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					                                                          MONTHLY LEGISLATIVE UPDATE
                                                           IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated Bill #       Name/Issue                                          Status                                          IREM Position/Comments
                      NONE AT THIS TIME


                                            The legislation includes an array of tax incentives for the
                                            production of renewable energy and energy conservation,
                                            including a five year extension of the $1.80/sf deduction for
                                            energy efficiency retrofits for commercial buildings. To pay for
                                            these incentives, Senate Democrats propose taxing "big oil"
                                                                                                                    IREM supports the extension of current
                                            which will make passage in the House difficult. The five year
                                                                                                                    energy-efficient tax deduction legislation as it
                                            extension is back in play in a modified version of the original HR
                                                                                                                    allows property owners to upgrade their
                       Renewable Energy and bill, which passed the House on 9/16, but has had some negative
            HR 5351/HR                                                                                              building systems with a suitable economic
  10/7/08               Energy Conservation provisions added as well, including mandated energy savings
               6899                                                                                                 benefit, but has significant concerns with other
                          Tax Act of 2008.  similar to HR 6, and drilling in protected areas. Passage in its
                                                                                                                    provisions in the modified bill that target
                                            current form is doubtful in the Senate.The Senate did pass an
                                                                                                                    specific goals without adding incentives to
                                            amended version of the House bill on Sept. 23rd, but the
                                                                                                                    help a property owner meet those objectives.
                                            legislation must now return to the House since it was modified.
                                            The 5-yr extension was successfully passed and signed by
                                            Pres. Bush as part of the Emergency Economic Stabilization
                                            Act of 2008. This tax excentive is now extended thru

                                               Permanent tax law stipulates a 29-year schedule for depreciating
                                               leasehold improvements, and term that everyone agrees is not
                                               logical. As a result, Congress has temporarily amended the
                                               schedule to allow for a 15-year period. Unfortunately, this is a
                                               temporary adjustment that expires every couple of years, the         IREM, in conjunction with other real estate
                                               latest being 12/31/07. Is thus must be included in an "extender"     organizations, supports the permanent
                                               bill, which retroactively continues the amendment for another 12     amendment to a 15-year schedule but realizes
            HR 6049 & S Leasehold Improvement
  10/7/08                                      to 24 month period. The House passed their version, the Senate       that Congressional budget restrictions make
               2886      Depreciation Schedule
                                               is considering passage of the "Extender" bill before Congress        this unlikely. Therefore, we continue to
                                               adjourns the Spring session. The Senate is still considering this    support the temporary amendment until a
                                               version but has not yet brought it to the floor for a vote. A 2-yr   permanent adjustment can be made.
                                               extension was successfully passed and signed by Pres.
                                               Bush as part of the Emergency Economic Stabilization Act
                                               of 2008. This depreciation schedule is now extended thru
                                                          MONTHLY LEGISLATIVE UPDATE
                                                           IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated    Bill #        Name/Issue                                        Status                                            IREM Position/Comments

                                                  Includes provision to treat carried interests (profits from private
                                                  equity & hedge funds, current considered investment income and
                                                  taxed as long-term capital gains) as ordinary income taxable up
                                                  to 35% (rather than 15%). Would dramatically affect the
                                                  economics of various real estate partnerships. Passed the US
                                                                                                                        While IREM supports the AMT relief and
                                                  House on 11/9 by a vote of 216 to 193, party line split. Also
                                                                                                                        accelerated depreciation schedules, it strongly
                                                  included extension of the AMT relief and accelerated
                                                                                                                        opposed the elimination of capital gains
                         Temporary Tax Relief     depreciation for qualified leasehold improvements. The Senate
                                                                                                                        treatment for carried interest in a real estate
  6/26/08      HR3996    Act of 2007 (including   is expected to consider this bill some time in December 07. Due
                                                                                                                        partnership, as this not only negatively
                           Carried Interest)      to the controversy on the carried interests issue, this provision
                                                                                                                        impacts existing partnerships, but treats more
                                                  has been removed from legislation at this time and Congress is
                                                                                                                        volatile stock market investments much more
                                                  instead focusing on AMT relief. It is anticipated that the tax rate
                                                                                                                        favorably than stable real estate investments.
                                                  provision will come back up some time in 2008 and needs to be
                                                  aggressively fought again. The House did successfully pass
                                                  this legislation on 6/25, and included the carried interst
                                                  provision. However, its passage thru the Senate is less

