ARSD Article 20:69 — REAL ESTATE BROKERS AND SALESPERSONS

          20:69:01:01.  Definitions. Words defined in SDCL chapter 36-21A have the same meaning when used in this article.

          Source: SL 1975, ch 16, § 1; 3 SDR 34, effective November 3, 1976; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:01:01, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-89.

          20:69:02:01.  Official office.Repealed.

          Source: SL 1975, ch 16, § 1; 7 SDR 31, effective October 6, 1980; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:02:01, 20 SDR 18, effective August 16, 1993; repealed, 24 SDR 172, effective June 16, 1998.

          20:69:02:02.  Commission action. The commission may take any action by a mail ballot or by a conference telephone call. In case of a conference telephone call, the executive director shall participate in the call and take minutes of the commission action. In case of a mail ballot, the results of the mail ballot shall be included in the minutes. A mail ballot or conference telephone call is a meeting of the commission.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:02:03.01, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-21.

          20:69:02:03.  Petition for declaratory ruling. Any person wishing the commission to issue its ruling as to the applicability to that person of a statutory provision, rule, or order of the commission may file a petition with the commission in substantially the following form:

State of South Dakota

South Dakota Real Estate Commission

          Pursuant to the provisions of SDCL 1-26-15, I, (name of petitioner), of (address of petitioner), am (title or capacity of petitioner), and do hereby petition the South Dakota Real Estate Commission for its declaratory ruling in regard to the following:

          1.  The state statute or South Dakota Real Estate Commission rule or order in question is: (here identify and quote the pertinent statute, rule, or order);

          2.  The facts and circumstances which give rise to the issue to be answered by the commission's declaratory ruling are:

          3.  The precise issue to be answered by the commission's declaratory ruling is:

          Dated at (city and state), this _____ day of __________ 20__.

_________________________

(Signature of petitioner)

          Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:07:01, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 1-26-15, 36-21A-89.

          20:69:02:04.  Commission action on petition. Upon receipt of a petition for a declaratory ruling, the commission may request from the petitioner any other information it requires for the issuance of its ruling. Following the receipt of the petition, the commission shall issue its declaratory ruling and serve a copy of it by mail on the petitioner.

          Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:07:02, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 1-26-15, 1-26-25.

          20:69:02:07.  Petition for contested case hearing. A person aggrieved by any action of the commission taken without a hearing may, within 30 days following the date of the commission action, petition the commission for a hearing to be held at a time and place established by the commission. The hearing is a contested case.

          Source: SL 1975, ch 16, § 1; 5 SDR 21, effective September 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:09:01, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 1-26-16, 1-26-18.

          Cross-Reference: Procedure to follow in contested cases, SDCL 1-26-16 to 1-26-29.

          20:69:02:08.  Petition for review of decision on contested case. Within 10 days after receipt of the commission's decision, a party to the hearing may file a petition with the commission for review of its decision. The commission, in its discretion, may deny the petition, order a rehearing, or direct any other proceedings it considers appropriate. Upon rehearing or other proceedings, the commission may affirm, reverse, or modify its earlier decision. Notice of the commission's decision on the petition to review shall be served by mail on the petitioner and other affected parties.

          Source: SL 1975, ch 16, § 1; 5 SDR 21, effective September 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:09:06, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 1-26-18, 1-26-25.

          20:69:03:01.  Application for license by examination. An applicant for license by examination shall file an application with the commission on a form provided by the commission within 60 days after the date of notice of having passed the examination. The application shall be accompanied by the fee prescribed by § 20:69:03:10.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:01, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-35.

          20:69:03:02. Proof of education to accompany application. An applicant for a license by examination shall submit proof that the applicant successfully completed the required education within the two years before the date of application.

          Source: 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 30 SDR 40, effective September 30, 2003.

          General Authority:SDCL 36-21A-31.

          Law Implemented:SDCL 36-21A-31.

          20:69:03:02.01.  Proof of passing score to accompany application. An applicant for license by examination shall submit proof that the applicant successfully completed the licensing examination.

          Source: 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-41.

          20:69:03:03.  Photograph to accompany application.Repealed.

          Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:02, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:03:04.  Authority to take examination. A person may not take the real estate examination unless the person has completed the prescribed prerequisite education and registered to take the examination.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:03:06, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 30 SDR 40, effective September 30, 2003.

          General Authority:SDCL 36-21A-30.1, 36-21A-89(2).

          Law Implemented:SDCL 36-21A-36, 36-21A-41.

          20:69:03:04.01.  Registering for examination. A person registering to take the real estate examination must complete the prerequisite education before submitting the registration.

          Source: 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-30.1, 36-21A-34, 36-21A-89(1).

          Law Implemented:SDCL 36-21A-36, 36-21A-41.

          20:69:03:05.  Failure to appear for examination. A person registered to take an examination must appear in person to take the examination as scheduled. If the person fails to do so, the person forfeits the examination fee and must register again to take the examination.

          Source: SL 1975, ch 16, § 1; 2 SDR 7, effective July 30, 1975; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:07, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-36, 36-21A-41.

          20:69:03:06.  Administration of examination. The licensing examination shall be conducted under the supervision of the executive director of the commission. The examiner shall require identification supplied to the registered person by the commission for admission to the examination room. Before beginning the examination, the person must state in writing that the person has not solicited or received any information concerning the contents of the examination about to be written and during or subsequent to the examination will not disclose its contents.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:08, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-36.

          20:69:03:06.01.  Testing service. The commission may negotiate an agreement with a testing service for examination development, administration, scoring, reporting, and analysis.

          Source: 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-36.

          20:69:03:07.  Passing score on licensing examination. The passing score on the licensing examinations is 75.

          Source: 7 SDR 31, effective October 6, 1980; 10 SDR 54, effective December 5, 1983; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:08.01, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-36, 36-21A-41.

          20:69:03:08.  Cheating on examination. The examination of any person who is caught cheating during an examination is void.

          Source: SL 1975, ch 16, § 1; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:03:09, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(1).

          Law Implemented:SDCL 36-21A-36, 36-21A-41.

          20:69:03:09.  Reinstatement of licensees discharged from armed forces. Application for reinstatement of a license by a former licensee discharged from the armed forces shall be made on forms provided by the commission.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; repealed, 12 SDR 102, effective December 22, 1985; readopted, 18 SDR 101, effective December 17, 1991; transferred from §  20:56:03:14, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-67, 36-21A-89.

          Law Implemented:SDCL 36-21A-67.

          20:69:03:10.  Application fee -- Brokers and salespersons. The application fee for brokers, including restricted brokers, and salespersons is $225.

          Source: SL 1975, ch 16, § 1; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:03:20, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-49.

          Law Implemented:SDCL 36-21A-49.

          20:69:03:11.  Reapplication fee -- Brokers and salesmen.Repealed.

          Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:03:21, 20 SDR 18, effective August 16, 1993; repealed, 24 SDR 172, effective June 16, 1998.

          20:69:03:12.  Application fee -- Firm license. The application fee for a firm license is $100.

          Source: SL 1975, ch 16, § 1; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:03:22, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-38.

          Law Implemented:SDCL 36-21A-38.

          20:69:03:13.  Biennial renewal fee -- Broker. The biennial renewal fee for a broker's license, including restricted licenses, is $125.

          Source: SL 1975, ch 16, § 1; 4 SDR 35, effective December 22, 1977; 7 SDR 31, effective October 6, 1980; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 13 SDR 31, effective September 23, 1986, effective January 1, 1988; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:03:23, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-61.

          Law Implemented:SDCL 36-21A-61.

          20:69:03:14.  Biennial renewal fee -- Salesperson. The biennial renewal fee for a salesperson's license is $125.

          Source: SL 1975, ch 16, § 1; 4 SDR 35, effective December 22, 1977; 7 SDR 31, effective October 6, 1980; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 13 SDR 31, effective September 23, 1986, effective January 1, 1988; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:03:24, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-61.

          Law Implemented:SDCL 36-21A-61.

          20:69:03:15.  Biennial renewal fee -- Firm. The biennial renewal fee for a firm license is $125.

          Source: SL 1975, ch 16, § 1; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 13 SDR 31, effective September 23, 1986, effective January 1, 1988; 15 SDR 100, effective January 10, 1989; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:03:25, 20 SDR 18, effective August 16, 1993; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-61.

          Law Implemented:SDCL 36-21A-61.

          20:69:03:18.  Transferred to §§ 20:69:16:01 and 20:69:16:02.

    20:69:03:21.  Reciprocal agreements. Repealed.

    Source: 20 SDR 18, effective August 16, 1993; 48 SDR 60, effective December 6, 2021.

    20:69:03:22.  Nonresident licensee as applicant -- Certificate of licensure required. A nonresident licensee who is an applicant for licensure in this state shall submit a certificate of licensure from the licensing agency of the current state in which the applicant holds an active license. The certificate of licensure shall be completed within 30 days before the date of application, stating that the applicant's license is on active status and in good standing and that no complaint is pending.

    Source: 20 SDR 18, effective August 16, 1993; 35 SDR 305, effective July 1, 2009; 48 SDR 60, effective December 6, 2021.

    General Authority: SDCL 36-21A-54, 36-21A-89(3).

    Law Implemented: SDCL 36-21A-54.

          20:69:03:23.  Supervising broker to be licensed in South Dakota. A licensed nonresident salesperson or broker associate shall be associated with a licensed South Dakota broker or a nonresident broker licensed by the commission.

          Source: 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(3).

          Law Implemented:SDCL 36-21A-54.

          20:69:04:01.  Application for approval of classroom instruction. A course provider desiring to give approved classroom instruction to prospective real estate licensees shall apply on a form provided by the commission. The application must be filed with the commission at least 30 days before the course begins.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:01, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-31, 36-21A-34.

          20:69:04:01.01.  Certificate of approval. The commission shall grant a certificate of approval for each course of study approved by the commission. The certificate is valid for three years.

          Source: 24 SDR 172, effective June 16, 1998.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-34, 36-21A-89(4).

          20:69:04:01.02.  Criteria for approval of classroom instruction. The application form for approval of classroom instruction shall include the following information and enclosures:

          (1)  Name, address, and telephone number of the course provider;

          (2)  The title of the course;

          (3)  A complete description or copies of all materials to be distributed to the participants;

          (4)  The date and exact location of each presentation of the course;

          (5)  The duration and time of the course;

          (6)  A comprehensive, detailed outline of the subject matter together with course objectives, the time sequence of each segment, the faculty for each segment, and the teaching technique used in each segment;

          (7)  The method of evaluation of the program;

          (8)  The procedure for measuring attendance; and

          (9)  A description of the faculty, including name, professional educational background, and practical or teaching experience. A complete résumé may be furnished.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

    20:69:04:04.  Contents of responsible broker course. The responsible broker course is a course in brokerage. The course must be a minimum of 24 hours long and contain a final examination which demonstrates knowledge of the subject areas. The course must include the following subject areas:

    (1)  Advertising compliance;

    (2)  Brokerage best practices;

    (3)  Business ethics;

    (4)  Business and strategic planning;

    (5)  Compensation planning;

    (6)  Policy review and risk management;

    (7)  State specific contracts;

    (8)  Exit strategies, including selling and transferring of ownership;

    (9)  Human resource essentials, including instruction on the differences between an employee and an independent contractor;

    (10)  Legal issues; and

    (11)  Trust accounting and finance.

    Source: 2 SDR 7, effective July 30, 1975; transferred from § 20:56:04:21, 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:02.03, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997; 30 SDR 40, effective September 30, 2003; 35 SDR 305, effective July 1, 2009; 49 SDR 51, effective November 27, 2022.

    General Authority: SDCL 36-21A-31.

