Gas Pipeline Disclosure – California’s New “Megan’s Law”

We’ve talked at length about AB 1511 – the new bill making its way through the California state assembly that aims to include gas pipeline and hazardous liquid disclosures as a part of the mandatory filings in all real estate transactions.

It was clear to everyone that after the disaster that occurred in San Bruno, something had to be done.

On May 8th, the legislation took a dramatic new turn that makes the proposed legislation more acceptable to everyone, and seems to be modeled very much after Megan’s Law.

Under the most recent amendments, the legislation proposes that a “consumer-friendly” disclosure notice at the time of sale of a home or real property is sent to every buyer.

The seller or broker is NOT required to provide any additional information.

The notice would provide an online link to a database in the National Pipeline Mapping System (NPMS) website, which is managed by the federal Pipeline and Hazardous Material Administration (PHMA) within the Department of Transportation.

This database reflects information submitted by all pipeline operators. The website features a map viewer and a database of contact information for gas, utilities and pipeline operators.

When RE-Insider sampled real estate agents for their take on AB 1511, the result was an overwhelming opposition to the old bill. Could our sample of voters have helped change the minds of legislators? We hope so.

How do you feel about this bill? Is it improved and helpful? Or do you feel ultimately it’s one more task for agents to be responsible for?

  • Samantha_B

    I don’t think that sounds like too much work. Agents should want to do that so buyers can feel safe.

  • 2muchREstuff

    Just when I had enough requirements our CA government adds another!  WhatEV!

  • Bradley Norton

    I don’t think this is going to solve the problem it was intended to. The buyers will get lazy and not check the database and then if something happens they’ll blame the agent

  • Heather Leigh

    The database has got to be innaccurate.

    • Ben

      Highly innaccurate!

  • Td4realtor

    Just one more task assigned to us that increases our liability. Just another reason for me to leave CA for less government.

  • Carol

    Many buyers check the Megan’s Law site. With the gas pipeline explosion in the news, I would think MANY will check that link as well.  As long as the agents are NOT responsible for “clicking the computers keys” for the buyer, we should be ok

  • Mgsocalglam

    I think the responsibility of notifying the public should lie with the gas pipeline provider not real estate agents.

  • Dianevaline

    Could this new disclosure be added to the exixting Natural Hazards  Disclosure package  ?  The hazard may not be natural but including it at that point seems to make sense to me.

    • Ben

      Dianevaline- unfortunately this is a “man-made” environmetal type hazard. Sticky wicket any way you look at it.

  • George

    What happened in San Bruno was unfortunate but no amount of disclosures could have ever prevented this disaster. As usual; politics at work here are creating more work for our industry. This is in a way; punishing us for this and it’s not focusing on the responsible parties. Regulation and not disclosure is needed for those parties to ensure that the likelihood of this happening again is significantly reduced. There is bound to be another unfortunate natural disaster here in California; maybe we should create a disclosure labeled “Beware Of Natural Disasters”. After all, we live in a state prone to natural disasters and those who don’t realize that or are unwilling to accept it, need to go live in another state!

  • Superstar

    Excellent I am so glad they are finally doing this.  

  • Deb Cavallaro

    Just one more task for agents to be responsible for.  We need to reduce the number of disclosures and reports that do nothing but bog down every real estate transaction and burden all parties concerned seller, buyer, agent, escrow, title with mountains of paperwork.  Most of the circumstances that the disclosures refer to and that boggs down the whole transaction occur in only a tiny fraction of cases.  Yet every time some bizzare accident occurs the legislature finds it necessary to add another reem of paperwork to every real estate transaction.  We need to reduce the number of pages required in every transaction, not add more to it. 

    Is any group out there lobbying the legislature for rolling back a lot of the paperwork?  Who is on the side of sanity and common sense out there? 

  • Brian

    Shouldn’t the burden of safe infrastructure and notification of its location be placed on the Utilities where it belongs?  After all, they’re the one profiting from it…

  • Agent_Julie

    Agents should be glad this was the compromise that was reached.
    It was a lot worse before! 
    Now all they need is a legal note with the disclosure that says “agent is not responsible if you don’t do your hw”

  • Gene R

    CA will figure out a way to change the bill again and it’ll be even worse for agents. 

