today on getting answers are harsher sentences the key to stopping crime? as california marks 30 years since three strikes and you're out. we dive into the data, and it's exactly one month until tax day. so today, abc seven is holding our annual free tax help with help

from united way bay area. we'll get your tax questions answered. but first a seismic change in what people pay to buy and sell their homes. the industry standard 6% commission is no more thanks to a sweeping settlement in the face of class action lawsuits. you're watching getting answers. i'm kristen sze. thanks for joining us. the sweeping settlement by the national association of realtors is seen as a huge deal that will make it less costly for regular person to sell a home. joining us live now to talk about what this agreement means for you and for industry professionals and for the availability of homes. norm miller, professor emeritus from uc san diego and faculty member at the hoyt institute. norm, thank you for joining us. thank you. so i understand this deal resulted from class action lawsuits. who filed those suits and what did they allege? >> it was called the sitzer barnett case in kansas city. uh- michael ketchmark was the lawyer back in 2019. that was the first

case. and what they allege is that we had the effect of price fixing because of the arrangement between sellers and buyers, where sellers would offer to pay the buyer's agent a fee. that fee would be disclosed through the mls, and it kind of discouraged competition in the sense of fees being varying because uh- if somebody was a price cutter, they alleged that uh- the buyer's agent, would not show those listings anyway. they won that lawsuit, they also alleged that real estate prices had gone up faster than inflation, and real estate commissions were increasing in terms of real terms, real terms. and, that is faster than inflation. and so they were alleging that, that commissions

were not flexible, that they were fixed. >> all right. so maybe you can help us understand better in terms of what the changes will be, by let's run through an example. okay. $1 million home here in the bay area. that's what it's listed for, let's talk about under the old structure. you know, we hear about 6. explain to us what you know, that 6% is who pays that commission. and what happens now. >> so under the old system, the commission was typically 5 or 6. the seller's agent would get a fee, typically 2 or 3. part of that fee would go to the brokerage firm. part of that would go to the agent. they would offer a 3% co-op fee to the buyer's agent, and the buyer's agent would know that they would get a 3% fee, $30,000, if they would bring a buyer and pay $1 million for that home. so we'd have 30,000 on each side. the agents would split that money with their firms, the proportion they got

varied with the firm, that's the old system, and the new system. yeah. is going to be different. >> so how would it work? now, i understand that the whole point of the change is there will be more transparency and more flexibility and negotiability. so what might that mean? what does that look like? so the lawsuit was trying to break down that that fee disclosure system to the buyer's agent. >> so that will no longer be disclosed. and the buyer's fees will be negotiated between the buyer and their agent. now, how they will be paid remains to be seen. but with the new system we're going to see all kinds of models out there in terms of buyers, agents charging fees and how they charge fees, and maybe non contingent fees on both the seller side and the buyer side. i should have said that on both sides, you usually didn't pay any fee. if you didn't actually

buy or sell a home under the new system. i expect some firms will be charging fixed fees, whether you sell the home or not, or whether you complete a transaction on the buyer side. >> and that is so that they are making some money, right? because i was doing some quick math. and so let's say you had that $1 million home in the bay area, 6% could have been like $60,000. and i wonder how much more, how much of that may be put or left in the seller's pocket as a result of these changes? i mean, we don't know for sure. and there could be all sorts of deals, but we are talking about tens of tens of thousands of dollars in each transaction. right? >> we are. and under the old system, again, we only paid a fee if we sold the home. and so the homes that sold subsidized the homes that did not sell, that's going to go away if we start seeing fees that are not contingent, so that's one thing that we might see. but if fees go down to what they are at, in

countries like israel, singapore, the united kingdom, we could see fees drop significantly instead of that 5 or 6% fee, we may see fees, 2, 3, 4. and that range eventually. not necessarily right away, but eventually we may see some firms compete on fees or for more expensive homes and markets like san francisco will probably pay lower fees than markets like dayton, ohio with the average home is much cheaper. >> let me just ask you then, could this then make it easier for people to say, you know what, i'm going to list my house? and could this contribute to more housing availability, more houses on the market? what do you think? >> absolutely. so if our average fees were, say, 2, and i don't expect that to happen anytime soon, 4% is more likely. but if they went down to 2, we would see some people buying and selling more often. instead of saying, oh, it's too expensive to buy or sell. if you can save