    Law Implemented: SDCL 36-21A-31.

          20:69:04:07.  Application for credit for alternative courses. An application for credit under § 20:69:04:06 must be accompanied by an authenticated transcript from the college, university, vocational school, or prelicensing education school and a description of the course or courses completed.

          Source: 2 SDR 7, effective July 30, 1975; transferred from § 20:56:04:23, 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:04:02.06, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-31, 36-21A-34.

          Law Implemented:SDCL 36-21A-31, 36-21A-34.

          20:69:04:08.01.  Instructors. No instructor may teach prelicensing courses unless approved, by name, by the commission. However, a guest speaker may teach a designated section of a prelicensing course pursuant to § 20:69:04:08.03.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:08.02.  Application for approval of instructor -- Guest speakers exempt. An applicant for instructor approval shall apply on a form provided by the commission. A guest speaker is exempt from making application if requesting approval pursuant to § 20:69:04:08.03.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:08.03.  Utilization of guest speakers -- Résumé to accompany course application. A course provider may utilize guest speakers with expertise in a particular area in any approved course if an approved instructor is present at the time of the presentation. A course provider may utilize a guest speaker without an approved instructor present with the prior written approval of the commission.

          An application for approval of a course utilizing guest speakers must include a résumé of each speaker.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:08.04.  Certificate of instructor approval -- Approval certificates not issued to guest speakers. The commission shall grant a certificate of approval for each instructor approved by the commission. Certificates of approval will not be issued to guest speakers who make application pursuant to § 20:69:04:08.03.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:09.  Educational facilities. An approved course of instruction must have the classrooms and other facilities and personnel necessary to implement the program as determined by the real estate commission.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:04, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4)

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:09.01.  Instructional techniques. Classroom courses must be presented to students through interactive instructional techniques. Interactive instruction includes providing a student the opportunity for immediate exchange with an instructor in a classroom setting and immediate assessment and remediation through computer assisted or other audio or audiovisual interactive instruction. An instructor may not provide instruction primarily by having students read text material, listen to audio tapes, watch video tapes or films, or study questions similar to those on the state licensing examinations.

          Source: 26 SDR 41, effective September 29, 1999; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:10.  Approval of classroom instruction, distance education, or independent study course. Prior to the contemplated date of opening, the commission shall notify the applicant in writing of its decision to grant or deny approval. No applicant may accept students without the commission's approval.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:05, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:10.01.  Auditing. The commission may audit courses.

          Source: 24 SDR 172, effective June 16, 1998; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:11.  Withdrawal of approval for course or instructor. If the commission at any time determines that a person or course approved pursuant to chapter 20:69:04 is not continuing to meet the requirements of SDCL chapter 36-21A and this chapter, it shall immediately notify the course provider in writing detailing the deficiencies requiring correction. The school's approval by the commission shall continue 90 days from the date of the commission's written notice to the course provider, and if, at the expiration of that period, the course provider has failed to correct to the commission's satisfaction the deficiencies noted, the commission may withdraw approval of the course or instructor.

          If the commission disciplines an instructor who holds a real estate license for acts committed as a licensee, the commission may also withdraw that licensee's approval as an instructor.

          Source: SL 1975, ch 16, § 1; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:08, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          Cross-Reference: Procedure to follow in licensing matters, SDCL 1-26-16 to 1-26-19.1.

          20:69:04:11.01.  Denial of approval for course or instructor. The commission may deny approval of a real estate course or instructor if it determines that either is not in compliance with SDCL chapter 36-21A and this article. Any person aggrieved by denial of approval by the commission may file a written request for a hearing pursuant to § 20:69:02:07.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

          Cross-Reference: Procedure for a contested case, SDCL chapter 1-26.

          20:69:04:12.  Withdrawal of approval for inactivity. The commission may withdraw its approval for any course that has not been offered for at least one year.

          Source: 7 SDR 31, effective October 6, 1980; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:08.01, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:13.  Credit for previously unapproved courses. A person completing any course which has not received prior commission approval shall submit a complete list of the courses taken, the number of hours of study for each course, and the qualifications of the instructors and shall answer any additional questions which the commission may have. After review of the information, the commission may approve the course and give the applicant credit for meeting all or a portion of the educational requirements imposed by SDCL chapter 36-21A.

          Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; 18 SDR 101, effective December 17, 1991; transferred from § 20:56:04:10, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001; 30 SDR 40, effective September 30, 2003.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31.

          20:69:04:15.  Length of course. No more than eight hours of instruction may be offered in one day.

          Source: 2 SDR 7, effective July 30, 1975; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:14, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:16.  Examination. A final examination must be given in each course. A copy of the final examination and the answers must be filed with the commission.

          Source: 2 SDR 7, effective July 30, 1975; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:15, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:17.  Reexamination. A candidate for a license who fails the final examination of a prelicensing course may retake the examination without retaking the education.

          Source: 15 SDR 100, effective January 10, 1989; 18 SDR 101, effective December 17, 1991; transferred from § 20:56:04:15.01, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(2).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:18.  Schedule. A schedule of all courses offered, including the date, time, and place where they will be offered, must be furnished to the commission before the courses begin.

          Source: 2 SDR 7, effective July 30, 1975; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:04:16, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34.

          20:69:04:19.  Prelicensing education certificate of attendance. A course provider shall provide an individual certificate of attendance to each licensee upon completion of the prelicensing course under the following conditions. The certificate shall contain the licensee's name, the course title, the date, the location of the course, the number of approved credit hours, and the signature of the course provider or instructor. No certificate of attendance may be issued to a licensee who is absent for more than ten percent of the classroom hours.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

          20:69:04:20.  Course provider reporting requirements. The course provider shall submit a list of participants to the commission within ten days after completion of a course. The course provider shall provide a course evaluation form to each licensee for completion and submit the completed course evaluations to the commission within ten days after completion of a course.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

          20:69:04:21.  Preregistration allowed -- Notice of cancellation required. A course provider offering approved prelicensing education courses may require preregistration with a registration cutoff date. The requirement must be advertised prior to each course. A course provider must notify registrants if the course is cancelled. The notification must be made at least 48 hours before the time of the beginning of the course.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

          20:69:04:22.  Application for approval of distance education or independent study course. A course provider desiring to give approved independent study or distance education courses to prospective real estate licensees shall apply on a form provided by the commission. The application must be filed with the commission at least 30 days before the course is offered.

          The application form shall include the following information and enclosures:

          (1)  Name, address, and telephone number of the course provider;

          (2)  Course title;

          (3)  The specific subject matter requirement met by the course;

          (4)  The names of any instructor who will be available to answer student questions, the means of contact, and the hours of availability;

          (5)  The overall structure, functioning, and administration of the proposed course;

          (6)  A complete list of all lessons, modules, and learning objectives for each;

          (7)  An explanation of the remediation process which is in effect to accomplish mastery of material when specific deficiencies are identified; and

          (8)  A description of the procedures used to ensure exam security.

          Source: 28 SDR 28, effective September 2, 2001; 30 SDR 40, effective September 30, 2003.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-89(4).

          20:69:04:23.  Additional requirements for distance education course offerings. In addition to the requirements of § 20:69:04:21, an application for approval of a distance education course must include the following:

          (1)  A complete description of any hardware, software, or other technology to be used by the provider and needed by the student to effectively engage in the delivery and completion of the course material and an assessment of the availability and adequacy of the equipment, software, or other technologies to the achievement of the course's instructional claims; and

          (2)  An explanation of how the course measures, documents, and records that the student has engaged in the required interactive exercises, achieved the required level of mastery, and spent the required amount of time completing the course and how the course provides protection against loss of student data due to hardware or software failure or against inadvertent loss by the student.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          20:69:04:24.  Distance education defined. As used in this chapter, a distance education course is one in which instruction takes place in other than a traditional classroom setting, the instructor and student are in physically separate locations, and instructional methods include interactive video-based instruction, computer conferencing, interactive audio, interactive computer software, and internet-based instruction.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          20:69:04:25.  Independent study defined. As used in this chapter, an independent study is a course in which no interaction with an instructor is planned or implied as part of the learning process.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          20:69:04:26.  Standards for distance education. A distance education course must provide mastery of the material. The course must:

          (1)  Divide the material into major learning units, each of which is further divided into modules of instruction;

          (2)  Specify learning objectives for each learning unit or module of instruction. Learning objectives must be comprehensive enough to ensure that if all the objectives are met, the entire content of the course will be mastered;

          (3)  Specify an objective, quantitative criterion for mastery used for each learning objective and provide a structured learning method designed to enable students to attain each objective;

          (4)  Provide a means of diagnostic assessment of each student's performance on an ongoing basis during each module of instruction, including appropriate remediation if required; and

          (5)  Require that the student demonstrate adequate comprehension of all material covered by the learning objectives for the module or unit before completing that module or unit.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          20:69:04:27.  Criteria for distance education or independent study course approval. The commission may approve any prelicensing course that is provided by a public or private school, organization, person, corporation, society, or similar organization. The commission, when acting on an application for approval of a course, shall consider the following minimum criteria:

          (1)  The course provider must specify the learning objectives for each lesson and clearly demonstrate that the objectives cover the required subject matter. Objectives must be specific to ensure that all relative content is covered adequately to ensure mastery of the objectives;

          (2)  The course provider must demonstrate that the course includes the same or reasonably similar informational content as a course that would otherwise qualify for the requisite number of hours of classroom-based instruction, and that students must proceed through and demonstrate comprehension of all the material;

          (3)  If the course is a distance education course, it must include consistent and regular interactive events as appropriate to the medium. The interactive elements must be designed to promote student involvement in the learning process, and must directly support the student's achievement of the course's learning objectives. The course approval submission must identify the types of interactive events included in the course and specify how the interactive events contribute to the achievement of the stated learning objectives;

          (4)  The course must require that the student demonstrate mastery of the learning objectives as designated for each lesson in order to successfully complete the lesson. The course must provide a mechanism of individual remediation to correct any deficiencies identified during the instruction and assessment process. In independent study courses, this remediation may be accomplished by quizzes or other exercises with detailed rationales in the answer key provided to students;

          (5)  The course provider must measure, at regular intervals, the student's progress toward and completion of the mastery requirement of each lesson or module covering all the required subject matter. In the case of computer-based instruction, the course software must include automatic shutdown after a period of inactivity;

          (6)  The applicant must demonstrate that approved instructors are available to answer student questions regarding course content at reasonable times and by reasonable means, including in-person contact, individual and conference telephone calls, E-mail, and fax. Communication by written postal correspondence alone is insufficient to satisfy the requirements of this subdivision.

          (7)  The course provider shall provide reasonable security to ensure that the student who receives credit for the course is the student who enrolled in and completed the course. Both the school and the student must certify in writing that the student has successfully completed the course; and

          (8)  The course provider must require that the student pass a comprehensive exam of 100 multiple-choice questions with a minimum passing score of 80 percent.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          Law Implemented:SDCL 36-21A-30.1, 36-21A-31, 36-21A-34, 36-21A-89(4).

          20:69:04:29.  Material change. A course provider of an approved real estate course shall immediately notify the commission of any material change contained in the application for approval or in the attached exhibits. A course provider may seek approval of a course subsequent to a course offering by submitting all information requested.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(4).

          Law Implemented:SDCL 36-21A-89(4).

    20:69:05:01.  Complaints authorized -- Procedure following filing -- Electronic filing. Repealed.

    Source: SL 1975, ch 16, § 1; 2 SDR 7, effective July 30, 1975; 3 SDR 34, effective November 3, 1976; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:06:01, 20 SDR 18, effective August 16, 1993; 35 SDR 305, effective July 1, 2009; 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:01.01.  Commission staff to investigate complaints. Repealed.

