Legal Update: Student Loans and the Housing Industry

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The debt needed to fund the American dream may be exactly what keeps the American dream from being realized. Student debt, not largely nondischargeable in bankruptcy, is accruing at a far faster rate than any other debt, and in a few years will be what keeps those college graduates (assuming they graduate) from being able to afford to purchase a home. The consequences could be catastrophic; there is no simple solution. 

The cost of a college education is going up. The funding of higher education has to look to resources from students. And students do not just pay tuition; they also pay for a lifestyle outside of the old, classic dorm and cafeteria of decades gone by. The simple fact is that young and older people will not be able to purchase homes when they are saddled with $100,000 in student debt, and obtain jobs that pay $30,000 or so. 

During the Great Recession, student loan debt is the only household debt that went up. It now exceeds all car loan debt; it exceeds all credit card debt, according the Federal Reserve Bank of New York. Between 2004 and 2012, the number of student borrowers and the amount borrowed skyrocketed by 70 percent. Forty percent of households led by someone under 35 has a student loan, according to the 2012 Pew Research Center study. 

It is not a question of whether there should be student loans, or whether people who get educated by reliance on such funding should repay the loans, but rather the impact that such huge, nondischargable, lifelong debt will have on our economy in the coming decades. 

Choices made now and the magnitude of those choices may undermine future economic growth. And to put it in perspective, think of the difference in choices we all would have made in the last 10 years, with a $100,000 unsecured but nondischargable debt on our back. 

The legal point of this is clear. By changing laws in the last 15 years on dischargeability of student debt, and government insuring some student debt, it has become an integral part of our economy. But for those changes, there is little doubt that the debt would be less. Some may not have been able to go to college; that is the tradeoff. But just as there has been a shock here about flood insurance and no one saw it coming, the same will be said when a generation of students are saddled with hopeless debt, that even now exceeds $1 trillion. 

Joe R. Boyd
TBR Legal Counsel
Board Certified Real Estate Attorney
Boyd & DuRant, P.L.

Volunteer Spotlight: United Way of the Big Bend – Virginia Glass

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United Way of the Big Bend (UWBB) has been a major contributor to our community’s health and human service arena for 71 years. Our Community Care fund has provided relief and assistance to those in need throughout our eight counties: Leon, Franklin, Gadsden, Jefferson, Liberty, Madison, Taylor, and Wakulla. 

We partner with 41 agencies to provide basic needs assistance to help improve the quality of life for individuals in our community. UWBB partners with the City of Tallahassee and Leon County in a funding process called the Community Human Services Partnership (CHSP). Each spring, over 100 volunteers sit on Community Investment teams throughout the Big Bend. They review funding requests from certified agencies and make decisions based on their review. Funds are then distributed based on the available dollars in a manner that ensures a balanced, effective, and efficient human service delivery system for our community. 

Over the years, UWBB has remained true to its founding goals. We are dedicated to supporting the greatest variety of human service agencies in the local area, helping people from all walks of life and income groups, and creating collaborative strategies that result in long-lasting, positive cane. UWBB is looking to the future with new and innovative ideas of improving our community. In addition to the support provided to our 41 health and human service partner agencies, we are also committed to providing services through education, income, and health programs. BEST Project, ReadingPals, and Read United are the newest initiatives UWBB has introduced to our community. 

Did you know that $5 per pay period provides over 500 pounds of food that will feed a family of four for two months? 

Did you know that $10 per pay period provides eight days of foster care for a youth who has been abused? 

I have always been a donor to the United Way, and have been a Leadership Giver for many years. I have also been a volunteer screening the various nonprofits through CHSP and overseeing the allocation of their funding. As Campaign Chair of the 2014 Capital Campaign, I will be working closely with our eight-county region. To learn how you can help, call me or visit uwbb.org

Virginia Glass
Coldwell Banker Hartung and Noblin, Inc.

