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State and Local Guidelines

Use of Eminent Domain For Economic Development
Methamphetamine Labs and Remediation
Deregulation of Electricity
Weatherization Grants
Housing Trust Funds
State Unemployment Insurance Taxes
Recycling and Waste Management (Including Medical Waste)
Legislative Activity
Drug Activity
Abating Criminal Activity in Rental Housing
Occupancy Policies
Commercial Broker Lien Laws
Community Assessment Protection Lien
Private Activity Bonds
Bed Bugs
Medical Marijuana in Property Management

Use of Eminent Domain For Economic Development

Background:  
In 2000, the City of New London, Connecticut, approved a development plan that was projected to create over 1,000 jobs, to increase tax and other revenues, and to revitalize the economically distressed city.   The private developers of the land planned on constructing a hotel, health club, and offices on the waterfront property.  In assembling the land needed for the project, the city's development agent purchased property from willing sellers of 135 properties and used the power of eminent domain to acquire the remainder of the property from unwilling owners of fifteen homes and businesses.  The property owners of the fifteen condemned properties filed suit against the city.   

The case of Kelo et al v City of New London et al reached the U.S. Supreme Court who answered the question of whether the city's proposed disposition of the property qualified as a "public use" within the meaning of the Takings Clause of the Fifth Amendment.  On June 23, 2005, the U.S. Supreme Court ruled 5-4 in favor of New London, deciding the city did not violate the Fifth Amendment by condemning the non-blighted properties for a private mixed-use development.  Justice John Paul Stevens, who penned the decision, wrote that economic development qualifies as a "public purpose" sufficient to satisfy the Fifth Amendment's "public use" requirement. 

Members of the U.S. Congress quickly reacted to the ruling.  The House of Representatives adopted H.R. 340, by a super-majority vote of 365-33, deploring the Supreme Court’s ruling.  In addition, the House voted 231-189 for a bill prohibiting expenditure of any federal housing, transportation, or treasury funds to enforce the judgment of the Supreme Court in the case of Kelo v City of New London.  On the Senate side, Senator John Cornyn (R-Texas) introduced S. 1313, creating the Protection of Homes, Small Businesses, and Private Property Act of 2005, which states that the power of eminent domain should be exercised only for “public use” as guaranteed by the Fifth Amendment and that the power to seize homes, small businesses, and other private property should be reserved only for true public purposes. 

At least 25 states are considering changes to their eminent domain laws.  States may restrict the use of eminent domain for economic development if enacting more strict standards of “public use” than the federally mandated standard.  At least eight states including Arkansas, Florida, Illinois, Kentucky, Massachusetts, Montana, South Carolina, and Washington had enacted laws, prior to the Kelo decision, forbidding the use of eminent domain for economic development unless it is to eliminate blighted properties.  Legislators in those states have introduced legislation increasing the difficulty for local governments to utilize eminent domain.  Several other states are considering legislative proposals to restrict or prohibit the use of eminent domain for economic development.       

IREM Position:
The Institute of Real Estate Management supports states’ rights in deciding under what conditions eminent domain may or may not be used.  IREM, a strong supporter of private property rights, urges state legislatures and local municipalities to respect the rights of property owners by limiting the circumstances under which eminent domain is permitted.

(11/05, confirmed 10/09)

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Methamphetamine Labs and Remediation

Background and Objective:   
The manufacturing of illicit methamphetamine (meth) has increased dramatically throughout the United States.  The production of meth is very hazardous, involving the use of highly toxic, flammable materials creating a serious risk of fire and explosion.  Aside from the production risks, the aftermath of meth production creates a serious health threat due to the residual presences of toxic materials.  These labs can be easily created by the purchase of some over-the-counter items available at most stores. According to the Office of National Drug Policy, the production of one pound of methamphetamine creates 5 to 7 pounds of toxic waste and releases poisonous gas into the atmosphere.

