By Counts H.B. No. 612
Substitute the following for H.B. No. 612:
By Jones of Lubbock C.S.H.B. No. 612
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating the regulation of real estate appraisers.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 3, Texas Appraiser Licensing and
1-5 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
1-6 is amended by amending Subdivision (1) and adding Subdivisions
1-7 (15), (16), (17), (18), and (19) to read as follows:
1-8 (1) "Appraisal" means the act or process of estimating
1-9 value; an estimate of value <a written statement used in connection
1-10 with a federally related transaction that is independently and
1-11 impartially prepared by a licensed or certified appraiser that
1-12 states an opinion of the defined value of an adequately described
1-13 property as of a specific date that is supported by the
1-14 presentation and analysis of relevant market information>.
1-15 (15) "Complete appraisal" means an appraisal performed
1-16 without invoking the departure provision.
1-17 (16) "Departure provision" means a permitted limited
1-18 departure from a section of the Uniform Standards of Professional
1-19 Appraisal Practice that is:
1-20 (A) classified as a specific guideline rather
1-21 than a binding requirement; and
1-22 (B) permitted only if the result of the
1-23 departure is not confusing or misleading and the specific guideline
1-24 from which the appraiser departs is reported.
2-1 (17) "Evaluation" means an estimate of value that is
2-2 no more than a limited appraisal and can be presented in a format
2-3 that is less than a self-contained report and that is prepared by a
2-4 certified or licensed real estate appraiser or other real estate
2-5 professional, including an estimate of a property's market value, a
2-6 certification and limiting conditions, and an analysis of the
2-7 supporting information used in forming the estimate of value.
2-8 (18) "Limited appraisal" means an appraisal in which
2-9 the departure provision is invoked.
2-10 (19) "Self-contained report" means a report that
2-11 includes sufficient information to indicate that the appraiser
2-12 complies with the requirements of Standard 1 and Standard 2 of the
2-13 Uniform Standards of Professional Appraisal Practice and describes
2-14 all data necessary for the user of the appraisal to follow the
2-15 conclusions without reference to additional materials.
2-16 SECTION 2. Section 5(a), Texas Appraiser Licensing and
2-17 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
2-18 as amended by Chapters 416 and 980, Acts of the 73rd Legislature,
2-19 Regular Session, 1993, is amended to read as follows:
2-20 (a) The board may:
2-21 (1) adopt rules for the licensing and certification of
2-22 real estate appraisers in this state in accordance with this Act
2-23 and consistent with, but no more stringent than, applicable federal
2-24 law;
2-25 (2) establish categories of appraiser certification
2-26 and appraiser licensing, consistent with the categories of
2-27 appraiser certification and appraiser licensing recognized by the
3-1 Appraiser Qualifications Board, the Appraisal Standards Board, and
3-2 the Appraisal Subcommittee, and prescribe qualifications for each
3-3 category that are no more stringent than the qualifications set
3-4 forth <required> by the Appraiser Qualifications Board, the
3-5 Appraisal Standards Board, and the Appraisal Subcommittee for each
3-6 category;
3-7 (3) adopt rules relating to the education and
3-8 experience requirements for certification and licensing as an
3-9 appraiser in a manner that is consistent with, but no more
3-10 stringent than, the guidelines recognized by <threshold
3-11 requirements adopted by the Appraiser Qualifications Board or> the
3-12 Appraisal Subcommittee;
3-13 (4) adopt rules relating to the qualifying examination
3-14 required for certification or licensing as an appraiser under the
3-15 Act;
3-16 (5) adopt rules requiring <establishing a code of
3-17 professional conduct and ethics for> a certified or licensed
3-18 appraiser to comply with <that meets the> standards of competency,
3-19 professional conduct, and ethics generally accepted by the
3-20 Appraisal Subcommittee and prescribed by the Uniform Standards of
3-21 Professional Appraisal Practice, as adopted by the Appraisal
3-22 Foundation;
3-23 (6) establish reasonable fees to implement this Act,
3-24 including an application fee for certification or licensing, an
3-25 examination fee, a renewal fee for a certificate or license, a
3-26 federal appraiser registry fee, and other appropriate fees;
3-27 (7) adopt rules relating to continuing education
4-1 requirements for a licensed or certified appraiser;
4-2 (8) adopt rules relating to the standards for the
4-3 development of an <a written> appraisal and the conveyance of an
4-4 appraisal report by a certified or licensed appraiser that are
4-5 consistent with <the appraisal regulations adopted by a federal
4-6 financial institution regulatory agency or> the Uniform Standards
4-7 of Professional Appraisal Practice;
4-8 (9) grant or deny an application for the certification
4-9 and licensing of a real estate appraiser;
4-10 (10) institute an action in its own name in a district
4-11 court of Travis County against a person, firm, corporation,
4-12 partnership, or any other group or combination of persons to enjoin
4-13 a violation of this Act or a rule adopted by the board under this
4-14 Act with the attorney general as legal advisor to the board to
4-15 provide any necessary legal assistance;
4-16 (11) adopt rules as necessary to conform with the
4-17 minimum written standards of the Appraisal Subcommittee by
4-18 incorporating the Uniform Standards of Professional Appraisal
4-19 Practice; and
4-20 (12) conduct disciplinary proceedings with regard to
4-21 appraisers in this state <except in circumstances when an appraiser
4-22 is required to be licensed or certified by another state agency to
4-23 perform property appraisals>.