Members Receive Honors at Florida REALTORS® Convention

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Lillian Jack (JAL Realty) was recognized by Florida REALTORS®’ board of directors for her work locally on behalf of the homeless, where she often can be found quietly handing out muffins and water to people awaiting entrance to The Shelter.

The Florida REALTORS® leadership team recently spent two months traveling the state to advocate, engage, and collaborate with REALTORS® to raise awareness about the homelessness problem in our state, and Lillian’s efforts impressed them. She was in Orlando last week to attend the Florida REALTORS® annual convention, but missed their praise—she was busy volunteering at an Orlando-area homeless shelter that morning.

Lillian is past chairman of the Tallahassee Board of REALTORS® Commercial Council and Brokers’ Outreach program.

Patti Ketcham (Ketcham Realty Group) received Florida REALTORS®’ Education Individual Achievement Award at the state association’s annual convention last week in Orlando. Patti instructs classes at TBR and throughout the state, including diversity training; specialized instruction for agents working with senior citizens; and the Florida core law update, which is required by the state for real estate license renewal.

The Florida Department of Professional Regulation (DBPR) Division of Real Estate has invited Patti and her husband, Clay Ketcham, to provide instruction to their investigators and attorneys, with the goal of understanding the “real world” of real estate. She continues to work as a subject matter expert for DBPR and most recently provided assistance in rewriting the state’s real estate broker licensing exam.

Patti is a past president of the Tallahassee Board of REALTORS® and past district vice president of Florida REALTORS®.

Midtown Revival

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The once sleepy area of Tallahassee between downtown and the suburbs has evolved into an 18-hour destination. In 2010, the City of Tallahassee, in conjunction with a working group of citizens and several members of the Midtown Merchants Association, visualized the possibilities that this special area could develop into. Midtown is perfectly situated in the middle of the city, surrounded by neighborhoods like Lafayette Park, Los Robles, Lake Ella, Glenview, Glendale, Levy Park, and Betton Hills, with downtown just a few blocks south. 

The planning department devised a plan to implement the infrastructure that would be needed to accomplish the goal of creating “A Sense of Place.” “Midtown Placemaking” created a “Midtown” brand to form a visual edge for the district while promoting the arts through murals, music, fashion, and cuisine. A prime concern was safety for pedestrians, as evidenced by the new crosswalk with blinking lights on Thomasville Road and Gadsden Street, creating a walkable and bikeable community. Another goal was to reclaim or create new public spaces as evidenced by the 5th Avenue Park, right between Whataburger and the Tallahassee Board of REALTORS®.  As a result, Midtown is a live, work, play community. 

Midtown has become a trendy district, merging business and pleasure into one area from sunrise into late evening. At any given time you can pick your activity of interest, whether it be a cup of coffee or fine dining, a trip to Whole Foods, getting new soles for your shoes, an evening walk by the gas lights on 5th and 7th Avenues, or real “sweat therapy.” You can choose among many fine shops and personal services for your entertainment. Midtown is known for its many fundraising events, with the popular Midtown Idol as an example, working to raise funds for various organizations. 

The focus of Midtown is to help the businesses be profitable, allowing people to enjoy all the activities in the district, while maintaining collaboration with the City of Tallahassee and all the Midtown Merchants and residents. 

Come walk or ride the StarMetro Rhythm Route Trolley or a Pedicab and get a feel for all this unique area can offer your buyers! Download the Midtown App on your phone, “iheart midtown,” to start planning your fun (for Android and iPhone). 

Caryl Pierce
NAI TALCOR

Understanding Florida’s Property Tax Amendments, Part Four

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Amendment 1, approved by voters in 2008, details four provisions relating to property taxes. We have explored the portability elements of Save Our Homes (SOH) benefits, and we have highlighted the inclusion of an additional homestead exemption. A third provision of the amendment allows benefits for commercial properties and non-homesteaded properties alike.  

Similar to the longstanding SOH statute which caps assessed value for homestead properties, this provision caps the assessed value for commercial and non-homestead properties at a maximum increase of 10% annually. This includes retail properties, offices, industrial, multifamily housing, townhouses, rentals, and vacant parcels, among others. Essentially, all properties now benefit from annual limitations on assessed value increases. For homestead properties, the SOH provision caps the annual increase at 3%, while this new statute caps all other parcels at no more than 10% annually. 

