HOUSE BILL 19-1172 BY REPRESENTATIVE(S) Weissman, Herod

HOUSE BILL 19-1172

BY REPRESENTATIVE(S) Weissman, Herod, Snyder, Soper,

Van Winkle, Arndt, Coleman, Cutter, Duran, Galindo, Gonzales-Gutierrez,

Hansen, Hooton, Jaquez Lewis, Kipp, Michaelson Jenet, Mullica, Roberts,

Singer, Titone;

also SENATOR(S) Gardner and Cooke, Foote, Lee, Rodriguez, Crowder,

Ginal, Holbert, Lundeen, Priola, Tate, Todd, Woodward.

CONCERNING AN ORGANIZATIONAL RECODIFICATION OF TITLE 12 OF THE

COLORADO REVISED STATUTES, AND, IN CONNECTION THEREWITH,

LIMITING SUBSTANTIVE CHANGES TO THOSE THAT CONFORM SIMILAR

PROVISIONS TO ACHIEVE UNIFORMITY, ELIMINATE REDUNDANCY, OR

ALLOW FOR THE CONSOLIDATION OF COMMON PROVISIONS OR THAT

ELIMINATE PROVISIONS THAT ARE ARCHAIC OR OBSOLETE.

Be it enacted by the General Assembly of the State of Colorado:

SECTION 1. In Colorado Revised Statutes, repeal and reenact,

with amended and relocated provisions, title 12 as follows:

TITLE 12

ARTICLE 1

________

Capital letters or bold & italic numbers indicate new material added to existing law; dashes

through words or numbers indicate deletions from existing law and such material is not part of

the act.

General Provisions

12-1-101. Short title. THE SHORT TITLE OF THIS TITLE 12 IS THE

"PROFESSIONS AND OCCUPATIONS ACT".

12-1-102. Scope of article. THIS ARTICLE 1 APPLIES TO EVERY

ARTICLE IN THIS TITLE 12 EXCEPT TO THE EXTENT OTHERWISE SPECIFIED IN

ANOTHER ARTICLE OF THIS TITLE 12.

12-1-103. Definitions. AS USED IN THIS TITLE 12, UNLESS THE

CONTEXT OTHERWISE REQUIRES:

(1) "DEPARTMENT" MEANS THE DEPARTMENT OF REGULATORY

AGENCIES CREATED IN SECTION 24-1-122.

(2) "EXECUTIVE DIRECTOR" MEANS THE EXECUTIVE DIRECTOR OF

THE DEPARTMENT OR THE EXECUTIVE DIRECTOR'S DESIGNEE.

(3) "PROFESSION OR OCCUPATION", "PROFESSION", OR "OCCUPATION"

MEANS AN ACTIVITY SUBJECT TO REGULATION BY A PART OR ARTICLE OF

THIS TITLE 12.

ARTICLE 10

Real Estate

PART 1

COMMON DEFINITIONS

12-10-101. Definitions. AS USED IN THIS ARTICLE 10, UNLESS THE

CONTEXT OTHERWISE REQUIRES:

(1) [Formerly 12-61-702 (7) and similar to 12-61-902

(3)] "Director" means the director of the division of real estate.

(2) [Formerly 12-61-702 (8) and similar to 12-61-902

(4)] "Division" means the division of real estate.

(3) [Formerly 12-61-101 (1.2) and similar to 12-61-401

(2.5)] "HOA" or "homeowners' association" means an association or unit

owners' association formed before, on, or after July 1, 1992, as part of a

PAGE 2-HOUSE BILL 19-1172

common interest community as defined in section 38-33.3-103. C.R.S.

PART 2

BROKERS AND SALESPERSONS

12-10-201. [Formerly 12-61-101] Definitions. As used in this part

1 2, unless the context otherwise requires:

(1) "COMMISSION" MEANS THE REAL ESTATE COMMISSION CREATED

IN SECTION 12-10-206.

(1) (2) "Employing real estate broker" or "employing broker" means

a broker who is shown in real estate commission records as employing or

engaging another broker.

(1.2) [Relocated to 12-10-101 (3)]

(1.3) (3) "Limited liability company" shall have the same meaning

as it is given in section 7-80-102 (7). C.R.S.

(1.5) (4) "Option dealer" means any person, firm, partnership,

limited liability company, association, or corporation who THAT, directly or

indirectly, takes, obtains, or uses an option to purchase, exchange, rent, or

lease real property or any interest therein with the intent or for the purpose

of buying, selling, exchanging, renting, or leasing said THE real property or

interest therein to another or others, whether or not said THE option is in that

person's or its name and whether or not title to said property passes through

the name of said THE person, firm, partnership, limited liability company,

association, or corporation in connection with the purchase, sale, exchange,

rental, or lease of said THE real property or interest therein.

(1.7) (5) "Partnership" includes, but is not limited to, a registered

limited liability partnership.

(2) (6) (a) "Real estate broker" or "broker" means any person, firm,

partnership, limited liability company, association, or corporation who

THAT, in consideration of compensation by fee, commission, salary, or

anything of value or with the intention of receiving or collecting such

compensation, engages in or offers or attempts to engage in, either directly

or indirectly, by a continuing course of conduct or by any single act or

PAGE 3-HOUSE BILL 19-1172

transaction, any of the following acts:

(I) Selling, exchanging, buying, renting, or leasing real estate, or

interest therein, or improvements affixed thereon;

(II) Offering to sell, exchange, buy, rent, or lease real estate, or

interest therein, or improvements affixed thereon;

(III) Selling or offering to sell or exchange an existing lease of real

estate, or interest therein, or improvements affixed thereon;

(IV) Negotiating the purchase, sale, or exchange of real estate, or

interest therein, or improvements affixed thereon;

(V) Listing, offering, attempting, or agreeing to list real estate, or

interest therein, or improvements affixed thereon for sale, exchange, rent,

or lease;

(VI) Auctioning or offering, attempting, or agreeing to auction real

estate, or interest therein, or improvements affixed thereon;

(VII) Buying, selling, offering to buy or sell, or otherwise dealing

in options on real estate, or interest therein, or improvements affixed

thereon, or acting as an "option dealer";

(VIII) Performing any of the foregoing acts as an employee of, or

in ON behalf of, the owner of real estate, or interest therein, or

improvements affixed thereon at a salary or for a fee, commission, or other

consideration;

(IX) Negotiating or attempting or offering to negotiate the listing,

sale, purchase, exchange, or lease of a business or business opportunity or

the goodwill thereof or any interest therein when such THE act or transaction

involves, directly or indirectly, any change in the ownership or interest in

real estate, or in a leasehold interest or estate, or in a business or business

opportunity which THAT owns an interest in real estate or in a leasehold

unless such THE act is performed by any broker-dealer licensed under the

provisions of article 51 of title 11 C.R.S., who is actually engaged generally

in the business of offering, selling, purchasing, or trading in securities or

any officer, partner, salesperson, employee, or other authorized

PAGE 4-HOUSE BILL 19-1172

representative or agent thereof; OR

(X) Soliciting a fee or valuable consideration from a prospective

tenant for furnishing information concerning the availability of real

property, including apartment housing which THAT may be leased or rented

as a private dwelling, abode, or place of residence. Any person, firm,

partnership, limited liability company, association, or corporation or any

employee or authorized agent thereof engaged in the act of soliciting a fee

or valuable consideration from any person other than a prospective tenant

for furnishing information concerning the availability of real property,

including apartment housing which THAT may be leased or rented as a

private dwelling, abode, or place of residence, is exempt from this

definition of "real estate broker" or "broker". This exemption applies only

in respect to the furnishing of information concerning the availability of real

property.

(b) "Real estate broker" OR "BROKER" does not apply to any of the

following:

(I) Any attorney-in-fact acting without compensation under a power

of attorney, duly executed by an owner of real estate, authorizing the

consummation of a real estate transaction;

(II) Any public official in the conduct of his or her official duties;

(III) Any receiver, trustee, administrator, conservator, executor, or

guardian acting under proper authorization;

(IV) Any person, firm, partnership, limited liability company, or

association acting personally or a corporation acting through its officers or

regular REGULARLY salaried employees, on behalf of that person or on its

own behalf as principal in acquiring or in negotiating to acquire any interest

in real estate;

(V) An attorney-at-law in connection with his or her representation

of clients in the practice of law;

(VI) Any person, firm, partnership, limited liability company,

association, or corporation, or any employee or authorized agent thereof,

engaged in the act of negotiating, acquiring, purchasing, assigning,

PAGE 5-HOUSE BILL 19-1172

exchanging, selling, leasing, or dealing in oil and gas or other mineral leases

or interests therein or other severed mineral or royalty interests in real

property, including easements, rights-of-way, permits, licenses, and any

other interests in real property for or on behalf of a third party, for the

purpose of, or facilities related to, intrastate and interstate pipelines for oil,

gas, and other petroleum products, flow lines, gas gathering systems, and

natural gas storage and distribution;

(VII) A natural person acting personally with respect to property

owned or leased by that person or a natural person who is a general partner

of a partnership, a manager of a limited liability company, or an owner of

twenty percent or more of such partnership or limited liability company, and

authorized to sell or lease property owned by such THE partnership or

limited liability company, except as provided in subsection (1.5)

SUBSECTION (4) of this section;

(VIII) A corporation with respect to property owned or leased by it,

acting through its officers or regular REGULARLY salaried employees, when

such THE acts are incidental and necessary in the ordinary course of the

corporation's business activities of a non-real-estate nature (but only if the

corporation is not engaged in the business of land transactions), except as

provided in subsection (1.5) SUBSECTION (4) of this section. For the

purposes of this subparagraph (VIII) SUBSECTION (6)(b)(VIII), the term

"officers or regular REGULARLY salaried employees" means persons

regularly employed who derive not less than seventy-five percent of their

compensation from the corporation in the form of salaries.

(IX) A principal officer of any corporation with respect to property

owned by it when such THE property is located within the state of Colorado

and when such THE principal officer is the owner of twenty percent or more

of the outstanding stock of such THE corporation, except as provided in

subsection (1.5) SUBSECTION (4) of this section, but this exemption does not

include any corporation selling previously occupied one-family and

two-family dwellings;

(X) A sole proprietor, corporation, partnership, or limited liability

company, acting through its officers, or partners, or through regular

REGULARLY salaried employees, with respect to property owned or leased

by such THE sole proprietor, corporation, partnership, or limited liability

company on which has been or will be erected a commercial, industrial, or

PAGE 6-HOUSE BILL 19-1172

residential building which THAT has not been previously occupied and

where the consideration paid for such THE property includes the cost of such

THE building, payable, less deposit or down payment, at the time of

conveyance of such THE property and building;

(XI) (A) A corporation, partnership, or limited liability company

acting through its officers, partners, managers, or regularly salaried

employees receiving no additional compensation therefor, or its wholly

owned subsidiary or officers, partners, managers, or regular REGULARLY

salaried employees thereof receiving no additional compensation, with

respect to property located in Colorado which THAT is owned or leased by

such THE corporation, partnership, or limited liability company and on

which has been or will be erected a shopping center, office building, or

industrial park when such shopping center, office building, or industrial

park is sold, leased, or otherwise offered for sale or lease in the ordinary

course of the business of such THE corporation, partnership, limited liability

company, or wholly owned subsidiary.

(B) For the purposes of this subparagraph (XI), SUBSECTION

(6)(b)(XI): "Shopping center" means land on which buildings are or will be

constructed which THAT are used for commercial and office purposes

around or adjacent to which off-street parking is provided; "office building"

means a building used primarily for office purposes; and "industrial park"

means land on which buildings are or will be constructed for warehouse,

research, manufacturing, processing, or fabrication purposes.

(XII) A regularly salaried employee of an owner of an apartment

building or complex who acts as an on-site manager of such an apartment

building or complex. This exemption applies only in respect to the

customary duties of an on-site manager performed for his or her employer.

(XIII) A regularly salaried employee of an owner of condominium

units who acts as an on-site manager of such units. For purposes of this

subparagraph (XIII) SUBSECTION (6)(b)(XIII) only, the term "owner"

includes a homeowners' association formed and acting pursuant to its

recorded condominium declaration and bylaws. This exemption applies only

in respect to the customary duties of an on-site manager performed for his

or her employer.

(XIV) A real estate broker licensed in another state who receives a

PAGE 7-HOUSE BILL 19-1172

share of a commission or finder's fee on a cooperative transaction from a

licensed Colorado real estate broker;

(XV) A sole proprietor, corporation, partnership, or limited liability

company, acting through its officers, partners, or regularly salaried

employees, with respect to property located in Colorado, where the

purchaser of such THE property is in the business of developing land for

residential, commercial, or industrial purposes;

(XVI) Any person, firm, partnership, limited liability company,

association, or corporation, or any employee or authorized agent thereof,

engaged in the act of negotiating, purchasing, assigning, exchanging,

selling, leasing, or acquiring rights-of-way, permits, licenses, and any other

interests in real property for, or on behalf, of a third party for the purpose

of, or facilities related to:

(A) Telecommunication lines;

(B) Wireless communication facilities;

(D) Electric generation, transmission, and distribution lines;

(E) Water diversion, collection, distribution, treatment, and storage

or use; and

(F) Transportation, so long as such THE person, firm, partnership,

limited liability company, association, or corporation, including any

employee or authorized agent thereof, does not represent any displaced

person or entity as an agent thereof in the purchase, sale, or exchange of

real estate, or an interest therein, resulting from residential or commercial

relocations required under any transportation project, regardless of the

source of public funding.

12-10-202. [Formerly 12-61-102] License required. It is unlawful

for any person, firm, partnership, limited liability company, association, or

corporation to engage in the business or capacity of real estate broker in this

state without first having obtained a license from the real estate

commission. No person shall be granted a license until such THE person

PAGE 8-HOUSE BILL 19-1172

establishes compliance with the provisions of this part 1 2 concerning

education, experience, and testing; truthfulness and honesty and otherwise

good moral character; and, in addition to any other requirements of this

section, competency to transact the business of a real estate broker in such

manner as to safeguard the interest of the public and only after satisfactory

proof of such THE qualifications, together with the application for such THE

license, is filed in the office of the commission. In determining such THE

person's character, the real estate commission shall be governed by section

24-5-101. C.R.S.

12-10-203. [Formerly 12-61-103] Application for license - rules

- definition. (1) (a) All persons desiring to become real estate brokers shall

apply to the real estate commission for a license under the provisions of this

part 1 2. Application for a license as a real estate broker shall be made to the

commission upon forms or in a manner prescribed by it THE COMMISSION.

(b) (I) Prior to submitting an application for a license pursuant to

paragraph (a) of this subsection (1) SUBSECTION (1)(a) OF THIS SECTION,

each applicant shall submit a set of fingerprints to the Colorado bureau of

investigation for the purpose of conducting a state and national

fingerprint-based criminal history record check utilizing records of the

Colorado bureau of investigation and the federal bureau of investigation.

The applicant shall pay the fee established by the Colorado bureau of

investigation for conducting the fingerprint-based criminal history record

check to the bureau. Upon completion of the criminal history record check,

the bureau shall forward the results to the real estate commission. The real

estate commission may acquire a name-based criminal history record check

for an applicant who has twice submitted to a fingerprint-based criminal

history record check and whose fingerprints are unclassifiable.

(II) For purposes of this paragraph (b) SUBSECTION (1)(b),

"applicant" means an individual, or any person designated to act as broker

for any partnership, limited liability company, or corporation pursuant to

subsection (7) (6) of this section.

(2) Every real estate broker licensed under this part 1 2 shall

maintain a place of business within this state, except as provided in section

12-61-107 12-10-208. In case a real estate broker maintains more than one

place of business within the state, the broker shall be responsible for

supervising all licensed activities originating in such THE offices.

PAGE 9-HOUSE BILL 19-1172

(3) The commission is authorized by this section to require and

procure any such proof as is necessary in reference to the truthfulness,

honesty, and good moral character of any applicant for a real estate broker's

license or, if the applicant is a partnership, limited liability company, or

corporation, of any partner, manager, director, officer, member, or

stockholder if such THE person has, either directly or indirectly, a substantial

interest in such THE applicant prior to the issuance of such THE license.

(4) (a) An applicant for a broker's license shall be at least eighteen

years of age. The applicant must furnish proof satisfactory to the

commission that the applicant has either received a degree from an

accredited degree-granting college or university with a major course of

study in real estate or has successfully completed courses of study, approved

by the commission, at any accredited college or university or any private

occupational school that has a certificate of approval from the private

occupational school division in accordance with the provisions of article 59

64 of this title 23 or that has been approved by the commission or licensed

by an official state agency of any other state as follows:

(I) Forty-eight hours of classroom instruction or equivalent

correspondent hours in real estate law and real estate practice; and

(II) Forty-eight hours of classroom instruction or equivalent

correspondent hours in understanding and preparation of Colorado real

estate contracts; and

(III) A total of seventy-two hours of instruction or equivalent

correspondence hours from the following areas of study:

(A) Trust accounts and record keeping;

(B) Real estate closings;

(D) Practical applications.

