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From Public Policy Battle Chaos, Flags of Success

By Robert Freedman, Senior Editor, REALTOR® Magazine

After Maine lawmakers in 2009 approved tax increases on goods and services and voted to convert the state mortgage interest deduction and other itemized deductions into a tax credit, the Maine Association of REALTORS® helped push through a ballot measure that repealed the tax increases and preserved the state MID.

“That tax increase was the last straw” for Maine households, says Chris Philbrook, government affairs and communications director for the Maine Association of REALTORS® (MAR). Voters, taking MAR’s side, approved a ballot referendum in 2010 to repeal the tax changes on a 60-40 basis.

Maine 2010 ballot issue

Maine 2010 ballot issue

But the battle was expensive, with MAR using close to $100,000 of its political advocacy funds to test and then mount a campaign that included media ads and a website, among many other components to the all-out effort. NAR helped with a $100,000 infusion of money from its issue mobilization funds.

NAR also helped bring MAR together with a media company to test and craft the ads that Philbrook says were critical to framing the debate for voters. “We did polling, and with a subset of people, we watched what messages resonated, and we based our ads on those,” he says.

The success of MAR in fighting back against a state initiative that could harm home owners and the real estate profession is the kind of effort NAR’s issue mobilization funds are intended for, and associations around the country have tapped those resources to tally up a string of high-impact victories over the years.

Like the big win of the Illinois Association of REALTORS®, back in 2006, when the U.S. Supreme Court threw private-property rights law into confusion with its ruling in Kelo vs. City of New London, Conn. to allow the city to take people’s houses so a developer could profit by building a mixed-use project that included condos, hotels, and retail space.

The Kelo case spurred REALTORS® in Illinois to take preemptive steps to prevent that kind of breach of private property rights in their state, so they combined their issue advocacy funds with $10,000 from NAR to get a law passed tightening the criteria by which localities can exercise their eminent domain powers. Under the change, localities have to show a tight correlation between a project and the public good so that a Kelo-type project that mainly focused on upping the tax base through an economic development project couldn’t sneak through.

One of the remaining houses in the impacted New London, Conn., neighborhood in 2006. Photo: Creative Commons

One of the remaining houses in the impacted New London, Conn., neighborhood in 2006. Photo: Creative Commons

“It was perfect issue for the REALTORS®,” says Greg St. Aubin, the Illinois association’s government affairs director. “Our organization tends to be really good at playing that watchdog role, and it was a great opportunity for us to be protector of private property rights.”

In addition to making money available, NAR has a contract with the land-use legal specialists at the law firm Robinson and Cole to help state and local associations tailor private property rights and other land-use legislation to their state or local situation.

REALTORS® charted a similarly big win in Indiana last year, when the Indiana Association of REALTORS® (IAR) tapped $50,000 in NAR issue mobilization funds to get a 1 percent cap on property taxes embedded in the state constitution. Lawmakers a few years earlier had passed legislation to bring down the cap on property taxes from 2 percent to 1.5 percent and then to 1 percent, where it is now. To help ensure the cap can’t be tinkered with easily, IAR helped lead a coalition to get the 1 percent cap placed on the 2010 ballot as a constitutional amendment. More than 70 percent voted in favor of the constitutional amendment. As a result, raising the property tax rate will require two successively elected general assemblies to pass a resolution to amend the constitution. So, it will take a minimum three-year process to make a change.

IAR

Past IAR President Paul Wyman at podium with Indiana governor Mitch Daniels behind him. IAR photo

But the win wasn’t cheap. “The coalition as a whole spent about $350,000 to get it passed,” says Karl Berron, CEO of IAR. “We spent about $100,000 and we got $50,000 from NAR.”

The issue advocacy successes in Maine, Illinois, and Indiana are a handful among a number of efforts to protect interests of home owners and real estate by state and local associations that tapped assistance from NAR issue mobilization funds.

Among others:

  • $100,000 to the Santa Fe, N.M., Association of REALTORS® to defeat a proposed transfer tax
  • $75,000 to the Austin, Texas, Association of REALTORS® to defeat mandated energy retrofits at the point of home sales
  • $30,000 to the Richmond, Va., Association of REALTORS® on an affordable housing matter
  • $15,000 to the Aransas Association of REALTORS® to address road impact fees
  • $10,000 to the Fargo-Moorhead, N.D., Association of REALTORS® to address a sales tax for flood protection matter

Of course, with the U.S. Supreme Court’s Citizens United decision last year, which allows corporations to pump money without limit into local, state, and national issue campaigns, the difficulty and cost of winning industry-critical issue campaigns is set to go way up, and indeed, reports make clear that unprecedented amounts of corporate money flooded into last year’s national elections, setting a template for what’s to come.

