Blunt OKs real estate bill despite veto plea

Federal agencies expressed concern that the bill could squeeze out discount brokers.

JEFFERSON CITY, Mo. -- Gov. Matt Blunt signed legislation backed by Missouri's real estate industry Tuesday despite a request to veto it by the Federal Trade Commission and Justice Department.

The federal agencies had expressed concerns that the bill was anti-competitive, but Blunt praised it for protecting consumers.

The bill bans real estate licenses for people convicted of violent felonies or sex crimes.

Federal authorities objected to a provision setting minimum service requirements that real estate agents must meet when clients sign an exclusive brokerage agreement with them. The agencies expressed fear that it could squeeze out discount brokers who work on a fee-for-service basis.

In response to the federal concerns, the Missouri Association of Realtors mounted an aggressive lobbying bid to get Blunt to sign the bill.

The group's members sent about 1,800 e-mails to Blunt's office. It also paid $50,000 to hire a Washington lobbyist with close ties to Blunt's father, U.S. Rep. Roy Blunt. The lobbyist's efforts led to letters from several Congress members criticizing the involvement of the federal agencies.

Blunt acknowledged that he got information supporting the bill from lobbyist Gregg Hartley, the former chief of staff of Roy Blunt and former lobbying partner of Jared Craighead, now the governor's senior policy adviser. Blunt also said he got hundreds of supportive letters from real estate agents and others.

But he said the predominant reason for signing the bill was its passage without a single dissenting vote in either the House or Senate.

"Ultimately I care more about the unanimous opinion of the Missouri House and Senate than I do a federal agency," Blunt said at a Capitol news conference where he was surrounded by members of the real estate group.

Supporters said the legislation, which would take effect Aug. 28, is intended to protect customers from lazy or unscrupulous agents who sign them to exclusive contracts and then do little or nothing to try to sell their homes.

The bill would require brokers with exclusive contracts to handle offers to buy, sell or lease a house; to help clients develop and negotiate offers and counteroffers; and to answer a customers' questions.

The Department of Justice's antitrust division and the Federal Trade Commission sent Blunt a joint letter in May urging him to veto the bill. They contend it could result in higher costs and fewer service options for people buying and selling homes.

The federal agencies said that for homes to be placed on a Multiple Listing Service, many brokerages require exclusive agreements with clients. Consequently, they claim the bill would limit competition from agents who are willing to offer fee-for-service pricing instead of full-package service.

After the federal letter, the real estate association hired Hartley, who pressed the case with key members of Congress.

Missouri Republican Sens. Kit Bond and Jim Talent sent a joint letter to the FTC and Justice Department suggesting that the agencies' veto request "is inappropriate and an unwanted intrusion into the state legislative process."

Real estate bill is HB174.