Two New Florida Bills - Amendments to Chapter 475

Two nearly identical bills have been filed for the 2017 Session of the Florida Legislature. On the House side, HB 927 was filed by Rep. Bob Rommel on February 21, 2017. Senator Kathleen Passidomo filed SB 716 of February 16, 2017. The bills are nearly identical, and appear to be attempts to amend Chapter 475, Part II to conform with the Final Rule on Minimum Requirements for Appraisal Management Companies. 

The major difference in the bills appears to be:

• The Senate Bill requires AMC compliance with the Truth in Lending Act (customary and reasonable fees). The House Bill does not have the same language. (see lines 503 - 505 of SB 716).
• The House Bill tightens up the restrictions on registration of AMCs by removing the FREAB's discretion to grant registration "after a lapse of time and subsequent good conduct and reputation" for individuals (officers, directors, general partners, managing partners, owners, or persons with 10% or more ownership interests) associated with an AMC applicant. (see lines 297 - 300 of HB 927). The Senate Bill deals with applicants in Section 475.6245 - Discipline of appraisal management companies, and grants the FREAB discretion to deny an application or renewal in the event the above named individuals is guilty of or committed listed violations. (see lines 306 - 323 and 332 - 505 of SB 716).

The filed bills each limit the responsibility of AMCs to their activities related to "covered transactions" or appraisals for "secondary mortgage market participants". This is troubling as the "covered transaction" is means a consumer credit transaction secured by the consumer's principal dwelling. (See lines 154 -155 HB 927 and lines 157 - 158 SB 716).

Language repealing the Post License Education Requirement for Registered Trainee Appraisers is in both bills. As a result of the most recent Appraiser Qualifications Board Real Property Appraiser Qualification Criteria, the post license education requirement had outlived its usefulness. It was confusing to licensees, costly for course providers, and is an unnecessary barrier for trainee appraisers. 

We've got a starting point, and can expect some amendments. Give the bills a close look and let me know what you think. I'll try to keep up with them when they start going through the committee process.

Florida Governor Scott Signs Two Appraisal Related Bills

Within the past ten days, Florida Governor Rick Scott inked his name to two appraisal related bills.

One June 7, 2013, CS/CS/HB 667 was signed into law. The bill amends Chapter 475 Part I and Part II. Of course, the amendments to Chapter 475, Part II affect Florida Real Estate Appraisers. The first change removes Licensed Appraisers from those permitted to supervise Registered Trainee Appraisers. The other significant amendments to the real estate appraiser licensing and certification law recognizes the new Real Property Appraiser Qualification Criteria adopted by the Appraiser Qualifications Board December 11, 2011. Education requirements have been enhanced, and the Florida background check information for new applicants has been modified to comply with the AQB "way". The enrolled version of the bill is at this LINK.

CS/SB 1398 was approved by the Governor June 14, 2013. This bill amends Chapter 475 Part II to authorize the Florida Real Estate Appraisal board to approve qualifying education courses completed by applicants for registration as a trainee or certification as a residential appraiser or general appraiser to be completed through distance learning. This is a major change for Florida. Although the FREAB accepts continuing education completed through distance learning, prior to this amendment, all qualifying education had to be accomplished in a classroom setting. It will take a while for the FREAB to adopt the rules to implement this amendment, and for schools to obtain the required approval for courses, but appraisers seeking qualifying education will soon have an option to the traditional classroom setting. The enrolled version of the bill is at this LINK.

Appraisal Events - Florida Realtors® 2011 Convention

From August 24 - 28, 2011, Florida Realtors host their Annual Convention & Trade Expo in Orlando. The event will be held at the Rosen Shingle Creek, 9939 Universal Boulevard, Orlando, Florida.

In addition to the regular business meetings for committees and the Florida Realtors Board of Directors, a number of education sessions will be offered on a variety of topics. There are two specific offerings available for attendees:

On Friday, August 26, 2011, the Florida Appraisal Council will meet from 1:00 - 2:30 P.M. If you are an appraiser and belong to a local association of Realtors, you are welcome to attend. The new AMC Registration laws and rules will be discussed, along with the Fast Track Application for NAR Appraisal Designations. Educational opportunities to assist in completing 2012 Continuing Education will also be planned. Your thoughts, ideas and suggestions are welcomed.

