AS Title 8, Chapter 87: Real Estate Appraisers

Article 1. Board of Certified Real Estate Appraisers. Chapter 87. Real Estate Appraisers. Sec. 08.87.010. Board created. There is created in the Department of Commerce, Community, and Economic Development the Board of Certified Real Estate Appraisers. The board is composed of five members appointed by the governor. At least one member shall be a person certified under this chapter as a general real estate appraiser, at least one member shall be a person certified under this chapter as a residential real estate appraiser, at least one member shall be an executive in a mortgage banking entity, and at least one member shall represent the public. The board shall elect a chair from among its membership. Sec. 08.87.020. Powers and duties of board. (a) In addition to the powers and duties conferred on the board by AS 08.01 , the board shall (1) establish the examination specifications for certification as a general real estate appraiser, as a residential real estate appraiser, and as an institutional real estate appraiser; (2) adopt rules of professional conduct to establish and maintain a high standard of integrity in the real estate appraisal profession; (3) adopt regulations necessary to carry out the purposes of this chapter, including regulations (A) necessary to comply with the requirements of (i) 12 U.S.C. 3331 — 3355 (Title XI, Financial Institutions Reform, Recovery, and Enforcement Act of 1989), as amended by 12 U.S.C. 5301 — 5641 (Dodd-Frank Wall Street Reform and Consumer Protection Act); the regulations adopted by the board under AS 08.87.110 , 08.87.120, 08.87.135, 08.87.220, and 08.87.310 may not be more stringent than the corresponding minimum requirements for receiving approval of the state's program of certification of real estate appraisers and registration of real estate appraisal management companies under 12 U.S.C. 3331 — 3355 or other federal law ; and (ii) 15 U.S.C. 1639e (Truth in Lending Act); (B) establishing registration procedures and standards for a real estate appraisal management company; and (C) establishing the standards for the real estate appraisal management company's appraiser panel, including panel size and member qualifications; and (4) report relevant information regarding a real estate appraisal management company's operations, including a disciplinary action under this chapter or a violation of state or federal law, to the Appraisal Subcommittee established under 12 U.S.C. 3310. (b) The board may (1) examine the records of a real estate appraisal management company operating in the state; (2) require a real estate appraisal management company to submit reports, information, and documents to the board; (3) investigate alleged violations of this chapter; (4) conduct background investigations as provided in AS 08.87.135 (c). Article 2. Certification. Sec. 08.87.100. Certificate required. A person is guilty of a class B misdemeanor who (1) does not hold a certificate issued by the board, whose certificate is suspended or revoked, or whose certificate has lapsed or terminated, and holds out as a certified real estate appraiser in any way, orally or in writing, directly or by implication; (2) is certified as a residential real estate appraiser and holds out as certified to appraise real estate other than (A) residential real property of four or fewer units; or (B) residential real property of 12 or fewer units when a net income capitalization analysis is not required by the terms of the appraisal assignment and a secondary mortgage market form is used; or (3) is certified as an institutional real estate appraiser and (A) holds out as certified to appraise real estate other than (i) residential real property of four or fewer units having a transaction value of less than $1,000,000; or (ii) commercial property having a transaction value of less than $250,000; (B) holds out as performing real estate appraisal services for a fee or for the public at large; (C) accepts a fee for real estate appraisal services other than for services conducted as a full-time employee of a financial institution with offices in the state and other than a salary received as a full-time employee of the financial institution; or (D) performs a real estate appraisal for other than the portfolio of the financial institution for which the person is employed. Sec. 08.87.110. General, residential, and institutional real estate appraiser certificates. (a) The board shall issue a general real estate appraiser certificate to a person who presents evidence satisfactory to the board that the person (1) has successfully completed classroom instruction in subjects related to real estate appraisal, as required by the board in regulation, from an appraisal organization or academic institution approved by the board; (2) has successfully completed classroom instruction related to standards of professional practice as a real estate appraiser, as required by the board in regulation; (3) successfully completes an examination prescribed by the board; (4) has not been convicted of a crime involving moral turpitude; and (5) has paid the required fees. (b) The board shall issue a residential real estate appraiser certificate to a person who presents evidence satisfactory to the board that the person (1) meets the requirements of (a)(2) — (5) of this section; and (2) has successfully completed classroom instruction in subjects related to residential real estate appraisal, as required by the board in regulation, from an appraisal organization or academic institution approved by the board. (c) Notwithstanding (a) and (b) of this section, the board shall issue a general real estate appraiser or residential real estate appraiser certificate to a person who does not reside in this state and who (1) applies on the form required by the department; (2) pays the required fee; and (3) holds a valid certificate or license from a state whose requirements for real estate appraiser certification or licensing (A) meet or exceed the appraiser certification standards in this chapter; and (B) comply