(b) An applicant for a broker's license who has been licensed as a

real estate broker in another jurisdiction shall be required to complete only

the course of study comprising the subject matter areas described in

PAGE 10-HOUSE BILL 19-1172

subparagraphs (II) and (III)(B) of paragraph (a) of this subsection (4)

SUBSECTIONS (4)(a)(II) AND (4)(a)(III)(B) OF THIS SECTION.

real estate salesperson in another jurisdiction shall be required to complete

only the course of study required in subparagraphs (II) and (III) of

paragraph (a) of this subsection (4) SUBSECTIONS (4)(a)(II) AND (4)(a)(III)

OF THIS SECTION.

(d) (Deleted by amendment, L. 96, p. 414, § 2, effective January 1,

1997.)

(5) (Deleted by amendment, L. 96, p. 414, § 2, effective January 1,

1997.)

(6) (5) (a) The applicant for a broker's license shall submit to and

pass an examination designated to determine the competency of the

applicant and prepared by or under the supervision of the real estate

commission or its designated contractor. The commission may contract with

an independent testing service to develop, administer, or grade

examinations or to administer licensee records. The contract may allow the

testing service to recover the costs of the examination and the costs of

administering exam and license records from the applicant. The commission

may contract separately for these functions and allow recovered costs to be

collected and retained by a single contractor for distribution to other

contractors. The commission shall have the authority to set the minimum

passing score that an applicant must receive on the examination, and said

THE score shall reflect the minimum level of competency required to be a

broker. Said THE examination shall be given at such times and places as the

commission prescribes. The examination shall include, but not be limited

to, ethics, reading, spelling, basic mathematics, principles of land

economics, appraisal, financing, a knowledge of the statutes and law of this

state relating to deeds, trust deeds, mortgages, listing contracts, contracts of

sale, bills of sale, leases, agency, brokerage, trust accounts, closings,

securities, the provisions of this part 1 2, and the rules of the commission.

The examination for a broker's license shall also include the preparation of

a real estate closing statement.

(b) An applicant for a broker's license who has held a real estate

license in another jurisdiction that administers a real estate broker's

PAGE 11-HOUSE BILL 19-1172

examination and who has been licensed for two or more years prior to

applying for a Colorado license may be issued a broker's license if the

applicant establishes that he or she possesses credentials and qualifications

that are substantively equivalent to the requirements in Colorado for

licensure by examination.

provisions apply to brokers that did not hold a current and valid broker's

license on December 31, 1996:

(I) No such broker shall engage in an independent brokerage

practice without first having served actively as a real estate broker for at

least two years. The commission shall adopt rules requiring an employing

broker to ensure that a high level of supervision is exercised over such a

broker during such THE two-year period.

(II) No such broker shall employ another broker without first having

completed twenty-four clock hours of instruction, or the equivalent in

correspondence hours, as approved by the commission, in brokerage

administration.

(III) Effective January 1, 2019, a broker shall not act as an

employing broker without first demonstrating, in accordance with rules of

the commission, experience and knowledge sufficient to enable the broker

to employ and adequately supervise other brokers, as appropriate to the

broker's area of supervision. The commission's rules must set forth the

method or methods by which the broker may demonstrate such THE

experience and knowledge, either by documenting a specified number of

transactions that the broker has completed or by other methods.

(7) (6) (a) Real estate brokers' licenses may be granted to

individuals, partnerships, limited liability companies, or corporations. A

partnership, limited liability company, or corporation, in its application for

a license, shall designate a qualified, active broker to be responsible for

management and supervision of the licensed actions of the partnership,

limited liability company, or corporation and all licensees shown in the

commission's records as being in the employ of such THE entity. The

application of the partnership, limited liability company, or corporation and

the application of the broker designated by it shall be filed with the real

estate commission.

PAGE 12-HOUSE BILL 19-1172

(b) No license shall be issued to any partnership, limited liability

company, or corporation unless and until the broker so designated by the

partnership, limited liability company, or corporation submits to and passes

the examination required by this part 1 2 on behalf of the partnership,

limited liability company, or corporation. Upon such broker's THE BROKER

successfully passing the examination and upon compliance with all other

requirements of law by the partnership, limited liability company, or

corporation, as well as by the designated broker, the commission shall issue

a broker's license to the partnership, limited liability company, or

corporation, which shall bear the name of such THE designated broker, and

thereupon the broker so designated shall conduct business as a real estate

broker only through the said partnership, limited liability company, or

corporation and not for the broker's own account.

commission or ceases to be the designated broker of such THE partnership,

limited liability company, or corporation, such THE entity may designate

another person to make application for a license. If such THE person ceases

to be the designated broker of such THE partnership, limited liability

company, or corporation, the director may issue a temporary license to

prevent hardship for a period not to exceed ninety days to the licensed

person so designated. The director may extend a temporary license for one

additional period not to exceed ninety days upon proper application and a

showing of good cause; if the director refuses, no further extension of a

temporary license shall be granted except by the commission. If any broker

or employee of any such partnership, limited liability company, or

corporation, other than the one designated as provided in this section,

desires to act as a real estate broker, such THE broker or employee shall first

obtain a license as a real estate broker as provided in this section and shall

pay the regular fee therefor.

(8) (7) The broker designated to act as broker for any partnership,

limited liability company, or corporation is personally responsible for the

handling of any and all earnest money deposits or escrow or trust funds

received or disbursed by said THE partnership, limited liability company, or

corporation. In the event of any breach of duty by the said partnership,

limited liability company, or corporation as a fiduciary, any person

aggrieved or damaged by the said breach of fiduciary duty shall have a

claim for relief against such THE partnership, limited liability company, or

corporation, as well as against the designated broker, and may pursue said

PAGE 13-HOUSE BILL 19-1172

THE claim against the partnership, limited liability company, or corporation

and the designated broker personally. The said broker may be held

responsible and liable for damages based upon such THE breach of fiduciary

duty as may be recoverable against the said partnership, limited liability

company, or corporation, and any judgment so obtained may be enforced

jointly or severally against said THE broker personally and the said

partnership, limited liability company, or corporation.

(9) (8) No license for a broker registered as being in the employ of

another broker shall be issued to a partnership, a limited liability company,

or a corporation or under a fictitious name or trade name; except that a

married woman may elect to use her birth name.

(10) (9) No person shall be licensed as a real estate broker under

more than one name, and no person shall conduct or promote a real estate

brokerage business except under the name under which such THE person is

licensed.

(11) Repealed.

(12) (10) A licensed attorney shall take and pass the examination

referred to in this section after having completed twelve hours of classroom

instruction or equivalent correspondent hours in trust accounts, record

keeping, and real estate closings.

12-10-204. [Formerly 12-61-103.6] Errors and omissions

insurance required - rules. (1) Every licensee under this part 1 2, except

an inactive broker or an attorney licensee who maintains a policy of

professional malpractice insurance that provides coverage for errors and

omissions for their activities as a licensee under this part 1 2, shall maintain

errors and omissions insurance to cover all activities contemplated under

parts 1 2 to 8 6 of this article 10. The division of real estate shall make the

errors and omissions insurance available to all licensees by contracting with

an insurer for a group policy after a competitive bid process in accordance

with article 103 of title 24. C.R.S. A group policy obtained by the division

of real estate must be available to all licensees with no right on the part of

the insurer to cancel a licensee. A licensee may obtain errors and omissions

insurance independently if the coverage complies with the minimum

requirements established by the division. of real estate.

PAGE 14-HOUSE BILL 19-1172

(2) (a) If the division of real estate is unable to obtain errors and

omissions insurance coverage to insure all licensees who choose to

participate in the group program at a reasonable annual premium, as

determined by the division, of real estate, a licensee shall independently

obtain the errors and omissions insurance required by this section.

(b) The division of real estate shall solicit and consider information

and comments from interested persons when determining the

reasonableness of annual premiums.

(3) The division of real estate shall determine the terms and

conditions of coverage required under this section based on rules

promulgated by the commission. The commission shall notify each licensee

of the required terms and conditions at least thirty days before the annual

premium renewal date as determined by the commission. Each licensee

shall file a certificate of coverage showing compliance with the required

terms and conditions with the commission by the annual premium renewal

date, as determined by the division. of real estate.

(4) In addition to all other powers and duties conferred upon the

commission by this article 10, the commission shall adopt such rules as it

deems necessary or proper to carry out the provisions of this section.

(5) (Deleted by amendment, L. 2008, p. 497, § 4, effective April 17,

2008.)

12-10-205. [Formerly 12-61-104] Licenses - issuance - contents

- display. (1) The commission shall make available for each licensee a

license in such form and size as said THE commission shall prescribe and

adopt. The real estate license shall show the name of the licensee and shall

have imprinted thereon the seal, or a facsimile, of the department of

regulatory agencies and, in addition to the foregoing, shall contain such

other matter as said THE commission shall prescribe.

(2) and (3) (Deleted by amendment, L. 2001, p. 24, § 2, effective

March 9, 2001.)

12-10-206. [Formerly 12-61-105] Real estate commission -

created - compensation - immunity - subject to termination. (1) There

is hereby created a commission of five members, appointed by the governor,

PAGE 15-HOUSE BILL 19-1172

which shall administer parts 1 2 and 4 5 of this article 61 10. This

commission is known as the real estate commission also referred to in this

part 1 as the "commission", and consists of three real estate brokers who

have had not less than five years' experience in the real estate business in

Colorado, one of whom has substantial experience in property management,

and two representatives of the public at large. Members of the commission

hold office for a period of three years. Upon the death, resignation, removal,

or otherwise of any member of the commission, the governor shall appoint

a member to fill out the unexpired term. The governor may remove any

member for misconduct, neglect of duty, or incompetence.

(2) Each member of the commission shall receive the same

compensation and reimbursement of expenses as those provided for

members of boards and commissions in the division of professions and

occupations pursuant to section 24-34-102 (13), C.R.S. 12-20-103 (6).

Payment for all such per diem compensation and expenses shall be made

out of annual appropriations from the division of real estate cash fund

provided for in section 12-61-111.5 12-10-215.

(2.5) (3) Members of the commission, consultants, expert witnesses,

and complainants shall be immune from suit in any civil action based upon

any disciplinary proceedings or other official acts they performed in good

faith.

(3) (4) No real estate broker's license shall be denied, suspended, or

revoked except as determined by a majority vote of the members of the

commission.

(4) The provisions of section 24-34-104, C.R.S., concerning the

termination schedule for regulatory bodies of the state unless extended as

provided in that section, are applicable to the real estate commission created

by this section.

12-10-207. [Formerly 12-61-106] Division of real estate - creation

- director, clerks, and assistants. (1) THERE IS HEREBY CREATED WITHIN

THE DEPARTMENT THE DIVISION OF REAL ESTATE. The executive director of

the department of regulatory agencies is authorized by this section to

employ, subject to the provisions of the state personnel system laws of the

state, a director of the division, of real estate, who in turn shall employ such

attorneys, deputies, investigators, clerks, and assistants as are necessary to

PAGE 16-HOUSE BILL 19-1172

discharge the duties imposed by parts 1 2 and 4 5 of this article 61 10. The

division of real estate, which is a division in the department of regulatory

agencies, and the director of the division shall exercise their powers and

perform their duties and functions under the department of regulatory

agencies as if they were transferred to the department by a type 2 transfer.

(2) It is the duty of the director, personally, or his THE DIRECTOR'S

designee to aid in the administration and enforcement of parts 1 2 and 4 5

of this article 61 10 and in the prosecution of all persons charged with

violating any of their provisions, to conduct audits of business accounts of

licensees, to perform such duties of the commission as the commission

prescribes, and to act in behalf of the commission on such occasions and in

such circumstances as the commission directs.

12-10-208. [Formerly 12-61-107] Resident licensee - nonresident

licensee - consent to service. (1) A nonresident of the state may become

a real estate broker in this state by conforming to all the conditions of this

part 1 2; except that the nonresident broker shall not be required to maintain

a place of business within this state if that broker maintains a definite place

of business in another state.

(2) If a broker has no registered agent registered in this state, such

THE registered agent is not located under its registered agent name at its

registered agent address, or the registered agent cannot with reasonable

diligence be served, the broker may be served by registered mail or by

certified mail, return receipt requested, addressed to the entity at its

principal address. Service is perfected under this subsection (2) at the

earliest of:

(a) The date the broker receives the process, notice, or demand;

(b) The date shown on the return receipt, if signed by or on behalf

of the broker; or

(3) All such applications shall contain a certification that the broker

is authorized to act for the corporation.

12-10-209. [Formerly 12-61-108] Record of licensees -

PAGE 17-HOUSE BILL 19-1172

publications. The commission shall maintain a record of the names and

addresses of all licensees licensed under the provisions of parts 1 2 and 4

5 of this article 10, together with such other information relative to the

enforcement of said THE provisions as deemed by the commission to be

necessary. Publication of the record and of any other information circulated

in quantity outside the executive branch shall be in accordance with the

provisions of section 24-1-136. C.R.S.

12-10-210. [Formerly 12-61-108.5] Compilation and publication

of passing rates per educational institution for real estate licensure

examinations - definition - rules. (1) The commission shall have the

authority to obtain information from each educational institution authorized

to offer courses in real estate for the purpose of compiling the number of

applicants who pass the real estate licensure examination from each

educational institution. The information shall include the name of each

student who attended the institution and a statement of whether the student

completed the necessary real estate courses required for licensure. The

commission shall have access to such other information as necessary to

accomplish the purpose of this section. For the purposes of this section, an

"applicant" is a student who completed the required education requirements

and who applied for and sat for the licensure examination.

(2) The commission shall compile the information obtained in

subsection (1) of this section with applicant information retained by the

commission. Specifically, the commission shall compile whether the student

applied for the licensure examination and whether the applicant passed the

licensure examination. The commission shall create statistical data setting

forth:

(a) The name of the educational institution;

(b) The number of students who completed the necessary real estate

course required for licensure;

examination; and

(d) The number of those applicants who passed the licensure

examination.

PAGE 18-HOUSE BILL 19-1172

(3) The commission shall publish this statistical data and make it

available to the public quarterly.

(4) The commission shall retain the statistical data for three years.

(5) Specific examination scores for an applicant will be kept

confidential by the commission unless the applicant authorizes release of

such THE information.

(6) The commission may promulgate rules for the administration of

this section.

12-10-211. [Formerly 12-61-109] Change of license status -

inactive - cancellation. (1) Immediate notice shall be given in a manner

acceptable to the commission by each licensee of any change of business

location or employment. A change of business address or employment

without notification to the commission shall automatically inactivate the

licensee's license.

(2) A broker who transfers to the address of another broker or a

broker applicant who desires to be employed by another broker shall inform

the commission if said THE broker is to be in the employ of the other broker.

The employing broker shall have the control and custody of the employed

broker's license. The employed broker may not act on behalf of said THE

broker or as broker for a partnership, limited liability company, or

corporation during the term of such THE employment; but this shall not

affect the employed broker's right to transfer to another employing broker

or to a location where the employed broker may conduct business as an

independent broker or as a broker acting for a partnership, limited liability

company, or corporation.

(3) In the event that any licensee is discharged by or terminates

employment with a broker, it shall be the joint duty of both such parties to

immediately notify the commission. Either party may furnish such THE

notice in a manner acceptable to the commission. The party giving notice

shall notify the other party in person or in writing of the termination of

employment.

(4) It is unlawful for any such licensee to perform any of the acts

authorized under the license in pursuance of this part 1 2, either directly or

PAGE 19-HOUSE BILL 19-1172

indirectly, on or after the date that employment has been terminated. When

any real estate broker whose employment has been terminated is employed

by another real estate broker, the commission shall, upon proper

notification, enter such THE change of employment in the records of the

commission. Not more than one employer or place of employment shall be

shown for any real estate broker for the same period of time.

12-10-212. [Formerly 12-61-110] License fees - partnership,

limited liability company, and corporation licenses - rules. (1) Fees

established pursuant to section 12-61-111.5 12-10-215 shall be charged by

and paid to the commission or the agent for the commission for the

following:

(a) and (b) (Deleted by amendment, L. 96, p. 419, § 5, effective

January 1, 1997.)

(d) (b) Each broker's original application and license;

(e) (Deleted by amendment, L. 96, p. 419, § 5, effective January 1,

1997.)

(f) (c) Each renewal of a broker's license;

(g) (Deleted by amendment, L. 96, p. 419, § 5, effective January 1,

1997.)

(h) (d) Any change of name, address, or employing broker requiring

a change in commission records;

(i) (e) A new application which THAT shall be submitted when a

licensed real estate broker wishes to become the broker acting for a

partnership, a limited liability company, or a corporation.

(2) The proper fee shall accompany each application for licensure.

The fee shall not be refundable. Failure by the person taking an examination

to file the appropriate broker's application within one year of the date such

THE person passed the examination will automatically cancel the

examination, and all rights to a passing score will be terminated.

PAGE 20-HOUSE BILL 19-1172

(3) Each real estate broker's license granted to an individual shall

entitle such THE individual to perform all the acts contemplated by this part

1 2, without any further application on his OR HER part and without the

payment of any fee other than the fees specified in this section.

(4) (a) (I) The commission shall require that any person licensed

under this part 1 2, whether on an active or inactive basis, renew the license

on or before December 31 of every third year after issuance; except that an

initial license issued under this part 1 2 on or after April 23, 2018, expires

at 12 midnight on December 31 of the year in which it was issued.