4-24 SECTION 3. Section 6, Texas Appraiser Licensing and
4-25 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
4-26 is amended by adding Subsection (1) to read as follows:
4-27 (1) If the federal government removes the requirements
5-1 for the preparation or use of an appraisal by federally regulated
5-2 financial institutions, the board shall be subject to Chapter 325,
5-3 Government Code (Texas Sunset Act), and be subject to sunset review
5-4 in the next regular session of the legislature following the date
5-5 of the federal government's action. Unless continued in existence
5-6 by that legislature as provided by that chapter, the board is
5-7 abolished and this Act expires on the 90th day after the last day
5-8 of the regular session of that legislature.
5-9 SECTION 4. Section 9(a), (c), and (e)-(j), Texas Appraiser
5-10 Licensing and Certification Act (Article 6573a.2, Vernon's Texas
5-11 Civil Statutes), are amended to read as follows:
5-12 (a) To become a state certified real estate appraiser, a
5-13 person must:
5-14 (1) pass the real estate appraiser certification
5-15 examination required under Section 10 of this Act;
5-16 (2) successfully complete the number and type of
5-17 classroom hours required by the guidelines recognized by the
5-18 Appraisal Subcommittee <Appraiser Qualifications Board for the
5-19 levels of certification that may from time to time be approved>;
5-20 and
5-21 (3) present evidence satisfactory to the board that
5-22 the applicant has at least the minimum number of <2,000> hours of
5-23 experience in appraisals over the specified number <a minimum of
5-24 two> of calendar years as set forth in the guidelines recognized by
5-25 the Appraisal Subcommittee.
5-26 (c) Acceptable appraisal experience for the purposes of the
5-27 determination of the qualifications of an applicant for
6-1 certification or licensing under this Act includes the categories
6-2 set forth in the guidelines recognized by the Appraisal
6-3 Subcommittee <a fee and staff appraisal, an ad valorem tax
6-4 appraisal, an appraisal review, an appraisal analysis, real estate
6-5 counseling, a highest and best use analysis, a feasibility
6-6 analysis, a feasibility study, or teaching of appraisal courses>.
6-7 Any one or any combination of these categories may be acceptable
6-8 for the completion of the experience requirement <1,000 hours of
6-9 credit each year. An applicant may receive not more than 500 hours
6-10 of credit each year from the teaching of appraisal courses>.
6-11 Experience as a real estate lending officer of a financial
6-12 institution or as a real estate broker is acceptable experience if
6-13 the experience includes the actual performance or technical
6-14 <professional> review of real estate appraisals. An hour of
6-15 experience means 60 minutes expended in one or more of the
6-16 acceptable appraisal experience areas recognized <designated> by
6-17 this Act. Calculations of the hours of experience must be based
6-18 solely on actual hours of experience.
6-19 (e) The board shall adopt a reliable means of validating the
6-20 education submitted by applicants for certification and licensing.
6-21 (f) The board shall adopt a reliable means to verify the
6-22 evidence of acceptable appraisal experience submitted by an
6-23 applicant for certification or licensing by relying on appropriate
6-24 sampling techniques applied to not more than five percent of the
6-25 applications received by the board. If an application is selected
6-26 to be verified, the applicant has at least 60 days after the date
6-27 of selection to prepare any records. The information required by
7-1 the board may not be more than the information the board may obtain
7-2 under Subsections (h)(1) and (2) of this section.
