While some call what happened in Chicagoland a witchhunt -- blaming former CEO Jay Huffman and his wife, for obeying directives by the MLSNI board of directors to pursue new avenues of revenue -- what's really at issue, is how the MLS was empowered by its association shareholder-members to generate so many millions of dollars that such sums, could be risked in speculative ventures like investment in REBIG.

It's certainly not what many agents felt they should be paying for, no matter how wealthy their brokers would get, and most didn't know they were being overcharged in order to produce revenues for the associations and broker-associates to invest in other entities.

That could be why so few leaders have appeared to defend the Huffmans after their attempts, to start a data-mining service using investment seed money from MLSNI and other associations. While there's evidence that some actions by Huffman could be interpreted as conflicts of interest, some say the Huffmans were collateral damage in a covert war waged by powerful brokers to regain control of their associations and the MLS.

That's where the situation stands now with a proposal before MLSNI shareholders to sign over its assets, and liabilities to a new entity called "NEWCO," which would also acquire the assets and liabilities of MAP to create a new MLS.

What some brokers and agents want, is one multiple listing service with one database to serve Chicagoland's Realtors without association management of the MLS. The MLSNI shareholder associations don't want to lose their cash cow -- the MLS, but they also want to put the past, and its attendant liabilities (including personal threats of lawsuits in some cases), behind them. And broker-owned MAP doesn't want to be used and abandoned, after brokers pumped up its listing bank and membership coffers, they pulled listings and offices out of MLSNI to join MAP, in order to send a strong message to the associations who operate MLSNI.

The question is how it will be done. Among the many considerations are the "operational, legal, membership, ownership, and voting challenges of creating a combined MLS entity," according to a report by real estate industry consultant Steve Murray who is assisting the Consolidation Task Force with logistical considerations.

While even the Task Force isn't unanimous on its recommendations, what is being considered, is a new non-profit MLS called "NEWCO," which would take the place of both MAP and MLSNI. NEWCO would "acquire the assets of, and assume certain liabilities of MLSNI and MAP," says a Task Force report written by Murray.

"It was felt, that since there was general agreement that brokerage firms are the primary customer/client of MLS that they should own, and govern the MLS. To have the broadest potential ownership participation, yet not force any firm to have to be an owner in order to receive full MLS privileges, brokers could chose to be members or subscribers (these terms used by example only).

"Members" would be firms that paid a joining fee, and were able to receive voting rights and distributions of excess fees (if there were any).

"Subscribers" would be firms that chose not to have to pay a joining fee, would not receive voting rights, and would not receive distributions of excess fees.

"Membership" privileges would be delivered through a membership agreement, rather than through any stock subscription agreement.

Members would elect directors, and include members from every brokerage size category, with associations having the right to appoint one director as well. Only Realtors would be allowed to be members and subscribers.

Without a formal association with the National Association of Realtors for MLS purposes, NEWCO would need its own Errors and Omissions Policy; Code of Ethics and other rules; policies about VOW's, IDX, and other critical issues of MLS governance and possibly other solutions.

On Friday, a presentation was made to the MLSNI shareholders to consider the proposal. All parties involved will get back to Murray and the Consolidation Task Force on April 15th, 2005, with their recommendations.

Published: March 21, 2005

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.