No. 30253 (Amendment): R162-104-5. Experience Requirement

DAR File No.: 30253
Filed: 07/30/2007, 02:10
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

It has come to the attention of the Division of Real Estate that out-of-state persons who have no intention of acting as appraisers in Utah are obtaining appraiser licensure or certification in Utah for the sole purpose of obtaining licensure or certification by reciprocity in their home states based on the Utah license or certification, thereby circumventing tougher licensure or certification procedures in their own state. This loophole can be closed by requiring applicants for licensure or certification in Utah to demonstrate that they have some familiarity with the Utah market. In addition to closing this loophole, requiring candidates to demonstrate trainee experience gained in the appraisal of Utah properties will also help to ensure that the appraisers who are licensed or certified by the State of Utah are actually familiar enough with the Utah market to do a competent job appraising Utah properties.

Summary of the rule or change:

A new subsection R162-104-5(104.5.4) is added, providing that at least 50% of the appraisals submitted for experience credit shall be appraisals of Utah properties.

State statutory or constitutional authorization for this rule:

Subsection 61-2b-6(1)(l)

Anticipated cost or savings to:

the state budget:

None--Which appraisals will count toward experience credit for appraiser licensure or certification has no effect on the state budget.

local governments:

The only local government entities who hire appraisers or appraiser trainees are county assessors' offices. The county assessors hire numerous appraiser trainees and train them to become licensed or certified appraisers who will work for the office in valuing real property for property tax purposes. It is not anticipated that this rule will have an impact on county assessors' offices since it would be to their advantage for their trainees to have some familiarity with the local market.

small businesses and persons other than businesses:

The only persons who would be affected by this rule change would be those individuals who want to obtain a license or certification in Utah without already having been licensed or certified in another state. Appraisers who have already been examined by another state and have become licensed or certified in that state may obtain a license in Utah by reciprocity instead of going through the process of proving their experience under the provisions of Rule R162-104. Therefore, those individuals who may obtain a Utah license or certification by reciprocity would not be affected by this rule and would not be deterred by this rule from either moving to Utah or doing business in Utah from their out-of-state residence. The rule change would affect only those out-of-state applicants who have not proven themselves in their home states, but who are asking the State of Utah to issue their initial appraiser license or certification to them despite a lack of experience in the Utah market. It is believed that the primary reason that out-of-state individuals would seek their initial license or certification license in Utah, although they do not do any business in Utah, is to avoid more rigorous requirements in their home states. Such applicants would incur costs due to this rule change because they would either have to comply with the more rigorous requirements to become licensed or certified in their own states, or spend time in Utah assisting a Utah appraiser as a trainee in order to gain the necessary Utah experience. Either alternative would cost these persons an amount that the division does not know how to calculate. Despite the potential impact on these persons, the rule change would help to protect Utah citizens, including small businesses, by ensuring that those persons who are issued a license or certification to appraise in Utah are in fact qualified to appraise Utah properties.

Compliance costs for affected persons:

As stated above, out-of-state applicants who are not licensed or certified in their home states and who do not have experience appraising in Utah would incur costs in an amount that cannot be determined if this rule change is made effective.

Comments by the department head on the fiscal impact the rule may have on businesses:

No fiscal impact is anticipated beyond the costs to out-of-state applicants discussed in the rule summary. Francine A. Giani, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Commerce
Real Estate
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316

Direct questions regarding this rule to:

Shelley Wismer at the above address, by phone at 801-366-0145, by FAX at 801-366-0315, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

09/14/2007

This rule may become effective on:

09/22/2007

Authorized by:

Derek Miller, Director

RULE TEXT

R162. Commerce, Real Estate.

R162-104. Experience Requirement.

R162-104-5. Compliance with USPAP and Licensing Requirements; Local Experience Requirement.

104.5 No experience credit will be given for appraisals which were performed in violation of Utah law, the law of another jurisdiction, or the administrative rules adopted by the Division and the Board.

104.5.1 No experience credit will be given for appraisals unless the appraisals were done in compliance with USPAP.

104.5.2 In order to qualify as experience credit toward certification, the additional points for certification required by Subsection R162-104.1.1.2 must have been accrued while the applicant was licensed as an appraiser in Utah, or in another state if licensure was required in that state, at the time the appraisal was performed.

104.5.3 Except for experience points claimed under Subsection R162-104.15.3, appraisals where only an exterior inspection of the subject property is performed shall be granted 25% of the credit awarded an appraisal which includes an interior inspection of the subject property. Not more than 25% of the total experience required for licensure or certification may be earned from appraisals where the interior of the subject property is not inspected.

104.5.4 At least 50% of the appraisals submitted for experience credit shall be appraisals of properties located in Utah.

 

KEY: real estate appraisals, experience

Date of Enactment or Last Substantive Amendment: [May 29], 2007

Notice of Continuation: February 15, 2007

Authorizing, and Implemented or Interpreted Law: 61-2b-1 through 61-2b-40