GENERAL GOVERNMENT CABINET

Kentucky Real Estate Appraisers Board

(Amendment)

 

      201 KAR 30:040. Standards of practice.

 

      RELATES TO: KRS 324A.035, 324A.050(1)(j), 12 C.F.R. 225.62-225.67, 12 U.S.C. 3331, 3336, 3339

      STATUTORY AUTHORITY: KRS 324A.035(3)(d)

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 324A.035(3)(d) requires the board to establish by administrative regulation standards of professional appraisal practice. 12 U.S.C. 3331, 3336, and 3339 and 12 C.F.R. 225.64 and 225.65 require that real estate appraisals in connection with federally related transactions be performed in accordance with appraisal standards promulgated by the Appraisal Standards Board of the Appraisal Foundation. This administrative regulation establishes the standards of professional practice.

 

      Section 1. Certificate holders or licensees listed in subsections (1) through (5) of this section shall comply with the Uniform Standards of Professional Appraisal Practice:

      (1) A certified general real property appraiser;

      (2) A certified residential real property appraiser;

      (3) A licensed real property appraiser;

      (4) An associate real property appraiser; and

      (5) A licensed nonfederal real property appraiser.

 

      Section 2. The standard for the calculation and reporting of above-grade square footage and below-grade square footage in single-family houses shall be the American National Standard for Single-Family Residential Buildings; Square Footage-Method for Calculating, ANSI Z765 2013[2003].

 

      Section 3. Appraisal Reporting Requirements. For each appraisal assignment that includes an appraisal management company reference as the client or agent for the client, an appraiser shall identify within the appraisal report:

      (1) The name that is on file with the board for the appraisal management company;

      (2) The Kentucky registration number that is on file with the board for the appraisal management company; and

      (3) The fee that will be paid to the appraiser for each appraisal assignment ordered by an appraisal management company, unless the appraiser is a W-2 employee of the appraisal management company.

 

      Section 4. Incorporation by Reference. (1) The following material is incorporated by reference:

      (a) "Uniform Standards of Professional Appraisal Practice", 2014 - 2015; and

      (b) "American National Standard for Single Family Residential Buildings; Square Footage Method for Calculating, ANSI Z765 2013[2003]", 2013[2003].

      (2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Kentucky Real Estate Appraisers Board, 135 W. Irvine Street, Suite 301, Richmond, Kentucky 40475, (859) 623-1658, Monday through Friday, 8 a.m. to 4:30 p.m.

      (3) This material may also be obtained from the Appraisal Standards Board of the Appraisal Foundation, 1155 15th Street, N.W., Suite 1111, Washington, D.C. 20005, (202) 347-7722.

 

LARRY DISNEY, Executive Director

      APPROVED BY AGENCY: January 14, 2015

      FILED WITH LRC: January 14, 2015 at 4 p.m.

      PUBLIC HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative regulation shall be held on February 27, 2015, at 1:30 p.m., in the office of the Kentucky Real Estate Appraisers Board; 135 W. Irvine Street, Suite 301, Richmond, Kentucky 40475, (859) 623-1658. Individuals interested in attending this hearing shall notify the agency in writing by five workdays prior to the hearing of their intent to attend. If no notification of intent to attend the hearing is received by that date, the hearing may be canceled. This hearing is open to the public. Any person who attends will be given an opportunity to comment on the proposed administrative regulation. A transcript of the public hearing will not be made unless a written request for a transcript is made. If you do not wish to attend the public hearing, you may submit written comments on the proposed administrative regulation. Written comments shall be accepted until close of business on March 2, 2015 Send written notification of intent to attend the public hearing or submit written comments on the proposed administrative regulation to:

      CONTACT PERSON: Larry Disney, Executive Director, Kentucky Real Estate Appraisers Board, 135 W. Irvine Street, Suite 301, Richmond, Kentucky 40475, phone (859) 623-1658, fax (859) 623-2598.