    Source: 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:02.  Dismissal of complaint. Repealed.

    Source: SL 1975, ch 16, § 1; 2 SDR 7, effective July 30, 1975; 5 SDR 21, effective September 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:02, 20 SDR 18, effective August 16, 1993; 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:03.  Informal disposition. Repealed.

    Source: SL 1975, ch 16, § 1; 2 SDR 7, effective July 30, 1975; 5 SDR 21, effective September 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:03, 20 SDR 18, effective August 16, 1993; 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:04.  Assurance of voluntary compliance or consent order. Repealed.

    Source: 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:06:03.01, 20 SDR 18, effective August 16, 1993; 37 SDR 112, effective December 8, 2010; 48 SDR 60, effective December 6, 2021.

    20:69:05:05.  Formal proceedings. Repealed.

    Source: SL 1975, ch 16, § 1; 2 SDR 7, effective July 30, 1975; 5 SDR 21, effective September 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:04, 20 SDR 18, effective August 16, 1993; 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:08.  Answer. Repealed.

    Source: SL 1975, ch 16, § 1; 3 SDR 34, effective November 3, 1976; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:08, 20 SDR 18, effective August 16, 1993; 44 SDR 71, effective October 24, 2017; 48 SDR 60, effective December 6, 2021.

    20:69:05:09.  Disqualification. Repealed.

    Source: SL 1975, ch 16, § 1; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:09, 20 SDR 18, effective August 16, 1993; 48 SDR 60, effective December 6, 2021.

    20:69:05:10.  Per diem and mileage. Repealed.

    Source: 2 SDR 7, effective July 30, 1975; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:12, 20 SDR 18, effective August 16, 1993; 48 SDR 60, effective December 6, 2021.

    20:69:05:11.  Final action by commission. Repealed.

    Source: 2 SDR 7, effective July 30, 1975; 5 SDR 21, effective September 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:06:13, 20 SDR 18, effective August 16, 1993; 48 SDR 60, effective December 6, 2021.

          20:69:06:02.  Auctioneers -- License required. A restricted broker's license, referred to in this chapter as an auctioneer's license, is required for any person not licensed as a real estate broker who is acting as a real estate auctioneer. A real estate salesperson or broker associate acting under the auspices and supervision of a licensed real estate broker may sell real estate at auction without an auctioneer's license. A real estate broker may obtain an auctioneer's license without examination.

          Source: 1 SDR 33, effective January 1, 1975; 3 SDR 34, effective November 3, 1976; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:12:01, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-47, 36-21A-89(7).

          Law Implemented:SDCL 36-21A-47, 36-21A-12.

    20:69:06:03.  Qualifications of applicants. An applicant for a real estate auctioneer’s license, in addition to the other requirements in SDCL chapter 36-21A, shall furnish evidence of completion of one hundred and sixteen classroom hours within the two years before the date of application in a course on the principles and practices of real estate.

    Source: 1 SDR 33, effective January 1, 1975; 2 SDR 7, effective July 30, 1975, and omitted as a temporary rule; readopted and transferred from § 20:56:12:08, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997; 29 SDR 48, effective October 10, 2002; 35 SDR 305, effective July 1, 2009; 47 SDR 37, effective October 5, 2020; 50 SDR 19, effective August 30, 2023.

    General Authority: SDCL 36-21A-47, 36-21A-89(2)(5).

    Law Implemented: SDCL 36-21A-30.

          20:69:06:04.  Duties of auctioneer. An auctioneer may list, advertise, show, and sell real property or business opportunities at auction only. An auctioneer may also close a real estate auction sale.

          Source: 1 SDR 33, effective January 1, 1975; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:12:21, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001; 30 SDR 40, effective September 30, 2003.

          General Authority:SDCL 36-21A-89(7).

          Law Implemented:SDCL 36-21A-1, 36-21A-6, 36-21A-47.

    20:69:06:09.  Certain acts prohibited. Prohibited acts by an auctioneer include the following:

    (1)  Knowingly receiving or using a rafter bid, puffing of a bid, or any type of bid rigging such as utilizing the services of a shill;

    (2)  Knowingly permitting an unlicensed individual to call or take bids in an auction sale; or

    (3)  Knowingly misleading or creating a false impression among the seller, buyer, or bidders in the advertising, conduct, and closing of an auction.

    Source: 5 SDR 12, effective August 14, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:12:24, 20 SDR 18, effective August 16, 1993; 37 SDR 112, effective December 8, 2010; 47 SDR 37, effective October 5, 2020; 50 SDR 19, effective August 30, 2023.

    General Authority: SDCL 36-21A-89(5).

    Law Implemented: SDCL 36-21A-47, 36-21A-68.

          20:69:07:01.  Notice of intent to sell domestic condominium. When a domestic condominium project is offered for sale in this state, the developer shall notify the commission in writing of the intention to sell the offering. The notice of intent must be on a form approved by the commission.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:08, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-10.

          20:69:07:02.  Rejection of filing. The commission may reject a filing that does not have the notice of intent to sell, does not have a questionnaire properly completed by the developer, or does not include the fee required in SDCL 43-15A-11 and § 20:69:07:04.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:11, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-11.

          20:69:07:03.  Properly filed defined. A notice of intent to sell is not properly filed until the commission has notified the developers in writing that all necessary requirements have been met.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:12, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-13.

          20:69:07:04.  Inspection fee. An estimated inspection fee in the amount of $100 for each $300,000 value of the project must be included with the notice of intent.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:13, August 16, 1993; 23 SDR 110, effective January 9, 1997.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-14.

          20:69:07:05.  Rejection for insufficient funds check. The commission shall reject any notice of intent to sell if it is accompanied by an insufficient funds check for either the registration fee or inspection fee or both.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:14, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-11, 43-15A-14.

          20:69:07:06.  Deposit and expenditure of fees. The commission shall deposit the fees that it collects in the enforcement of SDCL 43-15A in the general fund of the commission and shall expend them to defray the costs of registration and inspection. The commission representative inspecting the project is entitled to a fee not to exceed $75 per day and mileage in the amount of 35 cents per mile or actual reimbursement for first class transportation expenses. If the amount expended by the commission representative is greater than the estimated amount paid by the developer pursuant to § 20:69:07:04, the commission shall bill the developers for the excess amount. The excess amount must be paid immediately or the commission shall reject the notice of intention to sell.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:15, August 16, 1993.

          General Authority:SDCL 43-15A-15.

          Law Implemented:SDCL 43-15A-14, 43-15A-15.

          20:69:07:07.  Public offering statement to accompany questionnaire. A public offering statement (POS) shall accompany and be part of the questionnaire and must be in a form prescribed by the commission.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:17, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-2 to 43-15A-7, 43-15A-11, 43-15A-18 to 43-15A-25.

          20:69:07:08.  Conversion condominiums. The POS for conversion condominiums must conform in all aspects to the requirements of § 20:69:07:07 except that additional information as required by the commission must be incorporated.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:18, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-2 to 43-15A-7, 43-15A-11, 43-15A-18 to 43-15A-25.

          20:69:07:09.  Other information. In order to facilitate its powers of inspection, the commission may require the submission of additional information. The failure to submit such additional information is grounds for the commission to reject the application.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:20, August 16, 1993.

          General Authority:SDCL 43-15A-30.

          Law Implemented:SDCL 43-15A-11, 43-15A-13, 43-15A-16 to 43-15A-18, 43-15A-26.

          20:69:07:10.  Waiver. The commission may waive any of the requirements of this chapter for good cause shown and may accept, at its discretion, registration forms used in another state.

          Source: 3 SDR 34, effective November 3, 1976; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:13:21, August 16, 1993.

          General Authority:SDCL 43-15A-30

          Law Implemented:SDCL 43-15A-11.

          20:69:08:01.  Definitions. The term, lender, means a bank or trust company, savings bank, savings and loan association, insurance company, federal land bank, licensed mortgage broker or mortgage lender, or state or federal agency or its employees or any wholly owned subsidiary of any of the entities listed in this section.

          Source: 4 SDR 71, effective April 30, 1978; 5 SDR 21, effective September 21, 1978; 7 SDR 13, effective October 6, 1980; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:17:01, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-1, 36-21A-47, 36-21A-89(8).

          20:69:08:02.  Persons to whom license law applicable.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:03, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997; repealed, 26 SDR 41 effective September 29, 1999.

          20:69:08:03.  Persons and organizations exempt from licensing.Repealed.

          Source: 5 SDR 21, effective September 21, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:17:03.01, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:08:04.  Mortgage brokers affiliated with a firm exempt from trust account requirements.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:17:09, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:08:05.  Trust account requirements.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:17:32, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:08:06.  Office requirements.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:33, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:08:07.  Auditing.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:34, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:08:08.  No advance fee. A real estate broker acting as a mortgage broker may not accept compensation in advance from a potential borrower for the procurement of a loan.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:36, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-30, 36-21A-47, 36-21A-84.

          20:69:08:09.  Written contract required. Before a real estate broker performs any services for a potential borrower, the broker and the borrower must enter into a written contract specifying the duties and conditions under which the broker is to perform services. The contract must fully disclose estimated compensations and expenses and must have a definite expiration date.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:37, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:08:10.  Full disclosure required. In all dealings between a borrower and a real estate broker, the broker shall fully and fairly inform the prospective borrower of all liabilities, costs, and other financial obligations that can or will be incurred by the borrower if the borrower uses the services of the broker.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:17:38, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:08:11.  Contents of mortgage loan disclosure statement. When a real estate broker arranges a loan for a borrower, the following mortgage loan disclosure statement shall be prepared by the broker and the borrower:

          (1)  Summary of loan terms:

               (a)  Principal amount of loan;

               (b)  Estimated deductions from principal amount:

                      (i)         Costs and expenses;

                      (ii)Brokerage commission;

                      (iii)       Liens and other amounts to be paid on authorization of borrower;

               (c)  Estimated cash payable to borrower;

          (2)  General information concerning loans:

               (a)  The amount of principal and interest payable, the interest rate, the number of payments and whether they are monthly or quarterly, and whether there is a final or balloon payment to pay off the loan in full. If there is a balloon payment, the following cautionary instructions shall be printed in bold type on the contract:  CAUTION TO BORROWER:  IF YOU DO NOT HAVE THE FUNDS TO PAY THE BALLOON PAYMENT WHEN DUE, IT MAY BE NECESSARY FOR YOU TO OBTAIN A NEW LOAN AGAINST YOUR PROPERTY FOR THIS PURPOSE AND YOU MAY BE REQUIRED AGAIN TO PAY COMMISSION AND EXPENSES FOR ARRANGING THE LOAN. KEEP THIS IN MIND IN DECIDING UPON THE AMOUNT AND TERMS OF THE LOAN THAT YOU OBTAIN AT THIS TIME;

               (b)  Other information necessary, including the land description, types of instruments to be executed, and type of lien that will be against the property if the instruments are executed;

               (c)  Any prepayment penalty and full disclosure of its terms;

               (d)  Whether credit life or credit disability will be required of the borrower as a condition of making the loan;

          (3)  Deductions from loan proceeds:

               (a)  Estimated costs and expenses to be paid by the borrower out of the principal amount of the loan including appraisal fees, escrow fees, abstract or title insurance fees, notary fees, attorney fees, recording fees, credit investigation fees, and other costs and expenses;

               (b)  An estimate of the liens and other amounts to be paid out of the principal amount of the loan, on authorization of the borrower, including fire or other property insurance premiums, credit life or disability insurance premiums, beneficiary statement fees, reconveyance or similar fees, liens against property securing the loan, or other fees.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:17:39, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:08:12.  Restrictions on chargeable costs and expenses. In addition to the initial written contract, the real estate broker shall give to the potential borrower an estimate of the amount of chargeable costs and expenses that will be collected by the broker in case no loan is found for the borrower. An estimated total cost to the borrower under these conditions shall be stated to the borrower and may not exceed the amount customarily charged for the same or comparable service in the community where the service was rendered. All of these costs and expenses, if actually expended and chargeable to the borrower, must have been actually and reasonably expended for the potential borrower's benefit.