Under Citizens United, corporate political speech is given the same protection as individual political speech, effectively lifting limits on the amount of so-called soft dollars that can be pumped into issue advocacy. That will increase the importance of money, technical assistance, and other resources that NAR provides to local and state associations for issue advocacy efforts and why NAR’s Executive Committee two weeks ago voted to recommend to the NAR Board of Directors approval of the association’s REALTOR® Party Political Survival Initiative. Under that initiative, REALTORS® would pump $195 million over five years into political advocacy efforts like the ones in Maine, Illinois, and Indiana. About two-thirds of the resources—money, technical help, and resources—would go to local and state associations. The funds would come from a $40 dedicated dues increase.

As Ryan Swinney, president of the Helena, Mont., Association of REALTORS® has said, based on the help his association received to fight a transfer tax proposal last year, “The investment is nothing compared to what this initiative can do for us.”

More on the REALTOR® Party Political Survival Initiative.

Robert Freedman

Robert Freedman is director of multimedia communications for the NATIONAL ASSOCIATION OF REALTORS®. He can be reached at rfreedman@realtors.org.

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Comments
  1. George Sutherland

    Real Estate is LOCAL!…Identifying and addressing the political real estate issues must to be on a local and state level! Read the headlines:
    1) As realtors we’re not going through “the best to times”. Bad timing to ask those struggling to come up with more for your political lobbying.
    2) Both as realtors and as tax payers we’re fed up with sending our money to Washington where it goes behind the wizards curtain with very little accountability on how it is being spent.
    Thank you,
    George Sutherland

  2. Patricia McCord

    At a time when realtors are struggling to eke out a living why would you consider
    raising the dues? I am totally against any increase in due!!!

  3. I find it humorous that Mr Freedman’s first example of how NAR helps the real estate profession is in fighting tax increases on households in Maine. Increasing our dues is the same as a tax increase. We Realtors are fighting for our own household survival and you want to increase our expenses? NAR should do what we are asking government to do- learn to live with less until the economy improves!

  4. Mark Wessels

    There is a key ingredient missing from this story. Information that is vital before any agent/member can make an informed decision as to whether they should support the increased dues for politics issue.
    WHO sponsored the bills to increase taxes in the first place? R or D
    WHO sponsored the bills attacking private property rights? R or D
    WHICH party consistently goes after MID? R or D
    WHICH party receives the lions share of support from NAR each year? R or D
    This information, when compiled and disclosed to members will look absurd. We preach, at every level of membership, to DISCLOSE, DISCLOSE, DISCLOSE. Yet state associations and our very own NAR hides this vital information! I smell a rat.
    The same party that enjoys the majority of association member financial support spends the bulk of their time attacking our industry. To politicians, the NAR must look like a joke.

  5. Doug Wasson

    Are you listening NAR to our membership cry out!!!! Don’t do this!!!! They are crying out as loud as they can to you.. In large mass!!! Respectfully

  6. Our small association members are struggling just to keep groceries for their families. They should not have to worry about paying a dues increase when they can barely pay all that they are obligated to pay already. I hear them say they do not feel their positions are being represented at the state or national levels so they have been very reluctant to make contributions to RPAC. This will make the situation even worse. I hope you do not go forward with this proposed increase.

  7. Earl Boyer

    Does anyone else get the feeling that the NAR leadership is behaving in a way similar to many of those in government and pushing ahead with their agenda in spite of the wishes of the majority? MANDATORY DUES HAVE NO BUSINESS BEING USED FOR POLITICAL PURPOSES.

  8. Jim Eisberg

    I’m against a dues increase while business is so poor for most of us. We will pony up what is needed for well-picked battles on a local basis given good information on the battle from NAR and local associations (most of us are so overloaded with info that we need the same info from multiple reliable sources before the info sinks in). But I’m waiting for bankers, lenders, appraisers & Realtors who gave us the housing bubble & the troubled asset glut to go to prison, or at least be barred for life from all fiduciary occupations, before any incumbent gets my vote. And I’m also waiting for targeted (not shared) pain to people, real and legal, who’ve gotten richer over the past 30 years, based on serious definition and identification of the middle class (not 98% of US residents–anyone on food stamps or rent assistance is BELOW middle class and anyone making more than $106,800 (counting salary + benefits + all other sources of income) is ABOVE it). MID should apply only to primary residences, and only up to 80% of the local FHA mortgage limit. If we’re not part of the solution to the squeezing of the middle class, we’re part of the problem. And if this hurts the Real Estate Industry in the short run, so be it. We need more people fixing our system and fewer trying to sell more useless items, including humongous suburban homes, to people who already have enough. If we’re going to solve our energy problem, we’ll need small homes within walking or easy public transit distance from work and shopping, and that will require much construction and plenty of Realtors.

