One of TICA's paramount goals is to protect investors, DelRosso says. "We believe the securities format does that." DelRosso is also president of Inland Real Estate Exchange Corp., an Oak Brook, IL-based securitized TIC sponsor. There have been signals in the past that TICA could evolve into an association that more specifically represents the securitized TIC industry, and from DelRosso's comments it does appear that's where the association is heading. She says the TICA board is currently working on a position that would essentially say TICs should be sold as securities. "You will probably see us in the near future come out with a position paper." She hastens to add that the belief is Realtors are still vital to TIC transactions, since among their roles is to sell properties to TIC sponsors and ultimately selling them on for disposition for the TIC investors.

TICA has likewise verbally opposed a bill before the Oregon Senate, and DelRosso indicated that opposition will be followed up in written form. SB449 was introduced by Sen. Rick Metsger on Jan. 22, and a week later was referred to the Senate's Business, Transportation and Workforce Development Committee, of which Metsger is chairman. No hearings have been scheduled as yet.

As it is currently proposed, SB449 would change the state's definition of real estate to include "an ownership interest in real property when (A)The interest is a tenancy in common or other undivided estate, including but not limited to a fee or life estate; (B)Interests in the real property are owned by at least two but not more than 35 owners; and (C)An agreement, if any, for the management of rental real property subject to the interests, including an agreement for the management of a master lease that governs leases or subleases, permits a majority of owners of the interests not to renew the agreement at the end of the term of the agreement or to terminate the agreement after giving 180 days' notice of termination." Further, real estate would be excluded from the state's definition of a security under the proposed bill.

Both bills follow in the footsteps of Utah's SB64, which became law in March 2005 essentially excluding tenant-in-common transactions from the state's definition of securities, though it was amended last year to allow TIC interest securities in Utah properties to be sold without a real estate license under certain conditions.

"I think it's great that states are starting to take a proactive stance on the tenant-in-common issue where real estate is concerned," says Peter A. Johnson, VP of marketing for Boise, ID-based Spectrus Real Estate Group, which sells non-securitized TICs. "Where's the line between securities TICs and real estate TICs? That's all this bill proposes to do--draw that line," he says, adding that he hopes more states will "define a line so real estate professionals know, what's securities and what's real estate."

Spectrus' general counsel, Jeff Warr, was among those who spoke in favor of the Montana bill at its House Judiciary Committee hearing. Johnson tells TIC Monthly that his company and the TIC Real Estate Association, of which he is a board member, are among those who have "been involved in both lobbying and drafting legislation" in Oregon as well as his home state of Idaho and in Montana. "We are not trying to abolish securitized TICs…We're not trying to take anybody's business away, we're just trying to support the fact that there can be real estate TICs," Johnson adds, "We are going into these states trying to craft legislation that works for both sides…All we're interested in is not even the structure, but that real estate tenants-in-common is protected--to protect and preserve the rights of real estate professionals."

The concept has not reached the stage of a proposed bill in Idaho, adds Johnson, who is also a member of the TICA. "This process is starting slow, and then we hope it will gain ground," Johnson says.

In Idaho, a potential bill "is being negotiated right now with several of the government bodies that are involved," he reports. "We hope within the next year we would have something proposed."