FISCAL NOTE TO

SENATE, No. 664

STATE OF NEW JERSEY

DATED: JULY 25, 1997

      Senate Bill No. 664 of 1996 provides that a person who lists for sale or rent, or who sells or rents a business or business opportunity which includes real estate for a commission (also known as a business broker), must be licensed as a real estate broker, salesperson or broker-salesperson, as appropriate, by the New Jersey Real Estate Commission pursuant to R.S.45:15-1 et seq.

      Pursuant to R.S.45:15-15, the biennial fee for each real estate broker's or real estate broker-salesperson's license is $100. The biennial fee for each real estate sale's person's license is $50.

      The Department of Banking and Insurance estimates that this bill will generate a total of 1,000 additional licenses under the applicable categories of licensure. Given the existing fee schedule of the New Jersey Real Estate Commission, the department projects additional fee revenue of approximately $100,000, of which half would be reflected in the first year following enactment, and half would be deferred into the second year given the biennial fee structure. However, according to the department, this estimated revenue would be more than offset by the annual costs of administering the bill, which the department estimates at $92,000 for salaries and wages for two full and two part-time positions.

      The Office of Legislative Services does not concur with the department's estimate of administrative costs, which it believes are overstated, and notes that in a previous fiscal note worksheet to the bill, the department had estimated annual administrative costs of approximately $4,000. This previous estimate noted that the anticipated 1,000 additional licenses could be processed in approximately 10 working days utilizing two part-time staff positions.

This fiscal note has been prepared pursuant to P.L.1980, c.67.