Many states have passed laws to try and address the problem of meth production and cleanup.  There are also efforts at the federal level.  In 2007, Congress passed the Methamphetamine Remediation Research Act which establishes a research program to develop guidelines, based on the best currently available scientific knowledge, for the cleanup and remediation of former meth labs, including guidelines regarding preliminary site assessment and the remediation of residual contaminants.

IREM Position:
The lack of established guidelines for the remediation of properties impacted by methamphetamine production creates confusion and possibly liability in the property management industry.  Property owners may fall victim to unscrupulous contractors who may recommend unnecessary or unproven decontamination methods. Without appropriate research, residents can be left endangered by the health effects of meth. The Institute of Real Estate Management urges the U.S. These standards should be developed in conjunction with a federal study to determine the potential health effects of contaminated properties, and appropriate measures for safe levels of exposure. A clear set of principles is necessary to protect property owners and residents about the environmental impacts of methamphetamine production.  Without scientific research in this field, methamphetamine continues to be a danger to all affected by its production. Furthermore, the burden of cleanup costs should not be the property owner’s, but rather the cost of the occupant of the leased space.

 (11/05, updated 10/09)

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Deregulation of Electricity

Background and Objective:
The electric power industry is perhaps the last of the utility industries considered for deregulation by federal and state entities. Since the deregulation of the telephone and gas industries, there has been a growing feeling that electricity should follow suit.

Originally, electric power industries were awarded rate regulated franchises by the federal government in order to promote this power type across the country. As electricity has become a necessity rather than a luxury, discussion has surfaced regarding creating a free market to encourage competition, which in turn should bring lower electricity rates. It should be noted, however, that electricity's elements are different from the other utilities in its generation, transmission, and distribution. While the transmission and distribution costs are somewhat fixed and may remain regulated, the generation of electricity may provide for the most competition and benefit for consumers.

Congress passed the Energy Policy Act that opened the doors for competition at the wholesale (transmission) stage of the process in 1992.  The Federal Energy Regulatory Commission implemented the intent of the Act in 1996 with Orders 888 and 889 with the stated objective to “remove impediments to competition in wholesale trade and to bring more efficient, lower cost power to the Nation’s electricity consumers.”  The Commission’s orders required open and equal access to jurisdictional utilities’ transmission lines for all electricity producers, providing for the states’ restructuring of the electric industry to allow customers direct access to retail power generation.  

In recent years the utilities have publicized the benefits of a fully competitive electric environment in which competition can also occur at the generation stage of the process.  Recently, state and federal legislation to deregulate the electric industry has been focused on creating laws that remove competitive barriers at the generation stage.  

IREM Position:
IREM appreciates the need to restructure the electric power industry and believes it must be done carefully to ensure that all parties involved ;present providers, future providers, and all consumer types, including multifamily and commercial property owners, are treated fairly in the deregulation of this utility. While industry and some commercial consumers may benefit from the increased competition as a result of deregulation of electricity, smaller consumers, such as multifamily and commercial property owners and residential consumers, may not benefit as much considering the electric utility volume they consume.

Therefore, IREM believes that deregulation of our electric utilities should be done at the state level, not at the federal level, to ensure that rates will be decreased, not increased, for the individual consumer and businesses which will have the greatest representation in determining the impact on their particular area. If the federal government mandates that states deregulate, they should allow for a reasonable time period for states to carefully prepare their deregulation plans. However, this time period should not allow state to indefinitely postpone deregulation. Electrical system reliability should not be compromised by deregulation. Therefore, adequate safeguards should be included in deregulation plans to ensure the integrity of the electrical generation, high voltage transmission, and local delivery systems. In addition, the costs of deregulation should not be borne by the consumer. Although some states and municipalities could feel some loss in tax revenue, any shortfall resulting from deregulation should not be passed on to the property owner in the form of higher property taxes or other taxes or fees. Finally, since utility deregulation would not allow electricity producers to recover capital costs;previously considered stranded costs, recovery of these costs should be paid for by all rate payer categories on an equal basis.

(11/97, updated 10/07, 10/11)

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Weatherization Grants

Background and Objective:
Weatherization grants are funds provided to tenants by state Health and Human Services Departments (HHS) to compensate occupants for utility bills that they are unable to pay (in tenant-paid utility buildings).

