The Appraisal Institute reported April 17 that 37 bills affecting the valuation profession are pending in 23 states. The proposed legislation includes:
makes various changes to the state’s appraiser licensing law and appraisal management company oversight and registration law.
allows a state-licensed or state-certified appraiser to deviate from the Uniform Standards of Professional Appraisal Practice in certain circumstances.
allows real estate brokers and salespersons to estimate for a fee or other valuable consideration a probable property sale price or lease price.
would require AMCs to compensate appraisers within 14 days.
makes changes to the state’s AMC law and would allow appraisers to perform evaluations in compliance with the Interagency Appraisal and Evaluation Guidelines and allow the Florida Real Estate Appraiser Board to consider the adoption of standards of valuation practice other than USPAP for use in non-federally related transactions.
enacts a comprehensive AMC oversight and registration law.
prohibits AMCs from passing along to appraisers any costs, fees or other expenses.
requires the fee paid to an appraiser be shown separately from the fee paid to an AMC in any residential real estate closing document that lists real estate appraisal fees.
repeals the Appraisal Management Company Registration Act, thus eliminating a requirement to disclose to a borrower or loan applicant the total compensation paid to the appraiser or appraisal firm for an appraisal obtained through an AMC and used for the purposes of a loan.
increases to six the number of members appointed to the Real Estate Appraisal Administration and Disciplinary Board who have been actively engaged and currently licensed as a state-certified general real estate appraiser for a period of no less than five years. It also would eliminate two members holding valid licenses as both real estate brokers and real estate appraisers.
requires AMCs to compensate appraisers within 30 days of their submitting an appraisal to an AMC.
allows appraisers to utilize the Appraisal Institute’s Standards of Valuation Practice and Valuers’ Code of Professional Ethics when performing an appraisal for any purpose other than a real estate-related financial transaction, and would allow appraisers to perform evaluations.
reorganizes the state’s appraiser licensing and certification agency.
enacts mandatory appraiser licensing.
enacts a comprehensive AMC registration and oversight program.
defines the terms “client,” “intended use” and “intended user” and indemnifies appraisers from liability to any person other than the client or the intended user of the appraisal.
reduces the time during which appraisers are subject to disciplinary action by the Board of Registration of Real Estate Appraisers to five years from the date of the certified appraisal report or two years from the date of final disposition of any judicial proceeding.
clarifies that allegations that do not result in disciplinary action against an appraiser are not made public, and that a background check is only required for an initial appraiser application. It also provides for the sequestering of information related to disciplinary actions more than five years old and imposes a six-year statute of limitation on civil actions against real estate appraisers.
clarifies that state-licensed and state-certified appraisers may perform evaluations.
requires that appraisers are paid reasonable and customary fees, which are based on third-party information.
requires the payment of reasonable and customary fees to appraisers in accordance with federal law.
updates the state’s AMC law to bring it into compliance with federal minimum requirements and the state’s supervisor and trainee requirements so they’re consistent with the Appraiser Qualifications Board.
updates the state’s existing AMC law to bring it into compliance with federal minimum requirements.
enacts a comprehensive AMC oversight and registration program.
requires appraisers to include an invoice in the appraisal report.
establishes a “Special Appraiser” licensing category.
establishes an appraiser-specific statute of limitations.
requires the state appraiser board to establish an appraisal fee schedule.
calls upon the U.S. Congress to support proposed changes to the AQB minimum appraiser qualification criteria.
establishes the parameters around which a real estate broker or salesperson may perform a broker price opinion or comparative market analysis.
establishes a comprehensive AMC oversight and registration program in accordance with federal minimum requirements.
clarifies that real estate brokers and salespersons may only prepare price opinions for the purposes of listing, purchase or sale.
enacts a comprehensive AMC oversight and registration program in compliance with federal requirements.
enacts a statute of limitations applicable to civil claims against real estate appraisers.
makes various changes to the state’s existing AMC oversight and registration law to bring it into compliance with federal minimum requirements.
makes various changes to the state’s existing AMC oversight and registration law.
repeals both the requirement for criminal background checks for appraisers and the state’s existing AMC oversight and registration program, vesting that authority instead to the Vermont Real Estate Appraiser Board.
Arkansas Gov. Asa Hutchinson signed into law this spring two bills related to the valuation profession. One changes how members of the Arkansas Appraiser Licensing and Certification Board are appointed while the other updates the state’s appraisal management company law so it complies with minimum federal requirements.
, which was signed March 21, eliminates the requirement that all five individuals on the board be “members in good standing of one of The Appraisal Foundation member organizations.” Instead, individuals are required to be “members in good standing of a state chapter of a nationally recognized real estate appraisal organization that requires an individual to have qualified appraisal experience, education and testing to become a designated member and to adhere to standards of professional practice to maintain the designation, or the Association of Consulting Foresters of America, Inc., Arkansas Chapter.”
