CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA San Bernardino County Business Case for Electronic Recording Presented By: De Ana Thompson Chief Deputy Recorder For Larry Walker Auditor/Controller-Recorder of San Bernardino County

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 2 Introduction The Recorder’s office is under continual pressure to record title companies’ property-related documents as quickly as possible. Due to the competitive nature of the real estate industry, title companies rely on timely and accurate recordation of documents. The release of funds to escrow and payoffs of existing loans and other encumbrances depend upon the documents being recorded. Multiple parties, such as real estate agents, escrow officers, title companies, lenders, and buyers wait for confirmation that documents are recorded. In some cases, the buyer is waiting for the above- mentioned to move into their home and moving vans are waiting for the go ahead. The real estate industry is extremely competitive and each party involved has an important stake in the outcome.

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 3 The Title Company Submission Process in 2001 Title Co.Recorder

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 4 Why the Industry needs E-Recording Title Company or Service Company clerk would deliver documents and wait and wait until all documents were examined, recorded and cashiered. (This might take most of the day.) Title Company or Service Company clerk might have to travel long distances to meet the specific timeframes for recording. San Bernardino County is the largest geographic county in the country (over 20,000 square miles). This makes it very difficult for these companies to plan their days. County budget restraints resulted in the inability to increase staff to meet the increasing workloads.

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 5 Many recorders saw a significant increase in the number of documents 00/01 01/02 02/03 03/04 Documents Recorded492,293671,000860,496949,864 % increase over the previous year36%28%10% Average Docs recorded per day # of Examiners # of Docs Per Examiner per day * Based on a 246 day year

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 6 Fiscal Years 01-04

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 7 Reasonable Expectation For Examiners Examiners need to examine and record documents with care and diligence. But… –The Title Company clerk wrote everything manually, relating the recorded instrument number to the order number, occasionally making errors. –The examiner explains why documents were rejected to the Title Clerk or Service Agent. By the time that information made it to the Title Company, it may be incorrect, misunderstood or untimely resulting in phone calls to and from the Title Company to explain the rejection and resolution again. – Examiners worked overtime frequently to meet the requirements of the day. – The Title Company clerk sat with the examiner and they became very chatty which could take away from timely recordings. – A reasonable average of documents to be examined, recorded and cashiered is about 35 per hour on a 6.5 hour work day. Some examiners can examine more and some examine less. – We must also consider vacations, sick leave, and just being tired.

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 8 The Title Company Submission Process in 2002 When Implementing E-Confirmation Title Co.Recorder

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 9 The Title Company Submission Process in 2004 When Implementing E-Recording

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 10 What are the costs of E-Recording? RecorderSubmitter One – Time Software development$103,000 Hardware$ 8,000 Larger monitors ($1, ea.)$ 22,500 (Equivalent of 3.5 examiners for one year) $133,500 Annual Maintenance$ 25,000 Less Tangible Training (Operational staff time)$ 650 (Average of 24 hrs./title co.) Technical support/title company $ 400 (12 hrs. per title company) Hardware$6,392 Software$1,275 Maintenance$1,043 Ongoing Maintenance ? Postage$.35/doc Less Tangible Training of operational end technical staff

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 11 What are the savings? RecorderSubmitter 1.Ability to submit documents throughout the day. 2.Leveling of workflow (submissions, confirmations, closings, payoffs, release of funds). 3.Number of lost documents. 4.Documents can be corrected quickly and usually re-submitted the same day. 5.Happier customers. 6.Better utilization of staff. 7.Transportation costs for remote offices. Less Tangible Better utilization of staff Increased productivity Savings estimates Postage - Per document $.35 Annual overtime $36,808 Annual cost of 1 document examiner $37,736

CALIFORNIA E-RECORDING SUMMIT Implementing the Electronic Recording Delivery Act February 2005 Sacramento, CA Page 12 For Any Questions or Comments please contact: De Ana Thompson Chief Deputy Recorder For Larry Walker Auditor/Controller-Recorder of San Bernardino County (909)