20, 30, $40,000, we will see some people on the fence saying, i'm going to go ahead and sell my home. add to the inventory out there, and we may see more volume. so, some of the agents that are still busy will do more volume because people will sell a little bit more than they have in the past, i see. >> so they may not necessarily lose out because maybe more volume, maybe they make a little less per transaction, but maybe they have more transactions. we'll see. just so i'm clear, does this involve most realtors and most brokerage firms? i mean, how widespread is this going to be? >> well, we should note that not all real estate agents and brokers are members of the realtor association. yeah most are. they dominate the market. they're 90, there's also the real test association, which is mostly made up of african american real estate agents, not too many people know about them.

and then it's possible to be a licensed agent and not a member of the trade group at all. but since the realtors dominate the market, this will definitely affect most of the market. certainly 8,090% or more will be affected by this ruling, and how they run the mls, what they disclose in the future. >> so how might this affect online brokerages like redfin or online listing marketplaces like zillow? >> a few vendors very few like homes.com, makes their money, makes the money, from for their operating their website by advertising. zillow makes money by advertising and also referral fees to agents. i think that it will end up resulting in firms like zillow and their subsidiaries changing their model a little bit. the referral fees, might be a little bit different in the future. we may see some real estate agents, the

marginal mediocre ones, going out of business, but i expect that the full time professionals will do more volume. a lot more volume. so there'll be fewer agents for firms like redfin and zillow, out there. but but we should see a shift away from the mediocre part time agent towards the professional full time agent, which is good for, the professional full time agents and also good for society. >> yeah. all right, this is fascinating, by the way. real quickly before i let you go, when does this take effect, in july 1st, i believe, or sometime in july. this summer it takes effect. we could see some firms break away before that, there are some firms already negotiating fees. i got an email today from one in austin, texas, saying we're doing exactly what you're what you're saying. we're going to offer a menu of services, charge different fees for different services. so you might see some action soon. but

the real estate industry is a little bit stubborn. it's going to take a while before we see any big changes. all right. >> big news today. if you're thinking of buying or selling your home this year. norm miller, professor emeritus at uc san diego. thank you so much, actually, it's the university of san diego, but that's okay. thanks. >> what did i say? san francisco , uc san diego. oh, right. okay. it's a common mistake. thank you very much i appreciate it. thank you. yeah. and you're right. that needs to be noted. all right. take care. is california on the brink of another get tough on crime movement similar to the three strikes era. we'll be right back with a preview of a new abc seven original and talk with the stanford professor

prison sentences proven effective in containing crime. a new abc seven news originals video struck by justice looks back at the kidnaping and murder of a petaluma girl, polly klaas, and the tough on crime era that it brought on. did it make us safer and at what cost? here's a preview >> 12 year old polly hannah klaas was in her own bedroom, having a slumber party with two girlfriends when she was abducted last night. >> he had a knife. he threatened them, and then he left with the victim. >> police are calling richard aln das, the prime suspect in the polly klaas kidnap case. davis life of crime began at the age of 12. >> why was this guy on the street? why wasn't this guy in prison? >> polly's murder is pushing the three strikes and you're out. initiative forward. it would eliminate parole for repeat offenders. >> three strikes and you are out

in the 90s, we thought the only solution was lock them up and throw away the key. >> three strikes law disproportionately impacted people of color or people. >> these three strike guys that are here. they were seeing guys with murder have less time than they did for stealing a slice of bread. they all want to empty the prisons now. >> and what's happening? crime is on the rise. >> all these misdemeanors have gone nowhere. people aren't getting prosecuted for them. there are no consequences. >> i don't think there should be attempts to rehabilitate them. i think we should throw them away and lock up the key. i think violent people should be behind bars. >> you can just say, let's just lock them up. but it doesn't work. so then what? >> all right. joining us live now to talk more about this is michael romano, one of the stanford professors who authored