However, one rule applies in the calculation of the 10% cap. The cap does not apply to the school board millage. Consider an example of a commercial property where the market value increased from $500,000 the previous year, to $600,000 in the current year. School board millage rates would apply to $600,000 while all other taxing authorities would apply their millage rates to $550,000 (previous year + 10%). The calculation of taxable value appears in the following table:                         

Example of Property with a 10% Cap – Taxable Value

Taxing Authority

Market Value

Previous Year Value of $500,000

Capped Forward at 10%

Taxable Value

City

$600,000

$550,000

$550,000

County

$600,000

$550,000

$550,000

MSTU-EMS

$600,000

$550,000

$550,000

School

$600,000

Does not apply

$600,000

Water Management

$600,000

$550,000

$550,000

From the table you will notice the taxable value applied to the school board millage is the market value, since the 10% cap does not apply. All other taxing authorities will apply millage rates to the capped value of $550,000.  

The fourth, and final, provision of amendment 1 offers benefits to business owners with a $25,000 exemption of the value of tangible personal property, and will be detailed in the next article in this series.  

Doug Will, AAS, CFE
Chief Deputy-Appraisal Services
Leon County Property Appraiser’s Office    

Threatened and Endangered Species

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Do Your Due Diligence: Environmental Assessments of Commercial Properties 

Bordered by water, but attached to the continent—almost an island, but not quite—Florida offers us a diversity of climates and temperatures, which results in a wonderful variety of plants and animals. As a result of our great climate, thousands of people move here every year and this puts pressure on native plant and animal species as their habitats disappear. The state and federal government are charged with protecting these imperiled species and they have a variety of laws and rules at their disposal. However, sometimes these laws come into direct conflict with the goals of a development project. Ideally, before land is purchased for a project, you should have an idea as to whether or not you have threatened or endangered species living there. 

“Threatened and endangered species” is a term used to describe a plant or animal that is at risk of becoming extinct. “Threatened” usually means that the organism is likely to become extinct in the future. “Endangered” means that the species is at the brink of extinction now.

There are many laws, both at the state and federal government level, that deal with endangered species. Starting at the top, the federal government protects many species under the Endangered Species Act of 1973. The U.S. Fish and Wildlife Service maintains the list of endangered, threatened, and imperiled species, and writes the rules that govern how we interact with them. 

Migratory birds come under the Migratory Bird Treaty Act of 1918. Some 800 birds are protected under this law. This also includes bird parts, such as feathers, and bird eggs and nests. Common protected birds that you may be familiar with include eagles, owls, hawks, ospreys, vultures, kites, and falcons. 

The State of Florida also has a list of protected species, managed under the Florida Fish and Wildlife Conservation Commission (FWC). The FWC list shows both the federal and state species. 

The most common species that you may find on a parcel of land are described below: 

Gopher tortoises (Gopherus polyphemus) are large, long-lived, terrestrial reptiles that are commonly found in sandy soils in uplands. They prefer an open canopy (not a lot of big shade trees) as they need sunlight to maintain body temperature. They also prefer a diversity of groundcover plants for food, and an open understory so that they can move around with ease. Gophers are considered a keystone species; over 300+ other species depend on the gopher tortoise for survival, as they live in their distinct, deep burrows. Gophers are listed as Threatened by FWC and, as such, you are not allowed to disturb them or their burrows. You must obtain a permit from the FWC if you need to relocate a tortoise. 

Permitting and relocating tortoises can be an expensive undertaking. As part of your due-diligence period, it would be wise to assess the property to see if it contains the proper habitat for tortoises and, if so, to hire an experienced, authorized gopher tortoise agent to conduct a survey to see if there are any burrows. A list of agents is found at the FWC online locater map

If gopher tortoise burrows are found, your best option is to modify your proposed development plan to avoid them. If you can’t do that, you may want to begin the permitting process to relocate them. If the abundance of burrows is high, or the cost to relocate is prohibitive, then maybe that property isn’t right for your project at this time. 