IREM Position:
We support the concept of building owners receiving weatherization grants in accordance with existing federal regulations. We also support a low interest supplemental loan program to be used for weatherization needs.

(Updated 4/06, 10/10)

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Housing Trust Funds

The Institute of Real Estate Management supports the concept of safe, decent and sanitary housing, the production of new low/moderate income housing, and the preservation of the existing housing inventory. IREM feels that the best and most efficient means of creating local low/moderate income housing is through state finance agencies, not through additional funding via interest-bearing escrow accounts. This issue is a broad-based social issue that has a funding opportunity through the use of local tax sources or a low income housing line item in the respective state's budget. The use of housing trust interest-bearing escrow accounts will have an adverse effect on rent pricing and will adversely affect the original intent of security deposits.

(Updated 11/04, 9/12)  

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State Unemployment Insurance Taxes

We support the concept of amending the states' definition of wages subject to state unemployment insurance taxes (SUTA) to conform to the existing definition for federal unemployment insurance taxes (FUTA).

(Updated 11/05, 4/10, 4/13)

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Recycling and Waste Management (Including Medical Waste)

Background and Objective:
Rapidly filling landfills and new state and federal solid-waste regulations made recycling the fastest growing disposal alternative in the late 1980s. Several states have enacted legislation in the last fifteen years ranging from mandatory collection, to statewide goals, to mandated local plans.  Nearly all 50 states in the Union, including the District of Columbus, have statewide recycling laws varying in stringency. Ten states, as of 2011, have container deposit laws to encourage recycling of beverage containers. As of March, 2013, all 50 states have adopted the EPA’s universal waste regulations designed to manage wastes such as batteries, pesticides, mercury-containing equipment, and bulbs/lamps.  In addition, nearly every state has implemented a medical waste disposal program.

IREM Position:
The Institute of Real Estate Management strongly supports recycling programs that will reduce the use of landfills. In order to succeed, coordinated efforts between federal, state, and local governments and the waste management industry to coordinate collection and marketing of recyclable materials and, in the case of medical waste, to coordinate disposal tracking systems are essential. Without such a coordinated effort, recycling efforts may be random and non-productive. While supporting environmentally sound waste management, the Institute is very concerned that property managers are being caught in the middle when it comes to the responsibility of sorting and collection. The Institute strongly believes that the generator of waste or the vendor contracted to remove the waste should be responsible for properly disposing of the waste.

(11/89, Updated 11/05, 4/10, 4/13)

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Legislative Activity

Background and Objective:
Establishing local networks and working from the grassroots upward is a more effective and more credible way to approach potential legislative issues than reacting after the fact. In a concentrated effort to equip IREM chapters and individual members with the tools necessary to make a difference in real estate management-related state and local legislation, IREM created the Chapter Government Affairs Training Program in 1994. This training program, comprised of a comprehensive power point slideshow and written material, offers valuable information to all chapters and is intended to assist those chapters to improve their current level of government affairs activity.
           
The Institute’s Legislative Department is a valuable resource for members of the Institute, and members are encouraged to contact staff with any legislative requests. At the national level, IREM is part of a legislative advocacy team that constantly monitors legislative and regulatory developments in order to shape the direction of today's policy issues. IREM’s Legislative Staff review all proposed state legislation of potential impact to real estate managers, including pertinent bills in the IREM State Legislative Database. Staff stays connected with Chapter Legislative Chairs to track trends in local ordinances. Members are kept apprised of legislative victories and trends through the frequent release of the Legislative Bulletin. Additionally, members are encouraged to act on vital legislation through Calls-to-Action. Additional resources are available online through the IREM Public Policy home page.

IREM Position:
The Legislative and Public Policy Committee strongly urge Regional Vice Presidents to communicate to chapters in their regions the importance of grass roots legislative activity by individual members of IREM and to urge the chapter legislative committees to work with their counterparts in the National Association of REALTORS®, recognizing state and local NAR® boards, and other associations to develop local networking coalitions. Individuals and chapters involved in local efforts should report back to IREM National on an ongoing basis any obstacles or problems, as well as accomplishments, in order to strengthen the Institute's communications network.

