Realtors, builders fight over sales fees

first_imgScore this one for the home builders. They left the Realtors reeling. A bill, SB 670, suffered what’s akin to a one-punch knockout last week in the state Senate’s Housing and Transportation Committee. There was talking but no vote, which killed the bill. A rematch is in the works, though, between a couple of trade association heavyweights. The bill initially called for an outright ban on the fee or tax. The Realtors association said the bill would have protected consumers by placing responsible restrictions on private transfer taxes levied by developers and limiting the proceeds to environmental and affordable housing efforts. “We are extremely disappointed that SB 670 failed to make it out of committee,” Realtors association president Colleen Badagliacco said in a statement. “Home buyers in California deserve better.” She said private transfer taxes can add more than $10,000 to the cost of a home. The Realtors offered 11 amendments to try to get the bill through, said Alex Creel, their chief lobbyist. They included: When a developer imposed the fee, it would be part of the subdivision application submitted to the California Department of Real Estate. Annual audited financial statements from the beneficiary of the funds. A progress report on how the money is being spent. A requirement that the Department of Energy post the information on line. Limiting the fees to 1 percent of the sale price. “We made a number of good concessions, including the idea that these funds could be used for affordable housing,” Creel said. While SB 670 is kaput, the issue isn’t going away. The builders’ association is sponsoring AB 1574, and it has already moved through two committees this legislative session. The bill would allow the fees, but limit them to modest amounts. “I think it was clear that SB 670 was not the right bill, the right language, and the concept was turned down,” said Kimberley Dellinger, a legislative advocate at the CBIA. This association’s bill could come up for a vote in a week or so. [email protected] (818) 713-3743 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! The Sacramento-based California Building Industry Association and the Los Angeles-based California Association of Realtors are squabbling over what the former calls a reconveyance financing mechanism and the latter a private transfer tax. Either way, it adds up to fees you pay when you buy a new home. The bill, carried by Sen. Lou Correa, D-Anaheim, at the behest of the Realtors group, was called the “Private Transfer Tax Prohibition. Basically, in some parts of the state when you buy a house or condo, you pay a fee, which helps offset some of the fees municipalities charge. They could be used for things like parks and affordable housing. Typically the fees are put in a trust and designated for use by nonprofits. last_img

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