
Committee Report: Favorable with amendments
House action: Adopted
Read second time: February 11, 2021

CHAPTER ______

AN ACT concerning 1

State Real Estate Commission – Property Managers – Registration 2

FOR the purpose of requiring certain persons to be registered as a property manager by the 3
State Real Estate Commission before providing property management services in 4
the State; providing a certain exception to the requirement to be registered; 5
requiring the Commission to determine certain qualifications authorizing the 6
Commission to deny a registration to a certain applicant under certain 7
circumstances; authorizing the Commission to set by regulation certain fees for 8
certain purposes; requiring certain fees to be set so as to produce certain funds for 9
certain purposes; requiring certain applicants to submit a certain application and 10
pay a certain fee to the Commission; providing that a certain registration expires on 11
a certain date unless renewed for an additional term; prohibiting certain persons 12
from providing, attempting to provide, or offering to provide property management 13
services unless registered with the Commission; subjecting certain persons who 14
violate a certain provision of law to a certain fine; requiring certain property 15
managers to be covered by a certain surety bond and to provide certain proof of 16
coverage to the Commission, subject to a certain exception; defining certain terms; 17
and generally relating to the registration of property managers by the State Real 18
Estate Commission. 19

BY adding to 20
Article – Business Occupations and Professions 21
Section 17–3B–01 through 17–3B–08 to be under the new subtitle “Subtitle 3B. 22
Property Managers” 23

2 HOUSE BILL 239

Annotated Code of Maryland 1
(2018 Replacement Volume and 2020 Supplement) 2

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 3
That the Laws of Maryland read as follows: 4

Article – Business Occupations and Professions 5

SUBTITLE 3B. PROPERTY MANAGERS. 6

17–3B–01. 7

(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 8
INDICATED. 9

(B) “AFFILIATE” MEANS AN ENTITY THAT DIRECTLY, OR INDIRECTLY 10
THROUGH ONE OR MORE INTERMEDIARIES, CONTROLS OR IS CONTROLLED BY A 11
FINANCIAL INSTITUTION. 12

(C) “FINANCIAL INSTITUTION” HAS THE MEANING STATED IN § 1–101(J) OF 13
THE FINANCIAL INSTITUTIONS ARTICLE. 14

(D) (1) “PROPERTY MANAGEMENT SERVICES” MEANS THE LEASING, 15
MANAGING, ADVERTISING, RENTING, OR HANDLING OF TRUST MONEY OF A 16
PROPERTY. 17

(2) “PROPERTY MANAGEMENT SERVICES” DOES NOT INCLUDE: 18

(I) PARTICIPATING IN A COMMON OWNERSHIP COMMUNITY, 19
INCLUDING A HOMEOWNERS ASSOCIATION OR CONDOMINIUM; 20

(II) SERVICES PROVIDED BY A BUSINESS IMPROVEMENT 21
DISTRICT; 22

(II) (III) RENTING A PROPERTY FOR LESS THAN 6 MONTHS; 23

(III) (IV) LEASING, MANAGING, ADVERTISING, RENTING, OR 24
HANDLING OF: 25

1. TRUST MONEY OF AN APARTMENT COMPLEX WITH 25 26
OR MORE RESIDENTIAL DWELLING UNITS; 27

2. TRUST MONEY OF COMMERCIAL, INDUSTRIAL, OR 28
MIXED USE PROPERTIES REAL PROPERTY; OR 29

HOUSE BILL 239 3

3. REAL PROPERTY ACQUIRED BY A FINANCIAL 1
INSTITUTION OR AN AFFILIATE THROUGH FORECLOSURE; 2

(IV) (V) SERVICES PROVIDED BY A PERSON EMPLOYED 3
EXCLUSIVELY AS THE PROPERTY MANAGER FOR THE PROPERTY MANAGEMENT OF 4
ONE PERSON; 5

(V) (VI) SERVICES PROVIDED ON AN INCIDENTAL BASIS AND 6
WITHOUT ADDITIONAL COMPENSATION BY EMPLOYEES OF AN OWNER OF A 7
PROPERTY; 8

(VI) (VII) SERVICES THAT AN OWNER OF THREE OR FEWER 9
SINGLE–FAMILY RESIDENTIAL PROPERTIES PERSONALLY PROVIDES TO THE 10
PROPERTIES A RESIDENTIAL DWELLING UNIT PERSONALLY PROVIDES TO THE 11
PROPERTY; OR 12

(VII) (VIII) RECEIVING, ACCEPTING, OR HOLDING TRUST MONEY 13
OF A PROPERTY BY A FINANCIAL INSTITUTION; OR 14

(IX) SERVICES RELATED TO THE PHYSICAL MAINTENANCE, 15
MARKETING, OPERATIONS, AND FINANCIAL MANAGEMENT OF A PROPERTY 16
PROCURED BY A COMPANY PROVIDING PROPERTY MANAGEMENT SERVICES. 17

(E) (1) “PROPERTY MANAGER” MEANS A PERSON WHO IS REGISTERED BY 18
THE COMMISSION TO PROVIDE PROPERTY MANAGEMENT SERVICES. 19

(2) “PROPERTY MANAGER” INCLUDES A PARTNERSHIP OR A 20
CORPORATION PARTNERSHIP, CORPORATION, OR OTHER BUSINESS ENTITY. 21

17–3B–02. 22

(A) (1) EXCEPT AS PROVIDED UNDER SUBSECTION (B) OF THIS SECTION, 23
A PERSON MUST BE REGISTERED AS A PROPERTY MANAGER BY THE COMMISSION 24
BEFORE THE PERSON MAY PROVIDE PROPERTY MANAGEMENT SERVICES IN THE 25
STATE. 26

(2) EMPLOYEES OF A PARTNERSHIP, CORPORATION, OR OTHER 27
BUSINESS ENTITY THAT PROVIDES PROPERTY MAN