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ADDITIONAL INFORMATION SUBMITTED FOR INCLUSION IN THE RECORD-Con.

Barnes, Hon. James I, III:

Attachments to prepared statement:

Exhibit A: Landex, Inc., et al. v. State of Nevada, et al., Supreme
Court of Nevada decision_

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15.

Exhibit B: "The Regulation of Land Sales in Virginia," paper by
Thomas L. Stringfield----.

16

Prepared statement.......

14

Responses to questions of Congressman Gonzalez..

19

Belin, J. B., Jr., prepared statement on behalf of the American Land Development Association__

California State Department of Real Estate, prepared statement on behalf by John E. Hempel, assistant commissioner for policy and planning....... Federal Trade Commission, Bureau of Consumer Protection, prepared statement on behalf by Edward D. Steinman, Acting Assistant Director, Division of Marketing Abuses__.

Florida Division of Land Sales and Condominiums, Department of Busi-
ness Regulation, prepared statement on behalf by Gordon Pferish,
director

Halloran, Jean, prepared statement on behalf of INFORM
Hempel, John E.:

Attachments to prepared statement:

Attachment 1: Statement by Chief Counsel W. J. Thomas before
Government Operations Committee, Arizona State Legislature,
November 9, 1977--

269

591

56

658

85

601

Attachment 2: Extract of special subdivision laws and regulations
in California dealing with land projects - - - -

609

Attachment 3: Samples of filing forms of the California State
Department of Real Estate..

614

Attachment 4: Letter to Chairman Ashley, dated July 31, 1978,
with attachments__

641

Prepared statement on behalf of the California State Department of
Real Estate__

592

INFORM, prepared statement on behalf by Jean Halloran

85

McClory, Congressman Robert, letter dated July 28, 1978, with attached

letter dated May 22, 1978, from Jack L. Lawson, executive vice president, Elgin (Ill.) Board of Realtors...

683

Minish, Hon. Joseph G.:

Brief summary of H.R. 12574, a bill to revise the Interstate Land Sales
Full Disclosure Act

Summary of problems in the Nelson bill, S. 3084_

888888

66

National Association of Realtors, prepared statement on behalf by David
D. Roberts, vice chairman, Realtors Legislative Committee__
Office of Interstate Land Sales Registration, prepared statement on behalf
by Patricia Worthy, Administrator__

320

469

Pferish, Gordon, prepared statement on behalf of the Florida Division of
Land Sales and Condominiums, Department of Business Regulation ___
Roberts, David D.:

Abrahams, Albert E., staff vice president, National Association of
Realtors Government Affairs Department, statement before Senate
Committee on Banking, Finance and Urban Affairs, May 26, 1978__
Prepared statement on behalf of the National Association of Realtors_
Statement before House Committee on Banking, Finance and Urban
Affairs, April 11, 1978, with attached correspondence.
Table submitted comparing the Nelson provisons of S. 3084 with the
Minish proposals of H.R. 12574_.

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Prepared statement on behalf of the National Association of Home
Builders.

441

Steinman, Edward D.:

Prepared statement on behalf of the Bureau of Consumer Protection,
Federal Trade Commission___.

566

Response to request of Chairman Ashley for additional information..

676

Worthy, Patricia:

Prepared statement on behalf of the Office of Interstate Land Sales

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469

498, 499, 555

505, 561 496

THE INTERSTATE LAND SALES FULL DISCLOSURE

ACT AMENDMENTS

TUESDAY, AUGUST 1, 1978

HOUSE OF REPRESENTATIVES,

COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS,
SUBCOMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT,
Washington, D.C.

The subcommittee met at 10:30 a.m. in room 2212 of the Rayburn House Office Building, Hon. Thomas L. Ashley (chairman of the subcommittee) presiding.

Present: Representatives Ashley, Gonzalez, AuCoin, Brown, and Grassley.

Also present: Representative S. William Green of New York.
Chairman ASHLEY. The subcommittee will come to order.

This morning, the House and Community Development Subcommittee begins 3 days of hearings on the Interstate Land Sales Full Disclosure Act and the administration of this act by the Office of Interstate Land Sales and Registration [OILSR] in the Department of Housing and Urban Development.

Congress, 10 years ago, passed the Interstate Land Sales Full Disclosure Act in response to evidence of widespread abuses in the sale of undeveloped land. Many people bought land, sight unseen, on easy installment payment terms. They relied on the developers' assurances and seductive advertising campaigns that promised secluded home sites and good investments.

Many of these investments turned out to be worthless. The land was underwater or without water. The developer went bankrupt before providing promised amenities. Title to the land was encumbered after the land was sold pursuant to installment contracts. Often, there was no resale market for the land, whatever.

The essence of this act is that a fully informed consumer will make a reasoned investment decision. While the intent of the act is laudable to prevent fraud by assuring that consumers are adequately informed and to provide remedies for fraud when it occurs-the act and its administration by OILSR have not escaped criticism.

The land sales and building industry have criticized some requirements for being burdensome and being contrary to congressional intent. Many consumers believe that disclosure without substantive standards provides weak protection and that existing legal remedies are inadequate.

This debate has raised several significant issues that these hearings will address. We now have the opportunity, based on 10 year's experience, to review the act in its entirety and to legislate necessary changes.

Among the issues we will consider are the following: First, the Federal role in regulating intrastate sales of undeveloped land; two, whether fraudulent and unfair practices are any less prevalent in developments which differ in size, type, or location; three, the usefulness of requiring full disclosure without establishing substantive standards; four, the burden which existing law and regulation places on builders and developers; and five, the adequacy of existing consumer remedies.

Several bills are before this subcommittee: H.R. 11265, which contains the administration's proposals, H.R. 12574, introduced by our colleague, Mr. Minish, and S. 3084, which contains amendments passed by the Senate. In addition, the Office of Interstate Land Sales Registration has proposed regulatory changes based on existing law.

[Excerpts from H.R. 11265, the full text of H.R. 12574, and S. 3084, together with a table "Comparison of Proposed Statutory and Regulatory Changes to Interstate Land Sales Full Disclosure Act," and staff summaries of H.R. 12574, H.R. 11265, and S. 3084, follow:]

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