with 12 U.S.C. 3331 — 3351 (Title XI, Financial Institutions Reform, Recovery, and Enforcement Act of 1989), as amended by 12 U.S.C. 5301 — 5641 (Dodd-Frank Wall Street Reform and Consumer Protection Act). (d) A certificate may be issued to a natural person only. A certified real estate appraiser may sign an appraisal report on behalf of a corporation, partnership, firm, or group practice. (e) The board shall issue an institutional real estate appraiser certificate to a person who presents evidence satisfactory to the board that the person meets the educational and testing requirements of 12 U.S.C. 3331 — 3351 (Title XI, Financial Institutions Reform, Recovery, and Enforcement Act of 1989), as amended by 12 U.S.C. 5301 — 5641 (Dodd-Frank Wall Street Reform and Consumer Protection Act) and as implemented by the board, and that the person is a full-time employee of a financial institution with offices in the state. A person receiving certification under this subsection may perform an appraisal only (1) for and as an employee of a financial institution with offices in the state; (2) for the financial institution's own portfolio; and (3) of (A) commercial property with a transaction value of less than $250,000; or (B) residential property of four or fewer units having a transaction value of less than $1,000,000. (f) A certificate issued under (e) of this section terminates when the person certified leaves the full-time employment of the financial institution with offices in the state for whom the person was employed when the certificate was issued. (g) A person certified under (e) of this section as an institutional real estate appraiser may not perform real estate appraisal services for the general public or for a fee other than the salary the person receives as a full-time employee of a financial institution with offices in the state. (h) Notwithstanding (a) — (c) of this section, the board may issue a general or residential real estate appraiser certificate to a person who does not meet the requirements of (a) — (c) of this section and who (1) applies on a form required by the department; (2) pays the required fee; and (3) successfully completes the National Uniform Licensing and Certification Examination issued or endorsed by the Appraiser Qualifications Board of the Appraisal Foundation, has previous real estate appraiser experience acceptable to the board, or successfully completes courses approved by the board. Sec. 08.87.120. Continuing education requirements for renewal of certificate. (a) The board may not renew a certificate issued under this chapter unless the person applying for renewal presents evidence satisfactory to the board that the person has, within the two years preceding the application for renewal, attended classroom instruction, as required by the board in regulation, in courses or seminars that have received the approval of the board. (b) The board may grant credit toward some or all of the requirements of (a) of this section to a person who has (1) successfully completed a program of study determined by the board to be equivalent for continuing education purposes to a course or seminar approved by the board for continuing education credit; or (2) participated, other than as a student, in educational programs that related to real estate analysis or real property appraisal theory, practice, or technique, including teaching, program development, and preparation of textbooks, monographs, articles, and other instructional materials. (c) The board shall adopt regulations on continuing education to ensure that persons applying for renewal of certificates have thorough knowledge of current theories, practices, and techniques of real estate analysis and appraisal. The regulations must provide for (1) procedures for the sponsor of a course or seminar to apply for board approval for continuing education credit; the regulations must require the sponsor to show that claimed attendance at a course or seminar can be verified; and (2) procedures for evaluating equivalency claims for applicants for certificate renewal under (b) of this section. (d) In considering whether to approve courses and seminars under this section, the board shall give special consideration to courses, seminars, and other appraisal education programs developed by or under the auspices of organizations or associations of professional real estate appraisers that are utilized by those organizations or associations for the purposes of awarding real estate appraisal designations or of indicating compliance with the continuing education requirements of the organizations or associations. (e) An amendment or repeal of a regulation adopted by the board under this section may not operate to deprive a person holding a certificate under this chapter of credit toward renewal of the person's certificate for a course of instruction or seminar that had been completed by the person before the amendment or repeal of the regulation. Article 3. Real Estate Appraisal Management Companies. Sec. 08.87.130. Registration required. (a) A person shall register as a real estate appraisal management company with the board to perform appraisal management services if the person (1) provides an appraisal management service (A) to a creditor or secondary mortgage market participant, including an affiliate; and (B) in connection with valuing a borrower's principal dwelling as security for a consumer credit transaction or incorporating consumer credit transactions into a securitization; and (2) oversees an appraiser panel. (b) A person is guilty of a class B misdemeanor if the person engages in business as or holds out as a real estate appraisal management company, or performs or attempts to perform appraisal management services, at a time when the (1) person does not hold a registration issued by the board; or (2) registration issued by the board to the person is suspended, revoked, lapsed, or surrendered. Sec. 08.87.135. Requirements for registration of real estate appraisal management companies. (a) The board shall register a real estate appraisal management company