Transcript NBC Presentation Template

2009 Federal
Agency Update
Las Vegas, NV
January 13, 2009
Appraisal Services
Directorate
Chief Appraiser
ASD DC Office Staff
Deputy Chief Appraiser—
Appraisal Services
Directorate
Regional Offices:
Senior Advisor,
Compliance
Records,
Compliance
Team
Midwest
Mountain
Chief, Office of
Minerals Evaluation
Deputy Chief
Appraiser—Office of the
Special Trustee
Regional Offices:
Alaska
Eastern
Education
Northeast
Eastern Oklahoma
Northwest
Great Plains
Pacific
Midwest
Southeast
Navajo
Southwest
Northwest
Key
Organizational Chart as
of January 2009
Pacific
Albuquerque
Rocky Mountain
Washington, DC
Southern Plains
Denver
Multiple Locations
Southwest
Western
ASD Office Locations Map
Appraisal Services Directorate Regional Office
Appraisal Services Directorate Field Office
Minerals Evaluation Office
ASD LOCATIONS
► Currently,
the Chief Appraiser position is
vacant; Helen Honse, RPRA is serving as
Acting Chief Appraiser
•
•
•
Washington,DC
[email protected]
[email protected]
ASD LOCATIONS
► ASD
•
Northeast Region, headquarters Hadley, MA
o
o
•
is divided into seven defined regions
Gerald E. Stoebig, MAI, Regional Appraiser
[email protected]
Southeast Region, headquarters, Atlanta, GA
o
o
John R. Walker, MAI, Regional Apppraiser
[email protected]
ASD LOCATIONS
•
Midwest Region, headquarters, Minneapolis,
MN
o
o
•
Southeast Region, headquarters, Phoenix, AZ
o
o
•
Liz Hanna, SRA, Regional Appraiser
[email protected]
Michael, “Shawn” Redfield, RPRA, Regional
Appraiser
[email protected]
Mountain Region, headquarters, Denver, CO
o
o
Tanya E. Henderson, RPRA, Regional Appraiser
[email protected]
ASD LOCATIONS
•
Pacific Region, headquarters, Sacramento,
CA
o
o
•
Alex W. Glade, MAI, Regional Appraiser
[email protected]
Northwest Region, headquarters, Portland,
OR
o
o
Steven Herzog, MAI, Acting Regional Appraiser
[email protected]
Background
On November 12, 2003, Secretarial Order
3251 established the Office of Appraisal
Services (ASD), to consolidate the
Department’s appraisal function into DOI’s
National Business Center (NBC).
► The Order was created to:
►
•
•
•
•
Ensure adherence to professional standards
Ensure objectivity of the appraisal process
Improve efficiency of appraisal operations
Improve the effectiveness of the appraisal
function
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Strategic Direction
► To
accomplish the Secretary’s goals, ASD
is implementing the following Strategic
Initiatives:
•
•
•
•
•
•
Utilization of Departmental policies and
procedures
Increased adherence to professional standards
Creation of Compliance Inspection Program
Improvements in operational procedures
Technology Enhancements
Enhancing Appraisal Workforce
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Integrated Appraisal Organization
►
Consolidation of appraisal function into the NBC
improved efficiencies through the merging of
offices and reduced number of appraisers.
•
Pre-ASD:
o
o
•
34 offices
89 appraisers with single bureau focus
Currently:
o
o
26 offices
51 appraisers with multiple bureau focus
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Departmental Policies and Procedures
►
►
►
On October 1, 2006, DOI published the DOI Appraisal Policy
Manual. (We anticipate customer review of the revised manual in
FY09)
The September 2006 GAO Report stated: “… consolidation has
greatly improved the independence and objectivity of appraisals.”
Ensures consistency in process, for example:
•
•
•
•
•
Requires that all valuation services comply with the Uniform
Standards of Professional Appraisal Practice (USPAP) and the
Uniform Appraisal Standards for Federal Land Acquisitions
(UASFLA) as applicable to acquisitions and exchanges.
Defines requirements for training and certification for contract
appraisers
Includes procedure for obtaining full disclosure of market history
Provides guidance on the use of comparable sales for land
acquisition
Defines acceptable use of the period of validity for appraisals and
additional complex appraisal concerns
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OLD APPRAISERS NEVER DIE…
… THEY JUST LOSE VALUE
-Quote by Virgil Holtgrewe, ARA
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CONTRACTING FOR ASD
FROM BIDS TO REVIEWS
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Contracting Opportunities Available
►
►
►
►
58% of ASD’s completed work product in 2007 was
outsourced to contract appraisers.
Projects involve a variety of property types: residential,
recreational, agricultural, commercial, industrial.
Appraisal assignments range from the simple to the more
complex that require specialized experience and training.
Evaluations encompass a broad range of estates and rights.