(II) Renewal is conditioned upon fulfillment of the continuing

education requirements set forth in section 12-61-110.5 12-10-213. For

persons renewing or reinstating an active license, written certification

verifying completion for the previous licensing period of the continuing

education requirements set forth in section 12-61-110.5 12-10-213 must

accompany and be submitted to the commission with the application for

renewal or reinstatement. For persons who did not submit certification

verifying compliance with section 12-61-110.5 12-10-213 at the time a

license was renewed or reinstated on an inactive status, written certification

verifying completion for the previous licensing period of the continuing

education requirements set forth in that section must accompany and be

submitted with any future application to reactivate the license. The

commission may, by rule, establish procedures to facilitate such a renewal.

In the absence of any reason or condition that might warrant the refusal of

the granting of a license or the revocation thereof, the commission shall

issue a new license upon receipt by the commission of the written request

of the applicant and the appropriate fees required by this section.

Applications for renewal will be accepted thirty days prior to January 1.

(III) A person who fails to renew a license before January 1 of the

year succeeding the year of the expiration of the license may reinstate the

license as follows:

(A) If proper application is made within thirty-one days after the

date of expiration, by payment of the regular renewal fee;

(B) If proper application is made more than thirty-one days but

within one year after the date of expiration, by payment of the regular

renewal fee and payment of a reinstatement fee equal to one-half the regular

PAGE 21-HOUSE BILL 19-1172

renewal fee;

three years after the date of expiration, by payment of the regular renewal

fee and payment of a reinstatement fee equal to the regular renewal fee.

(IV) The commission may, by rule, establish procedures to facilitate

the transition of the reinstatement license periods described in subsections

(4)(a)(III)(A) to (4)(a)(III)(C) of this section from an anniversary expiration

date to a December 31 expiration date.

(a.5) Repealed.

(b) Any reinstated license shall be effective only as of the date of

reinstatement. Any person who fails to apply for reinstatement within three

years after the expiration of a license shall, without exception, be treated as

a new applicant for licensure.

who shall credit same THE FEES to the division of real estate cash fund, as

established by section 12-61-111.5 12-10-215.

(5) The suspension, expiration, or revocation of a real estate broker's

license shall automatically inactivate every real estate broker's license where

the holder of such THE license is shown in the commission records to be in

the employ of the broker whose license has expired or has been suspended

or revoked pending notification to the commission by the employed licensee

of a change of employment.

(6) (Deleted by amendment, L. 91, p. 1628, § 8, effective July 1,

1991.)

12-10-213. [Formerly 12-61-110.5] Renewal of license -

continuing education requirement - rules. (1) A broker applying for

renewal of a license pursuant to section 12-61-110 (4) 12-10-212 (4) shall

include with such THE application a certified statement verifying successful

completion of real estate courses in accordance with the following schedule:

(a) and (b) Repealed.

PAGE 22-HOUSE BILL 19-1172

passage within the previous three years of the Colorado portion of the real

estate exam or completion of a minimum of twenty-four hours of credit,

twelve of which must be the credits developed by the commission pursuant

to subsection (2) of this section;

(d) (b) For licensees applying for renewal of a license that expires

less than three years after it was issued, passage within the license period

of the Colorado portion of the real estate exam or completion of a minimum

of twenty-four hours of credit, at least eight of which must be the credits

developed by the commission pursuant to subsection (2) of this section.

(2) The real estate commission shall develop twelve hours of credit

designed to assure reasonable currency of real estate knowledge by

licensees, which credits shall include an update of the current statutes and

the rules promulgated by the commission that affect the practice of real

estate. If a licensee takes a course pursuant to rule 260 250 of the Colorado

rules of civil procedure and the course concerns real property law, the

licensee shall receive credit for the course toward the fulfillment of the

licensee's continuing education requirements pursuant to this section. The

credits shall be taken from an accredited Colorado college or university; a

Colorado community college; a Colorado private occupational school

holding a certificate of approval from the state board for community

colleges and occupational education; or an educational institution or an

educational service described in section 23-64-104. Successful completion

of such THE credits shall require satisfactory passage of a written

examination or written examinations of the materials covered. The

examinations shall be audited by the commission to verify their accuracy

and the validity of the grades given. The commission shall set the standards

required for satisfactory passage of the examinations.

(3) All credits, other than the credits specified in subsection (2) of

this section, shall be acquired from educational courses approved by the

commission that contribute directly to the professional competence of a

licensee. Such THE credits may be acquired through successful completion

of instruction in one or more of the following subjects:

(a) Real estate law;

(b) Property exchanges;

PAGE 23-HOUSE BILL 19-1172

(d) Real estate finance;

(e) Real estate appraisal;

(f) Real estate closing;

(g) Real estate ethics;

(h) Condominiums and cooperatives;

(i) Real estate time-sharing;

(j) Real estate marketing principles;

(k) Real estate construction;

(l) Land development;

(m) Real estate energy concerns;

(n) Real estate geology;

(o) Water and waste management;

(p) Commercial real estate;

(q) Real estate securities and syndications;

(r) Property management;

(s) Real estate computer principles;

(t) Brokerage administration and management;

(u) Agency; and

(v) Any other subject matter as approved by the real estate

commission.

PAGE 24-HOUSE BILL 19-1172

(4) A licensee applying for renewal of a license which THAT expires

on December 31 of the year in which it was issued is not subject to the

education requirements set forth in subsection (1) of this section.

(5) The real estate commission shall promulgate rules and

regulations to implement this section.

12-10-214. [Formerly 12-61-111] Disposition of fees. All fees

collected by the real estate commission under parts 1 2 and 4 5 of this

article 10, not including administrative fees that are in the nature of an

administrative fine and fees retained by contractors pursuant to contracts

entered into in accordance with section 12-61-103 12-10-203 or 24-34-101,

C.R.S., shall be transmitted to the state treasurer, who shall credit the same

to the division of real estate cash fund. Pursuant to section 12-61-111.5

12-10-215, the general assembly shall make annual appropriations from said

THE fund for expenditures of the commission incurred in the performance

of its duties under parts 1 2 and 4 5 of this article 10. The commission may

request an appropriation specifically designated for educational and

enforcement purposes. The expenditures incurred by the commission under

parts 1 2 and 4 5 of this article 10 shall be made out of such THE

appropriations upon vouchers and warrants drawn pursuant to law.

12-10-215. [Formerly 12-61-111.5] Fee adjustments - cash fund

created. (1) This section applies to all activities of the division under parts

1, 4, 7, 9, and 10 2, 5, 6, AND 7 of this article 61 10.

(2) (a) (I) The division shall propose, as part of its annual budget

request, an adjustment in the amount of each fee that it is authorized by law

to collect under parts 1, 4, 7, 9, and 10 2, 5, 6, AND 7 of this article 61 10.

The budget request and the adjusted fees for the division must reflect direct

and indirect costs.

(II) The costs of the HOA information and resource center, created

in section 12-61-406.5 12-10-801, shall be paid from the division of real

estate cash fund created in this section. The division of real estate shall

estimate the direct and indirect costs of operating the HOA information and

resource center and shall establish the amount of the annual registration fee

to be collected under section 38-33.3-401. The amount of the registration

fee shall be sufficient to recover these costs, subject to a maximum limit of

fifty dollars.

PAGE 25-HOUSE BILL 19-1172

(b) (I) Based upon the appropriation made and subject to the

approval of the executive director, of the department of regulatory agencies,

the division of real estate shall adjust its fees so that the revenue generated

from the fees approximates its direct and indirect costs incurred in

administering the programs and activities from which the fees are derived.

The fees shall remain in effect for the fiscal year for which the budget

request applies. All fees collected by the division, not including fees

retained by contractors pursuant to contracts entered into in accordance with

section 12-61-103 12-10-203 or 24-34-101, shall be transmitted to the state

treasurer, who shall credit the same to the division of real estate cash fund,

which fund is hereby created. All money credited to the division of real

estate cash fund shall be used as provided in this section or in section

12-61-111 12-10-214 and shall not be deposited in or transferred to the

general fund of this state or any other fund.

(II) Repealed.

moneys MONEY appropriated to the division for its activities for the prior

fiscal year are IS unexpended, said moneys THE MONEY shall be made a part

of the appropriation to the division for the next fiscal year, and such THE

amount shall not be raised from fees collected by the division. If a

supplemental appropriation is made to the division for its activities, its fees,

when adjusted for the fiscal year next following that in which the

supplemental appropriation was made, shall be adjusted by an additional

amount which THAT is sufficient to compensate for such THE supplemental

appropriation. Funds appropriated to the division in the annual long

appropriations bill shall be designated as a cash fund and shall not exceed

the amount anticipated to be raised from fees collected by the division.

12-10-216. [Formerly 12-61-112] Records - evidence - inspection.

(1) The executive director of the department of regulatory agencies shall

adopt a seal by which all proceedings authorized under parts 1 2 and 4 5 of

this article 61 10 shall be authenticated. Copies of records and papers in the

office of the commission or department of regulatory agencies relating to

the administration of parts 1 2 and 4 5 of this article 61 10, when duly

certified and authenticated by the seal, shall be received as evidence in all

courts equally and with like effect as the originals. All records kept in the

office of the commission or department, of regulatory agencies, under

authority of parts 1 2 and 4 5 of this article 61 10, must be open to public

PAGE 26-HOUSE BILL 19-1172

inspection at such time and in such manner as may be prescribed by rules

formulated by the commission.

(2) Repealed.

(3) (2) The commission shall not be required to maintain or preserve

licensing history records of any person licensed under the provisions of this

part 1 2 for any period of time longer than seven years.

12-10-217. [Formerly 12-61-113] Investigation - revocation -

actions against licensee or applicant - definition. (1) The commission,

upon its own motion, may, and, upon the complaint in writing of any

person, shall, investigate the activities of any licensee or any person who

assumes to act in the capacity of a licensee within the state, and the

commission, after holding a hearing pursuant to section 12-61-114

12-10-219, has the power to impose an administrative fine not to exceed

two thousand five hundred dollars for each separate offense and to censure

a licensee, to place the licensee on probation and to set the terms of

probation, or to temporarily suspend a license, or permanently revoke a

license, when the licensee has performed, is performing, or is attempting to

perform any of the following acts and is guilty of:

(a) Knowingly making any misrepresentation or knowingly making

use of any false or misleading advertising;

(b) Making any promise of a character which THAT influences,

persuades, or induces another person when he OR SHE could not or did not

intend to keep such THE promise;

agents, advertising, or otherwise;

(c.5) (d) Violating any provision of the "Colorado Consumer

Protection Act", article 1 of title 6; C.R.S.;

(d) (e) Acting for more than one party in a transaction without the

knowledge of all parties thereto;

(e) (f) Representing or attempting to represent a real estate broker

other than the licensee's employer without the express knowledge and

PAGE 27-HOUSE BILL 19-1172

consent of that employer;

(f) (g) In the case of a broker registered as in the employ of another

broker, failing to place, as soon after receipt as is practicably possible, in

the custody of that licensed broker-employer any deposit money or other

money or fund entrusted to the employee by any person dealing with the

employee as the representative of that licensed broker-employer;

(g) (h) Failing to account for or to remit, within a reasonable time,

any moneys MONEY coming into the licensee's possession that belong

BELONGS to others, whether acting as real estate brokers or otherwise, and

failing to keep records relative to said moneys THE MONEY, which records

shall contain such information as may be prescribed by the rules of the

commission relative thereto and shall be subject to audit by the commission;

(g.5) (i) Converting funds of others, diverting funds of others

without proper authorization, commingling funds of others with the broker's

own funds, or failing to keep such THE funds of others in an escrow or a

trustee account with some bank or recognized depository in this state, which

account may be any type of checking, demand, passbook, or statement

account insured by an agency of the United States government, and to so

keep records relative to the deposit which THAT contain such information

as may be prescribed by the rules and regulations of the commission relative

thereto, which records shall be subject to audit by the commission;

(h) (j) Failing to provide the purchaser and seller of real estate with

a closing statement of the transaction, containing such information as may

be prescribed by the rules and regulations of the commission or failing to

provide a signed duplicate copy of the listing contract and the contract of

sale or the preliminary agreement to sell to the parties thereto;

(i) (k) Failing to maintain possession, for future use or inspection by

an authorized representative of the commission, for a period of four years,

of the documents or records prescribed by the rules and regulations of the

commission or to produce such THE documents or records upon reasonable

request by the commission or by an authorized representative of the

commission;

(j) (l) Paying a commission or valuable consideration for performing

any of the functions of a real estate broker, as described in this part 1 2, to

PAGE 28-HOUSE BILL 19-1172

any person not licensed under this part 1 2; except that a licensed broker

may pay a finder's fee or a share of any commission on a cooperative sale

when such THE payment is made to a real estate broker licensed in another

state or country. If a country does not license real estate brokers, then the

payee must be a citizen or resident of said THE country and represent that

the payee is in the business of selling real estate in said THE country.

(k) (m) Disregarding or violating any provision of this part 1 2 or

part 8 4 of this article 10, violating any reasonable rule or regulation

promulgated by the commission in the interests of the public and in

conformance with the provisions of this part 1 2 or part 8 4 of this article

10; violating any lawful commission orders; or aiding and abetting a

violation of any rule, regulation, commission order, or provision of this part

1 2 or part 8 4 of this article 10;

(l) Repealed.

(m) (n) (I) Conviction of, entering a plea of guilty to, or entering a

plea of nolo contendere to any crime in article 3 of title 18; parts 1, 2, 3, and

4 of article 4 of title 18; part 1, 2, 3, 4, 5, 7, 8, or 9 of article 5 of title 18;

article 5.5 of title 18; parts 3, 4, 6, 7, and 8 of article 6 of title 18; parts 1,

3, 4, 5, 6, 7, and 8 of article 7 of title 18; part 3 of article 8 of title 18; article

15 of title 18; article 17 of title 18; section 18-18-404, 18-18-405,

18-18-406, 18-18-411, 18-18-412.5, 18-18-412.7, 18-18-412.8, 18-18-415,

18-18-416, 18-18-422, or 18-18-423; or any other like crime under

Colorado law, federal law, or the laws of other states. A certified copy of

the judgment of a court of competent jurisdiction of such THE conviction or

other official record indicating that such THE plea was entered shall be

conclusive evidence of such THE conviction or plea in any hearing under

this part 1 2.

(II) As used in this subsection (1)(m) (1)(n), "conviction" includes

the imposition of a deferred judgment or deferred sentence.

(m.5) (o) Violating or aiding and abetting in the violation of the

Colorado or federal fair housing laws;

(m.6) (p) Failing to immediately notify the commission in writing

of a conviction, plea, or violation pursuant to paragraph (m) or (m.5) of this

subsection (1) SUBSECTION (1)(n) OR (1)(o) OF THIS SECTION;

PAGE 29-HOUSE BILL 19-1172

(n) (q) Having demonstrated unworthiness or incompetency to act

as a real estate broker by conducting business in such a manner as to

endanger the interest of the public;

(o) (r) In the case of a broker licensee, failing to exercise reasonable

supervision over the activities of licensed employees;

(p) (s) Procuring, or attempting to procure, a real estate broker's

license or renewing, reinstating, or reactivating, or attempting to renew,

reinstate, or reactivate, a real estate broker's license by fraud,

misrepresentation, or deceit or by making a material misstatement of fact in

an application for such THE license;

(q) (t) Claiming, arranging for, or taking any secret or undisclosed

amount of compensation, commission, or profit or failing to reveal to the

licensee's principal or employer the full amount of such THE licensee's

compensation, commission, or profit in connection with any acts for which

a license is required under this part 1 2;

(r) (u) Using any provision allowing the licensee an option to

purchase in any agreement authorizing or employing such THE licensee to

sell, buy, or exchange real estate for compensation or commission, except

when such THE licensee, prior to or coincident with election to exercise such

THE option to purchase, reveals in writing to the licensee's principal or

employer the full amount of the licensee's profit and obtains the written

consent of such THE principal or employer approving the amount of such

THE profit;

(s) (I) Repealed.

(II) (v) Effective on and after August 26, 2013, fraud,

misrepresentation, deceit, or conversion of trust funds that results in the

entry of a civil judgment for damages;

(t) (w) Any other conduct, whether of the same or a different

character than specified in this subsection (1), which THAT constitutes

dishonest dealing;

(u) Repealed.

PAGE 30-HOUSE BILL 19-1172

(v) (x) Having had a real estate broker's or a subdivision developer's

license suspended or revoked in any jurisdiction, or having had any

disciplinary action taken against the broker or subdivision developer in any

other jurisdiction if the broker's or subdivision developer's action would

constitute a violation of this subsection (1). A certified copy of the order of

disciplinary action shall be prima facie evidence of such THE disciplinary

action.

(w) (y) Failing to keep records documenting proof of completion of

the continuing education requirements in accordance with section

12-61-110.5 12-10-213 for a period of four years from the date of

compliance with said THE section;

(x) (z) (I) Violating any provision of section 12-61-113.2 12-10-218.

(II) In addition to any other remedies available to the commission

pursuant to this title ARTICLE 10, after notice and a hearing pursuant to

section 24-4-105, C.R.S., the commission may assess a penalty for a

violation of section 12-61-113.2 12-10-218 or of any rule promulgated

pursuant to section 12-61-113.2 12-10-218. The penalty shall be the amount

of remuneration improperly paid and shall be transmitted to the state

treasurer and credited to the general fund.