7-3 (g) An applicant for certification or licensing must furnish
7-4 under oath, on an affidavit form prescribed by the board, a
7-5 statement that the applicant has the required number of <equivalent
7-6 of 2,000> hours of experience in performing appraisals as set out
7-7 in the guidelines recognized by the Appraisal Subcommittee.
7-8 (h) If a consumer complaint or peer complaint is brought
7-9 against the applicant alleging fraud, incompetency, or malpractice
7-10 and the board finds the complaint is reasonable or if the board
7-11 determines other just cause exists for requiring further
7-12 information, the board may obtain the additional information or
7-13 documentation requested by:
7-14 (1) requiring the applicant to complete a form,
7-15 prescribed by the board, that includes detailed listings of
7-16 appraisal experience showing, for each appraisal claimed by the
7-17 applicant, the city or county where the appraisal was performed,
7-18 the type and description of the building or property appraised, the
7-19 approaches to value utilized in the appraisal, the actual number of
7-20 hours expended on the appraisal, and other information determined
7-21 to be appropriate by the board; or
7-22 (2) engaging in other investigative research
7-23 determined to be appropriate by the board.
7-24 (I) <(f)> An applicant for licensing or certification must
7-25 satisfy the board as to the applicant's honesty, trustworthiness,
7-26 and integrity.
7-27 (j) <(g)> An applicant for licensing or certification shall
8-1 be given credit toward fulfilling the requirements of Subsections
8-2 (a)(2) and (b)(2) of this section for classroom hours taken in the
8-3 course of becoming licensed as a real estate broker or salesman or
8-4 for taking professional development or continuing education
8-5 courses, whether as a real estate broker or salesman or as an
8-6 employee of a financial institution engaged in real estate-related
8-7 financial transactions, if the classroom hours satisfy the
8-8 requirements <of> set forth in the guidelines recognized by the
8-9 Appraisal Subcommittee <the Appraiser Qualifications Board>.
8-10 SECTION 5. The Texas Appraiser Licensing and Certification
8-11 Act (Article 6573a.2, Vernon's Texas Civil Statutes), is amended by
8-12 adding Section 9A to read as follows:
8-13 Sec. 9A. ALTERNATIVE METHODS OF LICENSING. (a) If an
8-14 applicant for the appraiser trainee classification can demonstrate
8-15 to the board that the applicant has, after completing the
8-16 applicant's classroom education requirements, failed to secure
8-17 sponsorship from at least two certified appraisers in order to
8-18 obtain the 2,000 hours of acceptable experience required for
8-19 licensing, the applicant may apply to the board to take the
8-20 licensing examination under Section 10 of this Act.
8-21 (b) An applicant under this section who passes the licensing
8-22 examination required under Section 10 of this Act and who meets any
8-23 other requirements for licensing, except for the actual appraisal
8-24 experience requirement, shall be licensed by the board.
8-25 (c) An applicant receiving a license under Subsection (b) of
8-26 this section must complete the actual appraisal experience
8-27 requirement not later than the 60th month after the date the
9-1 license was issued. Failure to complete the appraisal experience
9-2 requirement by that date and to report a portion of the appraisal
9-3 experience requirements each renewal period constitutes grounds for
9-4 the automatic revocation of the license.
9-5 SECTION 6. Section 13(c) and (d), Texas Appraiser Licensing
9-6 and Certification Act (Article 6573a.2, Vernon's Texas Civil
9-7 Statutes), are amended to read as follows:
9-8 (c) The board shall collect from each licensed or certified
9-9 appraiser an annual registry fee established by the board in an
9-10 amount not to exceed <$25 or> the <maximum> amount required by the
9-11 Appraisal Subcommittee. The fee shall be transmitted to the
9-12 Appraisal Subcommittee <council> on a regular <an annual> basis as
9-13 required by federal law.
