[FONT=‘Times New Roman’]Legislative Alert**: **
Inspectors of Texas:
Please understand, I could easily spend 3-hours on this email explaining what all has transpired over the past 48-hours. I will not burden you.
Unfortunately we were unsuccessful in our earlier attempt(s) today of getting this amendment of “mandatory” E & O insurance to SB914 ](http://www.legis.state.tx.us/tlodocs/80R/amendments/html/SB00914H21.HTM)removed as we thought we would as of late last night.
Below is my version of the TAREI position statement just sent to the following Legislators. Long story short, various individuals have not been telling the truth to our Lobbyist and relaying this information back to Sen. Shapleigh & Sen.Brimer’s offices.
As of 10:30 PM last night, we were told TAR was not in favor of this amendment and that they were going to help our cause. Today, as of 9:30 AM, we were told TAR was taking a “neutral” position. At 2:30 PM, we were told TAR was “in favor” of this amendment. As of 5:17 PM, this does not appear to be the case…or so we are now told from Mr. Mark Lehman w/TAR.
Per my conversation as of 5:15 PM with Sen. Shapleigh’s Chief of Staff, Eduardo Hagert, he stated both TAR & Sunset stated: “This amendment would benefit the Consumers in Texas”.
I encourage you to take immediate action to the following individuals. This exact letter (except Word protected) was just sent to the individuals below.
Please do not simply “forward” this position statement. Form/chain letters do us NO GOOD. I have sent this “unlocked/unprotected” Word document so you may cut/paste for the key points including any other positive comments you may add. Your comments should be positive regarding pros/cons on this amendment for the Inspection Industry.
As stated in the provided letter, if the “intent” for the amendment is Consumer Protection, why not add the Brokers/Agents to have mandatory E & O. You may also wish to consider adding language regarding E & O for Builders. Here’s another thing to ponder when contacting your Legislators…
With the proposed mandatory E & O insurance, every Inspector in Texas for fear of being sued for the most minute item (remember…you now have “pockets”) will now absolutely “nit/pic” & destroy every property Inspection they perform. I wonder how the RE community will respond when their deals fall thru…repeatedly.
Individuals that must be contacted to call/email are as follows. I would also encourage you to contact your Rep. & Senators from your respective areas as well.
Sen. Eliot Shapleigh
Eliot.Shapleigh@senate.state.tx.us
(O) 512 463 0129
Chief of Staff: Mr. Eduardo Hagert
Sen. Kim Brimer
(O) 512 463 0110
Chief of Staff: Ms. Jill Crocker
Rep. Vicki Truit
Vicki. Truitt@house.state.tx.us
(O) 512 463 0690
Rep. Byron Cook
(O) 512 463 0730
Rep. Lois Kolkhorst
lois.kolkhorst@house.state.tx.us
(O) 512 463 0600
Rep. Ruth McClendon
Ruth.McClendon@house.state.tx.us
(O) 512 463 0708
Rep. Dan Flynn
Dan.Flynn @house.state.tx.us
(O) 512 463 0880
Ladies & Gentlemen, we are faced with yet another example of how the Inspectors in Texas get slammed at the “11th hour” during a Legislative Session. We must act now. At this point, we have absolutely nothing to lose & possi bly everything to gain.
I implore you to let your voices be heard. We still have a shot of getting this amendment pulled from the Senate, but…time is quickly running out. You must take action this weekend so the Legislators get this first thing Monday morning.
Thank you.
Sincerely,
**Daniel F. South **
TAREI President 2007-2008
**May 18, 2007 **
Re**: Amendment to SB914 **
**Hon. Senator Shapleigh, **
**Texas Association of Real Estate Inspectors TAREI](http://www.tarei.com/) is considered to be the vanguard of the Inspection Industry in Texas since 1977. As current President, I urge you to pull the amendment to SB914, requiring E & O “liability insurance” for all TREC Inspectors. **
**Considering th e “11th hour” tactics utilized for this amendment, I have no choice but to release a Legislative Alert to all 4,400+ Texas Inspectors on this issue. Unfortunately, time is not on our side. I have compiled the following facts for your consideration in removal of said amendment: **
**1. As you are aware, Sunset completed their audit of TREC. On page 56 of the Sunset repo rt, FY05 resulted in 5,020 Complaints against Real Estate Brokers/Agents. Complaints on Inspectors were 235. The Inspector is the only non-biased, true third-party for Consumer protection in a real estate transaction. **
**2. If you look at the TREC provided data per their website for the past 10 years on Inspector complaints, the total numbers for violations and monies out of the Recovery Fund are: 53-Disciplinary Actions totaling $ 88,500. **
**3. With mandatory E & O, costs for Consumers on Inspections will automatically increase a minimum of 30-40% overnight. **
**4. Considering the option of mandatory E & O, the current system in place withi n TREC for more than 25 years for Complaint Resolution for Consumers, also known as the Recovery Fund will seize to exist. By Legislative mandate, this Fund is required to be kept at a minimum of $ 450,000 annually. I would suspect TREC’s Budget will have to find these monies thru another revenue stream as well. **
**5. This past year, TREC had an “Emergency Hearing” for reciprocity for Inspectors in other states (Louisiana) to practice in Texas. With inco rporating “mandatory” E & O insurance, this will surely eliminate the reciprocity agreement for other Inspectors attempting to establish their businesses in Texas. **
**6. For the mandatory E & O insurance, please consider the following: **
**Ø Many Inspectors cannot qualify for E & O for either the cost(s) or, if he/she has been involved with any form of previous Litigation. (This is almost guaranteed for exemption) **
**Ø There are approximately 6 Carriers in Texas who offer E &a mp; O for Inspectors. Out of the approx. 4,400 + Inspectors who will now be “required” to carry, who will write this policy and…at what cost? **
**Ø 2006 Sunset’s recommendations, nor TREC, nor TAR has recommended “mandatory” E & O for Inspectors. That said, if we look at the Sunset provided numbers from above with over 5,000 Complaints from Agents/Brokers, if this amendment was truly concerned about Consumer Protection, you would also include “mandatory” E & O for the Real Estate community (Agents/Brokers) as well. **
**Ø For certain, this requirement will cause numerous Inspectors to close their businesses. That said, for the individuals who simply cannot afford the 4,000- 7,000/year in costs for E & O, is the state of Texas prepared to generate a “Risk Management” E & O Insurance pool considering we are a “right t o work” state? **
**Another point of contention of said amendment is that we have confirmed as of this afternoon, neither TAR nor Sunset is in favor of this amendment. As requested on behalf of the Inspectors in Texas, why this amendment? **
**As eluded to, if in fact this amendment is to “take aim” at Consumer Protection, where is the public outcry? Where are the Consumers who have been harmed? **
**There are none as indicated by the Sunset Review process. The Recovery Fund appears to be working well today, as it has been for the past 25+ years. **
**I strongly urge you to remove the amendment from SB914. **
**Thank you. **
**Sincerely, **
**Daniel F. South **
TAREI President 2007-2008
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