(y) (aa) Within the last five years, having a license, registration, or

certification issued by Colorado or another state revoked or suspended for

fraud, deceit, material misrepresentation, theft, or the breach of a fiduciary

duty, and such discipline denied the person authorization to practice as:

(I) A mortgage broker or mortgage loan originator;

(II) A real estate broker or salesperson;

(III) A real estate appraiser, as defined by section 12-61-702 (11)

12-10-602 (9);

(IV) An insurance producer, as defined by section 10-2-103 (6);

C.R.S.;

(V) An attorney;

PAGE 31-HOUSE BILL 19-1172

(VI) A securities broker-dealer, as defined by section 11-51-201 (2);

C.R.S.;

(VII) A securities sales representative, as defined by section

11-51-201 (14); C.R.S.;

(VIII) An investment advisor, as defined by section 11-51-201 (9.5);

C.R.S.; or

(IX) An investment advisor representative, as defined by section

11-51-201 (9.6). C.R.S.

(1.5) (2) Every person licensed pursuant to section 12-61-101

(2)(a)(X) 12-10-201 (6)(a)(X) shall give a prospective tenant a contract or

receipt; and such THE contract or receipt shall include the address and

telephone number of the real estate commission in prominent letters and

shall state that the regulation of rental location agents is under the purview

of the real estate commission.

(2) (3) In the event a firm, partnership, limited liability company,

association, or corporation operating under the license of a broker

designated and licensed as representative of said THE firm, partnership,

limited liability company, association, or corporation is guilty of any of the

foregoing acts, the commission may suspend or revoke the right of the said

firm, partnership, limited liability company, association, or corporation to

conduct its business under the license of said THE broker, whether or not the

designated broker had personal knowledge thereof and whether or not the

commission suspends or revokes the individual license of said THE broker.

(3) (4) Upon request of the commission, when any real estate broker

is a party to any suit or proceeding, either civil or criminal, arising out of

any transaction involving the sale or exchange of any interest in real

property or out of any transaction involving a leasehold interest in the real

property and when such THE broker is involved in such THE transaction in

such capacity as a licensed broker, it shall be the duty of said THE broker to

supply to the commission a copy of the complaint, indictment, information,

or other initiating pleading and the answer filed, if any, and to advise the

commission of the disposition of the case and of the nature and amount of

any judgment, verdict, finding, or sentence that may be made, entered, or

imposed therein.

PAGE 32-HOUSE BILL 19-1172

(4) (5) This part 1 2 shall not be construed to relieve any person

from civil liability or criminal prosecution under the laws of this state.

(5) (6) Complaints of record in the office of the commission and

commission investigations, including commission investigative files, are

closed to public inspection. Stipulations and final agency orders are public

records subject to sections 24-72-203 and 24-72-204. C.R.S.

(6) (7) When a complaint or an investigation discloses an instance

of misconduct which THAT, in the opinion of the commission, does not

warrant formal action by the commission but which THAT should not be

dismissed as being without merit, the commission may send a letter of

admonition by certified mail, return receipt requested, to the licensee

against whom a complaint was made and a copy thereof to the person

making the complaint, but the letter shall advise the licensee that the

licensee has the right to request in writing, within twenty days after proven

receipt, that formal disciplinary proceedings be initiated to adjudicate the

propriety of the conduct upon which the letter of admonition is based. If

such THE request is timely made, the letter of admonition shall be deemed

vacated, and the matter shall be processed by means of formal disciplinary

proceedings.

(7) (8) All administrative fines collected pursuant to this section

shall be transmitted to the state treasurer, who shall credit the same to the

division of real estate cash fund.

(8) (9) Any application for licensure from a person whose license

has been revoked shall not be considered until the passage of one year from

the date of revocation.

(9) (10) When the division of real estate becomes aware of facts or

circumstances that fall within the jurisdiction of a criminal justice or other

law enforcement authority upon investigation of the activities of a licensee,

the division shall, in addition to the exercise of its authority under this part

1 2, refer and transmit such THE information, which may include originals

or copies of documents and materials, to one or more criminal justice or

other law enforcement authorities for investigation and prosecution as

authorized by law.

12-10-218. [Formerly 12-61-113.2] Affiliated business

PAGE 33-HOUSE BILL 19-1172

arrangements - definitions - disclosures - enforcement and penalties -

reporting - rules - investigation information shared with the division of

insurance. (1) As used in this section, unless the context otherwise

requires:

(a) "Affiliated business arrangement" means an arrangement in

which:

(I) A provider of settlement services or an associate of a provider of

settlement services has either an affiliate relationship with or a direct

beneficial ownership interest of more than one percent in another provider

of settlement services; and

(II) A provider of settlement services or the associate of a provider

directly or indirectly refers settlement service business to another provider

of settlement services or affirmatively influences the selection of another

provider of settlement services.

(b) "Associate" means a person who has one or more of the

following relationships with a person in a position to refer settlement

service business:

(I) A spouse, parent, or child of such THE person;

(II) A corporation or business entity that controls, is controlled by,

or is under common control with such THE person;

(III) An employer, officer, director, partner, franchiser, or franchisee

of such THE person, including a broker acting as an independent contractor;

(IV) Anyone who has an agreement, arrangement, or understanding

with such THE person, the purpose or substantial effect of which is to enable

the person in a position to refer settlement service business to benefit

financially from referrals of such THE business.

with a real estate settlement including, but not limited to, the following:

(I) Title searches;

PAGE 34-HOUSE BILL 19-1172

(II) Title examinations;

(III) The provision of title certificates;

(IV) Title insurance;

(V) Services rendered by an attorney;

(VI) The preparation of title documents;

(VII) Property surveys;

(VIII) The rendering of credit reports or appraisals;

(IX) Real estate appraisal services;

(X) Home inspection services;

(XI) Services rendered by a real estate broker;

(XII) Pest and fungus inspections;

(XIII) The origination of a loan;

(XIV) The taking of a loan application;

(XV) The processing of a loan;

(XVI) Underwriting and funding of a loan;

(XVII) Escrow handling services;

(XVIII) The handling of the processing; and

(XIX) Closing of settlement.

(2) (a) An affiliated business arrangement is permitted where the

person referring business to the affiliated business arrangement receives

payment only in the form of a return on an investment and where it does not

violate the provisions of section 12-61-113 12-10-217.

PAGE 35-HOUSE BILL 19-1172

(b) If a licensee or the employing broker of a licensee is part of an

affiliated business arrangement when an offer to purchase real property is

fully executed, the licensee shall disclose to all parties to the real estate

transaction the existence of the arrangement. The disclosure shall be

written, shall be signed by all parties to the real estate transaction, and shall

comply with the federal "Real Estate Settlement Procedures Act of 1974",

as amended, 12 U.S.C. sec. 2601 et seq.

arrangement or a particular provider of settlement services as a condition

of obtaining services from that licensee for any settlement service. For the

purposes of this paragraph (c) SUBSECTION (2)(c), "require the use" shall

have the same meaning as "required use" in 24 CFR 3500.2 (b).

(d) No licensee shall give or accept any fee, kickback, or other thing

of value pursuant to any agreement or understanding, oral or otherwise, that

business incident to or part of a settlement service involving an affiliated

business arrangement shall be referred to any provider of settlement

services.

(e) Nothing in this section shall be construed to prohibit payment of

a fee to:

(I) An attorney for services actually rendered;

(II) A title insurance company to its duly appointed agent for

services actually performed in the issuance of a policy of title insurance;

(III) A lender to its duly appointed agent for services actually

performed in the making of a loan.

(f) Nothing in this section shall be construed to prohibit payment to

any person of:

(I) A bona fide salary or compensation or other payment for goods

or facilities actually furnished or for services actually performed;

(II) A fee pursuant to cooperative brokerage and referral

arrangements or agreements between real estate brokers.

PAGE 36-HOUSE BILL 19-1172

(g) It shall not be a violation of this section for an affiliated business

arrangement:

(I) To require a buyer, borrower, or seller to pay for the services of

any attorney, credit reporting agency, or real estate appraiser chosen by the

lender to represent the lender's interest in a real estate transaction; or

(II) If an attorney or law firm represents a client in a real estate

transaction and issues or arranges for the issuance of a policy of title

insurance in the transaction directly as agent or through a separate corporate

title insurance agency that may be established by that attorney or law firm

and operated as an adjunct to his or her law practice.

(h) No person shall be liable for a violation of this section if such

THE person proves by a preponderance of the evidence that such THE

violation was not intentional and resulted from a bona fide error

notwithstanding maintenance of procedures that are reasonably adopted to

avoid such THE error.

(3) On and after July 1, 2006, a licensee shall disclose at the time the

licensee enters into or changes an affiliated business arrangement, in a form

and manner acceptable to the commission, the names of all affiliated

business arrangements to which the licensee is a party. The disclosure shall

include the physical locations of the affiliated businesses.

(4) On and after July 1, 2006, an employing broker, in a form and

manner acceptable to the commission, shall at least annually disclose the

names of all affiliated business arrangements to which the employing broker

is a party. The disclosure shall include the physical locations of the

affiliated businesses.

(5) The commission may promulgate rules concerning the creation

and conduct of an affiliated business arrangement, including, but not limited

to, rules defining what constitutes a sham affiliated business arrangement.

The commission shall adopt the rules, policies, or guidelines issued by the

United States department of housing and urban development concerning the

federal "Real Estate Settlement Procedures Act of 1974", as amended, 12

U.S.C. sec. 2601 et seq. Rules adopted by the commission shall be at least

as stringent as the federal rules and shall ensure that consumers are

adequately informed about affiliated business arrangements. The

PAGE 37-HOUSE BILL 19-1172

commission shall consult with the insurance commissioner pursuant to

section 10-11-124 (2), C.R.S., concerning rules, policies, or guidelines the

insurance commissioner adopts concerning affiliated business

arrangements. Neither the rules promulgated by the INSURANCE

commissioner nor the real estate commission may create a conflicting

regulatory burden on an affiliated business arrangement.

(6) The division OF REAL ESTATE may share information gathered

during an investigation of an affiliated business arrangement with the

division of insurance.

12-10-219. [Formerly 12-61-114] Hearing - administrative law

judge - review - rules. (1) Except as otherwise provided in this section, all

proceedings before the commission with respect to disciplinary actions and

denial of licensure under this part 1 2 and part 8 4 of this article 10 and

certifications issued under part 4 5 of this article 10 shall be conducted by

an administrative law judge pursuant to the provisions of sections 24-4-104

and 24-4-105. C.R.S.

(2) Such THE proceedings shall be held in the county where the

commission has its office or in such other place as the commission may

designate. If the licensee is an employed broker, the commission shall also

notify the broker employing the licensee by mailing, by first-class mail, a

copy of the written notice required under section 24-4-104 (3) C.R.S., to the

employing broker's last-known business address.

(3) An administrative law judge shall conduct all hearings for

denying, suspending, or revoking a license or certificate on behalf of the

commission, subject to appropriations made to the department of personnel.

Each administrative law judge shall be appointed pursuant to part 10 of

article 30 of title 24. C.R.S. The administrative law judge shall conduct the

hearing pursuant to the provisions of sections 24-4-104 and 24-4-105.

C.R.S. No license shall be denied, suspended, or revoked until the

commission has made its decision by a majority vote.

(4) The decision of the commission in any disciplinary action or

denial of licensure under this section is subject to review by the court of

appeals by appropriate proceedings under section 24-4-106 (11). In order

to effectuate the purposes of parts 1, 4, and 8 2, 4, AND 5 of this article 61

10, the commission has the power to promulgate rules pursuant to article 4

PAGE 38-HOUSE BILL 19-1172

of title 24. The commission may appear in court by its own attorney.

(5) Pursuant to said THE proceeding, the court has the right, in its

discretion, to stay the execution or effect of any final order of the

commission; but a hearing shall be held affording the parties an opportunity

to be heard for the purpose of determining whether the public health, safety,

and welfare would be endangered by staying the commission's order. If the

court determines that the order should be stayed, it shall also determine at

said THE hearing the amount of the bond and adequacy of the surety, which

bond shall be conditioned upon the faithful performance by such THE

petitioner of all obligations as a real estate broker and upon the prompt

payment of all damages arising from or caused by the delay in the taking

effect of or enforcement of the order complained of and for all costs that

may be assessed or required to be paid in connection with such THE

proceedings.

(6) In any hearing conducted by the commission in which there is

a possibility of the denial, suspension, or revocation of a license because of

the conviction of a felony or of a crime involving moral turpitude, the

commission shall be governed by the provisions of section 24-5-101. C.R.S.

12-10-220. [Formerly 12-61-114.5] Rules. All rules adopted or

amended by the commission are subject to sections 24-4-103 (8)(c) and

(8)(d) and 24-34-104 (6)(b). C.R.S.

12-10-221. [Formerly 12-61-117] Broker remuneration. It is

unlawful for a real estate broker registered in the commission office as in

the employ of another broker to accept a commission or valuable

consideration for the performance of any of the acts specified in this part 1

2 from any person except the broker's employer, who shall be a licensed real

estate broker.

12-10-222. [Formerly 12-61-118] Acts of third parties - broker's

liability. Any unlawful act or violation of any of the provisions of this part

1 2 upon the part of an employee, officer, or member of a licensed real

estate broker shall not be cause for disciplinary action against a real estate

broker, unless it appears to the satisfaction of the commission that the real

estate broker had actual knowledge of the unlawful act or violation or had

been negligent in the supervision of employees.

PAGE 39-HOUSE BILL 19-1172

12-10-223. [Formerly 12-61-119] Violations. Any natural person,

firm, partnership, limited liability company, association, or corporation

violating the provisions of this part 1 2 by acting as real estate broker in this

state without having obtained a license or by acting as real estate broker

after the broker's license has been revoked or during any period for which

said THE license may have been suspended is guilty of a misdemeanor and,

upon conviction thereof, if a natural person, shall be punished by a fine of

not more than five hundred dollars, or by imprisonment in the county jail

for not more than six months, or by both such fine and imprisonment and,

if an entity, shall be punished by a fine of not more than five thousand

dollars. A second violation, if by a natural person, shall be punishable by a

fine of not more than one thousand dollars, or by imprisonment in the

county jail for not more than six months, or by both such fine and

imprisonment.

12-10-224. [Formerly 12-61-120] Subpoena compelling

attendance of witnesses and production of records and documents. The

commission, the director, for the commission, or the administrative law

judge appointed for hearings may issue a subpoena compelling the

attendance and testimony of witnesses and the production of books, papers,

or records pursuant to an investigation or hearing of such THE commission.

Such THE subpoenas shall be served in the same manner as subpoenas

issued by district courts and shall be issued without discrimination between

public or private parties requiring the attendance of witnesses and the

production of documents at hearings. If a person fails or refuses to obey a

subpoena issued by the commission, the director, or the appointed

administrative law judge, the commission may petition the district court

having jurisdiction for issuance of a subpoena in the premises, and the court

shall, in a proper case, issue its subpoena. Any person who refuses to obey

such A subpoena shall be punished as provided in section 12-61-121

12-10-225.

12-10-225. [Formerly 12-61-121] Failure to obey subpoena -

penalty. Any person who willfully fails or neglects to appear and testify or

to produce books, papers, or records required by subpoena, duly served

upon him or her in any matter conducted under parts 1 2 and 4 5 of this

article 61 10, is guilty of a misdemeanor and, upon conviction thereof, shall

be punished by a fine of twenty-five dollars, or imprisonment in the county

jail for not more than thirty days for each such offense, or by both such fine

and imprisonment. Each day such A person so refuses or neglects constitutes

PAGE 40-HOUSE BILL 19-1172

a separate offense.

12-10-226. [Formerly 12-61-122] Powers of commission -

injunctions. The commission may apply to a court of competent

jurisdiction for an order enjoining any act or practice that constitutes a

violation of parts 1 and 4 2 AND 5 of this article 61 10, and, upon a showing

that a person is engaging or intends to engage in any such act or practice,

an injunction, restraining order, or other appropriate order shall be granted

by such THE court regardless of the existence of another remedy therefor.

Any notice, hearing, or duration of any injunction or restraining order shall

be made in accordance with the provisions of the Colorado rules of civil

procedure.

12-10-227. [Formerly 12-61-123] Repeal of part. This part 1 2 is

repealed, effective September 1, 2026. Before its THE repeal, the real estate

division, including the real estate commission, shall be reviewed IS

SCHEDULED FOR REVIEW in accordance with section 24-34-104.

PART 3

BROKERS' COMMISSIONS

12-10-301. [Formerly 12-61-201] When entitled to commission.

No real estate agent or broker is entitled to a commission for finding a

purchaser who is ready, willing, and able to complete the purchase of real

estate as proposed by the owner until the same is consummated or is

defeated by the refusal or neglect of the owner to consummate the same as

agreed upon.

12-10-302. [Formerly 12-61-202] Objections on account of title.

No real estate agent or broker is entitled to a commission when a proposed

purchaser fails or refuses to complete his OR HER contract of purchase

because of defects in the title of the owner, unless such THE owner, within

a reasonable time, has said THE defects corrected by legal proceedings or

otherwise.

12-10-303. [Formerly 12-61-203] When owner must perfect title.

The owner shall not be required to begin legal or other proceedings for the

correction of such A title until such THE agent or broker secures from the

proposed purchaser an enforceable contract in writing, binding him OR HER

to complete the purchase whenever the defects in the title are corrected.