The other threatened and endangered species that you may have on your property are raptors (nests), which mostly include ospreys (Pandion haliaetus). Ospreys are protected both by the FWC in Florida and by the U.S. Fish and Wildlife Service under the Migratory Bird Treaty Act of 1918. Permits are required to remove inactive nests, and active nests can be removed only if they are providing a safety or health hazard, such as nesting on a power pole; here are nest removal guidelines. Osprey nests are typically found in wetlands or near waterbodies, so it is likely that your project will avoid them anyway. 

While the bald eagle is no longer on the official endangered species list due to its continued recovery, it still has protection under the Bald and Golden Eagle Protection Act of 1940, and the Migratory Bird Act. So you still need a permit to disturb a nest. 

Endangered plants also have protection status, and while you don’t have removal and relocation permitting issues typically, you might find that their presence can impact the overall assessment that a government agency makes on your parcel. A local government, for example, may require you to avoid a certain area with protected plants, or provide mitigation for their potential destruction.

As always, finding out about potential problems on your site before you enter into your final contract phase are well worth a little upfront time and cost to fully understand what you are getting into. 

You’ll be glad to know, by the way, that fire ants and yellow flies aren’t protected under any laws. 

Valerie Weeks
The Phoenix Environmental Group, Inc.

Volunteer Spotlight: Guardian ad Litem

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TBR member Brian Sealey (Keller Williams Town & Country Realty) is Chair of Guardian ad Litem’s 501©3 Child Advocates II (CAII). 

“Children are the greatest gift God will give. . . their souls are the heaviest responsibility He will place in your hands.” ~ Lisa Wingate 

Children in the foster care system are a demographic largely overlooked and forgotten. According to the U.S. Department of Health and Human Services, an estimated 400,000 children are in the foster care system during a fiscal year. When it is reported that a child’s home is no longer safe, a judge may appoint a committed volunteer to help them. That volunteer is called a Court Appointed Special Advocate, or Guardian ad Litem (GAL). 

The Guardian ad Litem volunteers are screened, highly trained, and sworn into service by a judge. These volunteers advocate for a child’s best interests in the child protection system. Working with DCF and the court, GAL volunteers save not only taxpayer’s money (fourth year in a row recipient of the Florida Tax Watch Prudential Davis Productivity Award), but also children’s futures by helping children find safe, permanent homes as soon as possible. 

As an advocate for abused families and Chair of its 501©3 Child Advocates II (CAII), I am firmly and humbly dedicated to the powerful mission of this organization—the mission to support and promote court-appointed volunteer advocacy so that every abused and neglected child can be safe from harm, establish permanency, and have the opportunity to thrive. Led by Executive Director Deborah Moore, the local Second Judicial Circuit, Guardian ad Litem Program has been taking a stand for abused and neglected children involved in the Juvenile and Domestic Relations Courts. 

Our vision is that we live in communities where every abused and neglected child removed from their home has a trained GAL volunteer until they secure a safe and permanent one. We seek to ensure children don’t get lost in an overburdened legal, social, and community service system or become forgotten in a foster home. Most of these children come through our doorways hurt, scared, and abandoned. A few even find their way to us due to the plight of poverty and homelessness. For many abused and neglected children, their GAL volunteer will be the one and only constant adult presence in their life. 

The opportunity for these children to not just survive but thrive has always been my ambition. In 2014, CAII in collaboration with the Guardian ad Litem launched two initiatives: First Beginnings and Beyond the Basics. Many youth move into their first home with no furniture and only an air mattress upon which to sleep. Often there is no family nor existing resources to provide household essentials like furniture, linens, and kitchenware; First Beginnings provides youth that are aging out of foster care with everything they need for their first home. Beyond the Basics is built on the belief that a school experience is beyond just paper, pens, and book bags. It was created to provide Guardian ad Litem children the ability to experience a normal and balanced education experience through financial and in-kind donations from individuals and companies throughout the community. With Beyond the Basics, children can participate in educational camps, sports, and academic trips for which many of our kids qualify but couldn’t attend due to financial limitations. 