                                                  Known more for the rebates to taxpayers, this bill included two
                                                  provisions to benefit small businesses. The first permits a           IREM remains supportive of any such
                          Economic Stimulus       deduction as much as $250,000 of otherwise depreciable                measures that encourages owners to upgrade
                              Package             property acquired and placed into service during 2008. The 2nd        existing building systems and structures and
                                                  provision allows a bonus depreciation deduction for the cost of       achieve a reasonable economic benefit.
                                                  the improvement. Consult your tax accountant for details.
                                                                                                                        IREM supports the plan that would allow
                                                                                                                        business, particularly trade organizations, to
                                               With Health Care reform a topic of the 2008 presidential                 combine in selecting health insurance and
                         Small Business Health
  2/20/08                                      election, it is not anticipated that Congress will take up the           thus level the playing field, which currently
                                               issue during the 2008 term.                                              favors large corporations and unions which
                                                                                                                        can attain more favorable plans due to the
                                                                                                                        size of participating associates.
                                                         MONTHLY LEGISLATIVE UPDATE
                                                          IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated    Bill #        Name/Issue                                       Status                                           IREM Position/Comments
                                                 Contained in this legislation, which was signed into law on          IREM supports the extension of current
                                                 12/19/07 is a provision establishing deadlines for reaching "zero-   energy-efficient tax deduction legislation as it
                                                 net-energy" usage by commercial office buildings. All                allows property owners to upgrade their
                                                 commercial building constructed in 2030 and beyond must have         building systems with a suitable economic
                             The Energy          ZNE status. By 2040, 50% of the existing building stock must         benefit. IREM has expressed concern on
   2/2/08       HR6       Independence and       meet ZNE, and by 2050, all commercial buildings must meet this       legislation that seeks to establish a "zero-net-
                          Security Act of 2007   goal. However, there currently is no provision offering any kind     energy" goal with a specific timetable for
                                                 of economic benefit or incentive to meet this deadline and make      compliance without providing sufficient
                                                 upgrades feasible. Also, there are specific provisions that apply    economic benefits, like the tax deduction, that
                                                 to private buildings leasing space to the federal government,        would make the forced upgrades economically
                                                 essentially escalating the deadline for ZNE status.                  viable.
                                                                                                                IREM supports the permanent ban on the
                                                                                                                banking industry being allowed to enter the
                                                 The Senate Appropriations Committee included language in the real estate management-development
                                                 FY2008 appropriations bill that would permanent prohibit banks industry due to the possibility of banks then
                                                 from entering into the real estate brokerage, leasing and      having an unfair advantage on securing
  1/14/08                 Banks in Real Estate
                                                 management business. Previously, this "separation" has been in financing for development projects. The
                                                 a series of one-year understandings. A last minute negotiation permanent ban would also address the
                                                 reduced the ban to a 2-year term only, thru fiscal 2009.       current practice where banks are able to get
                                                                                                                exemptions through the FDIC and other
                                                                                                                banking regulatory commissions.
                                                 Seeks to revise the tax code by shortening the current 39-year       IREM has been supportive of such measures
                          HVAC Depreciation      depreciation schedule for commercial property owners that install    as a way of encouraging owners to retrofit
   1/7/08      HR4574
                             Schedule            certain HVAC systems to lower overall energy use. Is proposing       inefficient systems and still be able to achieve
                                                 a 20 - 25 year schedule.                                             a reasonable economic benefit.
                                                This bill is to extend the federal backstop program currently set
                                                to expire 12/31/07. The House passed their version on Sept. 19,       IREM supports this bill as it addresses the
                                                the Senate a different version on 11/16. The primary difference       escalating cost of insurance to cover acts
                             Terrorism Risk     being the length of the extension: House is for 15 years, the         related to terrorism and war by having the
  12/26/07     HR2761    Insurance Revision Act Senate's is for just 7 years. Bill now in committee for               federal government provide backing to the
                                of 2007         compromise. Compromise agreement settled on 7 years and               insurance companies for this type of
                                                was passed by both Houses. Sent to Pres. Bush for signature,          coverage, making it affordable to property
                                                which he has stated he will do. Signed into law by the                owners with at-risk buildings.
                                                President on 12/26/07.
                                                            MONTHLY LEGISLATIVE UPDATE
                                                             IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated     Bill #         Name/Issue                                        Status                                            IREM Position/Comments
                                                                                                                          On flood insurance, IREM wants to make sure
                                                   Included in this legislation is a provision about the responsibility
                                                                                                                          that any provision holds the occupant
                                                   of multi-family occupants obtaining flood insurance. This has
                                                                                                                          ultimately responsible for the purchase of
                                                   passed out of the House committee and is awaiting action on the
                          Flood Insurance Reform                                                                          such insurance, and not the property owner -
                                                   floor of the House itself. Also being discussed is the
               HR3355 &   and Modernization Act of                                                                        as some amendments have sought to
  11/17/07                                         establishment of a national catastrophe program that would
                S 2310       2007; and National                                                                           consider. IREM also supports the expansion
                                                   provide assistance to states in mitigating disasters. Currently,
                             Disaster Programs                                                                            of a national disaster relief program so that
                                                   such programs are largely available only to "high profile" areas
                                                                                                                          other areas (i.e. Midwest flooding or
                                                   threatened by hurricanes and earthquakes. Passed the House;
                                                                                                                          tornadoes) could also have access to these
                                                   Senate version of the bill is still in Committee.
                                                                                                                          federal programs of assistance.