  9. Sharon Daniels

    Are you still considering your increase in dues for political purposes? I’ve yet to read EVEN ONE favorable comment from your members–myself included–and I’ve read a great number of them. NO, NO, and NO WAY!

  10. Donna Rogers

    I sure am glad to see others agree with me. I’ve been fighting the dues that go from me to the Republicans all year! I’d like to see the yearly income and type of real estate sold by those in NAR in charge of setting the issues to work on. They certainly don’t share my values as a lower-income seller of residential properties.

    WHY are we not using our clout to help those under foreclosure? Not to do a quick short sale — to stay in their homes, or better yet, to buy a different home! how about we work to give sellers the right to transfer their mortgage to a cheaper house, even if they are under foreclosure? Everybody would win, and we’d have a lot more businesss! that sure would work well for FL!!! What about those of us over 50 who will never have a chance to get our credit in shape again? How many realtors have been affected either on their own homes or investment property? if u are a realtor, send me an email at elitelady1 at msn dot com

    WHY did we not fight for affordable health insurance for self employed? WHY did we fight AGAINST Obama’s initial health care plan that would have set up a group with caps on costs for those that can’t get insurance, or don’t get it through their work???? WHY did we instead say insurance prices should be able to remain based on age — although we admittedly are an older group?

    WHY did we

  11. Robyn Simshauser

    Perhaps, if money is an issue our new president and vice president could have taken a miss on their trip to the far east. I’m really not sure what that accomplished.

  12. Bruce Shell

    As a recent Secretary/Treasurer of the largest Board of Realtors in Indiana, I was often involved in discussions at the state and national level pertaining to “reserves”. Reserves are theoretically designed for the worst of times and are earmarked to keep our respective organizations running at a “reasonable” level when revenue is down due primarily to loss of membership in economies such as we are currently experiencing.
    My question is – are we not in such a time? There are few among us that can say they have ever experienced a worse economy than what we are seeing now.
    NAR enjoys a cash reserve in excess of $200M! If we can’t dip into those reserves for “such as time as this”, then when? Asking our membership to give even more than has been given in our current economy feels a bit obscene to me.
    We are being told that our survival as an organization could depend on the proposed dues increase. What could possibly be worse than our survial?

  13. Robyn Simshauser

    I’m not sure where all the lobbying money is going. Last year, 17,000.000.00 plus. One website says NAR as a special interest group gives to both parties equally. Maybe we need to be a bit more decerning. NAR involves itself in every bit of “business” legislation it can find. It even worked on the Health Care bill to ensure no prejudice against preexisitng health issues. Weren’t there others better equipped who were lobbying against that, why does NAR have to? It seems we could be doubling up on everyone else’s issues. We have five primary lobbyists. From what I could see, all dems. Are they currying favor with their party by involving NAR in popular DEM issues. Out of the six top donations to campaigns, five were for democrats. I think we need to become less apathetic about what goes on with our ” trade union” and ask for some consideration in how and where the money, our dues, is being spent. With 1.1 million members and a 50% increase in dues we are talking about millions of additional dollars which NAR says it needs to fight state issues as well. What are our state dues for, let alone our local dues? This is all getting to be too much. It is time for austerity in all things, particularly when the RE market has been in the dumps year after year. Have we heard NAR say we’ll reduce the cost of this or that because we know you realtors are having a tough time. Absolutely not. They are becoming like the rest of washington, unweildly and out of touch with their people!!

  14. If you want support of many many other Realtors…… in the future….Stay Out of National Politics!!!!!! There are many many realtors that resent the money we contribute being spent on ANY Presidential Election! If you want to better Real Estate in INDIVIDUAL States, make VERY sure you understand that you can help or hurt and YOU have not been right very often LATELY. BETTER Real Estate in any way you can….BUT STAY OUT OF POLITICS WITH OUR MONEY!!!!!!!!!!!!

  15. Carol Moson

    There is no doubt we need advocacy given the political climate we are in HOWEVER, if NAR is supposed to be member driven and the members are overwhelmingly speaking against a dues increase, then you need to go with your Plan B and take the money from the awareness campaign and apply it to the political advocay.

    Many of our local members in GA feel the awareness campaign is weak and not effective because the public still does not know what the difference between a Realtor and non realtor is . In addition, many do not know if the public understands why we are doing the home ownership ads. If we are going to do awareness campaigns we need to be strong, to the point and clearly state what we want the public to know. As one of our members put it, “If I have to pay for the campaign, I should not have to do the work.”

    If the members are resisting as they are doing, then perhaps you need to examine the fact that the value perception of the members is severely lacking.

    I recognize that NAR is trying to do the right thing for it’s members but you have to ask and then listen to your members to be effective.You cannot make your members feel like they are children whose parents think they know what’s best for them and then force your ideas on them – not an affective leadership technique.

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