the proposition that modify the three strikes law. we saw you in the piece. thank you so much, professor romano, for joining us. >> oh, thanks for having me. >> look after polly klaas. voters driven by outrage and fear, passed the three strikes law in california. what did that do? what exactly did that change? so in 1994, after actually two murders, polly klaas was one of them. >> and as kimber reynolds was another young woman who was who was killed. yeah. california voters passed the three strikes law, which basically said any three felonies would send you away for life. and at the time, that could be very minor crimes, drug possession, petty theft, shoplifting would send you a life in prison and actually get longer sentences than murderers and rapists and child molesters. wow. >> even shoplifting. right uh. of course, three strikes was modified in 2012. you led that. that was proposition 36. how did that change things again? and why did you think that was necessary? >> so we set out to reform what we thought was the harshest aspects of the three strikes law and its original form,

california's three strikes law was the harshest sentencing law in the country. and like i said, people were sentenced to life for literally shoplifting a pair of socks. and so we changed the law. and proposition 36 in 2012 to make sure that the third strike had to be a serious or violent crime, had to be robbery or burglary or rape or child molestation, which we thought was really restoring the original intent of the law and what voters really wanted in the first place. and to really avoid the overcrowding, prisons and the overincarceration of people who are homeless and mentally ill and disproportionately people of color, we're getting caught up in these minor crimes. >> right? and those folks were always overrepresented, if you will. but are you saying three strikes made it even more so? >> yeah, three strikes made it even more so if you committed a very serious crime, rape or murder, you went to prison for a long period of time. but if you committed a street crime, petty theft, shoplifting, you went for a short period of time and had a chance to come in and come out. so that meant that that was the people who were targeted by the three strikes laws disproportionately, even more so

than the regular criminal justice system. people of color, people with mental illness, people are homeless, people who really needed help, not incarceration. incarceration wasn't doing anything. it was costing us a ton of money and not helping public safety. >> right. you said it really wasn't doing anything yet. it was costing a lot of money. when i ask, you did a 2007 report by the public policy institute of california find, though, that three strikes did deter serious crimes, especially among offenders who already had the two strikes and wouldn't want a third one. >> so long sentences in general shows a modest, very modest, deterrence for violent crimes. but that's not the type of crimes that we were talking about with proposition 36. we were talking about ray, petty theft, shoplifting, drug possession, and actually subsequent studies have shown that the three strikes law in general did nothing to improve public safety in california, and instead is it cost us billions of dollars. >> all right. and as you know, of course, you led two years later, another change, prop 47. and that raised the threshold for a felony, theft to $950. anything below that would then

be a misdemeanor, right. and many people now, see what's happening with the retail theft rings. and then they point to that as being one of the causes. what do you think about that? >> yeah. so again, studies show that prop 47 didn't do anything to change crime rates in california. but more to the point, i think we're all seeing what's going on on the streets of california and particularly san francisco. and we don't like it. almost all of those crimes have nothing to do with prop 47. organized retail theft has nothing to do with proposition 47. car theft, auto theft have nothing to do with proposition 47. this is a complex problem of crime, for sure, but also mental illness, housing, and the way that i see it in california and particularly in san francisco, these these issues are treated in silos. there's a mental health system, there's a housing system. it's criminal justice system. and really, we're only talking about increasing punishments without treating the whole system as a unit, as a system to really get to the root causes of the problems and really try to fix these things in a way that i think will

actually have impact. just increasing punishments, is not going to do the job, hasn't done the job. police aren't even arresting these people in the first place. so increasing punishments, isn't isn't going to change the outcomes, look, you're now the director of stanford's three strikes project. tell us more about that. what kinds of cases do you take up and what do you try to do there? >> so we represent people that we think are the most unfairly incarcerated in the country, people who are serving life sentences for petty theft, for stealing a purse for shoplifting, who are still serving life sentences. again, these people are almost all people of color, almost all mentally ill, some intellectually disabled. they've sort of been forgotten by the criminal justice system. they've been in prison for 20, 25, 30 years. and we use our students at stanford to run these cases. they go investigate these cases, find new evidence and file new pleadings in court. we've been tremendously successful in getting courts to revisit these sentences and saying, you know

what? actually, these people have served enough time. we can safely release them. it's not used to having them in prison anymore. wow. >> and how long have you been doing this? how successful have you been? how many people have you gotten? >> so we've been doing this for about 15 years and about 200 to 250 of our clients have been safely released. zero have been returned to prison, which we're very proud of and have all been returned to their community, returned to their families. many have great jobs and are doing spectacularly well on the outside, we spent a lot of time to make sure that people who get out of prison actually have a place to go, have the care and support mental health treatment, housing that they need. that's part of the systematic approach that we really need, just increasing punishments doesn't do the job. keeping these people in prison is expensive. is it worth it? it's ruining their lives, their family's lives. and i think harming our communities. >> stanford professor michael romano, thank you so much. really appreciate it. thanks for having me. all right. and you can see struck by justice, the impact of polly klaas. that is now streaming on the abc7 news app. okay. we are only one month