                                                                                                                 Although voluntary, IREM is concerned that
                                                                                                                 the insurance and credit-rating industry could
                                                                                                                 seek to use compliance with this standard as
                                                 Signed into law by President Bush on 8/16, it includes a        a basis for evaluating and establishing
                               Implementing      provision for the Dept of Homeland Security to set up a program insurance and credit rates for property
                           Recommendations of certifying private sector buildings as meeting a "voluntary"       owners, which could in effect force real estate
  9/24/07        HR1
                          9/11 Commission Act of national standard for security/emergency preparedness. It is    to decide which negative financial aspect is
                                   2007          expected that DHS will adopt the NFPA 1600 standard for this    the greater evil - upgrading to a non-
                                                 program.                                                        mandated and potentially costly code
                                                                                                                 compliance to achieve lower insurance and/or
                                                                                                                 interest rates, or leaving the property at status
                                                                                                                 quo and still suffer due to higher rates.

                                                                                                                          There is some concern that in areas where
                                                                                                                          there is a preponderance of qualified
                                                    Legislation being considered to lower property taxes for senior
  12/4/07                 Homestead Act Reform                                                                            taxpayers, the lower income from property
                                                    citizens and others on a fixed income below certain levels.
                                                                                                                          taxes would need to be made up by raising
                                                                                                                          the mill levy accordingly.

                                                             MONTHLY LEGISLATIVE UPDATE
                                                              IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated      Bill #         Name/Issue                                        Status                                           IREM Position/Comments

                                                     Missouri is considering legislative proposals to increase the
                                                     penalties on theft of valuable metals. Current proposals are
                                                     vague and wide-ranging; it is unknown what bill language will
                                                     come out of committee over the next several weeks. We are
                                                                                                                          IREM supports this legislation as a way of
                                                     aware that Tennessee is currently considering similar legislation.
               HB 1511 &                                                                                                  reducing the increasing problem and expense
  6/16/08                        Copper Theft        Bill has made it out of Senate committee and is on its way to the
                SB 1034                                                                                                   of property vandalism and the theft of copper
                                                     House side for review. House has passed its version, now
                                                                                                                          in particular.
                                                     working thru Senate Compromise Committee. Final legislation
                                                     was signed into law by the Governor on May 21st. It takes
                                                     effect 8/28/08 and includes record-keeping requirements and
                                                     increased criminal penalties.