Various components and interests – such as minerals, water
rights, timber and conservation easements – are often
involved.
14
The ASD Appraisal Process
USFWS
NPS
BOR
BLM
APPRAISAL REQUEST
ENTERED IN ARRTS
ASD REGIONAL APPRAISER
ENGAGING APPRAISER
3rd PARTY CONTRACT,
FAR EXEMPTION, ETC.
SOW
AQD CONTRACT
CONTRACT APPRAISER
15
The ASD Appraisal Process
(continued)
ASD REVIEW APPRAISER/COTR
(Technical Info/Questions)
PRE-WORK MEETING
BUREAU CONTACT
(Property Info/Questions)
PROPERTY INSPECTION
(May include ASD Appraiser(s), Landowner(s),
Bureau Reps, Project Partners, others)
COMPLETED APPRAISAL REPORT
ASD REVIEW APPRAISER
CONTRACT APPRAISER
FOR REVISIONS, IF NECESSARY
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The ASD Appraisal Process
(continued)
ASD REVIEW APPRAISER
ASD 2nd LEVELREVIEW APPRAISER
(IF NECESSARY)
APPRAISAL APPROVED
APPRAISAL REJECTED
CONTRACT COMPLETE –
PAYMENT TO CONTRACTOR
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Solicitations and Bids
►
►
►
Most ASD appraisal contracts are
facilitated by NBC’s Acquisition Services
Directorate (AQD),
Contracts for appraisal services and
payment for those services upon approval
by the ASD Review are handled by AQD
Exceptions include Third Party Contracts
(facilitated by Bureau partners) and FAR
Exemptions, which allow appraisals to be
contracted directly by the Bureau
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Solicitations and Bids
►
►
►
►
The Central Contractor Registration (CCR) is the primary
vendor database for the Federal government.
Registration in CCR is required of all Contract Appraisers:
www.ccr.gov.
A Data Universal Numbering System (DUNS) Number
provided by Dun and Bradstreet (D&B) is needed to register
with CCR: http://fedgov.dnb.com.
Additional information needed for CCR registration includes:
•
Tax Identification Number (TIN)
•
Taxpayer name used in Federal tax matters
•
Electronic Funds Transfer (EFT) information for payment of
invoices.
19
http://
www
/indirect.asp
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THE SOW
THE STATEMENT OF WORK (SOW)
The ASD Engaging Appraiser prepares a SOW for each
appraisal that clearly defines all particulars of the
assignment. Statements of Work have five primary
components:
•
•
•
•
•
Problem Identification
Assignment Qualifications
Supplemental Standards
General Requirements
Instructions to the Appraiser
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The Pre-Appraisal Meeting
25
The Pre-Appraisal Meeting
A pre-appraisal conference is usually required,
and is always necessary for a contract appraiser
who has not previously performed an appraisal
for the staff appraisers involved in the
assignment.
Pre-appraisal conferences provide the contract
appraiser, the client Bureau, ASD staff, and other
involved parties the opportunity to share
information relevant to the appraiser project,
promote a consistent understanding of the
important issues and answer the contractor’s
questions.
26
Technical Questions vs.
Property-Specific Questions
Technical Questions
ASD Review Appraiser
Property-Specific Questions
Bureau Contact
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ASD Appraisal Checklist
► Must
accompany each appraisal
completed for ASD
► Allows
the Contract Appraiser to make
certain that all required components are
included for each appraisal assignment
► Helps
to ensure uniformity in the review
process
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The Review Process
All appraisals must be
reviewed by ASD

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The Review Process
►
►
►
►
All contracted appraisal reports are reviewed by an ASD staff
review appraiser for compliance with the applicable appraisal
standards.
Appraisals which involve values above certain thresholds are
also subject to a second level review.
All ASD reviews are technical reviews done in accordance with
USPAP Standard 3 and UASFLA Section C. Reviews may
involve strictly a desk review, or may also include a field
review, dependent upon the complexity of the appraisal
assignment and other factors.
In addition to USPAP and UASFLA, ASD staff/review appraisers
are guided by the DOI Appraisal Policy Manual, which provides
a framework for specific issues not directly addressed in the
standards.
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Common Errors Found During Reviews
Can be “Fatal” Errors or “Non-Fatal” Errors
►
►
►
Highest and Best Use – HBU of sales differs from HBU
conclusion for Subject; or HBU of sales not adequately
analyzed so that conclusions of comparability are selfevident
Misuse of Hypothetical Conditions and/or Extraordinary
Assumptions
Failure to properly identify property rights (estate)
valued (i.e., valued leasehold rather than leased fee;
legal description inadequate; not recognizing easements
and encumbrances) Does a “Fee Simple Estate” really
exist?
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Common Errors Found During Reviews
(continued)
►
►
Data not fully analyzed for use in the application of one
or more of the three approaches to value (i.e., no
estimate of expenses when using rentals for income
approach; not analyzing improved sales for depreciation;
no evidence that sales have been researched, verified or
analyzed, etc.