operating in the state if the company applies on a form approved by the board, pays the fee required under AS 08.01.065 , and presents evidence satisfactory to the board that the company (1) has designated a controlling person who will be the main point of contact between the board and the company and who meets the requirements under (b) of this section; (2) has, if the company is not a corporation that is domiciled in this state, filed with the department a written consent to service of process on a resident of this state for any court action arising from an activity regulated under this chapter or 12 U.S.C. 3331 — 3355 and provided the name and contact information for the company's agent for service of process in this state; (3) requires a real estate appraiser to comply with the Uniform Standards of Professional Appraisal Practice adopted by the Appraisal Standards Board of the Appraisal Foundation when completing appraisals at the company's request; (4) engages only appraisers who are certified under this chapter; (5) has a process to verify that a person who is assigned to serve on an appraiser panel of the company (A) is certified under this chapter and maintains a certification in good standing; and (B) is qualified to conduct federally related transactions under federal law; in this subparagraph, “federally related transaction” means a real estate related transaction that involves an insured depository institution regulated by the United States Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, or the National Credit Union Administration and requires the services of a real estate appraiser under the interagency appraisal rules; (6) conducts appraisals independently and free from inappropriate influence and coercion as required under 12 U.S.C. 3353; (7) is not directly or indirectly owned in whole or in part by a person that has had a certificate to act as a real estate appraiser denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation in any state unless the person has later had a certificate to act as a real estate appraiser granted or reinstated by the same state; (8) has posted a surety bond in an amount required by the board, not to exceed $50,000; and (9) is owned by persons who meet the requirements under (c) of this section. (b) A controlling person designated under (a) of this section (1) must be actively certified in a state as a real estate appraiser at all times that the person is designated as a controlling person; (2) may not have had a certificate to act as a real estate appraiser denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation in any state unless the person has later had the certificate to act as a real estate appraiser granted or reinstated; and (3) must be of good moral character. (c) A person who owns at least 10 percent of a real estate appraisal management company required to be registered under this chapter must be of good moral character as determined by the board and shall submit to a background investigation conducted by the board. (d) The board shall provide a copy of a registration under this section to the Appraisal Subcommittee established under 12 U.S.C. 3310 on a form approved by the subcommittee. (e) A registration under this section is valid for two years and may be renewed upon proof of continued compliance with the requirements under (a) — (c) of this section. Sec. 08.87.140. Mandatory reporting. A real estate appraisal management company or a controlling person, employee, director, officer, or agent of a real estate appraisal management company that has reasonable cause to believe that a real estate appraiser has failed to comply with the Uniform Standards of Professional Appraisal Practice as adopted under 12 U.S.C. 3339 in a manner that materially affects a valuation appraisal shall report the noncompliance to the board and to the Appraisal Subcommittee established under 12 U.S.C. 3310. Sec. 08.87.145. Statement of fees. (a) When reporting to a borrower, an appraisal management company shall separately state the fees (1) paid to an appraiser for the completion of an appraisal; and (2) charged to the borrower for appraisal management services by the appraisal management company. (b) An appraisal management company may not include any fees for appraisal services listed in (a)(1) of this section as charges for an appraisal management service listed in (a)(2) of this section. Sec. 08.87.150. Retention of records and inspection. A registered real estate appraisal management company or a real estate appraisal management company that has applied for registration shall allow the board to inspect and shall retain, for not less than the later of either five years after the date a file is submitted to the company or two years after final disposition of a related judicial proceeding, (1) copies of all records related to requests for the company's appraisal management services and the real estate appraisers who perform the appraisals; (2) a written record of all substantive communications between a real estate appraisal management company registered under this chapter and a real estate appraiser relating to an appraisal or participation in an appraiser panel. Sec. 08.87.155. Reporting requirements for federally regulated real estate appraisal management companies. (a) A real estate appraisal management company that is owned and controlled by an insured depository institution as defined in 12 U.S.C. 1813 and regulated by the United States Comptroller of the Currency, the Board of Governors of the Federal Reserve System, or the Federal Deposit Insurance Corporation, shall annually submit to the board information that the board is required to submit to the Appraisal Subcommittee established under 12 U.S.C. 3310, including a (1) report of intent to operate in the state; and (2) disclosure of whether the company is directly or indirectly owned in whole or in part by any person that has had a certificate to act as a real estate appraiser denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation in any state. (b) If a person has had disciplinary action