(6/89, updated 4/06, 10/10)

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Drug Activity

Background and Objective:
The problem of drug abuse, drug trafficking, and drug-related crime has found its way into every facet of day to day life, including all investment property such as residential, multifamily, commercial, industrial, and retail. Such activity threatens the stability of entire families, businesses and communities. As apprehension about drug activity has grown, governments, businesses and communities have become increasingly fervent in their efforts to eradicate illegal drug use and the societal problems associated with it. While every individual must share in the obligation to achieve this goal, it is important that specific responsibilities be borne only by those with the appropriate talents, skills, and resources to address them. Problems associated with illegal drug activity may not only result in damage or loss of property, but also involve mental and physical well-being, the possible loss of life, as well as the potential for increased liability of the owner or managing agent. Consequently, interference by untrained, ill-equipped and unqualified persons may worsen the problem and create additional hazards.

Recently, property managers nationwide have become more aware of the growing problem of methamphetamine labs in rental properties.  After a lab has been shut down, a property is often still contaminated with high levels of hazardous chemicals. Long and short term health effects include liver and kidney damage, neurological problems and increased cancer risks, for people living in former lab sites.   This type of illegal activity is becoming increasingly problematic for commercial property owners and property managers.  More and more states are passing legislation requiring property owners to disclose to real estate agents if the property was at one time used as a methamphetamine lab.  Please see the IREM Statement of Policy, “Property Managers Combating Methamphetamine Laboratories: Prevention, Remediation, and Notification” that is specifically dedicated to this issue.

IREM Position:
Members of IREM believe in a real estate manager making a reasonable effort, within his or her area of expertise, to protect tenants, owners, employees and property from the harmful effects of illegal drug activity. IREM feels that appropriate responsibility includes cooperation with law enforcement to the extent allowed by landlord-tenant laws and other state and local laws. IREM also believes that it is the manager's responsibility to familiarize law enforcement authorities with the managing agent's fiduciary responsibilities to property owners. IREM further believes that managers who act in good faith by documenting and notifying authorities of drug activity, and otherwise cooperating with authorities, do thereby protect an innocent owner's property from seizure by law enforcement authorities.

IREM recommends that real estate managers take the following steps to curb illegal drug activity:
Include reviews for criminal activity, as permitted by law, in background checks of prospective tenants and employees.

  • Define and address drug activity in lease agreements and company policy.
  • Advise tenants in writing that illegal drug activity will be considered a breach of lease and subject to all applicable penalties.
  • Advise the proper authorities of any known drug activity.
  • Document all action taken in regards to a property involved in drug activity.
  • Take the same precautions with employees as are necessary when dealing with tenants.

IREM supports legislation which protects and aids owners and real estate managers in responsible administration of anti-drug efforts. Laws that treat innocent owners and managers as accomplices are counter-productive, as are laws that demand managers to assume responsibility beyond the realm of management expertise.

IREM believes that real estate managers can best address and combat drug activity through their day to day activities and capacities as managers. It is not productive, and is dangerous, to burden managers with responsibilities better suited to law enforcement, counseling agencies, or governments.

(6/90, updated 4/06, 10/10)

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Abating Criminal Activity in Rental Housing

Background and Objective:
It is a fundamental component of the residential landlord-tenant relationship that residents should be entitled to the safe and quiet enjoyment of their residential dwellings and not be exposed to unabated criminal activity. Except in those jurisdictions which have enacted enhanced rights for landlords to address criminal activity occurring upon project grounds swiftly and decisively, landlords are sometimes left with no accelerated remedies to the perpetuation of crime by tenants or their invitees.  Landlords can be  shouldered with a burden of proof effectively blocking action until the time of conviction, often with ongoing criminal activity continuing unabated, co-tenants living in fear and if they can afford to, relocating to other housing, to the detriment of the landlord and relocating tenant(s).