          Source: 4 SDR 71, effective April 30, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from §  20:56:17:40, 20 SDR 18, effective August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(8).

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:08:13.  Real estate law applicable.Repealed.

          Source: 4 SDR 71, effective April 30, 1978; 5 SDR 21, effective September 21, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from §  20:56:17:41, 20 SDR 18, effective August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:10:01.  Definitions. The following terms apply to this chapter:

          (1)  "Analysis," the act or process of providing information, recommendations, or conclusions on diversified problems in real estate other than estimating value, for another and for compensation;

          (2)  "Appraisal," the act or process of estimating value of real estate for another and for compensation;

          (3)  "Cash flow analysis," an analysis of the anticipated movement of cash in or out of real estate;

          (4)  "Feasibility analysis," an analysis of the cost-benefit relationship of an economic endeavor;

          (5)  "Investment analysis," an analysis that reflects the relationship between acquisition price and anticipated future benefits of a real estate investment;

          (6)  "Market analysis," an analysis of real estate market conditions for a specific type of property;

          (7)  "Report," any communication, written or oral, of an appraisal, review, or analysis; and

          (8)  "Review," the act or process of critically studying a report prepared by another, for another, and for compensation.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:18.01:01, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-89.

          20:69:10:02.  Departure provisions. An appraiser may enter into an agreement to perform an assignment that calls for something less than, or different from, the work that would otherwise be required by the specific guidelines if, before entering into such an agreement the appraiser has determined that the assignment to be performed is not so limited in scope that the resulting appraisal, review, or analysis would tend to mislead or confuse the client, the users of the report, or the public and the appraiser has advised the client that the assignment calls for something less than, or different from, the work required by the specific guidelines and therefore the report will include a qualification that reflects the limited or differing scope of the appraisal, review, or analysis.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:18.01:02, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-89.

          20:69:11:01.01.  Distance education defined. As used in this chapter, a distance education course is one in which instruction takes place in other than a traditional classroom setting, the instructor and student are in physically separate locations, and instructional methods include interactive video-based instruction, computer conferencing, interactive audio, interactive computer software, and internet-based instruction.

          Source: 25 SDR 90, effective December 28, 1998; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

          20:69:11:01.02.  Independent study defined. As used in this chapter, an independent study is a course in which no interaction with an instructor is planned or implied as part of the learning process.

          Source: 25 SDR 90, effective December 28, 1998.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

          20:69:11:01.03.  Interactive defined. As used in this chapter, interactive means the course structure and technologies promote active student involvement with the course content, including the ability to access or bypass optional content, submit questions or answer test items and receive direct feedback, and communicate with other students and the instructor on an immediate or reasonably delayed basis. Interactive instruction specifically excludes courses that only provide passive delivery of instructional content.

          Source: 25 SDR 90, effective December 28, 1998.

          General Authority:SDCL 36-21A-63.

          Law Implemented:SDCL 36-21A-63.

          20:69:11:01.04.  Standards for distance education. A distance education course must provide mastery of the material. The course must:

          (1)  Divide the material into major learning units, each of which is further divided into modules of instruction;

          (2)  Specify learning objectives for each learning unit or module of instruction. Learning objectives must be comprehensive enough to ensure that if all the objectives are met, the entire content of the course will be mastered;

          (3)  Specify an objective, quantitative criterion for mastery used for each learning objective and provide a structured learning method designed to enable students to attain each objective;

          (4)  Provide a means of diagnostic assessment of each student's performance on an ongoing basis during each module of instruction, including appropriate remediation where required; and

          (5)  Require that the student demonstrate adequate comprehension of all material covered by the learning objectives for the module or unit before completing that module or unit.

          Source: 25 SDR 90, effective December 28, 1998.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62, 36-21A-63.

    20:69:11:01.05.  Required continuing education subject areas. Required continuing education subject areas may only be in the following subject areas:

    (1)  Real estate ethics;

    (2)  Legislative issues that influence real estate practice including both pending and recent legislation;

    (3)  The administration of licensing provisions of real estate law and the administrative rules;

    (4)  Real estate brokerage, including agency, contracts, trust accounting, fiduciary duties, and risk management;

    (5)  Fair housing:

    (6)  Environmental issues;

    (7)  Antitrust; and

    (8)  The Americans with Disabilities Act; and

    (9)  Property Management, including financial management of a property, landlord and tenant procedures and operations, and fiduciary duties related to property management.

    Source: 41 SDR 219, effective July 1, 2015; 49 SDR 51, effective November 27, 2022.

    General Authority: SDCL 36-21A-63, 36-21A-89.

    Law Implemented: SDCL 36-21A-62, 36-21A-63, 36-21A-89(7).

    20:69:11:01.06.  Elective continuing education subject areas. Elective continuing education subject areas may only be in the following subject areas:

    (1)  Real estate finance;

    (2)  Real estate market measurement and evaluation, including site, evaluations, market data, and feasibility studies;

    (3)  Real estate mathematics;

    (4)  Real property management;

    (5)  Real property exchange;

    (6)  Land development, use, planning, and zoning;

    (7)  Real estate securities and syndication;

    (8)  Real estate portfolio management;

    (9)  Accounting and taxation as applied to real property;

    (10)  Real estate business planning;

    (11)  Real estate appraisal;

    (12)  Real estate marketing procedures;

    (13)  Technology as applied to the practice of real estate;

    (14)  Home inspection;

    (15)  Real estate negotiation;

    (16)  Real estate investment; and

    (17)  Real estate safety.

    Source: 41 SDR 219, effective July 1, 2015; 48 SDR 60, effective December 6, 2021.

    General Authority: SDCL 36-21A-63.

    Law Implemented: SDCL 36-21A-62, 36-21A-63.

          20:69:11:03.01.  Length of course. No more than eight hours of instruction may be offered in one day.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

    20:69:11:04.  Requirements for inactive licensee -- Exceptions. An inactive licensee is not required to meet the continuing education requirements. An inactive licensee who wishes to activate the individual's license shall complete 24 hours of continuing education within the licensee's current licensing period or within two years preceding the licensee's current licensing period. A licensee whose license is placed on inactive status during either of the first two license cycles after initial licensure shall complete the postlicensing education required during that cycle to activate the license. Courses taken to activate a license may not be used to renew a license.

    Source: 5 SDR 12, effective August 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:04, 20 SDR 18, effective August 16, 1993; 35 SDR 305, effective July 1, 2009; 37 SDR 112, effective December 8, 2010; 41 SDR 219, effective July 1, 2015; 48 SDR 60, effective December 6, 2021.

    General Authority: SDCL 36-21A-89(7).

    Law Implemented: SDCL 36-21A-65.

    20:69:11:04.01.  Requirements for nonresidents -- Exceptions. A nonresident licensee licensed in this state is not required to meet the continuing education requirements.

    A nonresident licensee in inactive status in this state who seeks to make the license active shall first provide a certificate of licensure to the commission staff from the licensing agency of the state where the nonresident licensee maintains residency, stating the nonresident's license is on active status and in good standing and that no complaint is pending.

    Source: 48 SDR 60, effective December 6, 2021.

    General Authority: SDCL 36-21A-89(3).

    Law Implemented: SDCL 36-21A-65.

    20:69:11:07.  Criteria for post-licensing or continuing education course approval. The commission may approve any course, seminar, conference, or equivalent that is provided by the commission, or by a public or private school, organization, association, person, corporation, society, or similar organization. The commission, to approve a course, shall require that:

    (1)  A course has a total instruction time of not less than three hours;

    (2)  A course offered via electronic means with real time visual and audio interaction between instructor and student, allows the instructor or a proctor to continuously view all participating students on a monitor or other viewing device or screen, or otherwise demonstrates to the executive director’s satisfaction the capability to track and record the presence and participation of students;

    (3)  A course provider certify to the best of its knowledge the attendance of each student at the course. The course provider shall submit its criteria for measuring attendance in the application for course approval on a form provided by the commission;

    (4)  A course provider maintain for a minimum of three years records of students successfully completing a course;

    (5)  Credit is earned on the basis of attendance or, in the case of independent study or distance education courses, completion of the course;

    (6)  Each course of study have a coordinator or administrator supervising the program. The coordinator must be qualified, either through previous education or experience, to administer a real estate course of study, to evaluate course content and instructors, and to analyze examinations; and

    (7)  All instructors in a real estate course of study file with the commission credentials showing the necessary specialized preparation, training, and experience to ensure competent instruction. The commission shall approve each instructor individually. Approval must be obtained from the commission before the instructor's lecture in an approved course of study. Instructors, lecturers, seminar leaders, and others who present a post-licensing or continuing education course must have at least one of the following qualifications:

        (a)  A bachelor's, graduate, or postgraduate degree in the field in which the person is to teach;

        (b)  A valid teaching credential or certificate from South Dakota or another state authorizing the holder to teach in the field of instruction being offered;

        (c)  Five years of full-time experience in a professional, trade, or technical occupation in the applicable field;

        (d)  Any combination of at least five years of full-time applicable field experience and college-level education; or

        (e)  Expertise in specialized courses as approved by the commission.

    In addition to meeting at least one of the qualifications in (a) to (e), inclusive, an instructor seeking approval to teach real estate agency law specific to South Dakota shall complete an approved training course.

    Source: 5 SDR 12, effective August 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:07, 20 SDR 18, effective August 16, 1993; 24 SDR 172, effective June 16, 1998; 25 SDR 90, effective December 28, 1998; 28 SDR 28, effective September 2, 2001; 35 SDR 305, effective July 1, 2009; 48 SDR 60, effective December 6, 2021.

    General Authority: SDCL 36-21A-30.2, 36-21A-63.

    Law Implemented: SDCL 36-21A-30.2, 36-21A-63.

          20:69:11:07.01.  Criteria for distance education or independent study course approval. The commission may approve any course that is provided by the commission, a public or private school, organization, person, corporation, society, or similar organization. The commission, when acting on an application for approval of a course, shall consider the following minimum criteria:

          (1)  The course provider must specify the learning objectives for each lesson and clearly demonstrate that the course covers the required subject matter. Objectives must be specific to ensure that all relative content is covered adequately to ensure mastery of the objectives;

          (2)  The course provider must demonstrate that the course includes the same or reasonably similar informational content as a course that would otherwise qualify for the requisite number of hours of classroom-based instruction, and that students must proceed through and demonstrate comprehension of all the material;

          (3)  If the course is a distance education course, it must include consistent and regular interactive events as appropriate to the medium. The interactive elements must be designed to promote student involvement in the learning process, and must directly support the student's achievement of the course's learning objectives. The course approval submission must identify the types of interactive events included in the course and specify how the interactive events contribute to the achievement of the stated learning objectives;

          (4)  The course must require that the student demonstrate mastery of the learning objectives as designated for each lesson in order to successfully complete the lesson. The course must provide a mechanism of individual remediation to correct any deficiencies identified during the instruction and assessment process. In independent study courses, this remediation may be accomplished by quizzes or other exercises with detailed rationales in the answer key provided to students.