How can you help?  

First, and most importantly, maintain an awareness of child abuse and neglect as a growing problem in our communities. Speak with your neighbors, colleagues, and community organizations about the Guardian ad Litem program, its mission and work. 

Consider becoming a volunteer advocate for neglected and abused children. You will receive adequate training. Once certified, you will spend a few hours each month and you’ll have a professional supervisor to guide you along the way. 

Get involved with our local Child Advocates II non-profit. Child Advocates II, Inc. (CAII) is a charitable, 501(c)(3) not-for-profit, all-volunteer organization founded to support the GAL program. Through fundraising, CAII supports the Second Judicial Circuit Guardian ad Litem Program in providing for the needs of abused and neglected children in Leon, Gadsden, Wakulla, Jefferson, and Liberty counties. Established in 1988, CAII conducts fundraising and marketing activities to provide the needs of children by securing basic necessities such as beds, baby supplies, and clothing, which would not have been available with state agency support alone. 

We have hundreds of dedicated GALs—men and women encompassing all age groups and backgrounds. They work full-time, part-time, are retired, are students. Some GAL volunteers have only one case child; others opt to advocate for more than one or a group of siblings. Because of the unique nature of this advocacy work and the personal connection to a child, many GAL volunteers find that their service is the experience of a lifetime. 

I am a Voice for the Child…..will you join me? 

Brian Sealey
Keller Williams Town & Country Realty

Legal Update: Bilingual Contracts

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Florida is a state of many languages, and getting more so every day. You do not have to leave north Florida to hear French, German, Italian, Chinese, Vietnamese, and Spanish, even though the latter is the most prevalent behind English. So how do you draw a real estate contract and make sure that there is a meeting of the minds? 

You cannot take the position that this is America and everyone has to learn English, or at least do business in English. The consequences of such an approach may be unsettling. 

The Florida Supreme Court this year found that an arbitration clause in an English-language car sales contract was unenforceable upon a Spanish-speaking couple in Hialeah. 

Mr. and Mrs. Gonzalez emigrated from Cuba in 1997. In 2005, they purchased a new 2005 Dodge Caravan, trading in their older car. Shortly after, they determined the trade-in value was lower than the agreed price and sought to unwind the deal. But their trade-in car had been sold and the couple sued the dealership on various grounds, including fraud and trade practices. 

The Potamkin dealership in Miami-Dade County circuit court sought to have the case sent to arbitration, as that remedy was what was in the sales agreement. Circuit Judge Thomas Wilson determined that the arbitration provision had never been explained to the couple and was invalid. The Third District Court of Appeal reversed, but the Florida Supreme Court overruled the 3rd and sustained Judge Wilson. 

Justice Perry, writing for a 5-2 divided Supreme Court, said Judge Wilson followed the proper process in deciding the arbitration issue. To have arbitration, there must be a valid written agreement, there must be an arbitrable issue, and arbitration must not have been waived. 

When Judge Wilson determined that there was not a valid written agreement—i.e., it was in English and the couple speak Spanish—that was enough. It will be interesting to see what impact, if any, this has on other contracts in Florida.

Joe R. Boyd
TBR Legal Counsel
Board Certified Real Estate Attorney
Boyd & DuRant, P.L.

Backpacks for Kids

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Everyone’s enjoying their summer, but it’s not too early to start thinking Back-to-School! The Tallahassee Board of REALTORS® is collecting backpacks and school supplies in July and August to help local kids get a great start to the school year.

Simply drop off new backpacks and supplies (school supply lists are available at local stores) at TBR, and we’ll be sure they get to children in need through Big Brothers Big Sisters, the Children’s Home Society, and the Early Learning Coalition. Read below to learn more about these great local organizations and the TBR members who actively support them.

