Appraisers in Alabama, Louisiana and Oregon may now perform evaluations for real estate-related financial transactions where federal law does not require appraisals to comply with the Uniform Standards of Professional Appraisal Practice. These three states join Florida, Georgia, Illinois, Indiana, Tennessee, Utah and Virginia in allowing appraisers to perform evaluations.
Alabama’s legislation took effective May 29, allowing state-licensed appraisers to perform evaluations for federally regulated financial institutions.
states that appraisers “shall not be subject to any provision” of the state’s appraiser licensing law when performing an evaluation that includes a disclaimer stating it is not an appraisal, and the requirements for a licensed real estate appraiser to comply with the USPAP do not apply.
Additionally, the law clarifies that evaluations are “governed by federal law and rules of the federal financial institution regulatory agencies, and not the board.”
Gov. John Bel Edwards on May 30 signed HB 340
, legislation that allows appraisers in the state to provide evaluations for federally insured depository institutions. The law took effect Aug. 1.
The legislation states that appraisers are not prohibited by the state’s appraiser licensing law from providing evaluations to federally regulated institutions in accordance with “federal law, regulation or the guidance for evaluations established by the federal financial institutions regulatory agency of the depository institution.”
Gov. Kate Brown signed SB 109
on May 13, which allows state-licensed and state-certified appraisers to provide evaluations to financial institutions beginning Jan. 1.
The law clarifies that licensed or certified appraisers who are providing evaluation services to financial institutions are not engaging in real estate appraisal activity if the evaluation includes a disclaimer stating the evaluation was not prepared in their capacity as a real estate appraiser and that it might not comply with USPAP. Providing evaluations is not considered a real estate appraisal activity, and therefore appraisers are not subject to the jurisdiction of the Oregon Appraiser Certification and Licensure Board.
In testimony supporting the legislation, the Coalition of Oregon Real Estate Appraisers stated, “We believe Oregon’s citizens and financial institutions would be best served and protected by allowing appraisers to perform evaluation services.” COREA concluded, “We are not opposed to qualified non‐appraisers performing evaluations, however, [sic] we strongly feel that it is in the best interest of Oregonians that those most qualified to perform evaluations (appraisers) not be prohibited from doing so.”
Louisiana Gov. John Bel Edwards on June 1 signed SB 191
, legislation that limits a cause of action against an appraiser or appraisal company in civil court to one year from the date that an alleged harmful act occurred or was discovered or should have been discovered. The law takes effect Jan. 1.
The law also states that a civil action cannot be filed more than three years after the alleged harmful act, omission or neglect. In cases where assignments resulted in appraisal reports, no civil action may be filed three years from the date that the appraiser signed the report.
The law applies to “all causes of action without regard to the date when the alleged act, omission or neglect occurred.” However, any alleged act, omission or neglect that occurred prior to Aug. 1, 2019, must be filed by Aug. 1, 2020, regardless of when the act, omission or neglect occurred.
The Louisiana Chapter of the Appraisal Institute partnered with the Louisiana Real Estate Appraisers Coalition to advance this important legislation.
Minnesota Gov. Tim Walz on May 30 signed HF 2
, legislation that makes several changes to the state’s appraiser licensing law.
The law adopts by reference the Real Property Appraiser Qualification Criteria that took effect May 1, 2018, and clarifies that temporary practice permits are available in the state for all appraisal assignments — not just federally related transactions. Additionally, appraisers in Minnesota no longer have to disclose whether they have previously been to the subject property. However, appraisers still must comply with Uniform Standards of Professional Appraisal Practice requirements to disclose any services they have performed related to the subject property within a three-year period immediately preceding acceptance of the assignment.
The legislation also updates or removes several obsolete definitions, and allocates $5,000 per year to compensate members of the newly reconstituted Appraiser Advisory Board.
Eighteen states and Washington, D.C., have enacted legislation this year to bring their laws governing appraisal management companies into compliance with the federal minimum requirements. Those states are:
Arizona (SB 1333)
Arkansas (SB 393)
Colorado (SB 46)
Connecticut (HB 7286 / HB 7299)
Georgia (HB 192)
Indiana (HB 1569)
Maryland (SB 69; SB 20)
Mississippi (SB 2697; SB 2451)
Nebraska (LB 77)
Nevada (SB 39)
New Mexico (SB 56)
North Carolina (SB 462)
North Dakota (SB 2075)
Oklahoma (SB 731)
Washington (SB 5124)
West Virginia (SB 597)
Wyoming (SF 83)
became the 50th state to enact a comprehensive program to regulate AMCs on July 31 when Gov. Charlie Baker signed HB 3904
. The legislation took immediate effect and should enable the state to meet the Appraisal Subcommittee’s Aug. 10 deadline to have AMC policies in place to be in compliance with the AMC registry rule and avoid operational restrictions for federally related transactions.
The legislation is mostly consistent with the federal minimum requirements for states as it relates to the regulation of AMCs.
, Mayor Muriel Bowser on July 31 signed B23-0382
, legislation that establishes a comprehensive registration and oversight program for AMCs operating in Washington — and while the legislation takes immediate effect, it will only be in place for 90 days.
The D.C. Council is considering B23-0383
, which would establish the same AMC registration and oversight program for no more than 225 days after mayoral and congressional review while the Council continues work on permanent legislation. The legislation will receive further consideration when the Council returns from its summer break in September.
An unusual aspect of both bills is that they place responsibility for AMC licensing and oversight within the Department of Insurance, Securities, and Banking, even though federal law requires that AMCs be “subject to supervision by a state appraiser certifying and licensing agency in each state.
awaits Gov. Andrew Cuomo’s signature on A8024
. The legislation would repeal and replace a provision in the state’s law prohibiting AMCs from hiring, employing or engaging anyone other than state-licensed or state-certified appraiser, and clarify that the prohibition only applies to appraisal assignments. The legislation also clarifies that AMCs are permitted to hire appraisers, brokers/salespersons and home inspectors to perform property inspections and evaluations and BPOs.