Many jurisdictions have granted landlords accelerated remedies to address criminal drug related activities and set the standard of proof as being a preponderance of the evidence, allowing terminations of tenancies pre-conviction if the landlord can prove that it is more likely than not, that drug related activity was committed by a tenant or the tenant's invitees. This principle is nothing new and has been custom and practice in federally assisted housing for years, enabled by supporting lease addenda. Such laws do not quash the accused resident's due process rights. The accused tenant is entitled to his or her day in court to respond to the accusations. Many states have expanded the scope of criminal activity qualifying for fast track evictions to include criminal gang related activity and a few even further, to include such crimes as illegal discharge of a weapon, prostitution, infliction of bodily harm, threatening or intimidating as defined by statute, or other activities of like gravity.

IREM Position:
IREM believes that state and local governments with landlord-tenant laws should empower landlords to promptly and decisively address criminal activity on property grounds or in dwelling units by tenants and/or their invitees in a manner not in violation of the accused tenant's due process rights, when such conduct breaches the rights of co-tenants and/or puts them at potential risk. IREM endorses such statutes enveloping illegal drug and criminal gang related activity, unlawful discharge or brandishing of weapons, assault or threats of assault, and other crimes against persons or property of like magnitude occurring within the property's boundaries. IREM further endorses governments setting shortened summons periods, and a preponderance of the evidence as the landlord's burden of proof to prosecute an accelerated eviction under such conditions, with the accused given the right to present a defense and to "show cause" as to why the eviction should not proceed.

Enacting such laws will not completely eliminate all criminal activity in rental housing, but it would allow reasonable and necessary responses by landlords once crime does occur.

(6/99, confirmed 10/06, updated 3/11)  

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Occupancy Policies

(NOTE: This position is to be accompanied by the IREM recommendation entitled, "Establishing Fair and Reasonable Occupancy Standards". See Appendix II.)

Background and Objective:
Occupancy standards, which determine the maximum number of occupants that can reside in a dwelling, have always been a matter of some contention among owners and operators of residential rental property. However, with the passage of the Fair Housing Amendments Act of 1988, occupancy standards, or more specifically the lack of them, have been a serious cause of concern for property managers. Although the Fair Housing Amendments Act did not set specific occupancy standards, it did require that any standard be fair and reasonable.

IREM has undertaken a study of occupancy standards which has led to the development of a guideline recommendation. The guidelines are meant to provide guidance tempered with flexibility and are designed to provide clarity to the Fair Housing Amendments Act provisions pertaining to occupancy standards and to reduce litigation resulting from the current lack of clarity.

IREM Position:
IREM shall adopt the guidelines and objectives outlined in the recommendation entitled, "Establishing Fair and Reasonable Occupancy Guidelines" and shall further recommend that IREM chapters and the real estate community in general consider the guidelines and, where appropriate and necessary, pursue their endorsement and acceptance by state and local legislative bodies.

(Updated 10/07, 10/11)

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Commercial Broker Lien Laws

Background and Objective:
Many states have been exploring, or have already enacted, a commercial real estate broker’s commission lien law. Litigation to recover fees often consumes the entire fee the broker earned and would have been paid, and is not always swift, to the detriment of the real estate brokerages and commissioned agents involved in the transaction. These laws have been enacted to solve the problem of brokers going into a closing of a sale and, without mutual consent, receiving a fee lower than previously agreed, upon, or in some cases, no fee at all. Although the language in each law varies from state to state, most laws state that the lien language must be placed in the written agreement signed by both the party the broker represents, and the real estate brokerage agency. This agreement is only typically valid with the principal broker, thus those working under the broker have no authority to place a lien.

The period in which a lien must be filed and perfected must be reasonable given transactional parameters. An example of such need would be in one state with a current lien law where the period in which a lien must be filed is within the window of time commonplace for free rent concessions, and often a commission is not payable in part or in whole until rent commences, thus making the lien right illusory.