The report does not indicate under what standards
(USPAP, UASFLA) it was prepared. All reports prepared
should comply with USPAP; if the report is for a Federal
land acquisition or exchange, it must be prepared to
UASFLA. Inappropriate standards (FIRREA, etc) are
cited; non-compliance with stated standards.
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Common Errors Found During Reviews
(continued)
►
►
►
►
►
Sources of definitions not provided in report (market
value, etc.); incorrect definition of market value used;
referenced sources have been superseded.
Approach to value excluded without adequate
justification.
Inadequate description of property and/or
improvements.
Client, Intended Use, Purpose, and/or Intended Users
not identified, or misidentified.
Sales history of Subject not included (USPAP requirement
– 3 yrs; UASFLA requirement – 10 yrs and analysis of
most recent sale regardless of age); no use history; no
rental history.
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Common Errors Found During Reviews
(continued)
►
►
►
►
►
Improved sales used in Sales Comparison Approach, but
no analysis completed to determine contribution of
improvements to total sale price; no analysis to
determine an allocation of rental between improvements
and land.
ASD Appraisal Checklist not included in report.
No comparable sales location or Subject Property
location maps.
Inappropriate statements in certification or certification
does not meet requirements of USPAP and/or UASFLA.
Report refers to timber value, but no analysis of cruise
data; summation of stumpage value and land value.
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Common Errors Found During Reviews
(continued)
►
►
►
►
►
A Jurisdictional Exception is used without referencing the
rules, law, etc. that cause the Exception; Exception was
used inappropriately.
No Scope of Appraisal included in report.
Comparable sales data sheets missing required
information, such as Grantor, Grantee, tax parcel
number, recording information, etc.
Regional/Area/Neighborhood data is weak and has little
relevance to the appraisal problem.
No acquisition analysis as required by UASFLA.
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USPAP Competency Rule
USPAP
2008–2009
COMPETENCY RULE
Prior to accepting an assignment or entering into an agreement
to perform any assignment, an appraiser must properly identify
the problem to be addressed and have the knowledge and
experience to complete the assignment competently; or
alternatively, must:
1. disclose the lack of knowledge and/or experience to the
client before accepting the assignment;
2. take all steps necessary or appropriate to complete the
assignment competently; and
3. describe the lack of knowledge and/or experience and the
steps taken to complete the assignment competently in the
report.
Comment: Competency applies to factors such as, but not
limited to, an appraiser’s familiarity with a specific type of
property, a market, a geographic area, or an analytical method.
If such a factor is necessary for an appraiser to develop
credible assignment results, the appraiser is responsible for
having the competency to address that factor or for following
the steps outlined above to satisfy this COMPETENCY RULE.
The background and experience of appraisers varies widely,
and a lack of knowledge or experience can lead to inaccurate or
inappropriate appraisal practice. The COMPETENCY RULE
requires an appraiser to have both the knowledge and the
experience required to perform a specific appraisal service
competently.
The COMPETENCY RULE requires recognition of, and
compliance with, laws and regulations that apply to the
appraiser or to the assignment.
If an appraiser is offered the opportunity to perform an
appraisal service but lacks the necessary knowledge or
experience to complete it competently, the appraiser must
disclose his or her lack of knowledge or experience to the client
before accepting the assignment and then take the necessary or
appropriate steps to complete the appraisal service competently.
This may be accomplished in various ways, including, but not
limited to, personal study by the appraiser, association with an
appraiser reasonably believed to have the necessary knowledge
or experience, or retention of others who possess the required
knowledge or experience.
In an assignment where geographic competency is necessary,
an appraiser preparing an appraisal in an unfamiliar location
must spend sufficient time to understand the nuances of the
local market and the supply and demand factors relating to the
specific property type and the location involved. Such
understanding will not be imparted solely from a consideration
of specific data such as demographics, costs, sales, and rentals.
The necessary understanding of local market conditions
provides the bridge between a sale and a comparable sale or a
rental and a comparable rental. If an appraiser is not in a position
to spend the necessary amount of time in a market area to obtain
this understanding, affiliation with a qualified local appraiser
may be the appropriate response to ensure development of
credible assignment results.
Although this Rule requires an appraiser to identify the problem
and disclose any deficiency in competence prior to accepting an
assignment, facts or conditions uncovered during the course of
an assignment could cause an appraiser to discover that he or
she lacks the required knowledge or experience to complete the
assignment competently. At the point of such discovery, the
appraiser is obligated to notify the client and comply with items 2
and 3 of this Rule.
USPAP 2008–2009 Edition
©The Appraisal Foundation
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The Appraiser—
Frequently Wrong,
Seldom in Doubt.
-Quote by John Widdoss, ARA
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