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with tax day 2020 for exactly one month away. tax filing season is kicking into high gear, so today, seven on your side is hosting a tax chat to get answers to your tax questions by real tax professional. go to abc7 news.com. click seven on your side and you'll find the form to fill out. tax experts will be

answering your questions until 7:00 this evening. they are on call right now, busy in the seven on your side office. so drop in your question. joining us live now to talk about this incredibly helpful event is united way bay area ceo kelly batson and program manager sophia selassie. hi kelly. hi, sophia. welcome, both of you. thanks for having us. this is great. we're so excited to partner with you. tell us why united way bay area does this and offers the tax help. yes >> so united way bay area is mobilizing the others to dismantle the root causes of poverty and build pathways to economic prosperity. so we do that by offering. one of the ways we do that is offering free tax preparation to low to moderate income families. we're looking to help people get their taxes done for free and claim those tax credits that are really valuable. >> it can be so difficult and challenging. and you're right, people don't always maximize and know the rules that could help them. look, what kind of questions are common? >> well, i think that a lot of common questions are around the around tax credits, how they can

maximize tax credits and are able to get the biggest refund possible. well, we do see a lot of parents with college age children, as well as just college age individuals. so thinking about what kind of education credits people can get, how can we make sure that, you know, we know college is expensive, so how can we make sure that taxes, you're able to, you know, get help on your taxes with that? >> anything new this year that people need to be aware of? there are some they're not exactly new, but some still under claimed tax credits that we're seeing. >> there's one for foster youth for here in california. and we also we are just always going to talk about the earned income tax credit, both the federal and the state. there's millions of dollars left on the table every year. and people that are eligible should really go and claim that. >> go get yours. let's give you another look at the tax professionals answering our viewer questions right now. we go from 3 to 7:00. who are these amazing free tax help volunteers? what's their background? >> well, our tax help volunteers

come from all sorts of different walks of life. we do have cpas and tax professionals who act as volunteers, but we have, you know, college students. we have retired folks, and they are all trained and all have irs certifications in order to prepare taxes that they are qualified to prepare. >> fantastic. and they are at your disposal for free. again, you just go to abc seven news.com, click on seven on your side and you drop your question in the form right there. so are you providing this help in different languages? what if the caller doesn't? or the person dropping in the email? the form doesn't speak english? >> yes. so many of our we have about 90 sites across the bay area. and we have volunteers from all walks of life that speak all kinds of languages. we have organizations that are really embedded in the community that are providing this help. so they have lots of volunteers that can help in the language that you need. >> wow, look how do you get ready for this every year? and make sure everyone's trained and

kind of has the same information at their fingertips. >> well, like i said, our volunteers are trained and they're able to answer these common questions. >> we do have we have common faqs that we have on our website that we see a lot of questions about. we also know that there are folks who don't have a social security number and would like to get an i10 number in order to file taxes, so we're able to assist with that as well. and we have trained volunteers to do that. >> truly a wonderful resource. sophia selassie and kelly batson, thank you both. so much. really appreciate this info. >> thank you for having us. >> and a reminder, folks, you can get answers to your tax questions by a real tax professional. just go to abc7 news.com. click seven on your side and you'll find the question form right there. and these tax experts will be answering questions until 7:00 this evening. so you've got about 3.5 hours. so get on it. thank you again. all right a

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questions with experts from around the bay area. and remember, from 3 to 7 tax experts answering your tax questions, just go to abc7 news.com and click on seven on your side for the forum to drop in your question. we'll have more on this at 4:00 today. meantime, wo >> whit: tonight, the judge's blistering decision about t