IREM position:
IREM supports the enactment of commercial broker lien laws in all states to provide adequate assurance of payment for brokers who previously had no means of insuring payment of the agreed upon fee for their services, other than costly legal battles that are not timely resolved. The concept of commercial (multi-family, office, retail, industrial, etc.) broker liens allows a real estate broker providing brokerage services to attach the monetary benefit that the property owner derives from the service provided.

Of special interest to property mangers is the need for the lien laws to be as forceful and efficient for the commercial lease transactions as for commercial real estate sales. As more and more states contemplate creation of such laws, listing commercial brokers and cooperative brokers who participate in transactions will have a greater sense of security when completing a transaction (leasing and sales), which is beneficial to not only the brokers themselves, but their clients and the commercial real estate market as a whole. For states that enact new commercial broker lien laws and for those with existing laws in place, due care needs to be given to make sure that the period in which a lien must be filed and perfected is reasonable given transactional parameters.  Please refer to IREM’s briefing paper, updated in August, 2010, “Commercial Lien Laws,” that is specifically dedicated to this issue.

(Adopted 10/06, updated 10/10)

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Community Assessment Protection Lien

Background and Objective:
In most states today, when a mortgage is foreclosed lenders do not recover enough money to pay the underlying debt and costs. Thus, the junior lienors, such as common interest associations, ultimately receive nothing.

Since the early 1960's when the Federal Housing Administration (FHA) Model State Act for apartment ownership was promulgated, priority has been given to the lien of first mortgage over the lien of common expense assessments. The FHA required mortgage priority as a condition for approval of association development and other lenders followed suit. Therefore, community associations usually received no money upon mortgage foreclosure to cover common expense assessments. In the absence of an assessment lien priority, non-defaulting unit owners must unfairly cover insurance, security, and maintenance expenses creating inequitable and unanticipated financial hardships.

Lenders holding mortgages on both defaulting and non-defaulting mortgages have a vested interest in ensuring the continuation of the maintenance of a community association's common areas during foreclosure proceedings. Such continued maintenance and general upkeep is essential to the preservation of the value of their mortgage security interests. If a significant number of units are not paying their assessments, and they are uncollectible, the burden falls on the other unit owners, weakening their equity.

The 1980 Uniform Condominium Act provides for a limited six-month association lien for common expense assessments prior to all liens and encumbrances except for those recorded before the date of the declaration. The lien is also prior to any mortgage or deed of trust for common expense assessments assessed against all of the units in proportion to their common expense liability, and due during six months immediately preceding institution of an action to enforce the lien. The adoption of the super priority assessment lien strikes a balance between the protection of the lenders and the need to enforce collection of assessments.

Several states have enacted legislation allowing for common interest association super priority liens. In those states collections have been much easier and lenders have paid the assessments. In most cases, lenders have made the delinquent owner pay the assessment. Lenders have had no problem purchasing and selling mortgages on the secondary markets. Virtually all secondary mortgage market lenders have been purchasing mortgages in these states without objection or second thought. The community association six month lien priority has been accepted by The Department of Housing and Urban Development, the Veterans Administration, the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac). In general, the super lien priority has not affected the availability of condominium unit financing and has had a substantial positive effect on the ability of the associations to easily and effectively collect on delinquent assessments.

IREM Position:
IREM supports state legislation which authorizes the recovery of up to six months of community association assessments through a lien of first priority. The priority lien should apply only to monthly or periodic common expense assessments made by an association, pursuant to an annual operating budget, and due during the six months immediately preceding institution of an action to enforce the lien. Such a provision will strike a balance between the protection of the security of the lenders and the need to enforce collection of assessments.

(12/93, updated 4/08)

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Private Activity Bonds

Background and Objective:
The Tax Reform Act of 1986 imposed caps on the dollar amounts of permitted private purpose bonds, with the exception of 501(c)(3) bonds. Each state is allowed to issue private activity bonds (PAB) each year in the amount of  $95 per capita or $291.87 million, whichever is greater. More than one-half of all the states qualify under the $95 per capita limit.  If a state does not use the entire amount permitted under its cap, it can carry forward the difference for up to three years.  Since 1986, Congress has adjusted or lifted the caps on various state or local allotments in the case of an emergency such as a natural disaster. The Internal Revenue Service created a new PAB cap formula in 2012 based off the latest population figures released by the U.S. Census Bureau.  With this new formula, state and local governments are expected to receive a 1.1% increase in 2013, on average, in the cap.

