Senate Study Bill 1030
SENATE/HOUSE FILE
BY (PROPOSED ATTORNEY
GENERAL BILL)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act providing for the registration of associate real estate
2 appraisers, prohibiting improper influence over an appraiser's
3 evaluation opinion, and imposing a penalty.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
5 TLSB 1181DP 82
6 jr/gg/14
PAG LIN
1 1 Section 1. Section 543D.3, Code 2007, is amended to read
1 2 as follows:
1 3 543D.3 PURPOSES == VOLUNTARY CERTIFICATION.
1 4 The purpose of this chapter is to establish standards for
1 5 real estate appraisals and a procedure for the voluntary
1 6 certification of real estate appraisers and the mandatory
1 7 registration of associate real estate appraisers.
1 8 A person who is not a certified real estate appraiser under
1 9 this chapter may appraise real estate for compensation if
1 10 certification is not required by this chapter or by federal or
1 11 state law, rule, or policy. However, an employee of the state
1 12 department of transportation whose duties include appraisals
1 13 of property pursuant to chapter 6B must be a certified real
1 14 estate appraiser under this chapter or a registered associate
1 15 real estate appraiser acting under the direct supervision of a
1 16 certified real estate appraiser.
1 17 Sec. 2. Section 543D.9, Code 2007, is amended to read as
1 18 follows:
1 19 543D.9 EDUCATION AND EXPERIENCE REQUIREMENT.
1 20 The board shall determine what real estate appraisal or
1 21 real estate appraisal review experience and what education
1 22 shall be required to provide appropriate assurance that an
1 23 applicant for certification is competent to perform the
1 24 certified appraisal work which is within the scope of practice
1 25 defined by the board. All experience required for initial
1 26 certification shall be performed as a registered associate
1 27 real estate appraiser acting under the direct supervision of a
1 28 certified real estate appraiser, except as the board may
1 29 provide by rule. The board shall prescribe a required minimum
1 30 number of tested hours of education relating to the provisions
1 31 of this chapter, the uniform appraisal standards, and other
1 32 rules issued in accordance with this chapter.
1 33 Sec. 3. Section 543D.18, subsection 1, Code 2007, is
1 34 amended to read as follows:
1 35 1. A certified real estate appraiser shall comply with the
2 1 uniform appraisal standards adopted under this chapter. The
2 2 reliance of the public in general and of the financial
2 3 business community in particular on sound, reliable real
2 4 estate appraisal practices imposes on persons engaged in the
2 5 practice of real estate appraising as certified real estate
2 6 appraisers or as registered associate real estate appraisers
2 7 certain obligations both to their clients and to the public.
2 8 These obligations include the obligation to maintain
2 9 independence in thought and action, to adhere to the uniform
2 10 appraisal standards adopted under this chapter, and to
2 11 maintain high standards of personal conduct in all matters
2 12 impacting one's fitness to practice real estate appraising. A
2 13 certified real estate appraiser and a registered associate
2 14 real estate appraiser acting under the direct supervision of a
2 15 certified real estate appraiser shall perform all appraisal
2 16 assignments in an honest, disinterested and impartial manner,
2 17 with objectivity and independence, and without accommodation
2 18 to the personal interests or objectives of the appraiser, the
2 19 client, or any third person.
2 20 Sec. 4. Section 543D.18, Code 2007, is amended by adding
2 21 the following new subsection:
2 22 NEW SUBSECTION. 7. A certified real estate appraiser who
2 23 receives significant real property appraisal assistance in the
2 24 development or reporting of an appraisal assignment shall
2 25 disclose such assistance in accordance with the uniform
2 26 appraisal standards adopted under this chapter.
2 27 Sec. 5. NEW SECTION. 543D.18A PENALTIES FOR IMPROPER
2 28 INFLUENCE OF AN APPRAISAL ASSIGNMENT.