          (5)  The course provider must measure, at regular intervals, the student's progress toward and completion of the mastery requirement of each lesson or module covering all the required subject matter. In the case of computer-based instruction, the course software must include automatic shutdown after a period of inactivity;

          (6)  The applicant must demonstrate that approved instructors are available to answer student questions regarding course content at reasonable times and by reasonable means, including in-person contact, individual and conference telephone calls, E-mail, and fax. Communication by written postal correspondence alone is insufficient to satisfy the requirements of this subdivision.

          (7)  The course provider shall provide reasonable security to ensure that the student who receives credit for the course is the student who enrolled in and completed the course. Both the school and the student must certify in writing that the student has successfully completed the course; and

          (8)  The course provider must require that the student pass an appropriate exam to successfully complete and receive credit. An examination will be considered appropriate if it contains at least five multiple-choice questions for each hour of credit and requires a minimum passing score of 80 percent.

          Source: 25 SDR 90, effective December 28, 1998; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62, 36-21A-63.

          20:69:11:08.01.  Application for approval of distance education or independent study courses -- Fee required. An application for approval of a distance education or independent study course shall be on a form provided by the commission and must be accompanied by an application fee pursuant to § 20:69:11:08.04. The application form shall include the following information and enclosures:

          (1)  Name, address, and telephone number of the course provider;

          (2)  Course title;

          (3)  The specific subject matter requirement met by the course;

          (4)  The names of any instructor who will be available to answer student questions, the means of contact, and the hours of availability;

          (5)  The overall structure, functioning, and administration of the proposed course;

          (6)  A complete list of all lessons, modules, and learning objectives for each;

          (7)  An explanation of the remediation process which is in effect to accomplish mastery of material when specific deficiencies are identified; and

          (8)  A description of the procedures used to ensure exam security.

          Source: 25 SDR 90, effective December 28, 1998; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63.

          Law Implemented:SDCL 36-21A-63.

          20:69:11:08.02.  Additional requirements for distance education courses. In addition to the requirements of § 20:69:11:08.01, an application for approval of a distance education course must include the following:

          (1)  A complete description of any hardware, software, or other technology to be used by the provider and needed by the student to effectively engage in the delivery and completion of the course material and an assessment of the availability and adequacy of the equipment, software, or other technologies to the achievement of the course's instructional claims; and

          (2)  An explanation of how the course measures, documents, and records that the student has engaged in the required interactive exercises, achieved the required level of mastery, and spent the required amount of time completing the course and how the course provides protection against loss of student data due to hardware of software failure or against inadvertent loss by the student.

          Source: 25 SDR 90, effective December 28, 1998.

          General Authority:SDCL 36-21A-63.

          Law Implemented:SDCL 36-21A-63.

          20:69:11:11.  Certificate of approval. The commission shall grant a certificate of approval for each course approved by the commission. The certificate remains valid for three years. A certificate of approval for a seminar course shall be valid for the duration of the seminar.

          Source: 5 SDR 12, effective August 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:09, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63.

          20:69:11:11.02.  Course accreditation reinstatement. A course approval that has expired may be reinstated if a renewal application is filed within six months of the date of expiration. A course provider must file a new application for approval of a course that has been expired for more than six months.

          Source: 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63.

          20:69:11:12.  Material change. A course provider of each approved real estate course shall immediately notify the commission of any material changes contained in the application for approval or in the attached exhibits. A course provider may seek approval of a course subsequent to a course offering by submitting all information requested.

          Source: 5 SDR 12, effective August 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:12, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62, 36-21A-63.

          20:69:11:13.  Denial of approval for a course or instructor. The commission may deny approval of a real estate course or instructor if it is determined that either is not in compliance with SDCL chapter 36-21A and this article. A person aggrieved by denial of approval by the commission may file a written request for a hearing pursuant to § 20:69:02:07.

          Source: 5 SDR 12, effective August 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:13, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63.

          20:69:11:13.01. Withdrawal of approval for a course or instructor. If the commission at any time determines that a course or an instructor approved pursuant to chapter 20:69:11 is not continuing to meet the requirements of SDCL chapter 36-21A and this chapter, it shall immediately notify the course provider in writing detailing the deficiencies requiring correction. The approval by the commission shall continue 90 days from the date of the commission's written notice to the course provider, and if, at the expiration of that period, the course provider has failed to correct to the commission's satisfaction the deficiencies noted, the commission may withdraw approval of the course or instructor.

          If the commission disciplines an instructor who holds a real estate license for acts committed as a licensee, the commission may also withdraw that instructor's approval as an instructor.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63.

          20:69:11:14.  Same or duplicate courses. Credit for a course may be given only once to an individual during a  reporting period.

          Source: 5 SDR 12, effective August 21, 1978; 10 SDR 54, effective December 5, 1983; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:14, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63.

          Law Implemented:SDCL 36-21A-63.

          20:69:11:15.  School fees.Repealed.

          Source: 5 SDR 12, effective August 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:16, 20 SDR 18, effective August 16, 1993; repealed, 23 SDR 110, effective January 9, 1997.

          20:69:11:17.  Facilities. Each course provider must have the classrooms, facilities, equipment, and personnel necessary to implement the course.

          Source: 5 SDR 12, effective August 21, 1978; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:18, 20 SDR 18, effective August 16, 1993; repealed, 23 SDR 110, effective January 9, 1997; readopted, 25 SDR 90, effective December 28, 1998; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63.

          20:69:11:17.01.  Schedule. The course provider shall provide a schedule of all courses, including the date, time, and place where they will be offered to the commission before the courses begin.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63, 36-21A-89(9).

          20:69:11:18.  Auditing. The commission or its representatives may audit courses.

          Source: 5 SDR 12, effective August 21, 1978; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:19:19, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-63

          20:69:11:19.01.  Course provider reporting requirements -- Course evaluation. The course provider must submit a list of participants to the commission within ten days after completion of a course. The course provider must provide a course evaluation form to each licensee for completion. The course provider must submit the completed course evaluations to the commission within ten days after completion of a course.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62, 36-21A-63.

          20:69:11:20.  Preregistration allowed -- Notice of cancellation required. A course provider offering approved continuing education courses may require preregistration with a cutoff date for permission to attend. The requirement must be advertised prior to each course. The course provider must notify registrants if the course is cancelled. The notification must be made at least 48 hours before the time of the beginning of the course.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:19:21, 20 SDR 18, effective August 16, 1993; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62, 36-21A-63.

          20:69:11:23.  Application for approval of instructors -- Guest speakers exempt. An applicant for instructor approval shall apply on a form provided by the commission. A guest speaker is exempt from making application if requesting approval pursuant to § 20:69:11:24.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

          20:69:11:24.  Utilization of guest speakers -- Résumé to accompany course application. A course provider may utilize guest speakers with expertise in a particular area in any approved course if an approved instructor is present at the time of the presentation. A course provider may utilize a guest speaker without an approved instructor being present with the prior written approval of the commission.

          An application for approval of a course utilizing guest speakers must include a résumé of each speaker.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

          20:69:11:25.  Certificate of instructor approval -- Approval certificates not issued to guest speakers. The commission shall grant a certificate of approval for each instructor approved by the commission. Certificates of approval will not be issued to guest speakers who make application pursuant to § 20:69:11:24.

          Source: 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-63, 36-21A-89(9).

          Law Implemented:SDCL 36-21A-62.

          20:69:12:02.  Registration of time-share estates. All applications for registration of time-share estates must be on forms approved by the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:20:02, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 43-15B-6.

          Law Implemented:SDCL  43-15B-3, 43-15B-4.

          20:69:12:03.  Registration fee. Applications for registration must be accompanied by a fee of $25 for each time-share unit. The total fee may not exceed $1,000. The fee is payable in advance and must be made to the commission.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:03, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 43-15B-4, 43-15B-6.

          Law Implemented:SDCL 43-15B-4.

          20:69:12:04.  Inspection fee. The inspection fee required by SDCL 43-15B-5 including actual and necessary expenses shall accompany the application.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:04, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-5, 43-15B-6.

          20:69:12:05.  Disclosure statement. An application for registration must include a disclosure statement.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:05, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:06.  Encouragement to read the disclosure statement. The following must be printed on the bottom half of the face page of the disclosure statement, in centered boldface capital letters:

THIS HANDBOOK IS PREPARED AND ISSUED BY THE DEVELOPER OF   (RESORT NAME)  . THE DEVELOPER STRONGLY ENCOURAGES YOU TO REVIEW THIS HANDBOOK WHEN CONSIDERING THE PURCHASE OF A MEMBERSHIP.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:06, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:07.  Additional disclosure statement requirements. In addition to the requirements prescribed in § 20:69:12:06, disclosure statements distributed to the public must meet the following requirements:

          (1)  Provide a brief description of the method by which the time-share plan or units is to be offered;

          (2)  Provide a description of the amount and types of units offered by the developer for the time-share plan; and

          (3)  A summary of the developer's escrow agreement.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:07, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:08.  Nonconforming disclosure statements. A disclosure statement not in conformance with the requirements of §§ 20:69:12:06 and 20:69:12:07 is void.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:12:08, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-2, 43-15B-3, 43-15B-6, 43-15B-7.

          20:69:12:09.  Offer, transfer, or disposal under a void statement. An offer, transfer, or disposal of a time-share unit or plan made under a void disclosure statement is voidable at the option of the purchaser.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:09, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-2, 43-15B-3, 43-15B-6, 43-15B-7.

          20:69:12:10.  Additional filings required. In addition to the application, fees, and disclosure statement, a developer shall file the following with the commission to register a time-share project:

          (1)  A financial statement not more than 90 days old prepared according to generally accepted accounting principles and certified by the developer or by a certified public accountant. If an audited financial report is filed, it must be the most current report and may not be more than 15 months old. A false or fraudulent financial statement submitted by the developer may be grounds for cancellation, suspension, or revocation of registration;

          (2)  A policy of title insurance, a preliminary title report, abstract of title, or certificate of title not more than 90 days old at the time of filing of a time-share plan;

          (3)  A certified copy of the articles of incorporation and bylaws, if a corporation, or a partnership registration if a partnership or joint venture at the time of filing a time-share plan;

          (4)  A copy of a special escrow agreement as required in § 20:69:12:30;

          (5)  The name and address of person in the state to receive service of process. Any change of name or address must be promptly reported to the commission.

          The format for filing shall be prescribed by the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:10, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          Cross-Reference: Accounting principles, § 20:37:11:08.

          20:69:12:11.  Filing of option unacceptable. A developer who has only an option to purchase a property for a time-share plan may not file with the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:11, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-2, 43-15B-3, 43-15B-6, 43-15B-7.

          20:69:12:12.  Acquisition solicitation requirements for agents. An agent, including the developer if it is also the agent, may not solicit or encourage others to attend a time-share sales presentation or to contact an agent or developer if the time-share unit is located in the state, whether the solicitation is conducted in the state or out-of-state, unless the agent files and the commission accepts the following:

          (1)  The time-share plan or plans for which it is providing prospective purchasers;

          (2)  Its principal office address and telephone number; and

          (3)  If a corporation, the name, address, and telephone number of its responsible managing employee.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:12, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:13.  Sales solicitation requirements for agents. An agent, including the developer if it is also the agent, may not sell or offer to sell an interest in a time-share plan for a developer if the time-share unit is located in the state whether the sale or offer for sale is made in the state or out-of-state, unless the agent files and the commission accepts the following:

          (1)  The time-share plan or plans it intends to sell;

          (2)  Its principal office address and telephone number;

          (3)  If a corporation, the name, address, and telephone number of its responsible managing employee; and

          (4)  A copy of the special escrow agreement as required by § 20:69:12:28.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:13, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:14.  Limitation on plan managers. A plan manager, including the developer if it is also the plan manager, may not undertake the duties, responsibilities, and obligations of managing a time-share plan if the time-share unit is located in the state unless the plan manager files and the commission accepts the following:

          (1)  The time-share plan or plans that it intends to manage;

          (2)  Its principal office address and telephone number;

          (3)  If a corporation, the name, address, and telephone number of its responsible managing employee;

          (4)  A sworn statement from the developer listing the plan manager's duties, responsibilities, and obligations;

          (5)  A sworn statement from the plan manager stating its duties, responsibilities, and obligations, as set out in § 20:69:12:19; and

          (6)  The address where all accounting records, including receipts, expenditures, and payment vouchers, are maintained.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:14, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:15.  Renewal of time-share filings. A filing required by this chapter shall be renewed by December 31 of each year on a form prescribed by the commission. Failure to renew by the specified date will result in forfeiture of the right to engage in the sale of a time-share plan. A forfeited registration may be restored within 90 days upon payment of a registration fee of $25 for each time-share unit and meeting all of the renewal requirements. The registration fee shall accompany the renewal application. The fee for renewal may not exceed $250. No sale or offer for sale of a time-share plan may be made until registration has been restored. A current financial statement is required for renewal in the same form as required in § 20:69:12:10.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:15, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-4, 43-15B-6.

