A Conversation with Michael Schoonover, Commercial Legislation & Regulatory Advisory Board Chair
Commercial Connections (CC): You have a long track record of success as a REALTOR®, both in your own business career and serving as an advocate on the political front. Do the two roles complement one another?
Michael Schoonover (MS): Absolutely. Being actively involved in the organization – at any level - helps your business because it builds your network. I can pretty much call someone I know in any part of the country because of my work at NAR. It’s also helped with clients. For example, I’m a strong supporter of the Main Street Tax Fairness Act, which seeks to establish an effective way to tax internet sales. That’s helped me with small business owners in my market who see I’m out there helping them and fighting to protect their right to do business.
CC: While it may seem like little is happening in Washington, D.C., political battles and stalemates at the local, state, and national level are nothing new. What should members be doing to remain involved and advocate for our industry?
MS: It’s true we are at a stalemate. In particular, the lack of nominations and confirmations for political appointments at the national level is slowing us down because we can’t go to anyone to advocate. Talking to our local senators and congressional representatives and pushing them to help fill these appointments is key. What happens too often when we go up on the Hill to meet with our congressional delegation is we say “we want this, please do that.” But sometimes what we need to be saying is “here are some things we support. What can we do to help?”
CC: In your position as Chair of the Legislation and Regulatory Advisory Board, you have an inside perspective on the pressing issues NAR is addressing. What key legislative and regulatory issues are you currently watching most closely?
MS: First of all, appraisal issues impact both the residential and commercial sides of the organization so we must continue to monitor this issue.
Next is 1031 Like Kind Exchanges, which are such an important piece of commercial real estate. There is currently a push in congress to allow 100% costing within the first year of a transaction, but you can’t cost out the land. There are areas in my state of Washington where the land might be worth as much or more than the improvements. So that’s scary. In my experience, it’s not really the huge corporations that do many of the 1031 transactions. It’s the mom and pop businesses with a half dozen or less employees that are able to sell a building and acquire a larger one where they can then hire more people. 1031s create jobs.
The third is the Main Street Tax Fairness Act, which taxes internet sales. We need to provide a level playing field on tax issues. I strongly believe the small business people are the ones that grow our economy.
CC: What value does NAR’s focus on advocacy provide to commercial practitioners?
MS: When I first got my license, I joined a firm. I had to pay my REALTOR® dues and I kind of felt I wasn’t getting anything out of it. But then I started going to meetings at my association and I saw they were doing things to change our market. I decided to get more involved because I learned NAR protects property rights and watches over tax issues. These are vitally important.
But it’s more than that. If you aren’t making money off of your membership then you aren’t paying attention. There are discounts on things like rental cars and computers. There is education from RLI, IREM®, SIOR, and CCIM and if you look at the people who hold those designations they make far more money than the folks who don’t. A big part of that is the networking, getting to know people all over the country and world. You’ve got to take advantage of what you are paying for by getting involved.
CC: What advice do you have for members who might want to follow in your footsteps and become more involved in legislative and regulatory matters at the local, state, or national level?
MS: If you’re going to learn the real estate business you are going to need a good mentor.
I was state president of the Washington Association of REALTORS® – the first commercial member to hold that position in 35 years. My goal was for five of the people who sat on my executive committee to follow me and become future State Presidents. So far three of them have done so. That’s what we as leaders need to do. A lot of young people don’t realize we want to mentor you. We aren’t going to be here forever. We need to replace ourselves.
It’s key to look around at your local and state association and see who is active. Then ask them if you can shadow them and see how they work. A lot of stuff happens at the local level that requires advocacy and it’s important for younger commercial members to be involved. For instance, here in Seattle a capital gains tax might pass and it could hurt our local economy and commercial markets. A less experienced member could get involved in that local issue, advocating against the measure, and develop the kind of background and understanding to build themselves up to the national level.