taken against the person under (a)(2) of this section, the board shall collect information related to whether the certificate to act as a real estate appraiser was denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation for a substantive cause and whether the person has later had the certificate to act as a real estate appraiser reinstated by the same state. Sec. 08.87.160. Exemptions. AS 08.87.130 — 08.87.150, 08.87.215, and 08.87.220 do not apply to a (1) person who is employed by a department or division of an entity that provides appraisal management services only to that entity; (2) real estate appraisal management company that is (A) owned and controlled by an insured depository institution; and (B) regulated by the Consumer Financial Protection Bureau, the Federal Housing Finance Agency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the United States Comptroller of the Currency, or the National Credit Union Administration; or (3) real estate appraiser who enters into an agreement with another real estate appraiser for the performance of an appraisal that upon completion results in a report signed by both the real estate appraiser who completed the appraisal and the real estate appraiser who requested completion of the appraisal. Article 4. Prohibited Practices and Disciplinary Proceedings. Sec. 08.87.200. Prohibited practices. A certified real estate appraiser may not (1) act negligently or incompetently or fail without good cause to exercise reasonable diligence in developing an appraisal, preparing an appraisal report, or communicating an appraisal; (2) wilfully disregard or violate a provision of this chapter or of a regulation adopted by the board under this chapter; (3) fail to comply with the Uniform Standards of Professional Appraisal Practice adopted by the Appraisal Standards Board of the Appraisal Foundation; (4) accept a fee for an appraisal assignment that is contingent upon the appraiser reporting a predetermined estimate, analysis, or opinion or upon the opinion, conclusion, or valuation reached, or upon the consequences resulting from the appraisal assignment; (5) knowingly make a false statement, submit false information, or fail to provide complete information in response to a question in an application for certification or for renewal of a certificate; or (6) violate the confidential nature of government records to which the person gains access through retention as an appraiser by the government agency. Sec. 08.87.210. Disciplinary proceedings. The board may exercise its disciplinary powers under AS 08.01.075 if, after hearing, the board finds a certified real estate appraiser has (1) violated a provision of this chapter or a regulation adopted by the board under this chapter; (2) been convicted of a crime that involves moral turpitude; or (3) committed, while acting as a real estate appraiser, an act or omission involving dishonesty, fraud, or misrepresentation with the intent to benefit the appraiser or another person or to injure another person. Sec. 08.87.215. Prohibited practices; real estate appraisal management companies. (a) A real estate appraisal management company may not, while registered in the state, retain or enter into a business relationship with an employee, contractor, or agent whose certificate to act as a real estate appraiser is denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation in any state unless the employee, contractor, or agent has later had a certificate to act as a real estate appraiser granted or reinstated by the same state. (b) A real estate appraisal management company or a controlling person, employee, director, officer, or agent of a real estate appraisal management company may not (1) seek to influence a real estate appraiser through intimidation, coercion, extortion, or bribery; (2) condition payment of an appraisal fee on a real estate appraiser's opinion, conclusion, or valuation; (3) request that a real estate appraiser report a predetermined opinion, conclusion, or valuation; (4) alter, amend, or change an appraisal report submitted by a real estate appraiser without the real estate appraiser's written consent; (5) require a real estate appraiser to sign an indemnification agreement for a claim that does not arise from a service performed by the real estate appraiser; (6) prohibit an appraiser from recording in the body of the report submitted by the appraiser to the appraisal management company the fee that the appraiser was paid by the company for the performance of the appraisal; (7) prohibit lawful communication between a real estate appraiser and any other person who the real estate appraiser determines possesses information relevant to the appraisal; (8) engage in an act or practice with intent to impair a real estate appraiser's independence, objectivity, and impartiality; (9) knowingly make a false statement, submit false information, or fail to provide complete information in response to a question in an application for registration or renewal of a registration; or (10) violate this chapter or a regulation adopted under this chapter. Sec. 08.87.220. Disciplinary proceedings; real estate appraisal management companies. The board may take disciplinary action under AS 08.01.075 or suspend or revoke a registration of a real estate appraisal management company if it finds that the (1) company or a controlling person, employee, director, officer, or agent of a real estate appraisal management company has violated a provision of this chapter or a regulation adopted by the board under this chapter; (2) company or a controlling person of the company has had a certificate to act as a real estate appraiser or a registration as a real estate appraisal management company denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending revocation in any state; (3) company fails to comply with the Uniform Standards of Professional Appraisal Practice under 12 U.S.C. 3339; (4) company performs appraisal management services in a manner that causes injury or loss to the public; (5) company has ceased to operate in the state as a real