Private activity bonds must do three things: 1) more than 10% of the proceeds must be used for a private business use; 2) payment on the principal or interest of more than 10% of the proceeds must be secured by, or payments derived from, a private business use; and 3) proceeds will be used to make or finance loans to non-governmental units. These bonds are also restricted by the types of privately owned public purpose projects which can take advantage of tax-exempt financing. The types of issues authorized are mortgage revenue bonds (MRBs), small-issue industrial development bonds (IDBs), certain state-voted bond issues, student loan bonds, and those for a variety of exempt facilities, including qualified residential rental projects (multi-family housing).

IREM Position:
IREM supports programs to enhance financing opportunities for eligible real estate projects. Private activity bonds allow states to assist in the development of projects to meet their needs. We support increasing private activity bond caps to allow expansion of financing opportunities.

(6/00, updated 10/08, 4/13)

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Bed Bugs

History and Background:
Recently, the issue of bed bugs has become a prevalent problem among U.S. property managers and homeowners.  Nearly eradicated in the 1940s, Cimex lectularius or bed bugs, made a return in the mid-1990s.  These tiny reddish-brown bugs tend to nest in the bedding, furniture, clothing and carpet of residential and commercial properties.  Although they are visible to the naked eye, their nocturnal behavior makes them elusive and difficult to spot.  Bed bugs feed off of warm-blooded animals, and leave behind red blotches and rashes when they bite the skin.  Although they are not recognized as harmful to human health, they do cause discomfort, and psychological and financial burdens. 

Recently, several states have introduced legislation in an effort to mitigate the prevalence of this pest.  The legislation also aims to define who is responsible for the costs associated with cleaning up properties infested with beg bugs.  New York passed a law stating landlords must disclose any history of bed bugs in a building within the preceding year to prospective tenants.  This law only pertains to New York City limits.  New Jersey went a bit further in requiring landlords of multiple-dwelling units to provide pamphlets to tenants with information on bed bugs and preventative methods.  Landlords must have bed bug infestations exterminated directly after learning about them and can face a fine if they do not comply.  So far there has been no federal legislation enacted to address the nuisance of bed bugs. 

IREM Position:
IREM believes that all housing should be safe, sanitary, and decent. It is important for property managers to be educated on how to protect and prevent against bed bugs.  IREM urges all property managers to comply with state and federal laws pertaining to bed bugs; although laws do not exist in every state addressing this issue, it is important to stay abreast of emerging laws that may affect your company and properties.  IREM supports the funding of research to examine effective ways of mitigating bed bugs.  Tenants have the responsibility to keep units sanitary; if there is a presence of bed bugs they must expeditiously inform the property manager.

Adopted 4/11

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Medical Marijuana in Property Management

Background and Objective:
As a Schedule I controlled substance under the Controlled Substances Act, marijuana is illegal at the federal level for any use.  However, 23 states and the District of Columbia have passed their own legislation authorizing the use of medical marijuana to varying degrees.  This conflict between federal and state laws creates a complicated situation for property managers.

Per a 2011 memo, HUD has directed public housing agencies or owners to deny admission of applicants who are using medical marijuana.

IREM Position:
It is critical for property managers to stay up to date on the legality of the cultivation, use, and sale of marijuana in their jurisdiction. The legality and regulation of medical marijuana varies not only by state, but also by local municipality.  Property managers should check with local municipal officials to ensure they are up to date on medical marijuana regulations.  There are tools available to property managers enabling them to deal with marijuana as they see fit, such as lease addendums, with which smoking and illegal drug use can be prohibited.  Please refer to our Statement of Policy on Combating Drugs in Real Estate, Smoking in the Workplace and Residential Smoking, and our white paper on Marijuana Legalization Laws.

Adopted 4/11

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