Michigan Independent Contractor Bill (HB 4390); It’s Sign Ordinance Season: Quick Links to Local Policies; and Rental Registration: A Prelude for Rent Control?
In this week’s GAD Top Three, we'll go over more information on the Michigan Independent Contractor Bill (HB 4390) which Michigan REALTORS® has called one of the most pressing issues in the real estate industry seen in years. Also, with the spring/summer selling season upon us, we'll review sign ordinances in our region, and lastly, we'll review a recent article that caught the attention of our CEO, Kim Pontius, as well as mine on rental registration being a first step towards rent control considerations.
1. Michigan Independent Contractor Bill (HB 4390)
Below is a recent update from Michigan REALTORS® regarding the Michigan House Bill (HB) 4390, introduced on April 12th and referred to the Committee on Labor that, if passed without any exceptions, would no longer define real estate agents as independent contractors. This is one of the most pressing issues in the real estate industry we have seen in years. An important reminder of the continued importance of supporting RPAC and our industry. You can also view more information on the importance of Independent Contractor Status to the real estate industry from NAR here.
Independent Contractors – HB 4390 – OPPOSE
What: This bill would eliminate the current common law test for independent contractor status in favor of the “ABC Test” made popular under California’s AB 5. The ABC test would build the test for independent contractor status down to 3 key elements.
a. The contractor is free from the control of and the direction of the payer in connection with the performance of the work both under contract or in fact.
b. The individual performs work outside of the usual course of the payer’s business.
c. The individual is customarily engaged in an independently established trade, occupation, or business of the same work performed by the individual for the payer.
Real estate agents and brokers have their own separate test for independent contractor status, already in statute. That definition recognizes the requirement of broker supervision, while still providing the flexibility and autonomy of a real estate licensee to act independently under a written agreement.
Why: Most of the testimony in the surprise committee hearing focused on the independent contractor status of construction employees and contractors. However, these bills have far-reaching implications beyond construction trades with a certain impact on gig workers and professional licenses. It would also muddy the water on our current test for real estate licensees.
Status: Michigan REALTORS® has spoken with bill sponsor and Chairman Rep. Jim Haadsma (D- Battle Creek) and he has assured us that he is interested in including real estate salespersons, brokers, and appraisers in a list of exemptions. The bills have not moved from committee after they received a first hearing.
2. It’s Sign Ordinance Season; Quick Links to Local Policies
With the Spring and Summer selling season now in full effect use it’s important to be aware of sign ordinance policies in local communities that you are listing and selling properties to best advocate for your clients within local sign restrictions. Below are some quick links to sign ordinance policies in Cities and Villages across the region. I am working on providing all townships as well to be available soon! This is a quick list, not fully comprehensive, contact the local city, township, or village in which you may be listing/promoting a property to insure adherence to any local ordinances:
- Village of Elk Rapids: Sec. 44-230 - Signage
- Village of Ellsworth: Zoning Ordinances for the Village of Ellsworth, Section 4.21 Signs (pages 32 to 35)
- Village of Mancelona: Zoning Ordinance Section 5.5 Signs (Pages 92 to 107)
- City of Frankfort: Zoning Ordinance Section 8205.15 Signs and Signage Standards (Pages 112 to 118)
- Village of Benzonia: Zoning Ordinance Article XIII Signs (Pages 52 to 60)
- Village of Beulah: Zoning Ordinance Article IX Sign Regulations (Pages 56 to 65)
- Village of Elberta: Zoning Ordinance Article 20.27 (Pages 57 to 58)
- Village of Lake Ann: Zoning Ordinance Article VII Section 11 (Pages 26 to 28) and Zoning Ordinance Article XVII Section 12 (Page 74)
- Village of Thompsonville: Zoning Ordinance Article 10: Signs (Pages 63 to 70)
- Traverse City: Code of Ordinances Chapter 1476 - Signs
- Village of Fife Lake: Zoning Ordinance, Sign Ordinance (Pages 37 to 41)
- Village of Kingsley: Code of Ordinances Section 152.227 Sign Regulations
· Village of Kalkaska: Land Usage Code Chapter 151: Signs (Pages 11 to 41)
- Village of Empire: Sign - Ordinance 142
- Village of Northport: Zoning Ordinance 2006 Article 6 - Signs and Billboards (Pages 44 to 46)
- Village of Suttons Bay: Zoning Ordinance Article 12 - Signs (Pages 122 to 131)
- City of Cadillac: Code of Ordinances Section 46-664
- City of Manton: Code of Ordinances Article IX - Signs
- Village of Buckley: Zoning Ordinance Article VIII - Signs (Pages 63 to 68)
- Village of Mesick: Sign Ordinance
3. Rental Registration of Inventory, a Foundation for Rent Control?
A recent article (Monterey Plan to Register Rentals Draws Opposition) came out in The Carmel Pine Cone, a local newsletter in California, which caught the attention of our CEO, Kim Pontius, as well as my own. The City of Monterey, a city located on a little under 9 square miles with a population of just over 30,000, is just starting to implement a rental inventory program effective as of June 18th. The City of Monterey has stated the intent of this program is to aid in the development of “policies to provide equitable access to affordable housing in Monterey.” This registry will track rental locations, types, and prices. With the intent likely to impose rent control as other jurisdictions around the country have done. I have covered some of the adverse effects of rent control in a previous GAD Top 3 (April 10th) and programs like this bear watching as there have been calls starting last year to end Michigan’s prohibition of rent control by state law. Keep an eye out as rental registration may just be a first step towards rent control that history has shown exacerbates housing shortages, disproportionally benefits higher-income households, and ultimately drives up rents.