                                                                                                                     IREM supports movement toward energy
                                                                                                                     efficient buildings provided the legislature
                   HB                                Creates requirements and provides incentives for                understands that tax incentives are necessary
  5/16/08      2442/2575 &                           environmentally sustainable buildings. Versions being debated to make the cost of such programs
                             Sustainable Buildings
                 SB 1117                             in various committees with some hearings taking place.          economically feasible, particularly for existing
                                                                                                                     properties, and any timetable implemented
                                                                                                                     must factor in the cost benefit.
                                                     Exempts landlords from liability on any damage to personal
                                                     property resulting from the enforcement of a judgment for
                                                     possession and disposition of property. Passed out of           IREM supports this legislation as it protects
               HB 1801 &     Landlord Liability on
  5/15/08                                            committee; anticipate coming up for vote in 2008. Re-           landlords during execution of judgments
                SB 781        Personal Property
                                                     introduction of last year's bill, new public hearings have been against former tenants.
                                                     completed but still in Committees. Passed out of the House,
                                                     sent to Senate for consideration.
                                                                                                                          IREM understands the reasoning behind such
                                                     This bill amends state legislation from 2000 such that landlords     measures, attempting to have valid contact
                               KCMO Landlord         in Kansas City will be required to register with the State of        info on landlords who do not maintain their
  8/28/07       HB 1060
                                Registration         Missouri. Public hearings on this bill were completed in April but   rental properties, but is concerned that such
                                                     no further action has occurred.                                      legislation unduly penalizes those property
                                                                                                                          owners who are responsible landlords.
                                                          MONTHLY LEGISLATIVE UPDATE
                                                           IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated    Bill #        Name/Issue                                       Status                                            IREM Position/Comments

                                                  KCMO is considering an ordinance to penalize junk dealers who
                                                  do not keep records of who they purchase metals from.
                                                                                                                       IREM supports this legislation as a way of
                                                  Ordinance is contested by scrap metal dealers. Outlook
                                                                                                                       reducing the increasing problem and expense
  6/19/08      KCMO           Copper Theft        unknown at this time. It is noted that Memphis recently passed
                                                                                                                       of property vandalism and the theft of copper
                                                  an ordinance almost identical to that being considered by KCMO.
                                                                                                                       in particular.
                                                  Proposed ordinance has passed out of committee and will
                                                  be presented to the City Council for vote on June 26th.

                                                  City of KCMO charged businesses and property owners fees for
                                                  fire inspections without following due process for enacting such     Plaintiffs of the original lawsuit, including
                                                  taxes. Lawsuit filed against the City resulted in the practice       IREM members, have filed with the Court
                                                  being barred; City appealed and lost. Now the City states that it    requesting an investigation into the City's
                                                  no longer has the records of who paid such fees and has asked        claims and possible destruction of records.
                                                  the Court to require the business to provide proof of payment        IREM and fellow supporters feel it is the City's
  6/16/08      KCMO       Fire Inspection Fees
                                                  before getting a refund. With no other option, the City appears to   responsibility to contact and refund the fees.
                                                  be forced to ask Landlords to provide documentation of paid fees     At the same time, IREM is recommending its
                                                  to receive a refund. The process for doing so is still being         members compile their own records of
                                                  formulated. The City began sending out refund letters to payees      payments to verify against whatever
                                                  in mid-March requesting documentation to verify refunds that are     information the City does end up revealing.
                                                  due. Refund requests are due by JULY 15th.

                                                                                                                       This repeal, admittedly being done as a cost-
                                                 The City is wanting to repeal the ordinance that authorizes
                                                                                                                       cutting measure affecting the City budget,
                                                 payments to multi-family complexes in lieu of providing public
                                                                                                                       would noticeably increase expenses for the
                                                 trash removal services. Such services are provided to single
                                                                                                                       affected complexes, resulting in a negative
                                                 family homes as part of the KCMO earnings tax. The earnings
                            Repeal of Trash                                                                            impact to the value of the property. The City
                                                 tax would still be assessed on individuals in multi-family
  6/23/08      KCMO      Rebates to Multi-Family                                                                       is not agreeing to repeal the earnings tax on
                                                 complexes even if the trash rebate is repealed. KCMO is holding
                              Complexes                                                                                multi-family residents though, which is what
                                                 hearings to gather information prior to proceeding with a vote on
                                                                                                                       pays for the service to single family homes.
                                                 the proposal. The City Council sent this back to Committee
                                                                                                                       Such an act then discriminates against multi-
                                                 for reconsideration, given the opposition, and additional
                                                                                                                       family residents by forcing them to pay more
                                                 hearings are taking place.
                                                                                                                       for the same service single families receive.
                                                         MONTHLY LEGISLATIVE UPDATE
                                                          IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated    Bill #       Name/Issue                                         Status                                            IREM Position/Comments