          20:69:12:16.  Responsible managing employee -- Designation, duties, and change. The commission may not accept the filing of a corporate time-share agent or corporate plan manager unless the corporation has designated a responsible managing employee and prescribed the RME's duties, responsibilities, and obligations.

          The corporate RME is responsible for the direct management of the corporation's time-share operations. The commission does not consider the corporate RME to have the direct management of the corporation's time-share operation unless the RME meets the following requirements:

          (1)  Is a bona fide employee of the corporation and has direct control, supervision, and management of the corporation's time-share operations;

          (2)  Has full knowledge and control of the corporation's accounting practices;

          (3)  Has full knowledge and control over the moneys belonging to and in the custody of the corporation in connection with the time-share operation; and

          (4)  Has full access to all books, records, and documents materially related to the corporation's part in the time-share operation whether they are kept in the state or out-of-state.

          The name, address, and telephone number of the RME must be filed with the commission. If there is a change in RME, the name of the new RME must be reported to the commission in writing within ten days after the change. A plan manager may manage one or more time-share plans. A plan manager may have one or more RMEs. If a developer or plan manager of two or more time-share plans, at least one of which includes time-share units located in this state, maintains its principal office or has primary management and accounting functions out-of-state, the duties of the RME specified in this section may be divided between two or more RMEs provided that at least one RME is located in the state.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:16, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-2, 43-15B-3, 43-15B-6.

          20:69:12:17.  Copy of disclosure statement to be given to prospective purchasers. A registrant or other person attempting to sell a time-share estate or plan shall provide to prospective purchasers a copy of the disclosure statement which is a true, accurate, and complete reproduction of the statement filed and accepted by the commission. The registrant or other person attempting to sell a time-share plan or estate shall give the prospective purchaser an opportunity to read the statement.

          Prospective purchasers receiving a copy of the disclosure statement shall sign a statement acknowledging receipt of the disclosure statement on a receipt form prescribed by the commission. The receipt must be kept at the principal office of the developer for a period of two years from the date of the receipt and is subject to inspection upon notice by the commission or the commission's representative. If the principal office is not located in this state, the developer is subject to the out-of-state inspection requirements of § 20:69:12:19.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:17, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:18.  Issuance of registration number. The commission shall issue a registration number to a time-share plan in consecutive order of receipt of filing provided that the filing complies with the requirements of this chapter. The commission shall print the registration number and the date of acceptance on the upper right-hand corner of the face page of the disclosure statement.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from §  20:56:20:18, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:19.  Plan manager or RME designated for time-share unit or time-share plan located in the state. All time-share plans must have a plan manager or an RME designated.

          There must be a plan manager or an RME in the state if a time-share unit or time-share plan is located in the state whether or not a time-share unit or time-share plan is offered for sale in the state or out-of-state.

          There must be a plan manager or an RME in the state for a multiple location time-share plan if the plan includes a time-share unit or time-share plan located in the state.

          A plan manager's duties, responsibilities, and obligations include the following:

          (1)  Management and maintenance of the time-share units;

          (2)  Assessments and the collection of maintenance fees;

          (3)  Payment of real property taxes due on the time-share units under the plan manager's authority;

          (4)  Supervision of the occupancy scheduling so that time-share unit owners or users will be provided the use of time-share units;

          (5)  Provision to time-share owners and users of a copy of the house rules of the building;

          (6)  Supervision of the enforcement of the house rules; and

          (7)  The keeping of a detailed and accurate record, in chronological order, of receipts and expenditures.

          All accounting records of the plan manager are subject to inspection by the commission or the commission's representative. Accounting records must be kept at the principal office of the plan manager, which may be located in this state or in another state.

          If the accounting records are not kept in this state, they shall be made available for inspection in this state upon notice. If the records are not made available, they shall be inspected at the place where they are kept and all costs, including the travel expense, per diem, and salary of the inspector, must be borne by the plan manager. The commission may require the plan manager to remit the amount of the estimated cost in advance of the inspection. Failure on the part of the plan manager to comply with the commission's request to remit the amount of the estimated cost may be grounds for cancellation, suspension, or revocation of registration of the project.

          If the principal office of the developer is not in the state, a failure to make available upon the commission's request bookkeeping records, computer records, or any other records of the developer on the time-share plan may be grounds for cancellation, suspension, or revocation of the plan manager's registration.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:20, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-4, 43-15B-5, 43-15B-6.

          20:69:12:20.  Material change in disclosure statement. A developer shall notify the commission in writing of any material changes in the disclosure statement.

          A developer shall file a supplemental disclosure statement which specifies, in detail, the material changes that have occurred.

          The supplemental disclosure statement must be filed with the commission within 20 days after the material changes become known to the developer.

          Upon acceptance of the supplemental disclosure statement by the commission, a true, accurate, and complete copy of the supplemental disclosure statement must be given to each purchaser adversely affected by the material change and to each prospective purchaser. A receipt from each purchaser and prospective purchaser must be taken and filed as required in §20:69:12:17. The developer is not in violation of this chapter if the purchaser fails to return the receipt and the developer can verify that a statement was sent to the purchaser.

          The commission may independently determine that a material change has occurred and  require the developer to prepare a supplemental disclosure statement disclosing the material change in a form approved by the commission.

          If the purchaser has received title by instrument of record in the sale of an interest in an ownership plan, the developer is not required to give the purchaser a supplemental disclosure statement.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:21, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:21.  Mutual right to cancel contract. A developer or purchaser may cancel a contract by giving the other party written notice within seven calendar days after execution of the contract or after the purchaser's receipt of a disclosure statement, whichever occurs later.

          The purchaser is entitled to a refund of all sums paid within 30 days after notice of cancellation if all materials received on the date of sale are returned to a specified address of the seller or within 60 days if all sales materials are not returned.

          A developer or agent shall furnish each purchaser at the time the contract for purchase of a membership is signed the following cancellation notice prepared exactly as follows:

NOTICE TO BUYER: YOU OR THE DEVELOPER MAY CANCEL THIS TRANSACTION WITHIN SEVEN (7) CALENDAR DAYS AFTER THE EXECUTION OF THE CONTRACT OR AFTER YOUR RECEIPT OF THE DISCLOSURE STATEMENT, WHICHEVER OCCURS LATER. YOU ARE ENTITLED TO A REFUND OF ALL SUMS YOU PAID WITHIN 30 DAYS AFTER NOTICE OF CANCELLATION WHEN ALL MATERIALS RECEIVED ON THE DATE OF SALE ARE RETURNED TO THE ADDRESS STATED BELOW OR WITHIN 60 DAYS IF ALL SALES MATERIALS ARE NOT RETURNED. TO CANCEL THIS TRANSACTION, MAIL OR DELIVER A SIGNED AND DATED WRITTEN CANCELLATION NOTICE TO:

(Insert name and address of developer)

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:20:22, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:22.  Retention of copy of contract. A copy of a contract from each sale of a time-share plan must be retained by the developer for a period of at least one year after the parties to the time-share plan have completely performed all of their obligations.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:23, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:23.  Preexisting time-share unit. Preexisting time-share units and time-share plans for preexisting time-share units must comply with the requirements of this chapter and the provisions of SDCL 43-15B by January 1, 1985.

          Time-share units not existing by July 1, 1983, are subject to this chapter when it takes effect.

          A developer, agent, or plan manager shall submit evidence, such as an agreement, contract, or document, at the time of filing of a preexisting time-share plan to show that a time-share unit or plan was created prior to July 1, 1983.

          Preexisting time-share plans must be filed on a form prescribed by the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:24, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:24.  Persons responsible for filing of preexisting time-share plan. In addition to the requirements of this chapter, a developer, agent, or plan manager presently associated with a preexisting time-share plan shall file at the time of filing of a preexisting time-share plan a certified statement giving the location of the preexisting time-share unit and time-share plan, the number of time-share units, the nature of the ownership of the units, the ownership or use period, the date, and an explanation of how the time-share plan was created, the number of purchasers who purchased time-share plans, and the name and address of the plan manager.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:25, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:25.  Plan manager for preexisting time-share plan. A preexisting time-share plan must have a plan manager. Any provision relating to a plan manager in this chapter is applicable to a plan manager of a preexisting time-share plan.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:26, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:26.  Mixed-use project containing existing time-share unit or plan. Additional time-share units may not be created in a mixed-use project containing an existing time-share unit or time-share plan and a residential unit unless the project is located in a hotel or in a place designated for hotel use, resort use, or transient vacation rentals and all of the requirements of this chapter relating to time-share use are met.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:27, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:27.  Law and rules to be available. A developer or agent must comply with the following:

          (1)  Have a copy of SDCL 43-15B and a copy of this chapter available for inspection by any prospective purchaser;

          (2)  Advise each prospective purchaser that copies are available at the time any interest in a time-share plan is offered for sale in this state or out-of-state; and

          (3)  Provide copies upon request.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:28, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:28.  Agent and special escrow account. An agent shall establish and maintain a special escrow account in a federally insured depository in this state for the deposit of any moneys received from the purchaser. A special escrow account with a federally insured depository doing business in another state may be established upon approval by the commission; but if all sales are conducted in this state, a special escrow account must be established and maintained in this state.

          The escrow agreement shall provide that no moneys received from a purchaser may be disbursed until after the expiration of the seven-day period in which a purchaser may rescind the contract. The agreement shall include a statement on the method of disbursement of funds in escrow.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:20:29, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:29.  Plan manager and special account. A plan manager shall establish and maintain a special account in a bank or trust company in this state for the deposit of any moneys received. A special account with a bank or trust company doing business in another state may be established upon approval by the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:30, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:30.  Developer and special escrow account. A developer shall establish and maintain a special escrow account with a bank, licensed escrow company, or a trust company in this state. A special escrow account with a bank, licensed escrow company, or trust company doing business in another state may be established upon approval by the commission.

          The developer shall place in the special escrow account all funds, except those excluded by §20:69:12:33, paid by the purchasers of time-share ownership or use plans or submit to the commission for approval a financial plan for the protection of the purchasers.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:31, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:31. Developer's escrow agreement when funds deposited. If a developer elects to place in the special escrow account all funds, except those excluded by § 20:69:12:33, the escrow agreement must provide for the following:

          (1)  The purchaser's right to refund at any time the time-share units or facilities are no longer available as provided in the contract in an amount which represents the purchaser's pro rata share of the moneys in the escrow account;

          (2)  If a deed, title, or assignment of lease of the time-share plan free and clear of any liens is transferred to the benefit of the purchaser, withdrawal by the developer of all of the funds which have been placed in escrow on behalf of the purchaser;

          (3)  If a deed, title, or assignment of lease of the time-share plan free and clear of any liens is not transferred to the benefit of the purchaser, withdrawal by the developer of a proportion of the moneys placed in escrow which is in the ratio of the time made available to the purchaser in relation to the total amount of time which the purchaser has a right to use under the contract.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:32, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          Example:

          Examples for subdivision (3):

          (1)  If the total time available to a time-share plan purchaser under the purchaser's plan is 100 days and in a given year the purchaser uses 10 of those days, the time-share plan seller that year may withdraw one-tenth of the moneys placed in escrow for the purchaser.