9-14 (d) All registry fees collected by the board shall be
9-15 deposited in the state treasury to the credit of a special fund to
9-16 be known as the appraiser registry fund. <The board shall send the
9-17 fees to the council as required by federal law.>
9-18 SECTION 7. Section 14(b), Texas Appraiser Licensing and
9-19 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
9-20 is amended to read as follows:
9-21 (b) A license or certification may be renewed on payment of
9-22 a renewal fee prescribed by the board and on furnishing evidence
9-23 satisfactory to the board <and the Appraiser Qualifications Board>
9-24 that the holder of the license or certification has completed <any>
9-25 continuing education requirements that comply with the guidelines
9-26 recognized by the Appraisal Subcommittee and are imposed by rule
9-27 under this Act<, met the experience requirements of this Act, and
10-1 complied with any minimum or maximum requirements set forth in the
10-2 criteria of the Appraiser Qualifications Board>. The board shall
10-3 accept as continuing education any educational offering that
10-4 complies with the guidelines recognized by the Appraisal
10-5 Subcommittee that <continuing education> a licensed or certified
10-6 appraiser was awarded by a national appraiser organization approved
10-7 by the board as a provider of qualifying appraiser education.
10-8 SECTION 8. Section 15(c), (d), and (f), Texas Appraiser
10-9 Licensing and Certification Act (Article 6573a.2, Vernon's Texas
10-10 Civil Statutes), are amended to read as follows:
10-11 (c) A person registered with the board under this section
10-12 may appraise real property in this state without holding a license
10-13 or certification issued under this Act if:
10-14 (1) the state, commonwealth, or territory licensing
10-15 and certification program under which the person holds a license or
10-16 certification has not been disapproved by the Appraisal
10-17 Subcommittee; and
10-18 (2) <the real property being appraised is part of a
10-19 federally related transaction; and>
10-20 <(3)> the appraiser's business in this state is of a
10-21 temporary nature not to exceed 60 days.
10-22 (d) If the board determines that another state has
10-23 <substantially equivalent> certification or licensure requirements
10-24 that have not been disapproved by the Appraisal Subcommittee <to
10-25 those of this state>, an applicant who is certified or licensed
10-26 under the laws of that state may obtain certification as a state
10-27 certified real estate appraiser or licensure as a state licensed
11-1 real estate appraiser in this state under the terms and conditions
11-2 set <determined> by the board. The terms and conditions must
11-3 comply with the minimum criteria for certification or licensure
11-4 recognized <issued> by the Appraisal Subcommittee <Appraiser
11-5 Qualifications Board of the Appraisal Foundation>. The fee charged
11-6 to an appraiser from another state and the form submitted by the
11-7 appraiser for reciprocity must be comparable to the fee and form
11-8 required by the state where the appraiser is certified or licensed.
11-9 (f) An application may not be accepted from <for> an
11-10 applicant from a state that refuses to offer reciprocal treatment
11-11 to residents of this state who are certified or licensed real
11-12 estate appraisers.
11-13 SECTION 9. Section 18(b), Texas Appraiser Licensing and
11-14 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
11-15 is amended to read as follows:
11-16 (b) This Act does not prohibit:
11-17 (1) a real estate broker or salesman licensed under
11-18 the Texas Real Estate Act (Article 6573a, Vernon's Texas Civil
11-19 Statutes) but not licensed or certified under this Act from
11-20 performing an appraisal in a nonfederally related transaction;
11-21 (2) the requirement of a real estate broker's or
11-22 salesman's license for an appraisal in nonfederally related
11-23 transactions by a person not licensed or certified under this Act;
11-24 <or>
11-25 (3) a real estate broker or salesman licensed under
11-26 the Real Estate License Act (Article 6573a, Vernon's Texas Civil
11-27 Statutes) <and its subsequent amendments> from giving an opinion in
12-1 the ordinary course of the broker's or salesman's business to a
12-2 potential seller or third party as to the recommended listing price
12-3 of real estate or to a potential purchaser or third party as to the
12-4 recommended purchase price of real estate if the opinion given
12-5 under this subdivision is not referred to as an appraisal; or
12-6 (4) a person, including a licensed or certified
12-7 appraiser, from performing or providing an evaluation of real
12-8 property for another person, including a financial institution.
12-9 SECTION 10. Section 21(a), Texas Appraiser Licensing and
12-10 Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes),
12-11 is amended to read as follows:
12-12 (a) A person commits an offense if the person knowingly or
12-13 intentionally violates Section 4(c) of this Act or knowingly or
12-14 intentionally furnishes false information in connection with an
12-15 affidavit filed under Section 9 <(9e)> of this Act.
12-16 SECTION 11. This Act takes effect September 1, 1995.
12-17 SECTION 12. The importance of this legislation and the
12-18 crowded condition of the calendars in both houses create an
12-19 emergency and an imperative public necessity that the
12-20 constitutional rule requiring bills to be read on three several
12-21 days in each house be suspended, and this rule is hereby suspended.