  • Steve

    There are so many regulations that are required to be provided to the buyers, that they will not read everything because they just want to sign the forms and close the deal.  Then in court they say the agents told them just sign everything, it is just legal stuff that everyone signs.   And the jury knows this because that is what they did.  The agents are still held liable.  It would be best if CAR would make it far simpler.  There should be an online training session that all buyers have to register and complete before they are legally allowed to close the transaction.  Agents could then have the buyers sign one form where the buyers have to insert their confirmation code given upon completion the course.  The agent would log into the CAR website to verify the code matches the client’s name, and the process is done.   Just two forms: the NHD Statement and this form.
    The online session would be similar to our CE training where each screen must be gone through and there is a minimum time limit so the client can’t come back as say the agent told me to just sign, and I never read anything.  The topics would cover the CAR forms as well as the statewide forms such as the Booklets: Guide to Homeowners, Environmental Hazards, Mold; HERS; Residential Earthquake Hazards Report (Built before 1960), and any local disclosures.

    • Monica Lascano Contreras

       Steve, I agree 100% with you. We should present a petition to the CAR regarding the “Buyer’s transaction course”….. They really need it, they have no idea what they sign in a real estate transaction.

  • Debra Sheehan

    It doesn’t solve the problem at hand. Only “Buyers” will get the information. What about everybody else? “All” homeowners should get the information. So publish in the newspapers….send the info out in the gas bills. Why segregate real estate agents? It’s just one more piece of paper in an already overwhelming stack of information for a buyer. So many disclosures most buyers are really not taking the time to read them. Information Over-load!!!!

  • John

    Totally ridiculous to add another disclosure to a real estate transaction….nobody reads them now!!!

  • Hillary K

    It’s essentially the same to me in this bill as it was before. The disclosure shouldn’t be necessary. As some of the other comments said, the agent will still be held liable since they were the ones handing the sheet over to be signed. Even if the language in the disclosure was simple and understandable, someone would sign it and then claim their agent mislead them or lied to them. This whole issue might have been somewhat lessened or at least easier to deal with if the utilities and gas pipleline companies had kept track of the exact location of their pipelines in the first place, or would go back and track them now to make everyone safer. The agents are being blamed/burdened because of someone else’s mistake.

  • Carmen Scherubel

    this should be included in the myriad other items that the NHD covers

  • Damemcknight

    Our Legal Counsel, Gov Hutchinson will just create a form…no biggie, it’s one more piece of paper that we can’t forget.

  • LKINGBROKER

    ABSOLUTELY!  IT IS NECESSARY.  IN  30  YEARS  OF  REAL  ESTATE  I  TELL  THE  BUYERS
    AND  SELLERS  EVERYTHING!  HAVE  NEVER  HAD  A  SLEEPLESS  NIGHT.

  • N.”Sig”Sigler

    Sirs: is bad enough that the housing  market has crashed,k worse in some places where there is NO LOCAL ECONOMY to help retain values. Now, the so-called people whom have been lucky enough to have been re-elected, hav decided to take it out on the hap=less and hopeless people who are TRYING 
    to stay in business of selling real estate to a scared society. Now, they are further saddled with a responsibility which is clearly that of LOCAL & STATE OFFICIALS, NOT the poor unprotected R.E. agents who have no defense of their own. I am a licensed R.E. Brkr since 64′ and can’t get things going here in little jerk-water areas like Hemet & San jacinto wherre there is NO ECONOMY, not even agriculture which was its only economy.  As a WW-2 vet I have lots of knowledge to give IF asked, but I am also smart enough to remember that new agents think they know ALL there is to know about Real Estate because they passed the tests!!   I even saw this last nation-wide collapse of real estate values, caused by same thing that happened in1963+ here in Calif.(mostly bay area & Sacto) not much in so. Ca. (again because of good local economies). I could write a great deal about this if given
    the chance, but won’t hold my breath. 
    Yours Truly,
    N.”Sig” Sigler, R.E. Brkr since 64′ 

  • The add’l Gas Pipeline Disclosure shouldn’t be a problem and should be included with the Natural Hazards Report Disclosure in which would be an expense towards the Seller at close of escrow.

  • Bngproperties

    The agent is held legally responsible IF it is proven they misled or did not explain the form to the client. How can the agent prove they did do their job? CONVERSATION LOG. If you write down what you told the client and that they understood and agreed to it then you are off the hook liability wise. Do the clients have conversation logs? No. Do the other agents have (good) logs? Mostly not. Been sued-Had bullet proof conversation log-Was dismissed from case (ie. I won). The conversation log is your warm blanket of safety. If you are too lazy to write a detailed one then you are practicing unsafe Real Estate. Yes there are toooooo many laws and govt is sticking their nose in too many places. But look at it another way, being the agent that covers all the bases makes you better than your competition and you get more business.