          (2)  If the time-share purchaser is entitled to 10 days a year and it is a 40-year plan, the time share seller may withdraw each year one-fortieth of the moneys placed in escrow for the purchaser.

          20:69:12:32.  Developer's escrow agreement when financial plan submitted. If a developer elects to submit a financial plan for protection of the purchasers to the commission for approval, the developer shall furnish the commission a certified statement of a summary of all underlying financial obligations of the time-share plan, including agreements of sale, leases, mortgages, liens, and a projected payment plan which provides for payment in full of all underlying financial obligations before the final receipts from the purchasers of their payments; a description of the source of means by which such payments will be made; and a description of arrangements with banks, licensed escrow companies, trust companies or lending institutions relating to the receipt of purchaser's moneys and disbursements on account of the payment plan.

          The developer shall submit an escrow agreement which provides for the following:

          (1)  The purchaser's right to refund at any time the time-share units or facilities are no longer available as provided in the contract in an amount which represents the purchaser's pro rata share of the moneys in the escrow account;

          (2)  Deposit of all funds, except those excluded by § 20:69:12:33 paid by the purchasers of the time-share ownership or use plan in the special escrow account;

          (3)  Payment in full of all underlying financial obligations of the time-share plan before the final receipts from the purchasers of their payments;

          (4)  Modification of the payment plan with the approval of the commission upon change of circumstances. However, any payment plan must provide for payment in full of all underlying obligations before the final receipts from the purchasers of their payments, and no additional encumbrances may be placed on any property subject to the time-share plan without the approval of the commission;

          (5)  Collection of funds and making of disbursements by the bank, escrow company, or trust company according to the payment plan submitted to the commission by the developer;

          (6)  After payment of the underlying financial obligations, any interests in the time-share property must be conveyed to the purchaser in an ownership plan and in a use plan. The developer shall convey to a disinterested third party, such as a nonprofit corporation or club or trust company, an interest in the property necessary to ensure the use of the property for the period of time conveyed by the developer in the time-share plan; and

          (7)  Approval by the commission of an amendment to the escrow agreement.

          A developer must have the holders of the underlying financial obligations submit to the commission annually statements of balances owing on the underlying financial obligations.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:33, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:33.  Exclusions from funds placed in escrow. Purchaser's funds to be placed in an escrow account need not include operational expenses, such as office expenses and sales commissions, maid services, telephone charges, special assessments, club dues, and maintenance fees.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:34, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:34.  Integrated special escrow account. If a developer also performs the function of plan manager and sales agent, it may establish and maintain a single special escrow account in a bank, licensed escrow company, or trust company for the deposit of any moneys received from purchasers.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:35, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:35.  Account open for inspection. A developer, agent, or plan manager shall provide information on the developer's, agent's, or plan manager's respective account to the commission upon written request. The account is subject to inspection upon notice by the commission or commission's representative. If the accounting records are not kept in this state, provisions on inspections and production of records in § 20:69:12:19 of these rules are applicable.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:36, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-3, 43-15B-6.

          20:69:12:36.  Unprofessional conduct. A developer or agent of time-share plans or units may not do any of the following:

          (1)  Use a promotional device without fully disclosing that the device is being used for the purpose of soliciting sales of time-share plans or units;

          (2)  Misrepresent or deceptively represent a material fact concerning the time-share plans or time-share units, including the following:

               (a)  The amount or period of time the units and facilities will be available to a purchaser;

               (b)  The location or locations of the offered units and facilities;

               (c)  The size, nature, or characteristics of the offered units and facilities;

               (d)  The rights of a purchaser, if any, to exchange the purchaser's rights to units in one location for rights to units in another location; and

               (e)  The contents of the contract or the purchaser's rights, privileges, or benefits under the contract;

          (4)  Fail to honor or comply with all provisions of the contract with the purchaser; and

          (5)  Include, in any contract, provisions purporting to waive a right or benefit provided for purchases pursuant to law.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 16 SDR 36, effective August 29, 1989; transferred from §  20:56:20:38, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 36-21A-71, 43-15B-3, 43-15B-6.

          20:69:12:37.  Cause for suspension or revocation. The commission may suspend or revoke a registration by a developer, agent, or plan manager for violation by the registrant or its employees of any of the provisions of this chapter, chapter 20:69:13, or SDCL 43-15B after a hearing conducted pursuant to SDCL 1-26.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:20:39, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 43-15B-2, 43-15B-3, 43-15B-6.

          20:69:13:01.  Definition of time-share agent. A time-share agent is a person who works for another person for compensation and performs at least one of the following functions:

          (1)  Directly or indirectly lists, sells, exchanges, buys, rents, manages, offers, or attempts to negotiate a sale, option, exchange, purchase, lease, or rental of an interest or use in a time-share estate;

          (2)  Advertises as engaging in or holds out to be engaged in any of the activities listed in subdivision (1) of this section; or

          (3)  Directly or indirectly negotiates, offers, or attempts to negotiate a loan or financing for the purchase of a time-share estate.

          Source: 10 SDR 121, adopted May 17, 1984, retroactively effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:00, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-6, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:02.  Time-share agents -- License required. Persons who act as time-share agents within this state must be licensed according to this chapter and must comply with the provisions of this chapter.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:01, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:03.  OPC exempt from licensing. An outside public contact is exempt from licensing under this chapter.

          Source: 10 SDR 121, adopted May 17, 1984, retroactively effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:01.01, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-6, 36-21A-47, 43-15B-6, 43-15B-7.

          Cross-Reference: Definitions, § 20:69:12:01(8).

          20:69:13:04.  Persons and organizations exempt from licensing or examination. Real estate brokers are exempt from licensing under this chapter. A real estate broker or salesperson may obtain a time-share license without examination.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:02, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:05.  Application. An applicant for a time-share agent's license shall file an application on a form provided by the commission.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:03, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(2), 43-15B-6.

          Law Implemented:SDCL 36-21A-30, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:06.  Application fee. The application fee for a time-share agent's license is $225.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 16 SDR 36, effective August 29, 1989; transferred from § 20:56:21:05, August 16, 1993; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-49, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 36-21A-49, 43-15B-6, 43-15B-7.

          20:69:13:07.  Photograph to accompany application.Repealed.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:06, August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:13:09.  Examination. Any person, not otherwise exempted by this chapter, who meets the qualifications of this chapter must pass an examination for a time-share agent's license to be given by the commission at a time, place, and in a manner established by the commission. The commission shall determine the contents of the examination and the rating and standards for passing. A passing grade of 75 is required.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:08, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(2), 36-21A-47, 43-15B-6.

          Law Implemented:SDCL 36-21A-36, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:10.  Authorization to take examination. A person may not take the time-share agent's examination unless authorized by the commission in writing to take the examination.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:09, August 16, 1993; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(2), 43-15B-6.

          Law Implemented:SDCL 36-21A-36, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:11.  Failure to appear for examination.Repealed.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:10, August 16, 1993; repealed, 26 SDR 41, effective September 29, 1999.

          20:69:13:12.  Administration of examination. The licensing examination must be conducted under the supervision of the executive director of the commission or a designee of the executive director. Identification supplied to the applicant by the commission is required for admission to the examination room. Before beginning the examination, the applicant must certify in writing that the applicant has not solicited or received any information about the contents of the examination about to be written and that during or subsequent to the examination the applicant will not disclose its contents to any person.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:11, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-36, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:13.  Cheating on examination. The examination of an applicant for a time-share agent's license who is caught cheating during the examination must be declared void.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:12, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-36, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:14.  Results of examination. The applicant must be notified in writing of the examination results.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:13, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-36, 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:14.01.  Rights to passing score. Upon notification that a person has passed the time-share examination, a person has 60 days to apply for a time-share agent's license, or the passing score is forfeited.

          Source: 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-89(2), 43-15B-6.

          Law Implemented:SDCL 36-21A-89(2), 43-15B-6.

          20:69:13:15.  Biennial renewal fee. The biennial renewal fee for a time-share agent's license is $125.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 13 SDR 31, effective September 23, 1986, effective January 1, 1988; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:16, August 16, 1993; 26 SDR 41, effective September 29, 1999; 29 SDR 48, effective October 10, 2002.

          General Authority:SDCL 36-21A-61, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 36-21A-61, 43-15B-6, 43-15B-7.

          20:69:13:16.  Cancellation of license upon failure to pay fee. Failure to remit the renewal fee or registration statement or both by the registration deadline automatically cancels the license of a time-share agent. In addition, if an insufficient funds check is presented to the commission for payment of the renewal fee, the commission may cancel the license of the time-share agent.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:17, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 36-21A-61, 43-15B-6, 43-15B-7.

          20:69:13:18.  Trust account requirements. All the requirements relating to trust accounts imposed by SDCL Chapter 36-21A or Article 20:69 upon real estate agents apply to time-share agents.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:20, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          Cross-References:

          Handling of money received by broker for principal, SDCL 36-21A-80.

          Deposit slip and ledger sheet for special trust account, SDCL 36-21A-82.

          Documents kept by broker remitting immediately to principal, SDCL 36-21A-83.

          Completed transaction required for compensation of broker, SDCL 36-21A-84.

          Acts constituting unprofessional conduct, SDCL 36-21A-71(5).

          20:69:13:19.  Office requirements. A time-share agent must have an office physically located in the state of South Dakota before transacting any sales of real estate located in the state of South Dakota.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:21, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 36-21A-51, 43-15B-6, 43-15B-7.

          20:69:13:20.  Auditing. The time-share agent must maintain all records of all sales transactions made within this state at the office required by § 20:69:13:19, and these records are subject to audit by the commission or its agents.

          Source: 10 SDR 68, effective January 1, 1984; 12 SDR 102, effective December 22, 1985; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:22, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:21.  Real estate law applicable. Unless inconsistent with this chapter and chapter 20:69:12, the real estate law contained in SDCL Chapter 36-21A and Article 20:69 applies to time-share agents.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; transferred from § 20:56:21:24, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          20:69:13:22.  Supervising agent. A developer must designate a real estate broker or time-share agent licensed in South Dakota as the supervising agent who has general superintending control over all time-share agents employed in South Dakota by that person. The supervising agent is also responsible for the actions of all outside public contacts who are employed by the principal or by the supervising agent.

          Source: 10 SDR 68, effective January 1, 1984; 10 SDR 121, amended May 17, 1984, retroactively effective January 1, 1984; 12 SDR 151, 12 SDR 155, effective July 1, 1986; 15 SDR 100, effective January 10, 1989; transferred from § 20:56:21:25, August 16, 1993.

          General Authority:SDCL 36-21A-89, 43-15B-6.

          Law Implemented:SDCL 36-21A-47, 43-15B-6, 43-15B-7.

          Cross-Reference: Definitions, § 20:69:12:01(3).

          20:69:14:01.  Property manager license. The property manager license is a restricted broker's license pursuant to SDCL 36-21A-47.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:02, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-47.

          Law Implemented:SDCL 36-21A-47.

