ShareQ. How do I amend our bylaws to include new policy or make sure our bylaws match our current practice?
Your bylaws should have amendment procedures. Most associations amend bylaws by noticing the change in the call for the board of directors meeting and requiring approval by a majority vote of the members present and qualified to vote at any meeting with a quorum.
Some associations’ amendment procedures provide for automatic amendments to the bylaws for changes to mandatory NAR policies, such as the recently passed change to the Code of Ethics, and others provide for adoption of changes to mandatory National Association of REALTORS® policies with director approval. You’ll need to follow your procedures as written to properly make any changes to any bylaw provision (including changing the amendment procedure).
You have discretion to adopt the amendment procedure that works best for your association, unless state law has other requirements for amending the corporation’s bylaws. For example, you can choose amendments by director vote, membership vote, or a hybrid of the membership and directors, and automatic amendments for mandatory policy changes.
Whatever procedure you choose, you should provide for advance distribution of the amendments in the call for the meeting. The amount of advance notice required for bylaw amendments is a matter of local discretion, unless there are other state requirements. Any new amendment procedure adopted by the association must be reviewed with legal counsel to ensure consistency with state law.
Q. Do I need to recertify my bylaws with NAR after we make amendments?
Since 2018, NAR has been using a new, streamlined process for verification of bylaws compliance. There is no need to submit your bylaws for review by NAR staff, but you do need to fill out the online certification form to attest that your bylaws contain all NAR mandatory policies.
Because there is a change to mandatory policy in 2020, you’ll need to first update your policy and then submit the certification form. By now, you should have received an email from NAR staff advising that changes must be made to the mandatory bylaw provisions and requiring you to recertify that your bylaws contain the mandatory language including the update to the frequency of Code of Ethics training. Associations must complete the certification for continued insurance coverage.
You need only certify to NAR when there are changes to be made in your bylaws concerning the five mandatory provisions that NAR requires in all local association bylaws (Code of Ethics, professional standards and training, REALTOR® trademark, state and national membership, and dues). Revisions to your other bylaws, such as changes to director qualifications or how often directors meet, do not need to be reviewed or recertified by NAR staff. Comparatively, associations should revise the five mandatory provisions only after amendments are approved by the NAR Board of Directors and local associations are advised of the change, which ensures compliance with NAR policy and continued insurance coverage.
At the November 2019 NAR Board of Directors meeting, the board approved amendments to Professional Standards Policy Statement #48 (REALTORS® Code of Ethics Training) changing the frequency of Code of Ethics training from two-year cycles to three-year cycles with the current cycle now ending Dec. 31, 2021.
Q. Is adopting a new MLS policy the same procedure as adopting a new association policy?
In November, the NAR’s Board of Directors passed the MLS Policy Statement 8.0, also called the Clear Cooperation Policy. This policy must be adopted by all REALTOR® association-owned MLSs. The revision procedure for MLS rules and regulations depends on whether the MLS is operated as a committee of the association or as a wholly owned subsidiary of one or more REALTOR® associations. The specific procedure for amending the MLS rules and regulations is generally found in the local MLS rules and regulations.
If your MLS is operated as a committee of your association, then your MLS rules and regulations mostly likely require the MLS committee or MLS participants to approve any amendments to the MLS rules and regulations, which are then approved by your association’s board.
If your MLS is wholly owned by one or more REALTOR® associations, then your MLS rules and regulations most likely call for the MLS board to approve amendments or additions subject to final approval by the shareholder associations’ board. Associations and MLSs have discretion to adopt the amendment procedures for MLS rules and regulations that work best for them.
All changes to NAR Multiple Listing Policy become effective Jan. 1 of the year following their approval by the NAR Board of Directors. Unless specifically provided otherwise by the board, associations and MLSs have 60 days from the effective date of new or amended policies to adopt them locally. For the new Clear Cooperation Policy, local implementation is required by May 1, 2020.