PAGE 41-HOUSE BILL 19-1172

12-10-304. [Formerly 12-61-203.5] Referral fees - conformity

with federal law required - remedies for violation - definitions. (1) A

person licensed under parts 1 to 4 PART 2, 3, OR 5 of this article 10 shall not

pay or receive a referral fee except in accordance with the federal "Real

Estate Settlement Procedures Act of 1974", as amended, 12 U.S.C. sec.

2601 et seq., and unless reasonable cause for payment of the referral fee

exists. A reasonable cause for payment means:

(a) An actual introduction of business has been made;

(b) A contractual referral fee relationship exists; or

(2) (a) No person shall interfere with the brokerage relationship of

a licensee.

(b) As used in this subsection (2):

(I) "Brokerage relationship" means a relationship entered into

between a broker and a buyer, seller, landlord, or tenant under which the

broker engages in any of the acts set forth in section 12-61-101 (2)

12-10-201 (6). A brokerage relationship is not established until a written

brokerage agreement is entered into between the parties or is otherwise

established by law.

(II) "Interference "INTERFERE with the brokerage relationship"

means demanding a referral fee from a licensee without reasonable cause.

(III) "Referral fee" means any fee paid by a licensee to any person

or entity, other than a cooperative commission offered by a listing broker

to a selling broker or vice versa.

(3) Any person aggrieved by a violation of any provision of this

section may bring a civil action in a court of competent jurisdiction. The

prevailing party in any such action shall be entitled to actual damages and,

in addition, the court may award an amount up to three times the amount of

actual damages sustained as a result of any such violation plus reasonable

attorney fees.

PAGE 42-HOUSE BILL 19-1172

12-10-305. [Formerly 12-61-204] Repeal of part. This part 2 3 is

repealed, effective September 1, 2026. Before its THE repeal, this part 2 3

is scheduled for review in accordance with section 24-34-104.

PART 4

BROKERAGE RELATIONSHIPS

12-10-401. [Formerly 12-61-801] Legislative declaration. (1) The

general assembly finds, determines, and declares that the public will best be

served through a better understanding of the public's legal and working

relationships with real estate brokers and by being able to engage any such

real estate broker on terms and under conditions that the public and the real

estate broker find acceptable. This includes engaging a broker as a single

agent or transaction-broker. Individual members of the public should not be

exposed to liability for acts or omissions of real estate brokers that have not

been approved, directed, or ratified by such THE individuals. Further, the

public should be advised of the general duties, obligations, and

responsibilities of the real estate broker they engage.

(2) This part 8 4 is enacted to govern the relationships between real

estate brokers and sellers, landlords, buyers, and tenants in real estate

transactions.

12-10-402. [Formerly 12-61-802] Definitions. As used in this part

8 4, unless the context otherwise requires:

(1) "Broker" shall have the same meaning as set forth in section

12-61-101 (2) 12-10-201 (6), except as otherwise specified in this part 8 4.

(1.3) (2) "Customer" means a party to a real estate transaction with

whom the broker has no brokerage relationship because such THE party has

not engaged or employed a broker.

(1.5) (3) (a) "Designated broker" means an employing broker or

employed broker who is designated in writing by an employing broker to

serve as a single agent or transaction-broker for a seller, landlord, buyer, or

tenant in a real estate transaction.

(b) "Designated broker" does not include a real estate brokerage

firm that consists of only one licensed natural person.

PAGE 43-HOUSE BILL 19-1172

(2) (4) "Dual agent" means a broker who, with the written informed

consent of all parties to a contemplated real estate transaction, is engaged

as a limited agent for both the seller and buyer or both the landlord and

tenant.

(3) (5) "Limited agent" means an agent whose duties and obligations

to a principal are only those set forth in section 12-61-804 12-10-404 or

12-61-805 12-10-405, with any additional duties and obligations agreed to

pursuant to section 12-61-803 (5) 12-10-403 (5).

(4) (6) "Single agent" means a broker who is engaged by and

represents only one party in a real estate transaction. A single agent includes

the following:

(a) "Buyer's agent", which means a broker who is engaged by and

represents the buyer in a real estate transaction;

(b) "Landlord's agent", which means a broker who is engaged by and

represents the landlord in a leasing transaction;

represents the seller in a real estate transaction; and

(d) "Tenant's agent", which means a broker who is engaged by and

represents the tenant in a leasing transaction.

(5) (7) "Subagent" means a broker engaged to act for another broker

in performing brokerage tasks for a principal. The subagent owes the same

obligations and responsibilities to the principal as does the principal's

broker.

(6) (8) "Transaction-broker" means a broker who assists one or more

parties throughout a contemplated real estate transaction with

communication, interposition, advisement, negotiation, contract terms, and

the closing of such THE real estate transaction without being an agent or

advocate for the interests of any party to such THE transaction. Upon

agreement in writing pursuant to section 12-61-803 (2) 12-10-403 (2) or a

written disclosure pursuant to section 12-61-808 (2)(d) 12-10-408 (2)(c), a

transaction-broker may become a single agent.

PAGE 44-HOUSE BILL 19-1172

12-10-403. [Formerly 12-61-803] Relationships between brokers

and the public - definition - rules. (1) When engaged in any of the

activities enumerated in section 12-61-101 (2) 12-10-201 (6), a broker may

act in any transaction as a single agent or transaction-broker. The broker's

general duties and obligations arising from that relationship shall be

disclosed to the seller and the buyer or to the landlord and the tenant

pursuant to section 12-61-808 12-10-408.

(2) A broker shall be considered a transaction-broker unless a single

agency relationship is established through a written agreement between the

broker and the party or parties to be represented by such THE broker.

(3) A broker may work with a single party in separate transactions

pursuant to different relationships including, but not limited to, selling one

property as a seller's agent and working with that seller in buying another

property as a transaction-broker or buyer's agent, but only if the broker

complies with this part 8 4 in establishing the relationships for each

transaction.

(4) (a) A broker licensed pursuant to part 1 2 of this article 10,

whether acting as a single agent or transaction-broker, may complete

standard forms for use in a real estate transaction, including standard forms

intended to convey personal property as part of the real estate transaction,

when a broker is performing the activities enumerated or referred to in

section 12-61-101 (2) 12-10-201 (6) in the transaction.

(b) As used in this subsection (4), "standard form" means:

(I) A form promulgated by the real estate commission for current

use by brokers, also referred to in this section as a "commission-approved

form";

(II) A form drafted by a licensed Colorado attorney representing the

broker, employing broker, or brokerage firm, so long as the name of the

attorney or law firm and the name of the broker, employing broker, or

brokerage firm for whom the form is prepared are included on the form

itself;

(III) A form provided by a party to the transaction if the broker is

acting in the transaction as either a transaction-broker or as a single agent

PAGE 45-HOUSE BILL 19-1172

for the party providing the form to the broker, so long as the broker retains

written confirmation that the form was provided by a party to the

transaction;

(IV) A form prescribed by a governmental agency, a

quasi-governmental agency, or a lender regulated by state or federal law, if

use of the form is mandated by such THE agency or lender;

(V) A form issued with the written approval of the Colorado Bar

Association or its successor organization and specifically designated for use

by brokers in Colorado, so long as the form is used within any guidelines

or conditions specified by the Colorado Bar Association or successor

organization in connection with the use of the form;

(VI) A form used for disclosure purposes only, if the disclosure does

not purport to waive or create any legal rights or obligations affecting any

party to the transaction and if the form provides only information

concerning either:

(A) The real estate involved in the transaction specifically; or

(B) The geographic area in which the real estate is located generally;

(VII) A form prescribed by a title company that is providing closing

services in a transaction for which the broker is acting either as a

transaction-broker or as a single agent for a party to the transaction; or

(VIII) A letter of intent created or prepared by a broker, employing

broker, or brokerage firm, so long as the letter of intent states on its face

that it is nonbinding and creates no legal rights or obligations.

form exists and is appropriate for the transaction. A broker's use of any

standard form described in subsection (4)(b)(III) or (4)(b)(IV) of this

section must be limited to inserting transaction-specific information within

the form. In using standard forms described in subsection (4)(b)(II),

(4)(b)(V), (4)(b)(VI), (4)(b)(VII), or (4)(b)(VIII) of this section, the broker

may also advise the parties as to effects thereof, and the broker's use of

those standard forms must be appropriate for the transaction and the

circumstances in which they are used. In any transaction described in this

PAGE 46-HOUSE BILL 19-1172

subsection (4), the broker shall advise the parties that the forms have

important legal consequences and that the parties should consult legal

counsel before signing such THE forms.

(5) Nothing contained in this section shall prohibit the public from

entering into written contracts with any broker which THAT contain duties,

obligations, or responsibilities which THAT are in addition to those specified

in this part 8 4.

(6) (a) If a real estate brokerage firm has more than one licensed

natural person, the employing broker or an individual broker employed or

engaged by that employing broker shall be designated to work with the

seller, landlord, buyer, or tenant as a designated broker. The employing

broker may designate more than one of its individual brokers to work with

a seller, landlord, buyer, or tenant.

(b) The brokerage relationship established between the seller,

landlord, buyer, or tenant and a designated broker, including the duties,

obligations, and responsibilities of that relationship, shall not extend to the

employing broker nor to any other broker employed or engaged by that

employing broker who has not been so designated and shall not extend to

the firm, partnership, limited liability company, association, corporation, or

other entity that employs such THE broker.

single agents for a seller or landlord and a buyer or tenant in the same real

estate transaction without creating dual agency for the employing real estate

broker, or any broker employed or engaged by that employing real estate

broker.

(d) An individual broker may be designated to work for both a seller

or landlord and a buyer or tenant in the same transaction as a

transaction-broker for both, as a single agent for the seller or landlord

treating the buyer or tenant as a customer, or as a single agent for a buyer

or tenant treating the seller or landlord as a customer, but not as a single

agent for both. The applicable designated broker relationship shall be

disclosed in writing to the seller or landlord and buyer or tenant in a timely

manner pursuant to rules promulgated by the real estate commission.

(e) A designated broker may work with a seller or landlord in one

PAGE 47-HOUSE BILL 19-1172

transaction and work with a buyer or tenant in another transaction.

(f) When a designated broker serves as a single agent pursuant to

section 12-61-804 12-10-404 or 12-61-805 12-10-405, there shall be no

imputation of knowledge to the employing or employed broker who has not

been so designated.

(g) The extent and limitations of the brokerage relationship with the

designated broker shall be disclosed to the seller, landlord, buyer, or tenant

working with that designated broker pursuant to section 12-61-808

12-10-408.

(7) No seller, buyer, landlord, or tenant shall be vicariously liable for

a broker's acts or omissions that have not been approved, directed, or

ratified by such THE seller, buyer, landlord, or tenant.

(8) Nothing in this section shall be construed to limit the employing

broker's or firm's responsibility to supervise licensees employed by such

THE broker or firm nor to shield such THE broker or firm from vicarious

liability.

12-10-404. [Formerly 12-61-804] Single agent engaged by seller

or landlord. (1) A broker engaged by a seller or landlord to act as a seller's

agent or a landlord's agent is a limited agent with the following duties and

obligations:

(a) To perform the terms of the written agreement made with the

seller or landlord;

(b) To exercise reasonable skill and care for the seller or landlord;

good faith, loyalty, and fidelity, including, but not limited to:

(I) Seeking a price and terms which THAT are acceptable to the seller

or landlord; except that the broker shall not be obligated to seek additional

offers to purchase the property while the property is subject to a contract for

sale or to seek additional offers to lease the property while the property is

subject to a lease or letter of intent to lease;

PAGE 48-HOUSE BILL 19-1172

(II) Presenting all offers to and from the seller or landlord in a

timely manner regardless of whether the property is subject to a contract for

sale or a lease or letter of intent to lease;

(III) Disclosing to the seller or landlord adverse material facts

actually known by the broker;

(IV) Counseling the seller or landlord as to any material benefits or

risks of a transaction which THAT are actually known by the broker;

(V) Advising the seller or landlord to obtain expert advice as to

material matters about which the broker knows but the specifics of which

are beyond the expertise of such THE broker;

(VI) Accounting in a timely manner for all money and property

received; and

(VII) Informing the seller or landlord that such THE seller or

landlord shall not be vicariously liable for the acts of such THE seller's or

landlord's agent that are not approved, directed, or ratified by such THE

seller or landlord;

(d) To comply with all requirements of this article 10 and any rules

promulgated pursuant to this article 10; and

(e) To comply with any applicable federal, state, or local laws, rules,

regulations, or ordinances including fair housing and civil rights statutes or

regulations.

(2) The following information shall not be disclosed by a broker

acting as a seller's or landlord's agent without the informed consent of the

seller or landlord:

(a) That a seller or landlord is willing to accept less than the asking

price or lease rate for the property;

(b) What the motivating factors are for the party selling or leasing

the property;

PAGE 49-HOUSE BILL 19-1172

than those offered;

(d) Any material information about the seller or landlord unless

disclosure is required by law or failure to disclose such THE information

would constitute fraud or dishonest dealing; or

(e) Any facts or suspicions regarding circumstances which THAT

may psychologically impact or stigmatize any real property pursuant to

section 38-35.5-101. C.R.S.

(3) (a) A broker acting as a seller's or landlord's agent owes no duty

or obligation to the buyer or tenant; except that a broker shall, subject to the

limitations of section 38-35.5-101, C.R.S., concerning psychologically

impacted property, disclose to any prospective buyer or tenant all adverse

material facts actually known by such THE broker. Such THE adverse

material facts may include but shall not be limited to adverse material facts

pertaining to the title and the physical condition of the property, any

material defects in the property, and any environmental hazards affecting

the property which THAT are required by law to be disclosed.

(b) A seller's or landlord's agent owes no duty to conduct an

independent inspection of the property for the benefit of the buyer or tenant

and owes no duty to independently verify the accuracy or completeness of

any statement made by such THE seller or landlord or any independent

inspector.

(4) A seller's or landlord's agent may show alternative properties not

owned by such THE seller or landlord to prospective buyers or tenants and

may list competing properties for sale or lease and not be deemed to have

breached any duty or obligation to such THE seller or landlord.

(5) A designated broker acting as a seller's or landlord's agent may

cooperate with other brokers but may not engage or create any subagents.

12-10-405. [Formerly 12-61-805] Single agent engaged by buyer

or tenant. (1) A broker engaged by a buyer or tenant to act as a buyer's or

tenant's agent shall be a limited agent with the following duties and

obligations:

(a) To perform the terms of the written agreement made with the

PAGE 50-HOUSE BILL 19-1172

buyer or tenant;

(b) To exercise reasonable skill and care for the buyer or tenant;

good faith, loyalty, and fidelity, including, but not limited to:

(I) Seeking a price and terms which THAT are acceptable to the

buyer or tenant; except that the broker shall not be obligated to seek other

properties while the buyer is a party to a contract to purchase property or

while the tenant is a party to a lease or letter of intent to lease;

(II) Presenting all offers to and from the buyer or tenant in a timely

manner regardless of whether the buyer is already a party to a contract to

purchase property or the tenant is already a party to a contract or a letter of

intent to lease;

(III) Disclosing to the buyer or tenant adverse material facts actually

known by the broker;

(IV) Counseling the buyer or tenant as to any material benefits or

risks of a transaction which THAT are actually known by the broker;

(V) Advising the buyer or tenant to obtain expert advice as to

material matters about which the broker knows but the specifics of which

are beyond the expertise of such THE broker;

(VI) Accounting in a timely manner for all money and property

received; and

(VII) Informing the buyer or tenant that such THE buyer or tenant

shall not be vicariously liable for the acts of such THE buyer's or tenant's

agent that are not approved, directed, or ratified by such THE buyer or

tenant;

(d) To comply with all requirements of this article 10 and any rules

promulgated pursuant to this article 10; and

(e) To comply with any applicable federal, state, or local laws, rules,

regulations, or ordinances including fair housing and civil rights statutes or

PAGE 51-HOUSE BILL 19-1172

regulations.

(2) The following information shall not be disclosed by a broker

acting as a buyer's or tenant's agent without the informed consent of the

buyer or tenant:

(a) That a buyer or tenant is willing to pay more than the purchase

price or lease rate for the property;

(b) What the motivating factors are for the party buying or leasing

the property;

those offered;

(d) Any material information about the buyer or tenant unless

disclosure is required by law or failure to disclose such THE information

would constitute fraud or dishonest dealing; or

(e) Any facts or suspicions regarding circumstances which THAT

would psychologically impact or stigmatize any real property pursuant to

section 38-35.5-101. C.R.S.

(3) (a) A broker acting as a buyer's or tenant's agent owes no duty

or obligation to the seller or landlord; except that such THE broker shall

disclose to any prospective seller or landlord all adverse material facts

actually known by the broker including but not limited to adverse material

facts concerning the buyer's or tenant's financial ability to perform the terms

of the transaction and whether the buyer intends to occupy the property to

be purchased as a principal residence.

(b) A buyer's or tenant's agent owes no duty to conduct an

independent investigation of the buyer's or tenant's financial condition for

the benefit of the seller or landlord and owes no duty to independently

verify the accuracy or completeness of statements made by such THE buyer

or tenant or any independent inspector.

(4) A buyer's or tenant's agent may show properties in which the

buyer or tenant is interested to other prospective buyers or tenants without

breaching any duty or obligation to such THE buyer or tenant. Nothing in

PAGE 52-HOUSE BILL 19-1172

this section shall be construed to prohibit a buyer's or tenant's agent from

showing competing buyers or tenants the same property and from assisting

competing buyers or tenants in attempting to purchase or lease a particular

property.