2 29 1. A mortgage lender, mortgage broker or originator, real
2 30 estate broker or salesperson, client, party, appraiser, or any
2 31 other person with an interest in a real estate transaction or
2 32 the financing or any loan secured by real estate involving an
2 33 appraisal assignment shall not improperly influence or attempt
2 34 to improperly influence the development, reporting, result, or
2 35 review of a real estate appraisal through coercion, extortion,
3 1 or bribery, or through any other means that impairs or may
3 2 impair the independent judgment of the appraiser including but
3 3 not limited to the withholding or threatened withholding of
3 4 payment for an appraisal fee, or the conditioning of the
3 5 payment of an appraisal fee upon the opinion, conclusion, or
3 6 valuation to be reached, or a request that the appraiser
3 7 report a predetermined opinion, conclusion, or valuation, or
3 8 the desired valuation of any person.
3 9 2. A violation of this section is an unlawful practice
3 10 under section 714.16, subsection 2, paragraph "a".
3 11 3. A violation of this section is a ground for discipline
3 12 against any person holding a certificate or registration under
3 13 this chapter or another license issued under the laws of the
3 14 state of Iowa, as license is defined in section 17A.2,
3 15 subsection 6, if the practice of the profession, occupation,
3 16 or business regulated by the license relates to real estate
3 17 transactions or the financing of loans secured by real estate.
3 18 4. A person does not violate this section solely by asking
3 19 an appraiser to consider additional, appropriate property
3 20 information, or to provide further detail, substantiation, or
3 21 explanation for the appraiser's value conclusion, or to
3 22 correct errors in the appraisal report, or by withholding
3 23 payment of an appraisal fee based on a bona fide dispute
3 24 regarding the appraiser's compliance with the appraisal
3 25 standards adopted by the board under this chapter.
3 26 Sec. 6. NEW SECTION. 543D.20 REGISTRATION OF ASSOCIATE
3 27 REAL ESTATE APPRAISERS.
3 28 1. A person shall not assist a certified real estate
3 29 appraiser in the development or reporting of an appraisal
3 30 assignment that is required by this chapter, or by federal or
3 31 state law, rule, or policy to be performed by a certified real
3 32 estate appraiser, unless the person meets one or more of the
3 33 following conditions:
3 34 a. The person is certified under this chapter.
3 35 b. The person is registered as an associate real estate
4 1 appraiser and is acting under the direct supervision of a
4 2 certified real estate appraiser.
4 3 c. The person is solely providing administrative services,
4 4 such as taking photographs, preparing charts, or typing
4 5 reports, and is not providing real estate appraisal assistance
4 6 in developing the analysis, valuation, opinions, or
4 7 conclusions associated with the appraisal assignment.
4 8 d. The person is providing professional consultation that
4 9 does not constitute real property appraisal assistance, such
4 10 as the assistance of a professional engineer or certified
4 11 public accountant.
4 12 2. The board shall establish by rule the terms and
4 13 conditions of the registration of associate real estate
4 14 appraisers, including the educational and other prerequisites
4 15 to registration, the fees for registration and the renewal of
4 16 registration, and the continuing education requirements for
4 17 renewal of registration. The board shall consider and may
4 18 incorporate any guidelines recommended by the appraisal
4 19 qualifications board of the appraisal foundation relating to
4 20 associate real estate appraisers.
4 21 3. The board shall adopt rules governing the manner in
4 22 which certified real estate appraisers shall directly
4 23 supervise associate real estate appraisers, the standards of
4 24 conduct for associate real estate appraisers, and the grounds
4 25 for imposing discipline against an associate real estate
4 26 appraiser which shall include all of the grounds provided in
4 27 section 543D.17.
4 28 4. Associate real estate appraisers shall be bound by the
4 29 uniform appraisal standards adopted by the board under this
4 30 chapter.
4 31 Sec. 7. NEW SECTION. 543D.21 VIOLATIONS == INJUNCTIONS
4 32 == CIVIL PENALTIES.