On Saturday, August 27, 2011, Rick Baumgardner, Chairman of the Appraisal Foundation Appraiser Qualifications Board, will present "What's Happening With Appraiser Qualifications?" This will be a discussion of the 4th Exposure Draft of Proposed Revisions to the Real Property Appraiser Qualification Criteria. Among other things, Rick will discuss trainee and supervisor qualifications, background checks and education.

Take a ride over to Orlando and stop by!

How About an NAR Update!

The National Association of REALTORS® met in New Orleans November 3 - 7, 2010 for their Annual Conference and Expo. As an active participant in the NAR Family, the Appraisal Committee met November 5th.

The agenda included reports from the NAR representative to The Appraisal Foundation Advisory Committee, Vic Knight, and an update about The Appraisal Foundation from the NAR representative to Board of Trustees. H.R. 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act was discussed, along with our participation in the rules-making process. The committee was briefed on the activity of the NAR HVCC Work Group, and the progress of the Realtor's Property Resource (RPR).

The Appraisal Committee learned that Joe Traynor, GAA, a past Chair of the Committee, has been selected as Chairman of The Appraisal Foundation Board of Trustees for 2011. Another past Chair of the Committee, Vic Knight, has been named as the NAR representative to the Board of Trustees. The Chair of The Appraisal Foundation's Appraiser Qualifications Board (AQB) is another past Chair of the NAR Appraisal Committee, Rick Baumgardner. Since one of the 2011 goals is to maintain NAR representation within The Appraisal Foundation, it's nice to see an early fulfillment of that aspiration. All three are good friends, and tolerate my kidding them about going over to the Dark Side.

In addition to the above accomplishments, the Committee discussed the upcoming meeting of the NAR Professional Standards Committee. Back in August, 2010, the Appraisal Committee submitted a letter to the Professional Standard Committee with several suggestions for amendments to the NAR Code of Ethics and Standards of Practice. The recommendations were considered by the Interpretations and Procedures Subcommittee, and their report would be considered by the full committee. Later, it would be considered by the NAR Executive Committee and Board of Directors.

Although not all of the Appraisal Committee recommendations were accepted, two important ones were, and approved by the Board of Directors.

Standard of Practice 3-7 was amended to recognize that appraisers do not typically "represent" a client. Realtor Appraisers, when seeking information about listed property, now must merely disclose the "relationship" with their client to the listing Realtor. Representation of the client is no longer required.

That's nice, but the Board of Directors also approved an amendment to Article 15, and Standard of Practice 15-3. An amendment to an Article of the Code of Ethics must be approved by the NAR Delegate Body. The Delegate Body will consider this amendment in Anaheim, California during their meeting on November 14, 2011. If approved, Article 15 will read:

REALTORS® shall not knowingly or recklessly make false or misleading statements about other real estate professionals, their businesses, or their business practices.

The amendment to Standard of Practice 15-3 will be effective if the change to Article 15 is adopted by the Delegate Body. It will read:

The obligation to refrain from making false of misleading statements about other real estate professionals, their businesses, and their business practices includes the duty to publish a clarification about or to remove statements made by others on electronic media the REALTOR® controls once the REALTOR® knows the statement is false or misleading.

Since many Realtor Appraisers have expressed their concern about the Quadrennial Ethics Training Course, we're in the process assembling a group of folks to make some recommendations for course content. It's unlikely that fulfilling this education requirement will ever be a favorite for appraisers, but we aim to make the content more appropriate for our niche of the real estate profession.

Well, that's part of what the Appraisal Committee has been up to. There's more and more updates to come. There are a few appraisals on my desk to complete.

“That NAR’s Appraisal Committee be asked to provide content applicable to appraisal practice and NAR’s Code of Ethics, and that such content be developed as a separate course or an optional component of the existing Quadrennial Ethics Training Course.”

Rationale: A separate ethics course, or course component, with content applicable to appraisal practice would make the Quadrennial Ethics Training requirement more meaningful to the appraisal practitioners as they satisfy their ethical duties of REALTOR® membership.

There was one additional recommendation considered by the Professional Standards Committee: Currently, the term "competitors" is used in place of "other real estate professionals".