(5) A broker acting as a buyer's or tenant's agent owes no duty to

conduct an independent inspection of the property for the benefit of the

buyer or tenant and owes no duty to independently verify the accuracy or

completeness of statements made by the seller, landlord, or independent

inspectors; except that nothing in this subsection (5) shall be construed to

limit the broker's duties and obligations imposed pursuant to subsection (1)

of this section.

(6) A broker acting as a buyer's or tenant's agent may cooperate with

other brokers but may not engage or create any subagents.

12-10-406. [Formerly 12-61-806] Dual agent. (1) A broker shall

not establish dual agency with any seller, landlord, buyer, or tenant.

(2) to (6) (Deleted by amendment, L. 2002, p. 1060, § 6, effective

January 1, 2003.)

12-10-407. [Formerly 12-61-807] Transaction-broker. (1) A

broker engaged as a transaction-broker is not an agent for either party.

(2) A transaction-broker shall have the following obligations and

responsibilities:

(a) To perform the terms of any written or oral agreement made with

any party to the transaction;

(b) To exercise reasonable skill and care as a transaction-broker,

including, but not limited to:

(I) Presenting all offers and counteroffers in a timely manner

regardless of whether the property is subject to a contract for sale or lease

or letter of intent;

(II) Advising the parties regarding the transaction and suggesting

that such THE parties obtain expert advice as to material matters about

PAGE 53-HOUSE BILL 19-1172

which the transaction-broker knows but the specifics of which are beyond

the expertise of such THE broker;

(III) Accounting in a timely manner for all money and property

received;

(IV) Keeping the parties fully informed regarding the transaction;

(V) Assisting the parties in complying with the terms and conditions

of any contract including closing the transaction;

(VI) Disclosing to all prospective buyers or tenants any adverse

material facts actually known by the broker including but not limited to

adverse material facts pertaining to the title, the physical condition of the

property, any defects in the property, and any environmental hazards

affecting the property required by law to be disclosed;

(VII) Disclosing to any prospective seller or landlord all adverse

material facts actually known by the broker including but not limited to

adverse material facts pertaining to the buyer's or tenant's financial ability

to perform the terms of the transaction and the buyer's intent to occupy the

property as a principal residence; and

(VIII) Informing the parties that as seller and buyer or as landlord

and tenant they shall not be vicariously liable for any acts of the

transaction-broker;

promulgated pursuant to this article 10; and

(d) To comply with any applicable federal, state, or local laws, rules,

regulations, or ordinances including fair housing and civil rights statutes or

regulations.

(3) The following information shall not be disclosed by a

transaction-broker without the informed consent of all parties:

(a) That a buyer or tenant is willing to pay more than the purchase

price or lease rate offered for the property;

PAGE 54-HOUSE BILL 19-1172

(b) That a seller or landlord is willing to accept less than the asking

price or lease rate for the property;

leasing the property;

(d) That a seller, buyer, landlord, or tenant will agree to financing

terms other than those offered;

(e) Any facts or suspicions regarding circumstances which THAT

may psychologically impact or stigmatize any real property pursuant to

section 38-35.5-101; C.R.S.; or

(f) Any material information about the other party unless disclosure

is required by law or failure to disclose such THE information would

constitute fraud or dishonest dealing.

(4) A transaction-broker has no duty to conduct an independent

inspection of the property for the benefit of the buyer or tenant and has no

duty to independently verify the accuracy or completeness of statements

made by the seller, landlord, or independent inspectors.

(5) A transaction-broker has no duty to conduct an independent

investigation of the buyer's or tenant's financial condition or to verify the

accuracy or completeness of any statement made by the buyer or tenant.

(6) A transaction-broker may do the following without breaching

any obligation or responsibility:

(a) Show alternative properties not owned by the seller or landlord

to a prospective buyer or tenant;

(b) List competing properties for sale or lease;

other prospective buyers or tenants; and

(d) Serve as a single agent or transaction-broker for the same or for

different parties in other real estate transactions.

PAGE 55-HOUSE BILL 19-1172

(7) There shall be no imputation of knowledge or information

between any party and the transaction-broker or among persons within an

entity engaged as a transaction-broker.

(8) A transaction-broker may cooperate with other brokers but shall

not engage or create any subagents.

12-10-408. [Formerly 12-61-808] Broker disclosures. (1) (a) Any

person, firm, partnership, limited liability company, association, or

corporation acting as a broker shall adopt a written office policy that

identifies and describes the relationships offered to the public by such THE

broker.

(b) A broker shall not be required to offer or engage in any one or

in all of the brokerage relationships enumerated in section 12-61-804,

12-61-805 12-10-404, 12-10-405, or 12-61-807 12-10-407.

subsection (2) of this section shall contain a statement to the seller,

landlord, buyer, or tenant that different brokerage relationships are available

that include buyer agency, seller agency, or status as a transaction-broker.

Should the seller, landlord, buyer, or tenant request information or ask

questions concerning a brokerage relationship not offered by the broker

pursuant to the broker's written office policy enumerated in subsection

(1)(a) of this section, the broker shall provide to the party a written

definition of that brokerage relationship that has been promulgated by the

Colorado real estate commission.

(d) Disclosures made in accordance with this part 8 4 shall be

sufficient to disclose brokerage relationships to the public.

(2) (a) (I) Prior to engaging in any of the activities enumerated in

section 12-61-101 (2) 12-10-201 (6), a transaction-broker shall disclose in

writing to the party to be assisted that such THE broker is not acting as agent

for such THE party and that such THE broker is acting as a

transaction-broker.

(II) As part of each relationship entered into by a broker pursuant to

subparagraph (I) of this paragraph (a) SUBSECTION (2)(a)(I) OF THIS

SECTION, written disclosure shall be made which THAT shall contain a

PAGE 56-HOUSE BILL 19-1172

signature block for the buyer, seller, landlord, or tenant to acknowledge

receipt of such THE disclosure. Such THE disclosure and acknowledgment,

by itself, shall not constitute a contract with the broker. If such THE buyer,

seller, landlord, or tenant chooses not to sign the acknowledgment, the

broker shall note that fact on a copy of the disclosure and shall retain such

THE copy.

(III) If the transaction-broker undertakes any obligations or

responsibilities in addition to or different from those set forth in section

12-61-807, such 12-10-407, THE obligations or responsibilities shall be

disclosed in a writing which THAT shall be signed by the involved parties.

(b) Prior to engaging in any of the activities enumerated in section

12-61-101 (2) 12-10-201 (6), a broker intending to establish a single agency

relationship with a seller, landlord, buyer, or tenant shall enter into a written

agency agreement with the party to be represented. Such THE agreement

shall disclose the duties and responsibilities specified in section 12-61-804

12-10-404 or 12-61-805 12-10-405, as applicable. Notice of the single

agency relationship shall be furnished to any prospective party to the

proposed transaction in a timely manner.

1, 2003.)

(d) (c) (I) Prior to engaging in any of the activities enumerated in

section 12-61-101 (2) 12-10-201 (6), a broker intending to work with a

buyer or tenant as an agent of the seller or landlord shall provide a written

disclosure to such THE buyer or tenant that shall contain the following:

(A) A statement that the broker is an agent for the seller or landlord

and is not an agent for the buyer or tenant;

(B) A list of the tasks that the agent intends to perform for the seller

or landlord with the buyer or tenant; and

liable for the acts of the agent unless the buyer or tenant approves, directs,

or ratifies such THE acts.

(II) The written disclosure required pursuant to subparagraph (I) of

PAGE 57-HOUSE BILL 19-1172

this paragraph (d) SUBSECTION (2)(c)(I) OF THIS SECTION shall contain a

signature block for the buyer or tenant to acknowledge receipt of such THE

disclosure. Such THE disclosure and acknowledgment, by itself, shall not

constitute a contract with the broker. If the buyer or tenant does not sign

such THE disclosure, the broker shall note that fact on a copy of such THE

disclosure and retain such THE copy.

(e) (Deleted by amendment, L. 2002, p. 1061, § 8, effective January

1, 2003.)

(f) (d) A broker who has already established a relationship with one

party to a proposed transaction shall advise at the earliest reasonable

opportunity any other potential parties or their agents of such THE

established relationship.

(g) (e) (I) Prior to engaging in any of the activities enumerated in

section 12-61-101 (2) 12-10-201 (6), the seller, buyer, landlord, or tenant

shall be advised in any written agreement with a broker that the brokerage

relationship exists only with the designated broker, does not extend to the

employing broker or to any other brokers employed or engaged by the

employing broker who are not so designated, and does not extend to the

brokerage company.

(II) Nothing in this paragraph (g) SUBSECTION (2)(e) shall be

construed to limit the employing broker's or firm's responsibility to

supervise licensees employed by such THE broker or firm nor to shield such

THE broker or firm from vicarious liability.

12-10-409. [Formerly 12-61-809] Duration of relationship.

(1) (a) The relationships set forth in this part 8 4 shall commence at the

time that the broker is engaged by a party and shall continue until

performance or completion of the agreement by which the broker was

engaged.

(b) If the agreement by which the broker was engaged is not

performed or completed for any reason, the relationship shall end at the

earlier of the following:

(I) Any date of expiration agreed upon by the parties;

PAGE 58-HOUSE BILL 19-1172

(II) Any termination or relinquishment of the relationship by the

parties; or

(III) One year after the date of the engagement.

(2) (a) Except as otherwise agreed to in writing and pursuant to

paragraph (b) of this subsection (2) SUBSECTION (2)(b) OF THIS SECTION, a

broker engaged as a seller's agent or buyer's agent owes no further duty or

obligation after termination or expiration of the contract or completion of

performance.

(b) Notwithstanding paragraph (a) of this subsection (2) SUBSECTION

(2)(a) OF THIS SECTION, a broker shall be responsible after termination or

expiration of the contract or completion of performance for the following:

(I) Accounting for all moneys MONEY and property related to and

received during the engagement; and

(II) Keeping confidential all information received during the course

of the engagement which THAT was made confidential by request or

instructions from the engaging party unless:

(A) The engaging party grants written consent to disclose such THE

information;

(B) Disclosure of such THE information is required by law; or

or conduct of the engaging party or from a source other than the broker.

(3) Except as otherwise agreed to in writing, a transaction-broker

owes no further obligation or responsibility to the engaging party after

termination or expiration of the contract for performance or completion of

performance; except that such THE broker shall account for all moneys

MONEY and property related to and received during the engagement.

12-10-410. [Formerly 12-61-810] Compensation. (1) In any real

estate transaction, the broker's compensation may be paid by the seller, the

buyer, the landlord, the tenant, a third party, or by the sharing or splitting of

a commission or compensation between brokers.

PAGE 59-HOUSE BILL 19-1172

(2) Payment of compensation shall not be construed to establish an

agency relationship between the broker and the party who paid such THE

compensation.

(3) A seller or landlord may agree that a transaction-broker or single

agent may share the commission or other compensation paid by such THE

seller or landlord with another broker.

(4) A buyer or tenant may agree that a single agent or

transaction-broker may share the commission or other compensation paid

by such THE buyer or tenant with another broker.

(5) A buyer's or tenant's agent shall obtain the written approval of

such THE buyer or tenant before such THE agent may propose to the seller's

or landlord's agent that such THE buyer's or tenant's agent be compensated

by sharing compensation paid by such THE seller or landlord.

(6) Prior to entering into a brokerage or listing agreement or a

contract to buy, sell, or lease, the identity of those parties, persons, or

entities paying compensation or commissions to any broker shall be

disclosed to the parties to the transaction.

(7) A broker may be compensated by more than one party for

services in a transaction if those parties have consented in writing to such

multiple payments prior to entering into a contract to buy, sell, or lease.

12-10-411. [Formerly 12-61-811] Violations. The violation of any

provision of this part 8 4 by a broker constitutes an act pursuant to section

12-61-113 (1)(k) 12-10-217 (1)(m) for which the real estate commission

may investigate and take administrative action against any such broker

pursuant to sections 12-61-113 12-10-217 and 12-61-114 12-10-219.

PART 5

SUBDIVISIONS

12-10-501. [Formerly 12-61-401] Definitions. As used in this part

4 5, unless the context otherwise requires:

(1) "Commission" means the real estate commission established

under section 12-61-105 12-10-206.

PAGE 60-HOUSE BILL 19-1172

(2) "Developer" means any person, as defined in section 2-4-401 (8),

C.R.S., which THAT participates as owner, promoter, or sales agent in the

promotion, sale, or lease of a subdivision or any part thereof.

(2.5) "HOA" or "homeowners' association" means an association or

unit owners' association formed before, on, or after July 1, 1992, as part of

a common interest community as defined in section 38-33.3-103, C.R.S.

(3) (a) "Subdivision" means any real property divided into twenty

or more interests intended solely for residential use and offered for sale,

lease, or transfer.

(b) (I) The term "subdivision" also includes:

(A) The conversion of an existing structure into a common interest

community, AS DEFINED IN ARTICLE 33.3 OF TITLE 38, of twenty or more

residential units; as defined in article 33.3 of title 38, C.R.S.;

(B) A group of twenty or more time shares intended for residential

use; and

housing corporation, as defined DESCRIBED in article 33.5 of title 38. C.R.S.

(II) The term "subdivision" does not include:

(A) The selling of memberships in campgrounds;

(B) Bulk sales and transfers between developers;

erected residential buildings that have not been previously occupied and

where the consideration paid for such THE property includes the cost of such

THE buildings;

(D) Lots which THAT, at the time of closing of a sale or occupancy

under a lease, are situated on a street or road and street or road system

improved to standards at least equal to streets and roads maintained by the

county, city, or town in which the lots are located; have a feasible plan to

provide potable water and sewage disposal; and have telephone and

PAGE 61-HOUSE BILL 19-1172

electricity facilities and systems adequate to serve the lots, which facilities

and systems are installed and in place on the lots or in a street, road, or

easement adjacent to the lots and which facilities and systems comply with

applicable state, county, municipal, or other local laws, rules, and

regulations; or any subdivision that has been or is required to be approved

after September 1, 1972, by a regional, county, or municipal planning

authority pursuant to article 28 of title 30 or article 23 of title 31; C.R.S.;

(E) Sales by public officials in the official conduct of their duties.

(4) "Time share" means a time share estate, as defined in section

38-33-110 (5), C.R.S., or a time share use, but the term does not include

group reservations made for convention purposes as a single transaction

with a hotel, motel, or condominium owner or association. For the purposes

of this subsection (4), "time share use" means a contractual or membership

right of occupancy, which THAT cannot be terminated at the will of the

owner, for life or for a term of years, to the recurrent, exclusive use or

occupancy of a lot, parcel, unit, or specific or nonspecific segment of real

property, annually or on some other periodic basis, for a period of time that

has been or will be allotted from the use or occupancy periods into which

the property has been divided.

12-10-502. [Formerly 12-61-402] Registration required.

(1) Unless exempt under the provisions of section 12-61-401 (3) 12-10-501

(3), a developer, before selling, leasing, or transferring or agreeing or

negotiating to sell, lease, or transfer, directly or indirectly, any subdivision

or any part thereof, shall register pursuant to this part 4 5.

(2) Upon approval by the commission, a developer who has applied

for registration pursuant to section 12-61-403 12-10-503 may offer

reservations in a subdivision during the pendency of such THE application

and until such THE application is granted or denied if the fees for such THE

reservations are held in trust by an independent third party and are fully

refundable.

12-10-503. [Formerly 12-61-403] Application for registration.

(1) Every person who is required to register as a developer under this part

4 5 shall submit to the commission an application which THAT contains the

information described in subsections (2) and (3) of this section. If such THE

information is not submitted, the commission may deny the application for

PAGE 62-HOUSE BILL 19-1172

registration. If a developer is currently regulated in another state that has

registration requirements substantially equivalent to the requirements of this

part 4 5 or that provide substantially comparable protection to a purchaser,

the commission may accept proof of such THE registration along with the

developer's disclosure or equivalent statement from the other state in full or

partial satisfaction of the information required by this section. In addition,

the applicant shall be under a continuing obligation to notify the

commission within ten days of any change in the information so submitted,

and a failure to do so shall be a cause for disciplinary action.

(2) (a) Registration information concerning the developer shall

include:

(I) The principal office of the applicant wherever situate;

(II) The location of the principal office and the branch offices of the

applicant in this state;

(III) Repealed.

(IV) (III) The names and residence and business addresses of all

natural persons who have a twenty-four percent or greater financial or

ultimate beneficial interest in the business of the developer, either directly

or indirectly, as principal, manager, member, partner, officer, director, or

stockholder, specifying each such person's capacity, title, and percentage of

ownership. If no natural person has a twenty-four percent or greater

financial or beneficial interest in the business of the developer, the

information required in this subparagraph (IV) SUBSECTION (2)(a)(III) shall

be submitted regarding the natural person having the largest single financial

or beneficial interest.

(V) (IV) The length of time and the locations where the applicant

has been engaged in the business of real estate sales or development;

(VI) (V) Any felony of which the applicant has been convicted

within the preceding ten years. In determining whether a certificate of

registration shall be issued to an applicant who has been convicted of a

felony within such period of time, the commission shall be governed by the

provisions of section 24-5-101. C.R.S.

PAGE 63-HOUSE BILL 19-1172

(VII) (VI) The states in which the applicant has had a license or

registration similar to the developer's registration in this state granted,

refused, suspended, or revoked or is currently the subject of an investigation

or charges that could result in refusal, suspension, or revocation;

(VIII) (VII) Whether the developer or any other person financially

interested in the business of the developer as principal, partner, officer,

director, or stockholder has engaged in any activity that would constitute a

violation of this part 4 5.

(b) If the applicant is a corporate developer, a copy of the certificate

of authority to do business in this state or a certificate of incorporation

issued by the secretary of state shall accompany the application.

(3) Registration information concerning the subdivision shall

include:

(a) The location of each subdivision from which sales are intended

to be made;

(b) The name of each subdivision and the trade, corporate, or

partnership name used by the developer;

or lease is registered or will be registered in accordance with state or local

requirements of the state in which each subdivision is located;

(d) Copies of documents evidencing the title or other interest in the

subdivision;

(e) If there is a blanket encumbrance upon the title of the

subdivision or any other ownership, leasehold, or contractual interest that

could defeat all possessory or ownership rights of a purchaser, a copy of the

instruments creating such THE liens, encumbrances, or interests, with dates

as to the recording, along with documentary evidence that any beneficiary,

mortgagee, or trustee of a deed of trust or any other holder of such THE

ownership, leasehold, or contractual interest will release any lot or time

share from the blanket encumbrance or has subordinated its interest in the

subdivision to the interest of any purchaser or has established any other

arrangement acceptable to the real estate commission that protects the rights

PAGE 64-HOUSE BILL 19-1172

of the purchaser;

(f) A statement that standard commission-approved forms will be

used for contracts of sale, notes, deeds, and other legal documents used to

effectuate the sale or lease of the subdivision or any part thereof, unless the

forms to be used were prepared by an attorney representing the developer;

(g) A true statement by the developer that, in any conveyance by

means of an installment contract, the purchaser shall be advised to record

the contract with the proper authorities in the jurisdiction in which the

subdivision is located. In no event shall any developer specifically prohibit

the recording of the installment contract.

(h) A true statement by the developer of the provisions for and

availability of legal access, sewage disposal, and public utilities, including

water, electricity, gas, and telephone facilities, in the subdivision offered for

sale or lease, including whether such are to be a developer or purchaser

expense;

(i) A true statement as to whether or not a survey of each lot, site,

or tract offered for sale or lease from such THE subdivision has been made

and whether survey monuments are in place;

(i.5) (j) A true statement by the developer as to whether or not a

common interest community is to be or has been created within the

subdivision and whether or not such THE common interest community is or

will be a small cooperative or small and limited expense planned

community created pursuant to section 38-33.3-116; C.R.S.;

(j) (k) A true statement by the developer concerning the existence

of any common interest community association, including whether the

developer controls funds in such THE association.

(3.5) (4) The commission may disapprove the form of the

documents submitted pursuant to paragraph (f) of subsection (3)

SUBSECTION (3)(f) of this section and may deny an application for

registration until such time as the applicant submits such THE documents in

a form that is satisfactory to the commission.

(4) Repealed.

PAGE 65-HOUSE BILL 19-1172

(5) Each registration shall be accompanied by fees established

pursuant to section 12-61-111.5 12-10-215.

12-10-504. [Formerly 12-61-404] Registration of developers.

(1) The commission shall register all applicants who meet the requirements

of this part 4 5 and provide each applicant so registered with a certificate

indicating that the developer named therein is registered in the state of

Colorado as a subdivision developer. The developer which THAT will sign

as seller or lessor in any contract of sale, lease, or deed purporting to convey

any site, tract, lot, or divided or undivided interest from a subdivision shall

secure a certificate before offering, negotiating, or agreeing to sell, lease,

or transfer before such THE sale, lease, or transfer is made. If such person

or entity is acting only as a trustee, the beneficial owner of the subdivision

shall secure a certificate. A certificate issued to a developer shall entitle all

sales agents and employees of such THE developer to act in the capacity of

a developer as agent for such THE developer. The developer shall be

responsible for all actions of such THE sales agents and employees.

(2) All certificates issued under this section shall expire on

December 31 following the date of issuance. In the absence of any reason

or condition under this part 4 5 that might warrant the denial or revocation

of a registration, a certificate shall be renewed by payment of a renewal fee

established pursuant to section 12-61-111.5 12-10-215. A registration that

has expired may be reinstated within two years after such THE expiration

upon payment of the appropriate renewal fee if the applicant meets all other

requirements of this part 4 5.

(3) All fees collected under this part 4 5 shall be deposited in

accordance with section 12-61-111 12-10-214.

(4) With regard to any subdivision for which the information

required by section 12-61-403 (3) 12-10-503 (3) has not been previously

submitted to the commission, each registered developer shall register such

THE subdivision by providing the commission with such THE information

before sale, lease, or transfer, or negotiating or agreeing to sell, lease, or

transfer, any such subdivision or any part thereof.

12-10-505. [Formerly 12-61-405] Refusal, revocation, or

suspension of registration - letter of admonition - probation. (1) The

commission may impose an administrative fine not to exceed two thousand

PAGE 66-HOUSE BILL 19-1172

five hundred dollars for each separate offense; may issue a letter of

admonition; may place a registrant on probation under its close supervision

on such terms and for such time as it deems appropriate; and may refuse,

revoke, or suspend the registration of any developer or registrant if, after an

investigation and after notice and a hearing pursuant to the provisions of

section 24-4-104, C.R.S., the commission determines that the developer or

any director, officer, or stockholder with controlling interest in the

corporation:

(a) Has used false or misleading advertising or has made a false or

misleading statement or a concealment in his OR HER application for

registration;

(b) Has misrepresented or concealed any material fact from a

purchaser of any interest in a subdivision;

defraud a purchaser of any interest in a subdivision;

(d) Has been convicted of or pled guilty or nolo contendere to a

crime involving fraud, deception, false pretense, theft, misrepresentation,

false advertising, or dishonest dealing in any court;

(e) Has disposed of, concealed, diverted, converted, or otherwise

failed to account for any funds or assets of any purchaser of any interest in

a subdivision or any homeowners' association under the control of such THE

developer or director, officer, or stockholder;

(f) Has failed to comply with any stipulation or agreement made

with the commission;

(g) Has failed to comply with or has violated any provision of this

article 10, including any failure to comply with the registration requirements

of section 12-61-403 12-10-503, or any lawful rule or regulation

promulgated by the commission under this article 10;

(h) (Deleted by amendment, L. 89, p. 740, § 17, effective July 1,

1989.)

(i) (h) Has refused to honor a buyer's request to cancel a contract for

PAGE 67-HOUSE BILL 19-1172

the purchase of a time share or subdivision or part thereof if such THE

request was made within five calendar days after execution of the contract

and was made either by telegram, mail, or hand delivery. A request is

considered made if by ELECTRONIC MAIL WHEN SENT, IF BY mail when

postmarked, if by telegram when filed for telegraphic transmission, or if by

hand delivery when delivered to the seller's place of business. No developer

shall employ a contract that contains any provision waiving a buyer's right

to such a cancellation period.

(j) (i) Has committed any act that constitutes a violation of the

"Colorado Consumer Protection Act", article 1 of title 6; C.R.S.;

(k) (j) Has employed any sales agent or employee who violates the

provisions of this part 4 5;

(l) (k) Has used documents for sales or lease transactions other than

those described in section 12-61-403 (3)(f) 12-10-503 (3)(f);

(m) (l) Has failed to disclose encumbrances to prospective

purchasers or has failed to transfer clear title at the time of sale, if the

parties agreed that such THE transfer would be made at that time.

(1.5) (2) A disciplinary action relating to the business of subdivision

development taken by any other state or local jurisdiction or the federal

government shall be deemed to be prima facie evidence of grounds for

disciplinary action, including denial of registration, under this part 4 5. This

subsection (1.5) (2) shall apply only to such disciplinary actions as are

substantially similar to those set out as grounds for disciplinary action or

denial of registration under this part 4 5.

(2) (3) Any hearing held under this section shall be in accordance

with the procedures established in sections 24-4-105 and 24-4-106. C.R.S.

(2.5) (4) When a complaint or investigation discloses an instance of

misconduct that, in the opinion of the commission, does not initially warrant

formal action by the commission but which THAT should not be dismissed

as being without merit, the commission may send a letter of admonition by

certified mail, return receipt requested, to the registrant who is the subject

of the complaint or investigation and a copy thereof to any person making

such THE complaint. Such THE letter shall advise the registrant that he OR

PAGE 68-HOUSE BILL 19-1172

SHE has the right to request in writing, within twenty days after proven

receipt, that formal disciplinary proceedings be initiated against him OR HER

to adjudicate the propriety of the conduct upon which the letter of

admonition is based. If such THE request is timely made, the letter of

admonition shall be deemed vacated, and the matter shall be processed by

means of formal disciplinary proceedings.

(3) (5) All administrative fines collected pursuant to this section

shall be transmitted to the state treasurer, who shall credit the same to the

division of real estate cash fund.

12-10-506. [Formerly 12-61-406] Powers of commission -

injunction - rules. (1) The commission may apply to a court of competent

jurisdiction for an order enjoining any act or practice which THAT

constitutes a violation of this part 4 5, and, upon a showing that a person is

engaging or intends to engage in any such act or practice, an injunction,

restraining order, or other appropriate order shall be granted by such THE

court, regardless of the existence of another remedy therefor. Any notice,

hearing, or duration of any injunction or restraining order shall be made in

accordance with the provisions of the Colorado rules of civil procedure.

(1.2) (2) The commission may apply to a court of competent

jurisdiction for the appointment of receiver if it determines that such THE

appointment is necessary to protect the property or interests of purchasers

of a subdivision or part thereof.

(1.5) (3) The commission shall issue or deny a certificate or

additional registration within sixty days from the date of receipt of the

application by the commission. The commission may make necessary

investigations and inspections to determine whether any developer has

violated this part 4 5 or any lawful rule or regulation promulgated by the

commission. If, after an application by a developer has been submitted

pursuant to section 12-61-403 12-10-503 or information has been submitted

pursuant to section 12-61-404 12-10-504, the commission determines that

an inspection of a subdivision is necessary, it shall complete the inspection

within sixty days from the date of filing of the application or information,

or the right of inspection is waived and the lack thereof shall not be grounds

for denial of a registration.

(1.6) (4) The commission, the director for the commission, or the

PAGE 69-HOUSE BILL 19-1172

administrative law judge appointed for a hearing may issue a subpoena

compelling the attendance and testimony of witnesses and the production

of books, papers, or records pursuant to an investigation or hearing of such

THE commission. Any such subpoena shall be served in the same manner as

for subpoenas issued by district courts.

(2) (5) The commission has the power to make any rules necessary

for the enforcement or administration of this part 4 5.

(2.5) (6) The commission shall adopt, promulgate, amend, or repeal

such rules and regulations as are necessary to:

(a) Require written disclosures to any purchasers as provided in

subsection (3) (7) of this section and to prescribe and require that

standardized forms be used by subdivision developers in connection with

the sale or lease of a subdivision or any part thereof, except as otherwise

provided in section 12-61-403 (3)(f) 12-10-503 (3)(f); and

(b) Require that developers maintain certain business records for a

period of at least seven years.

(3) (7) The commission may require any developer to make written

disclosures to purchasers in their contracts of sale or by separate written

documents if the commission finds that such THE disclosures are necessary

for the protection of such THE purchasers.

(4) (8) The commission or its designated representative may audit

the accounts of any homeowner HOMEOWNERS' association, the funds of

which are controlled by a developer.

12-10-507. [Formerly 12-61-407] Violation - penalty. Any person

who fails to register as a developer in violation of this part 4 5 commits a

class 6 felony and shall be punished as provided in section 18-1.3-401.

C.R.S. Any agreement or contract for the sale or lease of a subdivision or

part thereof shall be voidable by the purchaser and unenforceable by the

developer unless such THE developer was duly registered under the

provisions of this part 4 5 when such THE agreement or contract was made.

12-10-508. [Formerly 12-61-408] Repeal of part. This part 4 5 is

repealed, effective September 1, 2026. Before its THE repeal, this part 4 5

PAGE 70-HOUSE BILL 19-1172

is scheduled for review in accordance with section 24-34-104.

PART 6

REAL ESTATE APPRAISERS

12-10-601. [Formerly 12-61-701] Legislative declaration. The

general assembly finds, determines, and declares that sections 12-61-702

12-10-602 to 12-61-723 12-10-623 are enacted pursuant to the requirements

of the "Real Estate Appraisal Reform Amendments", Title XI of the federal

"Financial Institutions Reform, Recovery, and Enforcement Act of 1989",

as amended, 12 U.S.C. secs. 3331 to 3351. The general assembly further

finds, determines, and declares that sections 12-61-702 12-10-602 to

12-61-723 12-10-623 are intended to implement the requirements of federal

law in the least burdensome manner to real estate appraisers and appraisal

management companies. Licensed ad valorem appraisers licensed under this

article 10 are not regulated by the federal "Real Estate Appraisal Reform

Amendments", Title XI of the federal "Financial Institutions Reform,

Recovery, and Enforcement Act of 1989", as amended, 12 U.S.C. secs.

3331 to 3351.

12-10-602. [Formerly 12-61-702] Definitions. As used in this part

7 6, unless the context otherwise requires:

(1) (a) "Appraisal", "appraisal report", or "real estate appraisal"

means a written or oral analysis, opinion, or conclusion relating to the

nature, quality, value, or utility of specified interests in, or aspects of,

identified real estate that is transmitted to the client upon the completion of

an assignment. These terms include a valuation, which is an opinion of the

value of real estate, and an analysis, which is a general study of real estate

not specifically performed only to determine value; except that the terms

include a valuation completed by an appraiser employee of a county

assessor as defined in section 39-1-102 (2). C.R.S.

(b) The terms do not include an analysis, valuation, opinion,

conclusion, notation, or compilation of data by an officer, director, or

regular REGULARLY salaried employee of a financial institution or its

affiliate, made for internal use only by the financial institution or affiliate,

concerning an interest in real estate that is owned or held as collateral by the

financial institution or affiliate and that is not represented or deemed to be

an appraisal except to the financial institution, the agencies regulating the

PAGE 71-HOUSE BILL 19-1172

financial institution, and any secondary markets that purchase real estate

secured loans. An appraisal prepared by an officer, director, or regular

REGULARLY salaried employee of a financial institution who is not licensed

or certified under this part 7 6 shall contain a written notice that the preparer

is not licensed or certified as an appraiser under this part 7 6.

include a federally authorized "waiver valuation", as defined in 49 CFR

24.2 (a)(33), as amended.

(2) (a) "Appraisal management company" or "AMC" means, in

connection with valuing properties collateralizing mortgage loans or

mortgages incorporated into a securitization, any external third party

authorized either by a creditor in a consumer credit transaction secured by

a consumer's principal dwelling that oversees an appraiser panel or by an

underwriter of, or other principal in, the secondary mortgage markets that

oversees an appraiser panel to:

(I) Recruit, select, and train appraisers;

(II) Contract with licensed and certified appraisers to perform

appraisal assignments;

(III) Manage the process of having an appraisal performed,

including providing administrative duties such as receiving appraisal orders

and appraisal reports, submitting completed appraisal reports to creditors

and underwriters, collecting fees from creditors and underwriters for

services provided, and reimbursing appraisers for services performed; or

(IV) Review and verify the work of appraisers.

(b) "Appraisal management company" OR "AMC" does not include:

(I) A corporation, limited liability company, sole proprietorship, or

other entity that directly performs appraisal services;

(II) A corporation, limited liability company, sole proprietorship, or

other entity that does not contract with appraisers for appraisal services, but

that solely distributes orders to a client-selected panel of appraisers; and

PAGE 72-HOUSE BILL 19-1172

(III) A mortgage company, or its subsidiary, that manages a panel

of appraisers who are engaged to provide appraisal services on mortgage

loans either originated by the mortgage company or funded by the mortgage

company with its own funds.

(3) "Board" means the board of real estate appraisers created in

section 12-61-703 12-10-603.

(4) "Client" means the party or parties who engage an appraiser or

an appraisal management company for a specific assignment.

(5) Repealed.

(6) (5) "Consulting services" means services performed by an

appraiser that do not fall within the definition of an "independent appraisal"

in subsection (10) (7) of this section. "Consulting services" includes

marketing, financing and feasibility studies, valuations, analyses, and

opinions and conclusions given in connection with real estate brokerage,

mortgage banking, and counseling and advocacy in regard to property tax

assessments and appeals thereof; except that, if in rendering such THE

services the appraiser acts as a disinterested third party, the work is deemed

an independent appraisal and not a consulting service. Nothing in this

subsection (6) (5) precludes a person from acting as an expert witness in

valuation appeals.

(7) [Relocated to 12-10-101 (1)]

(8) [Relocated to 12-10-101 (2)]

(9) (6) "Financial institution" means any "bank" or "savings

association", as such THOSE terms are defined in 12 U.S.C. sec. 1813, any

state bank incorporated under title 11, C.R.S., any state or federally

chartered credit union, or any company that has direct or indirect control

over any of those entities.

(10) (7) "Independent appraisal" means an engagement for which an

appraiser is employed or retained to act as a disinterested third party in

rendering an unbiased analysis, opinion, or conclusion relating to the nature,

quality, value, or utility of specified interests in or aspects of identified real

estate.