Big Brothers Big Sisters of the Big Bend
Sarah Kosturko (PrimeSouth Fezler, Russell and Ferrie) has been an in-school mentor for three years with Big Brothers Big Sisters:

“I chose the school setting as I felt the weekly consistency was important, as often the children in this program have little to no consistency in their lives. Some of the children come from very broken or strained family situations which makes this program so much more valuable than just aiding them in the educational system. Being a role model for my child is always life changing, both for me and for them—having someone for just an hour a week, who devotes full attention to them, cares about who they are, what their dreams are, and their personal growth, affects them profoundly. I am hopeful that by spotlighting this agency in the backpack drive that other REALTORS® will also see how one hour a week is virtually an insignificant sacrifice of our time when it is given to a child who is in need of hope for their future.” 

Children’s Home Society of Florida
Children’s Home Society of Florida (CHS) began in Jacksonville in 1905 as an adoption agency. In 1964 the Tallahassee office (North Central Division) started serving the eight counties of the Big Bend Region. CHS has transformed to an agency that supports kids who have been abused through its Child Advocacy Center, provides early interventions for kids with developmental delays, foster care and transitional living programs, and, of course, adoption services.

Ted Thomas (Thomas Mitchell Realty) was on the CHS Board of Directors for 13 years. During that time, he served as Chairman of the Chefs’ Sampler for two years, where they raised between $50-100,000 from the event, thanks to the great participation from the community. Ted also chaired the building fundraising committee, raising $2 million to build what is now a premier facility for the kids in our community and the surrounding counties.

Early Learning Coalition
Headquartered in Tallahassee, the Early Learning Coalition (ELC) proudly serves Gadsden, Jefferson, Leon, Liberty, Madison, Taylor, and Wakulla counties. Throughout the ELC’s history, the Board and staff have strived to provide a holistic service delivery system that is responsive to needs of families and communities while maintaining effective and efficient business practices supporting the following primary goals: children are ready for success when they enter school; and families have access to the quality child care services and assistance they need. The ELC staff work every day at effectively connecting approximately 7,000 children and their families to the early learning program that best meets the needs of the child and family. Working with a network of over 300 child care programs and local community partners, the ELC provides a comprehensive system of services.
 
Additionally, the ELC has a strong network of community partners and volunteers that are an integral component of the ELC’s service delivery system. Working with the community, the ELC is the catalyst working to help families be ready to work and children ready to learn.

MLS Update: Changes to Paragon 5

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Expiring Notifications: Addition of notice for 1-year renewal. For clarification, verbiage has been added to the Expiring Notifications modal that informs the user that renewing a notification will extend the expiration date to one year.

Client Connect:
Ability to customize Subject line for Client Notifications. This release adds customization for the user to modify the Subject line for Client Connect notifications via the Advanced Email window.
New Help section. A new Help button is now available within Client Connect that will open a tutorial video for clients on how to use the site.
New sorting options. For ease of use, sorting options are available for the client to sort the results by Update Date, Highest to Lowest Price, and Lowest to Highest Price.
Navigation controls added to the bottom of results view pages. The Client Connect interface navigation controls are now available at the bottom of the Client Connect page, allowing clients to progress to the next results set without having to scroll back to the top of the page.

Contacts: Sort by Name, Last Notified and Last Accessed. Columns in the Contact Manger now will sort by Last Name, Last Notified, and Last Accessed.

CMA: Clarification of verbiage for Create New Subject Property. Create New Subject Property verbiage has been updated to further clarify that users may manually enter a subject property, along with the ability to copy an existing listing for conversion to an MLS number at a later time.

CMA Summary view and report views. An important design correction was made to the CMA Summary view which now allows users to email the report as a hyperlink with the ability to add additional report views in an email.

If you have questions about any of these changes, or need MLS or technology assistance, contact the CATRS Helpdesk at (850) 224-7713.

Paul A. Galloway
Manager of Association Technology
Tallahassee Board of REALTORS®
Capital Area Technology and REALTOR® Services