          20:69:14:02.  Persons to whom license law applicable. A person may not act as a property manager in this state unless the person holds a property manager license pursuant to this chapter or otherwise complies with the provisions of this chapter. Individuals must be licensed as individual property managers. Partnerships, associations, or corporations must be licensed as firms.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:03, 20 SDR 18, effective August 16, 1993.

          General Authority: SDCL 36-21A-47.

          Law Implemented: SDCL 36-21A-27, 36-21A-28, 36-21A-37, 36-21A-38, 36-21A-47.

          Cross-Reference: Persons and entities exempted from this chapter, SDCL 36-21A-29.

          20:69:14:02.01.  Qualifications of applicants. An applicant for a property manager's license, in addition to the other requirements in SDCL chapter 36-21A, shall furnish evidence of completion of 40 hours of education within the two years before the date of application in a course on the fundamentals of property management.

          Source: 23 SDR 110, effective January 9, 1997; 28 SDR 28, effective September 2, 2001.

          General Authority:SDCL 36-21A-47, 36-21A-89.

          Law Implemented:SDCL 36-21A-47.

          20:69:14:03.  Exemptions from examination. A real estate broker may obtain a property manager license without an examination. A broker associate may manage property independently of a responsible broker if the broker associate has fulfilled the education and experience requirements of SDCL 36-21A-31.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:04, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997; 26 SDR 41, effective September 29, 1999.

          General Authority:SDCL 36-21A-47.

          Law Implemented:SDCL 36-21A-6, 36-21A-47.

          Cross-References: Broker defined, SDCL 36-21A-6.

          20:69:14:04.  Trust account requirements. All of the requirements relating to trust accounts imposed by SDCL Chapter 36-21A or this article on real estate brokers apply to property managers.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:29, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47, 36-21A-80, 36-21A-82.

          Cross-References:

          Handling of money received by broker for principal, SDCL 36-21A-80.

          Deposit slip and ledger sheet for special trust account, SDCL 36-21A-82.

          Acts constituting unprofessional conduct, SDCL 36-21A-71(5).

          Financial obligations and records, § 20:69:14:11.

          20:69:14:05.  Auditing. The property manager must maintain all records of all South Dakota transactions at the property manager's office. These records are subject to audit by the commission or its agents.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:30, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:14:06.  Contracts to be in writing. Before a property manager performs any services, the property manager and client must enter into a written management agreement specifying the duties and conditions under which the property manager is to perform services. A management agreement may include a provision for automatic renewal at expiration if it contains a provision for written cancellation on terms agreeable to all parties to the agreement.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:31, 20 SDR 18, effective August 16, 1993; 23 SDR 110, effective January 9, 1997.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-30, 36-21A-47.

          20:69:14:07.  Full disclosure required. In all dealings between a client and property manager, the property manager must inform the client of all liabilities, costs, and other financial obligations that may be incurred by the client if the client uses the services of the property manager.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:32, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47.

          20:69:14:08.  Real estate law applicable. Unless inconsistent with this chapter, the real estate law contained in SDCL Chapter 36-21A and this article applies to property managers.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:33, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47.

          20:69:14:10.  Broker subject to chapter. A real estate broker who acts as a property manager is subject to the provisions of this chapter.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:35, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47, 36-21A-71.

          20:69:14:11.  Financial obligations and records. A property manager must deposit all security deposits, damage deposits, advance fees, and rental proceeds received in a federally insured financial institution and must make a full accounting to the client. Rental proceeds must be disbursed pursuant to the contract between the property manager and owner. Records related to the receipt, deposit, maintenance, and withdrawal of the funds must be maintained for four years following the termination of a management contract.

          Source: 15 SDR 100, effective January 10, 1989; transferred from § 20:56:22:36, 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47, 36-21A-80, 36-21A-82.

          Cross-References:

          Amount of deposit, SDCL 43-32-6.1.

          Return of deposit, SDCL 43-32-24.

          Handling of money, SDCL 36-21A-88.

          20:69:14:12.  Property management accounting. A property manager shall prepare and maintain a receipts and disbursements journal or a check register for each trust account. Tenant security deposits must be maintained as a separate balance in the owner's ledger or in a tenant ledger account. Receipts and disbursements must be posted at least once each month, and all trust accounts must be reconciled at least once each month. Prenumbered receipt documents must be completed for any currency received by the property manager which belongs to a principal.

          Source: 18 SDR 101, effective December 17, 1991; transferred from § 20:56:22:37, 20 SDR 18, effective August 16, 1993; 21 SDR 125, effective January 23, 1995; 23 SDR 110, effective January 9, 1997.

          General Authority:SDCL 36-21A-89.

          Law Implemented:SDCL 36-21A-47, 36-21A-71.

          20:69:15:01.  Definition of terms. For the purposes of this chapter, a "qualified insurance carrier" is an insurance carrier which maintains an A.M. Best financial size category of class VI or higher and is and will remain, for the policy term, authorized by the South Dakota Division of Insurance to do business in this state as an errors and omissions insurance carrier of the type contemplated by this chapter.

          Source: 20 SDR 18, effective August 16, 1993; 27 SDR 7, effective August 3, 2000.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-120.

          20:69:15:02.  Insurance required. An applicant for issuance of a license on active status, a licensee renewing a license, or an inactive licensee activating a license must submit proof of insurance coverage through the group plan or through certification of optional coverage.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-120.

          20:69:15:03.  Minimum standards. The group policy obtained by the commission shall cover all activities contemplated by SDCL Chapter 36-21A and shall provide, at a minimum, the following terms and conditions:

          (1)  Not less than $100,000 single-limit liability coverage for each licensee per occurrence or claim made, not including costs for investigation or defense;

          (2)  An annual aggregate limit of not less than $500,000 per licensee;

          (3)  A deductible amount of not greater than one percent of the total single-limit liability coverage amount for each occurrence and a like deductible amount for defense and investigation;

          (4)  Coverage for the vicarious liability for current or previously employed or contracted individuals;

          (5)  An extended reporting provision of 90 days and an option to purchase an additional three years extended reporting provision for a premium not to exceed 200 percent of the premium charged for the last year of the terminating coverage;

          (6)  Coverage under this section for covered acts in any state, United States territory, or Canada in which a covered individual, domiciled in South Dakota, holds a license; and

          (7)  Stacking of benefits.

          The minimum coverage applies to each individual licensee.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-121.

          20:69:15:04.  Exceptions to coverage. Except as provided in this section, coverage may not exclude claims brought against the insured licensee arising out of an act or failure to act by the licensee when performing a professional service for which a license is required. Coverage may limit or exclude claims brought against a licensee which arise as follows:

          (1)  Out of claims or suits made or brought by any insured person against any other insured person within the same firm or from compensation disputes between licensees;

          (2)  Out of loss assumed under contract or agreement, except for liability the insured would have had in the absence of such agreements;

          (3)  From any criminal, dishonest, fraudulent, or willful act or omission. This exclusion does not apply to any insured person who did not personally participate in committing such an act or omission and who, upon having knowledge of the act or omission, reported it;

          (4)  From unlawful discrimination committed by or for the insured person;

          (5)  From fines or penalties imposed by law;

          (6)  From failure to maintain any type or amount of insurance for managed property;

          (7)  From bodily injury, personal injury, advertising injury, or property damage;

          (8)  From management or sale of property in which the insured or spouse has more than a 10 percent financial or ownership interest. This exclusion does not apply for one year from the date a property is acquired under a guaranteed sale listing contract if the property is listed for sale during that entire period;

          (9)  From related business activities for which a license is not required under this chapter;

          (10)  From any violation of the Securities Act of 1933 as amended through July 1, 1993, or the Securities Exchange Act of 1934 as amended through July 1, 1993, or any state blue sky or securities law or similar state or federal statutes;

          (11)  From involvement in any real estate investment contract or syndication as a partner, joint venturer, or underwriter;

          (12)  From hazardous materials, nuclear materials, or pollutants;

          (13)  From prior wrongful acts; or

          (14)  Standard exclusions.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-121.

          20:69:15:05.  Group policy approval requirements. Any group policy to be issued must conform to the standards and practices of the insurance industry and be approved by the South Dakota Division of Insurance.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-120.

          20:69:15:06.  Optional coverage. An active licensee who chooses the option of obtaining errors and omissions insurance independently from a provider other than the group carrier under contract with the commission must show evidence of coverage by providing certification of coverage on a form prescribed by the commission. The form must show proof that the licensee has coverage in compliance with the minimum standards established by § 20:69:15:06.01. The form must be signed by an authorized representative of the insurance company, and shall contain a cancellation notification clause as required by § 20:69:15:09.

          Source: 20 SDR 18, effective August 16, 1993; 21 SDR 125, effective January 23, 1995.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-120, 36-21A-122.

          20:69:15:06.01.  Standards for optional coverage. A provider issuing insurance coverage pursuant to SDCL 36-21A-122 must be an admitted carrier in South Dakota or in the state in which the licensee being certified resides. All activities contemplated under SDCL chapter 36-21A must be covered.

          The insurance must provide, at a minimum, not less than $100,000 single limit liability coverage for each licensee for each occurrence or claim made, not including the cost of investigation or defense, and an annual aggregate of $500,000 for each licensee, not including the cost of investigation and defense. A responsible broker may comply with this requirement by certifying coverages of a minimum of $500,000/$1,000,000, if all licensees associated with the broker are covered.

          A person who resides in and is licensed in a state that has a mandated program of errors and omissions insurance and who is also licensed in South Dakota meets the requirements for errors and omissions insurance in South Dakota upon providing proof that the person meets the requirements of the person's state of residence.

          Source: 21 SDR 125, effective January 23, 1995.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-121.

          20:69:15:07.  Time for filing of certification of optional coverage. Certification of optional coverage must be filed with the commission by 5:00 p.m. on the date of expiration of coverage. If the certification is not filed on time, the commission shall place the license on inactive status on that date.

          Source: 20 SDR 18, effective August 16, 1993; 21 SDR 125, effective January 23, 1995.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-122.

          20:69:15:08.  Nonpayment of premium. If a certifying insurance company which submitted certification of optional coverage notifies the commission that a licensee has not paid a premium, the commission shall place that licensee's license on inactive status as of the date of termination of coverage.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-122.

          20:69:15:08.01.  Surrender of license for failure to provide proof of insurance. When a licensee receives notice of being placed on inactive status for failure to provide proof of insurance, the licensee shall immediately surrender the license and the licensee's identification card to the commission.

          Source: 21 SDR 125. effective January 23, 1995.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-69.

          20:69:15:09.  Notification required for cancellation. If insurance under equivalent coverage is to be lapsed or nonrenewed, the providing company must notify the Real Estate Commission of its intent to lapse or nonrenew a minimum of 30 days before the expiration date of the term.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-122.

          20:69:15:10.  Proof of insurance required to reactivate license. A licensee whose license has been placed on inactive status for failure to provide proof of insurance may not conduct any activities for which a license is required until proof of insurance has been provided to the commission and the license has been activated. The license shall be considered active as of the effective date of the insurance.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-119.

          20:69:15:11.  Authenticity of coverage. A licensee may not willfully or knowingly cause or allow a certificate of coverage to be filed with the commission which is false, fraudulent, or misleading.

          Source: 20 SDR 18, effective August 16, 1993.

          General Authority:SDCL 36-21A-119.

          Law Implemented:SDCL 36-21A-119.

          20:69:16:02.  Open houses.Repealed.

          Source: 16 SDR 36, effective August 29, 1989; transferred from § 20:56:04:12.02, 20 SDR 18, effective August 16, 1993; transferred from § 20:69:03:18, 21 SDR 125, effective January 23, 1995; repealed, 25 SDR 90, effective December 28, 1998.