House Bill Reopens Path for Appraisal Modernization
In this issue:
- AIIA Updates: New opportunity for appraisal modernization
- Texas Toast: Celebrate the launch of our newest book
- U.S. Tax Court sides with MAI-designated appraiser analysis
- Free Webinar: Transforming Workflow Efficiency: A Showcase of Approved UAD 3.6 Tools
Association News
National Nominating Committee Nominates Smedmore Montgomery Bernard, Jr., MAI, as 2026 AI Vice President
Smedmore Montgomery Bernard, Jr., MAI, was nominated for 2026 Appraisal Institute vice president by the AI National Nominating Committee at its December 4 meeting in Chicago.
National Nominating Committee Chair Sandy Adomatis, SRA, submitted the committee’s nomination to the AI Board of Directors. Board members may file petitions for additional nominees in accordance with the Appraisal Institute Bylaws. The AI Board of Directors is expected to elect the 2026 vice president in January.
The 2026 vice president will serve as the Appraisal Institute’s 2027 president-elect, 2028 president, and 2029 immediate past president, in addition to chairing the Finance Committee in 2026 and the National Nominating Committee in 2029.
Celebrate the launch of The Valuation of Vineyards, Wineries, Breweries, and Distilleries!
Correction
We shared an incorrect suite number for our new office last week.
The new address is:
200 W. Madison Avenue, Suite 2630, Chicago, Illinois 60606
Insights
House Action Creates New Opportunity for Appraisal Modernization
The Appraisal Industry Improvement Act (AIIA), bipartisan legislation introduced in the House of Representatives by Janelle Bynum (D-OR) and Byron Donalds (R-FL), has reemerged as Congress prepares to take up a broader bipartisan housing package. Although the Senate-released National Defense Authorization Act (NDAA) ultimately excluded appraisal provisions, the momentum behind federal housing reforms creates a viable path for incorporating the AIIA and the Portal for Appraisal Licensing (PAL) Act into upcoming legislative negotiations.
The House bill focuses on targeted statutory updates that strengthen federal coordination, improve the structure of the appraisal regulatory framework, and enhance tools relied upon by lenders, regulators, and practitioners.
Key Provisions of the House AIIA
- Expanded Eligibility for FHA Assignments. The bill allows state-licensed appraisers, not only certified appraisers, to perform FHA appraisals, provided they meet additional education or experience requirements. This aligns FHA policy more closely with other lending programs and provides greater flexibility for lenders and appraisers while maintaining competency safeguards.
- Modernized Federal Representation. The bill adds representatives from the U.S. Department of Veterans Affairs (VA) and USDA Rural Housing Service to the Appraisal Subcommittee (ASC). This ensures that federal oversight reflects the full spectrum of housing programs, particularly in veteran and rural lending markets where appraisal policy integration is critical.
- Registry Inclusion for Trainee Appraisers. The AIIA authorizes the ASC to list state-credentialed trainee appraisers on the National Appraiser Registry, providing lenders with a consistent mechanism to verify trainee status and enabling clearer participation pathways within the profession.
- Support for State Licensing Agencies. The ASC is authorized to award grants to state appraiser regulatory agencies for education, training, technology modernization, and recruitment efforts, enhancing the capacity of state systems that license and oversee appraisers. Importantly, the bill also makes clear that professional organizations, including groups like the Appraisal Institute, would be eligible to receive ASC grant funding for education, training, and modernization initiatives that support the broader appraisal ecosystem.
- Flexible AMC Registry Fee Authority. The AIIA grants the ASC the authority to adjust appraisal management company (AMC) registry fees to better reflect market conditions and administrative needs, improving oversight stability and responsiveness.
Why the Appraisal Institute Supports the AIIA
“The AIIA gives Congress a real opportunity to modernize the appraisal regulatory framework in a way that strengthens federal coordination and supports a more efficient, accessible profession,” said Brian Rodgers, Senior Manager of Federal Affairs at the Appraisal Institute. “By improving pathways for trainees, reinforcing the role of state regulators, and aligning oversight across federal housing agencies, the bill delivers practical updates that benefit lenders, consumers, and appraisers alike. We’re encouraged to see this bipartisan momentum and look forward to working with lawmakers as housing legislation advances.”
The AIIA offers practical, bipartisan reforms that meaningfully strengthen the federal appraisal framework. The Appraisal Institute supports the legislation because it will enhance interagency coordination through expanded ASC representation.
The AIIA offers practical, bipartisan reforms that meaningfully strengthen the federal appraisal framework. Together with the PAL Act, the AIIA represents the most significant opportunity in years to update the foundational structures supporting the appraisal profession.
Next Steps
As the House prepares to consider a comprehensive bipartisan housing package, the AIIA stands as a strong, ready-made component for appraisal-system modernization. The Appraisal Institute will continue working with congressional offices to highlight how the bill complements federal housing policy priorities and supports a more efficient, transparent, and well-aligned appraisal oversight framework.
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Transforming Workflow Efficiency:
A Showcase of Approved UAD 3.6 Tools
December 18 • 11:00 a.m. – 12:00 p.m. CT
Join us for a special Appraisal Institute webinar featuring live demonstrations from approved software providers supporting the new UAD 3.6 rollout. This session offers Appraisal Institute members an opportunity to see leading tools in action, better understand their capabilities, and engage directly with the developers shaping the technology behind modern appraisal workflows.
During this one-hour program, two approved software vendors will each provide a 15-minute demonstration of their platforms, highlighting key features, functionality, and benefits for appraisers adapting to the new requirements. Following the demonstrations, a member practitioner will lead a discussion with the presenters, with 15–20 minutes reserved for audience Q&A.
Whether you’re evaluating solutions, preparing for the transition, or simply looking to stay informed about evolving appraisal technology, this interactive session will help you explore your options and ask questions directly to the providers.
Featured Demonstrations:
- Remington Jones, CEO, SFREP
- Jake Lew, Co-Founder & CEO, AIVRE
Date: December 18
Time: 11:00 a.m. CT (1 hour)
Don’t miss this opportunity to gain firsthand insight into emerging tools that support compliance, efficiency, and professional practice in the new 3.6 environment.
Advocacy Updates
Tax Court Calls Out Overvaluation, Relies on MAI Appraiser’s Market-Based Approach
In Lake Jordan Holdings, LLC v. Commissioner (T.C. Memo. 2025-123), the U.S. Tax Court again sharply criticized an inflated conservation easement valuation, reducing a claimed $12.7 million deduction to just $1.09 million and sustaining a 40% gross valuation misstatement penalty. The Court found that the taxpayer’s appraiser, who lacked an Alabama license and relied on aggressive assumptions and extensive cut-and-paste narrative material, produced an appraisal that was “egregious” and unsupported by market evidence.
By contrast, the Internal Revenue Service relied on an appraiser holding the MAI designation, whose market-supported analysis the Court found persuasive. Although the Court rejected several IRS legal theories, it consistently credited the IRS appraiser’s methodology and market-based reasoning over the taxpayer’s valuation work.
For appraisers, the decision underscores the importance of credible market analysis, competency in the relevant geographic area, and adherence to professional standards, factors that ultimately shaped the Court’s view of reliability in this case.
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