Transcript Kfoeoeoeo a - International Right of Way Association

2010 USPAP Changes
&
Common USPAP/UA Interfaces
Federal Agency Update
Sponsored by the Appraisal Institute and the International
Right of Way Assoc.
1/26/10 Las Vegas
Presenter: Michael C. McCall, MAI
[email protected]
New Definitions
Purpose: Clarification
• Assignment: 1) an agreement between
an appraiser and a client to provide a
valuation service; 2) the valuation service
that is provided as a consequence of such
an assignment
New Definitions
(Cont.)
• Signature: personalized evidence
indicating authentication of the work
performed by the appraiser and the
acceptance of the responsibility for
content, analyses, and the conclusions in
the report.
New Definitions
(Cont.)
• Jurisdictional Exception: an assignment
condition established by applicable law or
regulation which precludes an appraiser
from complying with part of USPAP
Edits to Ethics Rule
• Introductory Section: Reworded and the
caveat for compliance by organizations
involved in appraisal has shifted to the
individual employed by said organizations.
Ethics Rule Edits – Conduct
• Conduct:
– New Bullet: must not perform an assignment
in a grossly negligent manner (Standards
Rules already prohibit “careless and negligent
manner”)
– New Bullet: must not perform an assignment
with bias
Ethics Rule Edits – Conduct (cont.)
• New Requirement: If known prior to accepting
an assignment, and/or if discovered at any time
during the assignment, an appraiser must
disclose to the client, and in the subsequent
report certification:
– Any current or perspective interest in the subject
property or parties involved; and
– Any services regarding the subject property
performed by the appraiser within the three year
period immediately preceding acceptance of the
assignment, as an appraiser or in any other capacity.
Ethics Rule Edits – Management
– An appraiser must disclose that he or she
paid a fee or commission, or gave a thing of
value in connection with the procurement of
an assignment.
• Must appear in certification and letter of
transmittal.
• Not necessary to disclose amount
Ethics Rule Edits – Management (cont.)
• Misleading advertising language clarified
• Signature:
– An appraiser must fix, or authorize the use of,
his or her signature to certify recognition and
acceptance of his or her USPAP
responsibilities in an appraisal or review
– An appraiser may authorize the use of his or
her signature only on an assignment-byassignment basis.
– An appraiser must not affix the signature of
another appraiser without his or her consent.
Ethics Rule Edits (cont)
• Confidentiality Section – edited for clarity
• Record Keeping Section
– Requirement for client access to restricted
appraisal files deleted
Ethics Rule Edits – Record Keeping (cont.)
• An appraiser having custody of a workfile
must allow other appraisers with workfile
obligations related to an assignment
appropriate access and retrieval for the
purpose of:
– State Regulatory Agencies
– Compliance with due process of law
– Professional peer review
– Compliance with retrieval agreements
Edits to Competency Rule
• Edited and expanded for clarity. Now
includes:
– Some discussion and description of
competency
• Ability to define the problem
• Knowledge and experience to complete
assignment
• Recognition of, and compliance with, laws and
regulations
Edits to Competency Rule (cont)
– Some expanded discussion of how
competency may be acquired e.g.
• Personal study
• Association with others that have knowledge and
experience in the subject matter
• Retention of others that have knowledge and
experience in the subject matter
Edits to Jurisdictional Exception Rule
• New language: If any applicable law or
regulation precludes compliance with any
part of USPAP, only that part of USPAP
becomes void for that assignment.
– Comment: When compliance with USPAP is
required by federal law or regulation, no part
of USPAP can be voided by law or regulation
of the state or local jurisdiction.
Edits to Jurisdictional Exception Rule (cont)
• Descriptions of laws and regulations edited
– Law includes constitutions, legislative and courtmade law, and administrative rules and
ordinances. Regulations include rules or orders
having legal force, issued by an administrative
agency. Instructions from a client or attorney do
not establish a jurisdictional exception.
– Non-Compensable?
Edits to Jurisdictional Exception Rule (cont)
4 NEW REQUIREMENTS
• In an assignment involving a jurisdictional
exception, an appraiser must:
– 1) Identify the law or regulation that precludes
compliance with USPAP
– 2) Comply with that law or regulation
– 3) Clearly and conspicuously disclose in the
report the part of USPAP that is voided by that
law
– 4) Cite in the report the law or regulation requiring
this exception to USPAP compliance
Edits to Standard 3
Appraisal Review
• Standard 3 was reorganized and edited for
clarification. No substantial changes to
fundamental requirements.
Common Uniform Act Issues
• Jurisdictional Exception
• Hypothetical Conditions
• Scope of Work
Jurisdictional Exception
• Project Influence
–Uniform Act requires appraiser to
ignore influence of project in the
“before value”
–Question of Jurisdictional Exception
• Addressed in USPAP language.
Discussion follows with Q&A
examples
Hypothetical Conditions
• Valuing the property as if the project
is complete creates a hypothetical
condition
• While ignoring project influence is not
a jurisdictional exception, it is a
hypothetical condition
• Discussion follows with Q&A
examples
Scope of Work
• FHWA requires agency to take the lead in
scope of work decision.
• USPAP requires appraiser to take
responsibility
• Conflict?
– No, the decision is a mutually agreed upon
process. Discussion follows with Q&A
examples.
Hope this was useful