PAGE 73-HOUSE BILL 19-1172

(10.5) (8) (a) "Panel" or "appraiser panel" means a network, list, or

roster of licensed or certified appraisers approved by an AMC to perform

appraisals as independent contractors for the AMC.

(b) Appraisers on an AMC's appraiser panel include both:

(I) Appraisers accepted by the AMC for consideration for future

appraisal assignments in covered transactions or for secondary mortgage

market participants in connection with covered transactions; and

(II) Appraisers engaged by the AMC to perform one or more

appraisals in covered transactions or for secondary mortgage market

participants in connection with covered transactions.

subsection (10.5) (8) if the appraiser is treated as an independent contractor

by the AMC for purposes of federal income taxation.

(11) (9) (a) "Real estate appraiser" or "appraiser" means a person

who provides an estimate of the nature, quality, value, or utility of an

interest in, or aspect of, identified real estate and includes one who

estimates value and who possesses the necessary qualifications, ability, and

experience to execute or direct the appraisal of real property.

(b) "Real estate appraiser" OR "APPRAISER" does not include:

(I) A person who conducts appraisals strictly of personal property;

(II) A person licensed as a broker pursuant to part 1 2 of this article

10 who provides an opinion of value that is not represented as an appraisal

and is not used for purposes of obtaining financing;

(III) A person licensed as a certified public accountant pursuant to

article 2 100 of this title 12, and otherwise regulated, as long as the person

does not represent his or her opinions of value for real estate as an

appraisal;

(IV) A corporation, acting through its officers or regular

REGULARLY salaried employees, when conducting a valuation of real estate

property rights owned, to be purchased, or sold by the corporation;

PAGE 74-HOUSE BILL 19-1172

(V) A person who conducts appraisals strictly of water rights or of

mineral rights;

(VI) A right-of-way acquisition agent, an appraiser who is licensed

and certified pursuant to this part 7 6, or any other individual who has

sufficient understanding of the local real estate market to be qualified to

make a waiver valuation when the agent, appraiser, or other qualified

individual is employed by or contracts with a public entity and provides an

opinion of value that is not represented as an appraisal and when, for any

purpose, the property or portion of property being valued is valued at

twenty-five thousand dollars or less, as permitted by federal law and 49

CFR 24.102 (c)(2), as amended;

(VII) An officer, director, or regular REGULARLY salaried employee

of a financial institution or its affiliate who makes, for internal use only by

the financial institution or affiliate, an analysis, evaluation, opinion,

conclusion, notation, or compilation of data with respect to an appraisal so

long as the person does not make a written adjustment of the appraisal's

conclusion as to the value of the subject real property;

(VIII) An officer, director, or regular REGULARLY salaried employee

of a financial institution or its affiliate who makes an internal analysis,

valuation, opinion, conclusion, notation, or compilation of data concerning

an interest in real estate that is owned or held as collateral by the financial

institution or its affiliate; or

(IX) A person who represents property owners as an advocate in tax

or valuation protests and appeals pursuant to title 39. C.R.S.

12-10-603. [Formerly 12-61-703] Board of real estate appraisers

- creation - compensation - immunity - legislative declaration - repeal

of part. (1) (a) There is hereby created in the division OF REAL ESTATE a

board of real estate appraisers consisting of seven members appointed by

the governor with the consent of the senate. Of the members, three shall be

licensed or certified appraisers, one of whom shall have expertise in

eminent domain matters; one shall be a county assessor in office; one shall

be an officer or employee of a commercial bank experienced in real estate

lending; one shall be an officer or employee of an appraisal management

company; and one shall be a member of the public at large not engaged in

any of the businesses represented by the other members of the board.

PAGE 75-HOUSE BILL 19-1172

(b) Members of the board shall hold office for terms of three years.

In the event of a vacancy by death, resignation, removal, or otherwise, the

governor shall appoint a member to fill the unexpired term. The governor

has the authority to remove any member for misconduct, neglect of duty, or

incompetence.

(2) (a) The board shall exercise its powers and perform its duties and

functions under the division OF REAL ESTATE as if transferred to the division

by a type 1 transfer, as defined in the "Administrative Organization Act of

1968", article 1 of title 24. C.R.S.

(b) The general assembly finds, determines, and declares that the

organization of the board under the division as a type 1 agency will provide

the autonomy necessary to avoid potential conflicts of interest between the

responsibility of the board in the regulation of real estate appraisers and the

responsibility of the division in the regulation of real estate brokers and

salespersons. The general assembly further finds, determines, and declares

that the placement of the board as a type 1 agency under the division is

consistent with the organizational structure of state government.

(3) Each member of the board shall receive the same compensation

and reimbursement of expenses as is provided for members of boards and

commissions in the division of professions and occupations pursuant to

section 24-34-102 (13), C.R.S. 12-20-103 (6). Payment for all per diem

compensation and expenses shall be made out of annual appropriations

from the division of real estate cash fund provided for in section 12-61-705

12-10-605.

(4) Members of the board, consultants, and expert witnesses are

immune from liability in any civil action based upon any disciplinary

proceedings or other official acts they performed in good faith pursuant to

this part 7 6.

(5) A majority of the board constitutes a quorum for the transaction

of all business, and actions of the board require a vote of a majority of the

members present in favor of the action taken.

(6) This part 7 6 is repealed, effective September 1, 2022. Prior to

BEFORE the repeal, the department of regulatory agencies shall review the

functions of the board of real estate appraisers as provided in THIS PART 6

PAGE 76-HOUSE BILL 19-1172

IS SCHEDULED FOR REVIEW IN ACCORDANCE WITH section 24-34-104. C.R.S.

12-10-604. [Formerly 12-61-704] Powers and duties of the board

- rules. (1) In addition to all other powers and duties imposed upon it by

law, the board has the following powers and duties:

(a) (I) To promulgate and amend, as necessary, rules pursuant to

article 4 of title 24 C.R.S., for the implementation and administration of this

part 7 6 and as required to comply with the federal "Real Estate Appraisal

Reform Amendments", Title XI of the federal "Financial Institutions

Reform, Recovery, and Enforcement Act of 1989", as amended, 12 U.S.C.

secs. 3331 to 3351, and with any requirements imposed by amendments to

that federal law.

(II) The board shall not establish any requirements that are more

stringent than the requirements of any applicable federal law.

(III) Licensed ad valorem appraisers are not regulated by the federal

"Real Estate Appraisal Reform Amendments", Title XI of the federal

"Financial Institutions Reform, Recovery, and Enforcement Act of 1989",

as amended, 12 U.S.C. secs. 3331 to 3351, but the board shall adopt rules

regarding minimum qualifications and standards of practice for licensed ad

valorem appraisers.

(IV) In any list or registry it maintains, the board shall identify or

separately account for any appraisal management company that oversees a

panel of more than fifteen certified or licensed appraisers in Colorado, or

more than twenty-five in all states in which it does business, within a given

year.

(b) To charge application, examination, and license and certificate

renewal fees established pursuant to section 12-61-111.5 12-10-215 from

all applicants for licensure, certification, examination, and renewal under

this part 7 6. The board shall not refund any fees received from applicants

seeking licensure, certification, examination, or renewal.

appropriations made to the department, of regulatory agencies, to employ

administrative law judges, appointed pursuant to part 10 of article 30 of title

24, C.R.S., on a full-time or part-time basis to conduct any hearings

PAGE 77-HOUSE BILL 19-1172

required by this part 7 6;

(d) To issue, deny, or refuse to renew a license or certificate

pursuant to this part 7 6;

(e) To take disciplinary actions in conformity with this part 7 6;

(f) To delegate to the director the administration and enforcement

of this part 7 6 and the authority to act on behalf of the board on occasions

and in circumstances that the board directs;

(g) (I) To develop, purchase, or contract for any examination

required for the administration of this part 7 6, to offer each examination at

least twice a year or, if demand warrants, at more frequent intervals, and to

establish a passing score for each examination that reflects a minimum level

of competency.

(II) If study materials are developed by a testing company or other

entity, the board shall make the materials available to persons desiring to

take examinations pursuant to this part 7 6. The board may charge fees for

the materials to defray any costs associated with making the materials

available.

(h) In compliance with article 4 of title 24, C.R.S., to make

investigations; subpoena persons and documents, which subpoenas may be

enforced by a court of competent jurisdiction if not obeyed; hold hearings;

and take evidence in all matters relating to the exercise of the board's power

under this part 7 6;

(i) Pursuant to sec. SECTION 1119 (b) of Title XI of the federal

"Financial Institutions Reform, Recovery, and Enforcement Act of 1989",

Pub.L. 101-73, AS AMENDED, to apply, if necessary, for a federal waiver of

the requirement relating to certification or licensing of a person to perform

appraisals and to make the necessary written determinations specified in

said THAT section for purposes of making the application;

(j) If the board has reasonable cause to believe that a person,

partnership, limited liability company, or corporation is violating this part

7 6, to enter an order requiring the individual or appraisal management

company to cease and desist the violation; and

PAGE 78-HOUSE BILL 19-1172

(k) To establish classroom education and experience requirements

for an appraiser who prepares an appraisal for a conservation easement for

which a tax credit is claimed pursuant to section 39-22-522. The

requirements must ensure that appraisers have a sufficient amount of

training and expertise to accurately prepare appraisals that comply with the

uniform standards of professional appraisal practice and any other provision

of law related to the appraisal of conservation easements for which a tax

credit is claimed. A tax credit certificate for a conservation easement shall

not be given in accordance with sections 12-61-1105 12-15-105 and

12-61-1106 12-15-106 unless the appraiser who prepared the appraisal of

the easement met all requirements established in accordance with this

subsection (1)(k) in effect at the time the appraisal certification is signed.

(2) The board shall maintain or preserve, for seven years, licensing

history records of a person licensed or certified under this part 7 6.

Complaints of record in the office of the board and board investigations,

including board investigative files, are closed to public inspection.

Stipulations and final agency orders are public record and are subject to

sections 24-72-203 and 24-72-204. C.R.S.

12-10-605. [Formerly 12-61-705] Fees, penalties, and fines

collected under part 6. All fees, penalties, and fines collected pursuant to

this part 7 6, not including fees retained by contractors pursuant to contracts

entered into in accordance with section 12-61-103, 12-61-706 12-10-203,

12-10-606, or 24-34-101, C.R.S., shall be transmitted to the state treasurer,

who shall credit the same to the division of real estate cash fund, created in

section 12-61-111.5 12-10-215.

12-10-606. [Formerly 12-61-706] Qualifications for licensing and

certification of appraisers - continuing education - definitions - rules.

(1) (a) The board shall, by rule, prescribe requirements for the initial

licensing or certification of persons under this part 7 6 to meet the

requirements of the "Real Estate Appraisal Reform Amendments", Title XI

of the federal "Financial Institutions Reform, Recovery, and Enforcement

Act of 1989", as amended, 12 U.S.C. secs. 3331 to 3351, and shall develop,

purchase, or contract for examinations to be passed by applicants. The

board shall not establish any requirements for initial licensing or

certification that are more stringent than the requirements of any applicable

federal law; except that all applicants shall pass an examination offered by

the board. If there is no applicable federal law, the board shall consider and

PAGE 79-HOUSE BILL 19-1172

may use as guidelines the most recent available criteria published by the

Appraiser Qualifications Board of the Appraisal Foundation or its successor

organization.

(b) The four levels of appraiser licensure and certification, pursuant

to paragraph (a) of this subsection (1) SUBSECTION (1)(a) OF THIS SECTION,

are defined as follows:

(I) "Certified general appraiser" means an appraiser meeting the

requirements set by the board for general certification.

(II) "Certified residential appraiser" means an appraiser meeting the

requirements set by the board for residential certification.

(III) "Licensed ad valorem appraiser" means an appraiser meeting

the requirements set by the board for ad valorem appraiser certification.

Only a county assessor, employee of a county assessor's office, or employee

of the division of property taxation in the department of local affairs may

obtain or possess an ad valorem appraiser certification. and

(IV) "Licensed appraiser" means an appraiser meeting the

requirements set by the board for a license.

is a licensed ad valorem appraiser may not perform real estate appraisals

outside of his or her official duties.

(d) The board shall transfer persons employed in a county assessor's

office or in the division of property taxation in the department of local

affairs who are registered appraisers as of July 1, 2013, to the category of

licensed ad valorem appraiser. The board shall allow these persons, until

December 31, 2015, to meet any additional requirements imposed by the

board pursuant to section 12-61-704 (1)(a), as amended 12-10-604 (1)(a).

(2) (a) The board shall, by rule, prescribe continuing education

requirements for persons licensed or certified as certified general appraisers,

certified residential appraisers, or licensed appraisers as needed to meet the

requirements of the "Real Estate Appraisal Reform Amendments", Title XI

of the federal "Financial Institutions Reform, Recovery, and Enforcement

Act of 1989", as amended, 12 U.S.C. secs. 3331 to 3351. The board shall

PAGE 80-HOUSE BILL 19-1172

not establish any continuing education requirements that are more stringent

than the requirements of any applicable FEDERAL law; except that all

persons licensed or certified under this part 7 6 are subject to continuing

education requirements. If there is no applicable federal law, the board shall

consider and may use as guidelines the most recent available criteria

published by the Appraiser Qualifications Board of the Appraisal

Foundation or its successor organization.

(b) The board shall, by rule, prescribe continuing education

requirements for licensed ad valorem appraisers.

(3) Notwithstanding any provision of this section to the contrary, the

criteria established by the board for the licensing or certification of

appraisers pursuant to this part 7 6 shall not include membership or lack of

membership in any appraisal organization.

(4) (a) Subject to section 12-61-719 (2) 12-10-619 (2), all appraiser

employees of county assessors shall be licensed or certified as provided in

subsections (1) and (2) of this section. Obtaining and maintaining a license

or certificate under either of said subsections SUBSECTION (1) and OR (2) OF

THIS SECTION entitles an appraiser employee of a county assessor to perform

all real estate appraisals required to fulfill the person's official duties.

(b) Appraiser employees of county assessors who are employed to

appraise real property are subject to this part 7 6; except that appraiser

employees of county assessors who are employed to appraise real property

are not subject to disciplinary actions by the board on the ground that they

have performed appraisals beyond their level of competency when

appraising real estate in fulfillment of their official duties. County assessors,

if licensed or certified as provided in subsections (1) and (2) of this section,

are not subject to disciplinary actions by the board on the ground that they

have performed appraisals beyond their level of competency when

appraising real estate in fulfillment of their official duties.

is employed shall pay all reasonable costs incurred by the appraiser

employee of the county assessor to obtain and maintain a license or

certificate pursuant to this section.

(5) The board shall not issue an appraiser's license as referenced in

PAGE 81-HOUSE BILL 19-1172

subparagraph (IV) of paragraph (b) of subsection (1) SUBSECTION (1)(b)(IV)

of this section unless the applicant has at least twelve months' appraisal

experience.

(6) (a) The board shall not issue a license or certification until the

applicant demonstrates that he or she meets the fitness standards established

by board rule and submits a set of fingerprints to the Colorado bureau of

investigation for the purpose of conducting a state and national

fingerprint-based criminal history record check utilizing records of the

Colorado bureau of investigation and the federal bureau of investigation.

Each person submitting a set of fingerprints shall pay the fee established by

the Colorado bureau of investigation for conducting the fingerprint-based

criminal history record check to the bureau. Upon completion of the

criminal history record check, the bureau shall forward the results to the

board. The board may require a name-based criminal history record check

for an applicant who has twice submitted to a fingerprint-based criminal

history record check and whose fingerprints are unclassifiable. The board

may deny an application for licensure or certification based on the outcome

of the criminal history record check and may establish criminal history

requirements more stringent than those established by any applicable federal

law. At a minimum, the board shall adopt the criminal history requirements

established by any applicable federal law.

(b) An applicant for certification as a licensed ad valorem appraiser

is not subject to the fingerprinting and criminal background check

requirements of paragraph (a) of this subsection (6) SUBSECTION (6)(a) OF

THIS SECTION.

12-10-607. [Formerly 12-61-707] Appraisal management

companies - application for license - exemptions. (1) An applicant shall

apply for a license as an appraisal management company, or as a controlling

appraiser, to the board in a manner prescribed by the board.

(2) The board may grant appraisal management company licenses

to individuals, partnerships, limited liability companies, or corporations. A

partnership, limited liability company, or corporation, in its application for

a license, shall designate a controlling appraiser who is actively certified in

a state recognized by the appraisal subcommittee of the federal financial

institutions examinations EXAMINATION council or its successor entity. The

controlling appraiser is responsible for the licensed practices of the

PAGE 82-HOUSE BILL 19-1172

partnership, limited liability company, or corporation and all persons

employed by the entity. The application of the partnership, limited liability

company, or corporation and the application of the appraiser designated by

it as the controlling appraiser shall be filed with the board. The board has

jurisdiction over the appraiser so designated and over the partnership,

limited liability company, or corporation.

(3) The board shall not issue a license to any partnership, limited

liability company, or corporation unless and until the appraiser designated

by the partnership, limited liability company, or corporation as controlling

appraiser and each individual who owns more than ten percent of the entity

demonstrates that he or she meets the fitness standards established by board

rule and submits a set of fingerprints to the Colorado bureau of