The law also prohibits AMCs from requiring an appraiser to pay or reimburse it for the Appraisal Management Company National Registry fee.
, which was signed April 4, gives the governor full discretion to appoint the two at-large board members and the three additional board members, which include a banking representative, a consumer representative and a senior citizen representative. Previously, professional appraiser organizations could submit to the governor a list of recommended candidates.
The Colorado Division of Real Estate on Jan. 31 issued an “Appraiser Licensee Advisory” regarding the use of unlicensed appraisers — Colorado does not have a trainee appraiser credential — when preparing appraisals for loans that are intended to be sold to Fannie Mae.
The advisory states, “Colorado’s appraiser license law does not prohibit an unlicensed person from performing a property inspection or from performing a significant amount of the appraisal. Additionally, Colorado’s appraiser license law does not prohibit an unlicensed person from signing on the left side of the FNMA forms if they have met the FNMA criteria identifying them as the appraiser.” The advisory outlines different scenarios and each party’s responsibilities.
The Florida Real Estate Appraiser Board on March 22 published proposed rules regarding the supervision and training of registered appraiser trainees.
FREAB proposed eliminating the requirement that a supervisory appraiser must be state-certified for a minimum of four years before being eligible to become a supervisory appraiser. Instead, FREAB is proposing that a supervisory appraiser must currently be state-certified and must be in good standing and not subject to disciplinary action in any jurisdiction for the past three years.
Representatives of the Appraisal Institute’s Kansas City Chapter appeared Jan. 13 before the Kansas Real Estate Appraisal Board, where they testified on having the state’s appraisers perform evaluations and utilizing standards of valuation practice other than the Uniform Standards of Professional Appraisal Practice.
Legislation, HB 2414
, was introduced in the Kansas legislature on March 24 to addresses those two issues.
The Michigan Supreme Court ruled Feb. 1 that it would hear oral arguments in the case of Menard, Inc. vs. City of Escanaba. One of the issues to be decided by the court is whether the Michigan Tax Tribunal may use a “value in use” approach.
The case involves ad valorem property tax assessments by a “big-box” retailer. Originally, the Michigan Tax Tribunal found in favor of the property owner. The state’s intermediate Court of Appeals, however, reversed that decision and found that the “Tribunal committed an error of law requiring reversal when it rejected the cost-less-depreciation approach and adopted a sales comparison approach that failed to fully account for the effect on the market of the deed restrictions in those comparables.”
The Court of Appeals directed that “On remand, the tribunal shall take additional evidence with regard to the market effect of the deed restrictions” and stated, “If the data is insufficient to reliably adjust the value of the comparable properties if sold for the subject property’s HBU, then the comparables should not be used.”
Menards appealed this decision to the U.S. Supreme Court. Amicus Curiae briefs regarding Menards’ “Application for Leave to Appeal” were filed by the Michigan Manufacturers Association, the Michigan Retailers Association and the Michigan Municipal League, as well as state real estate professionals and municipalities.
The Mississippi Supreme Court’s Rules Committee on the Legal Profession requested input Jan. 6 from the bench, the bar and the public on the Mississippi Bar Association’s “Petition to Amend Certain Rules of the Mississippi Rules of Appellate Procedure and the Mississippi Rules of Professional Conduct in order to Define the Practice of Law in Mississippi and Exceptions thereto and to Prohibit the Unauthorized Practice of Law in Mississippi.”
A letter was submitted on behalf of the state’s real estate appraisers specifically requesting that it be known that they do not engage in the practice of law when performing the following activities as part of the practice of appraisal: 1) sales contract analysis; 2) analyzing and reporting legal descriptions; 3) interpreting and citing court cases, rulings, and opinions of courts in support of appraisal theory or practice, and 4) other activities required of a real estate appraiser discharging his or her duties as required by state or federal law and regulations.
Virginia Gov. Terry McAuliffe in March signed into law two bills that affect how appraisers can perform evaluations and how appraiser management companies pay appraisers.
, which was signed into law March 3, clarifies that Virginia licensed and certified appraisers are permitted to perform evaluations in accordance with Interagency Appraisal and Evaluation Guidelines. When performing an evaluation, appraisers are only required to “comply with any standards imposed by the state or federal financial institution’s or lender’s regulatory agencies for evaluations prepared by nonstate-certified or nonstate-licensed appraisers.”
, which was signed into law March 20, requires AMCs operating in the state to pay appraisers within 30 days of the “initial delivery by the appraiser of the completed appraisal report.” Exceptions include breach of contract, non-compliance with the conditions of engagement or violations of the Uniform Standards of Professional Appraisal Practice.