 

REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT

 

Contact person: Larry Disney

       (1) Provide a brief summary of

      (a) What this administrative regulation does: This administrative regulation establishes the standards of practice for certified and licensed appraisers.

      (b) The necessity of this administrative regulation: This administrative regulation is necessary to comply with Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 and to establish the standards of practice.

      (c) How this administrative regulation conforms to the content of the authorizing statutes: The administrative regulation is in conformity as the authorizing statute gives the board the ability to promulgate regulations regarding the standards of practice.

      (d) How this administrative regulation currently assists or will assist in the effective administration of the statutes: This administrative regulation will assist the board in enforcing the standard of practice of the profession.

      (2) If this is an amendment to an existing administrative regulation, provide a brief summary of:

      (a) How the amendment will change this existing administrative regulation: This amendment replaces the obsolete version of ANSI to the current version.

      (b) The necessity of the amendment to this administrative regulation: This amendment is amends the administrative regulation to incorporate the most recent ANSI version regarding practice standards in the industry.

      (c) How the amendment conforms to the content of the authorizing statutes: The administrative regulation is in conformity as the authorizing statute gives the board the ability to promulgate administrative regulations regarding the standards of practice.

      (d) How the amendment will assist in the effective administration of the statutes: This amendment to the administrative regulation allows the board to ensure that certified and licensed appraisers are relying on the most recent American National Standard for Single Family Residential Buildings.

      (3) List the type and number of individuals, businesses, organizations, or state and local governments affected by this administrative regulation: There are approximately 1,800 persons certified by the board.

      (4) Provide an analysis of how the entities identified in question (3) will be impacted by either the implementation of this administrative regulation, if new, or by the change, if it is an amendment, including:

      (a) List the actions that each of the regulated entities identified in question (3) will have to take to comply with this administrative regulation or amendment: A certificate holder or licensee must comply with the Uniform Standards of Professional Appraisal Practice and American National Standard for Single Family Residential Buildings.

      (b) In complying with this administrative regulation or amendment, how much will it cost each of the entities identified in question (3): There are no additional costs for complying with the amendment.

      (c) As a result of compliance, what benefits will accrue to the entities identified in question (3): The licensees will be up to date in the profession.

      (5) Provide an estimate of how much it will cost to implement this administrative regulation:

      (a) Initially: No new costs will be incurred by the changes.

      (b) On a continuing basis: No new costs will be incurred by the changes.

      (6) What is the source of the funding to be used for the implementation and enforcement of this administrative regulation: The board’s operations are funded by fees paid by certificate holders.

      (7) Provide an assessment of whether an increase in fees or funding will be necessary to implement this administrative regulation, if new, or by the change if it is an amendment: No increase in fees or funding will be required to implement the changes made by this administrative regulation.

      (8) State whether or not this administrative regulation establishes any fees or directly or indirectly increases any fees: This administrative regulation does not establish fees or directly or indirectly increase any fees.

      (9) TIERING: Is tiering applied? Tiering was not applied as the administrative regulation is applicable to all certificate holders. This administrative regulation does not distinguish between similarly situated individuals on the basis of any factor.

 

FISCAL NOTE ON STATE OR LOCAL GOVERNMENT

 

      1. What units, parts or divisions of state or local government (including cities, counties, fire departments, or school districts) will be impacted by this administrative regulation? Kentucky Real Estate Appraisers Board.

      2. Identify each state or federal statute or federal regulation that requires or authorizes the action taken by the administrative regulation: KRS 324A.035(3)(d).

      3. Estimate the effect of this administrative regulation on the expenditures and revenues of a state or local government agency (including cities, counties, fire departments, or school districts) for the first full year the administrative regulation is to be in effect. None

      (a) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for the first year? None

      (b) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for subsequent years? None

      (c) How much will it cost to administer this program for the first year? None

      (d) How much will it cost to administer this program for subsequent years? None

      Note: If specific dollar estimates cannot be determined, provide a brief narrative to explain the fiscal impact of the administrative regulation.

      Revenues (+/-):

      Expenditures (+/-):

      Other Explanation: