A Mid-Year Update on Key REALTOR® Issues

As your Government Relations department, we advocate on your behalf to create a provincial legislative and regulatory environment that is favourable to REALTORS® and real estate.

With the Ontario legislature adjourned for the summer, it’s the perfect opportunity to look back on what we’ve accomplished and what we’re working on.

Employment Standards Act Review

 The government has initiated a full review of the Employment Standards Act (“ESA”). The review is intended to update the Act and tackle the issue of precarious contract work that has become more prevalent in the provincial economy.

One of the areas of focus for the review will be the exemptions that exist under the ESA. The ESA exempts real estate salespeople and brokers from having to comply with certain provisions under the Act. As a result, real estate brokerages do not have to pay salespeople or brokers overtime, vacation pay and for statutory holidays, among others.

If the exemption were removed, brokerages could be faced with having to pay thousands of dollars per salesperson they employ.

You may recall that OREA fought hard for the exemption back when the Act was first introduced in 2000 and when the Real Estate and Business Brokers Act, 2002 (“REBBA”) was proclaimed in 2006. If the exemption is removed it could be disastrous for real estate brokerages who would face a significant increase in employment costs.

While it is not clear where the government stands on our specific exemption, this is an issue the OREA government relations team is taking very seriously. Moving forward, OREA will advocate for the maintenance of the exemption. Please stay tuned for further updates on this issue over the summer months.

Municipal Land Transfer Tax

Last week, the province announced a formal review of the Municipal Act, 2001, City of Toronto Act, 2006, and Municipal Conflict of Interest Act.

The Municipal Act sets out many of the roles, responsibilities and powers for Ontario’s municipalities. The City of Toronto Act sets a similar framework specifically for the City of Toronto. The Municipal Conflict of Interest Act sets out conflict of interest rules for municipal council members and members of local boards.

The review of these acts will focus on three broad themes:

Accountability and Transparency – the review will consider municipal accountability, conflict of interest, compliance, and transparency in local decision-making.

Financial Sustainability – the review will consider the effective use of existing financial tools and any barriers that may be preventing municipalities from achieving long-term financial sustainability.

Responsive and Flexible Service Delivery – the review will consider municipal service delivery; the role of community councils, and how municipalities are responding to climate change.

Through meetings OREA has had with staff in the minister’s office and from comments made publicly by the Premier, we know this review will consider the issue of giving municipalities new “revenue tools”.

While the province understands our concerns with respect to the MLTT, the minister’s office has maintained that it would be the “option” of individual municipalities to implement any new taxes. In other words, the province could create the space for new taxes but the final decision to implement those taxes locally will fall to municipal councils. Of note, the province would first have to amend the Municipal Act or pass new legislation to give municipalities the new tax powers.

OREA is deeply concerned with these developments. If new revenue tools move forward it is very unlikely that the province will exclude the MLTT.

Moving forward, the province will consult with municipalities and other stakeholders over the summer. The minister’s office has suggested that new legislation could be introduced in the fall of 2015 or spring of 2016. OREA will be very active with respect to these consultations over the summer. We will be engaging with member boards as part of our strategy to fight the spread of the MLTT. Please stay tuned for further updates in the coming weeks.

Mandatory Home Energy Audits

In late May, OREA’s government relations team met with officials from the Ministry of Energy and Ministry of Government and Consumer Services. At the meeting we were informed that the Minister of Energy, Bob Chiarelli, has instructed staff to move forward on the issue of mandatory home energy audits.

You will recall that in 2009, the government introduced the Green Energy Act, 2009 which included a provision which stated that the person making an offer to purchase a home had the “right” to receive the results of an energy audit.

Although the Act passed, OREA’s advocacy efforts were successful in stopping the government’s implementation of this section. The provision currently sits as an unproclaimed piece of the legislation.

The government’s new plan for mandatory home energy audits differs slightly from the plan introduced in the Green Energy Act. Instead of requiring mandatory home energy audits at the time of offer, the province is now suggesting the audits must be completed by the time of listing.

More specifically, Ministry of Energy officials expressed interest in requiring an energy audit rating to be included on an MLS® listing. Although officials were clear that the government’s plan for mandatory home energy audits is in its infancy, here is their general plan moving forward:

Consultations will be held with stakeholders and public over the summer.
They plan on introducing legislation later in the fall session.
The program will be phased in over time with full implementation in 2019. The phase in is required to build up the number of certified auditors in Ontario.
According to officials, the new requirement would mandate that an energy audit be completed prior to a listing and the results posted on MLS®.
The ministry is looking at developing potential exemptions based on age of the home, location and other certain categories.
The ministry is exploring an enforcement regime which would make the REALTOR® responsible for ensuring that the audit was completed and posted to MLS®.

Similar to the two previous issues, this development is very concerning. In essence, the province is actively considering mandating requirements on the MLS®.

OREA’s government relations team is currently planning a course of action for the association’s advocacy efforts on this issue. A strong voice from REALTORS® will be needed to help us successfully advocate against this proposal. Please stay tuned for further updates on this issue in the coming months.

Personal Real Estate Corporations

OREA continues to lobby for the fair tax treatment of REALTOR® when it comes to forming personal corporations.

Thanks to these efforts, earlier this year Bill 69, the Tax Fairness for REALTORS® Act, 2015 was reintroduced by Prince Edward-Hastings PC MPP Todd Smith. The bill was co-sponsored by Eglinton-Lawrence Liberal MPP Mike Colle. If passed, the bill would make the necessary amendments to the Real Estate and Business Brokers Act, 2002 (REBBA) to give REALTORS® the ability to operate their business through a personal real estate corporation (PREC).

Over 30 REALTORS® from across Ontario attended the bill’s introduction and sent a strong message to MPPs that OREA members want to be treated fairly. OREA also launched a Call-for-Action on Bill 69 which saw over 7,000 emails go from REALTORS® to the Minister of Finance.

Recently, Catherine Fife, MPP from Kitchener-Waterloo and NDP Finance Critic sent a letter to the Minister of Finance announcing the NDP’s support of PRECs. The fact that the bill enjoys the support from all political parties is a testament to the strength of the REALTOR® voice at Queen’s Park and of our ongoing advocacy on this issue. Moving forward, OREA will continue to work with the government to find ways to move the bill forward.

Condominium Act Review

Late last month, the government introduced amendments to the Condominium Act, 1998. OREA had the opportunity to participate in the province-wide consultations and welcomes the proposed changes. There are five key areas of reform being proposed by the government:

Enable the establishment of a Condominium Authority, a delegated administrative authority similar to RECO, which would provide dispute resolution assistance. The Condominium Authority would be subject to oversight by the Auditor General.
Provide better rules to protect consumers from unexpected costs after purchasing a condominium.
Introduce new rules for condo corporations to prevent fraud and mismanagement including giving condo owners information about their condo corporations’ financial matters.
Requires the licensing and regulation of condo managers and management firms. Regulations under the act would set training and education requirements for condo managers and a code of ethics.

The government relations team will continue to provide updates as the bill moves through the legislative process.

Land Use Planning Reviews

OREA has also had the opportunity to participate in a number of reviews undertaken by the government pertaining to land use planning. OREA will also be participating in a review being conducted on the issue of affordable housing.

In our submissions, OREA continues to stress the importance of affordable home ownership and having the government look at initiatives to address brownfield redevelopment and implementing provincial-wide standards for second suites.

Electronic Signatures 

Lastly, OREA continues to make progress on proclamation of the amendment to the Electronic Commerce Act, 2000 which will protect the use electronic signatures on agreements of purchase and sale. OREA successfully lobbied for the inclusion of the amendment in the Ontario Budget 2013.

Although the government has signaled its intention to proclaim the amendment for July 1st, 2015, no formal announcement has yet been made. Nonetheless, OREA continues to push key decision makers behind the scenes to move forward with the July 1st proclamation. These changes will give REALTORS® and consumers the confidence to use new technology that will help make transactions more efficient and accessible.

We hope to share some good news on this important issue very soon.

For more updates please continue to visit OREA’s GR blog.

 

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A Mid-Year Update on Key REALTOR® Issues