REVISED
SESSION OF 2020
SUPPLEMENTAL NOTE ON SENATE BILL NO. 42
As Amended by Senate Committee on
Commerce

Brief*
SB 42 would define “rebate” for purposes of the Real
Estate Brokers’ and Salespersons’ License Act (Act) to mean
the return of all or a portion of any real estate purchase price,
whether by cash or cash equivalent (which could include gift
cards, prepaid credit cards, or other similar items of value)
which is agreed to between a licensee and client or customer
before closing and is contingent upon the transaction closing.
A rebate also would include the return of all or part of a
licensee’s commission or compensation to a client that would
have the purpose of affecting the price specified in the closing
statement. Under continuing law, the Act prohibits the use of
rebates in a real estate transaction. The bill also would clarify
the definition of “interest,” as that term is used in the Act, to
mean a property interest in the real estate involved in the
transaction.

Background
The bill was introduced by the Senate Committee on
Commerce during the 2019 Session. In the Senate
Committee hearing on February 12, 2019, representatives
from the Kansas Real Estate Commission (Commission), the
Kansas Association of Realtors (Realtors), and Cartus
Corporation spoke in favor of the bill. The Chairperson of the
Commission expressed concern the Federal Trade
Commission could sue the State over alleged antitrust
____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
violations regarding the prohibition on rebates. After
determining the Commission had insufficient authority to
define a rebate, it was determined a legislative solution could
be necessary. On February 18, 2020, a representative of the
Realtors provided additional testimony in favor of the bill,
suggesting an alternative approach if needed.
No neutral or opponent testimony was provided.
The Senate Committee amended the bill by updating a
statutory reference.
According to the fiscal note prepared by the Division of
the Budget on the bill as introduced, the Commission
indicates the bill would have no fiscal effect on its operations.


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Statutes affected:
As introduced: 58-3035
As Amended by Senate Committee: 58-3035