President's Letter
By Ray Kisor, MiCAR President
Grubb & Ellis/Paramount Commerce, Grand Rapids, MI

Dear Members,

Recently, MiCAR was pleased to become engaged with RocketScience Marketing to craft a plan to boost visibility as well as examine the perceived value of MiCAR by commerical REALTOR® members. Thank you to all who responded to the survey, your input is essential in developing top-line strategies for the future success of MiCAR communication initiatives and services to members.

This survey was created to analyze the following focus areas:

We learned that MiCAR must improve its service offerings and get full credit for the value it provides to members. Your board will consider a number of “upgrades,” some of which can be acted upon in the short term and others phased in over time. Look forward to further progress with this initiative as MAR, through MiCAR, remains committed to enhancing the business opportunities of our commercial members.

Repeatedly, members have asked for a single source to access information. To that end, this issue includes a link to key NAR commercial resources and a statewide commercial education calendar.

I am also proud that we are sponsoring a new commercial legal update at both the upcoming Synergy Conference and the West Michigan Summit. This legal update is specifically directed towards the commercial broker and will be led by MAR’s popular legal counsel Greg McClelland.

I look forward to continuing to best serve MiCAR members’ interests throughout this year and to the positive changes that will be implemented in order to create the most effective organization and valuable tools for commercial REALTORS®.

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MiCAR Public Policy Update

MAR launches grassroots opposition to Governor’s Tax Plan

It was recently confirmed that a 2% tax on various services, the main focus of Governor Granholm’s tax proposal, includes commercial real estate commissions. The complete list encompasses a number of other real estate fees. Clearly, this 2% plan is a devastating proposal on our real estate market. Now, Senate Bill 307 has been introduced, which includes Governor’s tax plan. MiCAR leadership is highly concerned about the effects this legislation will have on the commercial real estate industry in Michigan. Bill Martin, CEO of the Michigan Association of REALTORS®, stated, “There is a very negative implication for the real estate market and for our members in particular.”

The Michigan Association of REALTORS® remains strongly opposed to any tax on services. A “Call to Action” has been launched, and you can access it by clicking here.

In addition to a general real estate call to action, MiCAR members will receive a specific call to action in the future focused on the impact on the commercial sector. We encourage your immediate response.

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SBT Replacement Options - assessment phase continues

There is a lot of talk about taxes since the new legislative session began in January. Not only Governor Granholm’s proposed new 2% tax on services, including REALTORS® and other industry-related services, but also a replacement for the Single Business Tax (SBT) set to expire at the end of 2007.

Make no mistake; the Governor’s new 2% service tax is separate and distinct from her proposed SBT replacement, the Michigan Business Tax (MBT). While the new version of the MBT will seek to replace most of the revenue generated by our current SBT, the 2% tax on services is a tax increase to address the state’s budget and Governor Granholm’s push for 17 new programs that cost an estimated $1 billion.

As the situation stands, of all of the SBT replacement proposals circulating around the legislature three particular proposals have gained the most steam as serious contenders to replace the often maligned SBT: the MBT, the Senate Republican’s Business and Economic Stimulus Tax (BEST), and the Michigan Chamber’s plan which MAR played a part in crafting.

Depending on how a business is structured each plan has its own appeal. While all of the plans tax a combination of gross receipts, income, and provide some form of personal property tax relief, the MBT and BEST plans contain components of an asset tax. MAR is in the midst of working through each plan to determine their effects on commercial real estate and the state’s economy. Michigan stands at a crossroad to attract businesses and people to this state; it is just a matter of finding the right business tax to choose a path for the economy.

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Call for Speakers: 2007 CommercialSource.com

The REALTORS® Commercial Alliance is accepting speaker proposals for the 2007 CommercialSource.com, an online convention and trade show for commercial real estate to be held June 18 – 25. If you have insights or tips for success to share with others, this opportunity may be perfect for your presentation. Last year’s attendees logged more than 81,000 hits to the daily speaker sessions. Deadline for the speaker proposals is April 27. Complete your application form today. For more info, contact Peggy Luckey at 312.329.8821.

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Inform Staff and Clients About Tenants-in-Common

The RCA has created a brochure with information addressing issues surrounding tenants-in-common (TIC). This new investment vehicle, frequently used to complete 1031 exchanges does hold risks and rewards, so it's best to be informed up front. The brochure provides answers to questions on the business of a TIC transaction. How to talk to clients to help them evaluate elements of the TIC investment and the ethical considerations and risk management issues that apply when working with a client who wishes to acquire a TIC interest are also discussed.

Order the brochure with valuable information for real estate professionals from the REALTOR® store.

MiCAR Monthly
March 2007

• President's Letter

• Mergers Challenge Brokers

• Public Policy Update

• SBT Replacement Options

• Call for Speakers

• Tenants-In-Common

NAR - REALTORS® Commercial Alliance Resources

• Hot Topics

• Technology & Intelligence

• Commercial Report

• Real Estate Outlook

• RCA Report

• Commercial Power Tools