estate appraisal management company; or (6) company used fraud, deception, misrepresentation, or bribery in securing a registration under this chapter. Article 5. General Provisions. Sec. 08.87.300. Retention of records. (a) A certified real estate appraiser shall retain copies of all written contracts engaging the appraiser's services for real property appraisal work, and all reports and supporting data assembled and formulated by the appraiser in preparing the reports, for at least five years after the date of the contract engaging the appraiser's services, five years after the date of the submittal of the appraisal reports to the client, or at least two years after the final disposition of litigation in which the appraiser provided testimony related to the engagement, whichever is longer. (b) [Repealed, § 9 ch 42 SLA 2014.] (c) All records that a certified appraiser must maintain under (a) of this section shall be made available to the board or department for inspection and copying upon reasonable notice to the appraiser. Sec. 08.87.310. Trainee appraiser; supervisory appraiser. The board may establish requirements for trainee appraisers and supervisory appraisers. The board shall ensure that the requirements conform with 12 U.S.C. 3345. Sec. 08.87.320. Actions by uncertified real estate appraisers prohibited. A person may not bring an action in a court of this state for compensation for an act done or service rendered as a certified real estate appraiser if the person did not hold a certificate under this chapter at the time that the person performed the act or service or offered to perform the act or service. Sec. 08.87.330. Exemptions. This chapter does not apply to a person who appraises real estate as part of the tax assessment process of a municipality. Sec. 08.87.340. Appraisals by uncertified appraisers permitted. Nothing in this chapter precludes a person who is not certified as a real estate appraiser from appraising real estate for compensation if the person does not hold out to be a certified appraiser and if appraisal by a certified appraiser is not required by federal law. Sec. 08.87.900. Definitions. In this chapter, (1) “analysis assignment” means an analysis, opinion, or conclusion prepared by a real estate appraiser that relates to the nature, quality, or utility of certified real estate or real property; (2) “appraisal” means an analysis, opinion, or conclusion prepared by a real estate appraiser relating to the nature, quality, value, energy efficiency, or utility of specified interests in, or aspects of, identified real estate, and includes a valuation appraisal, an analysis assignment, and a review assignment; (3) “appraisal assignment” means an engagement for which an appraiser is employed or retained to act, or would be perceived by third parties or the public as acting, as a disinterested person rendering an unbiased analysis, opinion, or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate; (4) “appraisal management services” includes the performance of any of the following functions on behalf of a lender, financial institution, or other person: (A) administration of an appraiser panel; (B) recruitment, retention, or selection of real estate appraisers for the performance of appraisal services; (C) contracting with real estate appraisers to perform appraisals; (D) review of a completed appraisal before the delivery of the appraisal or review assignment to the person that ordered the appraisal; (5) “appraiser panel” means a group of licensed or certified real estate appraisers who perform appraisals as independent contractors for a real estate appraisal management company; (6) “appraisal report” means any communication, written or oral, of an appraisal; (7) “board” means the Board of Certified Real Estate Appraisers; (8) “borrower” means a person who applies for a mortgage loan; (9) “company” means a real estate appraisal management company required to register under AS 08.87.130 that performs appraisal management services; (10) “controlling person” means a person who (A) owns more than 10 percent of a real estate appraisal management company; (B) is an officer or director of a real estate appraisal management company; (C) is employed and authorized by a real estate appraisal management company to enter into a contractual relationship with another person for the performance of appraisal management services or with a real estate appraiser to perform an appraisal; or (D) has the authority to direct the management or policies of a real estate appraisal management company; (11) “department” means the Department of Commerce, Community, and Economic Development; (12) “general real estate appraiser” means a real estate appraiser certified to appraise all types of real property; (13) “institutional real estate appraiser” means a real estate appraiser employed full-time by a financial institution with offices in the state; (14) “principal dwelling” means a residential structure or mobile home that contains one to four units but does not include a vacation or second home unless the borrower buys or builds a new dwelling that will become the primary location that the borrower inhabits within a year after the purchase or completion of construction; (15) “real estate” means an identified parcel or tract of land, including improvements, but excluding subsurface natural resource values; (16) “real property” means one or more defined interests, benefits, and rights inherent in the ownership of real estate; (17) “residential real estate appraiser” means a real estate appraiser certified to appraise residential real property, subject to the limitations of AS 08.87.100 (2); (18) “review assignment” means an analysis, opinion, or conclusion prepared by a real estate appraiser that forms an opinion as to the adequacy and appropriateness of a valuation appraisal or an analysis assignment; (19) “valuation appraisal” means an analysis, opinion, or conclusion prepared by a real estate appraiser that estimates the value of an identified parcel of real estate, or identified real property at a particular time.