                                                 KCMO is in the process of updating a number of development-
                                                                                                                        IREM continues to support eco-friendly
                                                 related provisions. Most notably, increasing the amount of
                                                                                                                        measures provided their impact on existing
                                                 acreage for stream setback constraints on new development.
                         Stream setback and                                                                             and new development is fully understood and
   6/4/08      KCMO                              Also, may be revising requirements to provide substantially more
                           green proposals                                                                              weighed prior to enactment, and that such
                                                 bicycle parking racks on commercial properties. KCMO is
                                                                                                                        measures do not end up stifling commercial
                                                 continuing to hold hearings to work through points of
                                                                                                                        real estate development.
                                                 contention by opposition.

                                                                                                                  While an attempt to gain more control over the
                                                 KCMO is looking at revising the current ordinances regarding
                                                                                                                  proliferation of various signs is admirable, a
                           Sign Ordinance        outside signage, making them more restrictive in size, placement
   5/2/08      KCMO                                                                                               knee-jerk reaction too far the other way harms
                              Revisions          and length of time to display. KCMO is holding hearings and
                                                                                                                  retail development and the needs of owners &
                                                 working with opposition to find compromise points.
                                                                                                                  brokers who depend on visual marketing.

                                                 KCMO passed an ordinance requiring defined owners of rental
                                                 property to annually register their property owners, one
                                                 registration for each building containing at least one rental unit.
                                                 The purpose is to have accurate contact info on all landlords,
                                                                                                                        KCMO and the State of Missouri already have
                                                 particularly those that violate building code regulations. There is
                                                                                                                        legislation regarding code compliance of
                                                 no fee assessed with the registration at this time. It also requires
                                                                                                                        rental properties, and appropriate avenues for
                                                 the property owner to either live in KCMO or designate an agent
                                                                                                                        contact information. Funding a new
  12/17/07     KCMO      Landlord Registration   who lives or has a business office in KCMO. The ordinance also
                                                                                                                        department to duplicate such measures is
                                                 creates a city division to inspect such properties for code
                                                                                                                        wasteful and again seeks to penalize
                                                 compliance, with fines to be assessed against violators that do
                                                                                                                        responsible landlords in an attempt to control
                                                 not correct issues within a certain time frame. This ordinance
                                                                                                                        other property owners.
                                                 goes into effect 1/1/08 with property inspections to begin after
                                                 5/1/08. NOTE: the annual registration is only free during the
                                                 month of Jan each year (on existing properties and owners);
                                                 a $50 fine, per month, starts Feb 1st for non-compliance.
                                                    MONTHLY LEGISLATIVE UPDATE
                                                     IREM Kansas City Chapter #15
       as of 10/7/2008

Last Updated    Bill #     Name/Issue                                      Status                                             IREM Position/Comments
                                                                                                                  While IREM acknowledges the intent behind
                                                                                                                  such ordinances - having accurate contact
                                                                                                                  info on problematic landlords - penalizing
                                            OPKS passed an ordinance requiring owners of single family,
                                                                                                                  responsible landlords is not supported. And
                                            duplex and tri-plex rental properties within the city limits to
               Overland   Rental Property                                                                         though the current ordinance does not apply
  11/7/07                                   register with the city. The fee is $10 per rental unit with a penalty
                Park       Registration                                                                           to large rental complexes, similar legislation in
                                            of up to $500 or 6 months in jail. This ordinance goes into effect
                                                                                                                  other areas has later been expanded to
                                                                                                                  include all rental properties, thus the potential
                                                                                                                  for a noticeable negative impact on property
                                                                                                                  values and rental rates.

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