4 33 1. If, as the result of a complaint or otherwise, the
4 34 board believes that a person has engaged, or is about to
4 35 engage, in an act or practice that constitutes or will
5 1 constitute a violation of this chapter, the board may make
5 2 application to the district court for an order enjoining such
5 3 act or practice. Upon a showing by the board that such person
5 4 has engaged, or is about to engage, in any such act or
5 5 practice, an injunction, restraining order, or other order as
5 6 may be appropriate shall be granted by the district court.
5 7 2. The board may investigate complaints or initiate
5 8 complaints against persons who are not certified or registered
5 9 under this chapter, and in connection with such complaints or
5 10 investigations may issue subpoenas to compel witnesses to
5 11 testify or persons to produce evidence consistent with the
5 12 provisions of section 272C.6, subsection 3, as needed to
5 13 determine whether probable cause exists to initiate
5 14 proceedings under this section or to make application to the
5 15 district court for an order enjoining violations of this
5 16 chapter.
5 17 3. In addition to or as an alternative to making
5 18 application to the district court for an injunction, the board
5 19 may issue an order to a person who is not certified or
5 20 registered under this chapter to require compliance with this
5 21 chapter and may impose a civil penalty against such person for
5 22 any violation of subsection 4 in an amount up to one thousand
5 23 dollars for each violation. All civil penalties collected
5 24 pursuant to this subsection shall be deposited in the housing
5 25 trust fund created in section 16.181. An order issued
5 26 pursuant to this section may prohibit a person from applying
5 27 for certification or registration under this chapter.
5 28 4. The board may impose civil penalties against a person
5 29 who is not certified or registered under this chapter for any
5 30 of the following acts:
5 31 a. A violation of section 543D.15.
5 32 b. A violation of section 543D.18A, subsection 1.
5 33 c. A violation of section 543D.20, subsection 1.
5 34 d. Developing or communicating an appraisal assignment in
5 35 a deceptive or dishonest manner or in a manner inconsistent
6 1 with a direct or indirect representation to the public that
6 2 such assignment was completed as a disinterested, unbiased,
6 3 objective, or independent appraiser.
6 4 e. Fraud, deceit, or deception, through act or omission,
6 5 in connection with an application for certification or
6 6 registration under this chapter.
6 7 5. The board, before issuing an order under this section,
6 8 shall provide the person written notice and the opportunity to
6 9 request a hearing. The hearing must be requested within
6 10 thirty days after receipt of the notice and shall be conducted
6 11 in the same manner as provided for disciplinary proceedings
6 12 involving a licensee under this chapter.
6 13 6. A person aggrieved by the imposition of a civil penalty
6 14 under this section may seek judicial review pursuant to
6 15 section 17A.19.
6 16 7. If a person fails to pay a civil penalty within thirty
6 17 days after entry of an order imposing the civil penalty, or if
6 18 the order is stayed pending an appeal, within ten days after
6 19 the court enters a final judgment in favor of the board, the
6 20 board shall notify the attorney general. The attorney general
6 21 may commence an action to recover the amount of the penalty,
6 22 including reasonable attorney fees and costs.
6 23 8. An action to enforce an order under this section may be
6 24 joined with an action for an injunction.
6 25 EXPLANATION
6 26 This bill requires registration of associate real estate
6 27 appraisers who may appraise real estate under the direct
6 28 supervision of a certified real estate appraiser. Associate
6 29 real estate appraisers must also train under the direct
6 30 supervision of a certified real estate appraiser. The bill
6 31 requires that when a certified real estate appraiser receives
6 32 significant assistance in preparing an appraisal, that
6 33 assistance must be disclosed. The bill establishes a specific
6 34 standard which requires that appraisals be performed in an
6 35 honest, disinterested, and impartial manner, with objectivity
7 1 and independence. Penalties are imposed on persons who
7 2 attempt to impose improper influence on an appraisal. The
7 3 bill sets out a variety of penalties that range from judicial
7 4 action to enjoin an act or a practice to a civil penalty up to
7 5 $1,000 for each violation.
7 6 LSB 1181DP 82
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