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APPRAISER The Arkansas by alicejenny



Volume 13, Number 2                              Winter Issue                                   December, 2004

        Opinion                      Arkansan Heads National Group
        of Value                        Jim Martin, executive director
         By Jim Martin               of the Arkansas Appraiser Li-
        Executive Director           censing and Certification Board
                                     since its creation by the legisla-
    Members of the Board’s Edu-      ture in 1991, was elected presi-
 cation Committee often have         dent of the Association of Ap-
 voiced concern about and dis-       praiser Regulatory Officials
 cussed what might be causing        (AARO) at its recent annual con-
 the dismal pass rate by Arkan-      ference in Washington, D.C.
 sas applicants sitting for the         The Arkansas Board has been
 various appraisal exams.            active in AARO since 1992.
    They also have wondered          AARO’s executive committee last
 what the candidates’ major defi-    year chose Mar tin to become
 ciencies were with respect to the   vice president to fill a vacancy.
 15 measured subjects on the         He performed in several key
 exams.                              leadership positions before being
    The Board had the raw data       elevated for a year to the top post
 on hand to provide answers to       last month.
 these questions, so we set             Born in Louisiana’s East Carroll
                                                                             Jim Martin
 about to do the necessary re-       Parish, Martin received a B.S. de-
 search and comparisons.             gree in geology from Northeast
                                                                             visions and serving as legislative
    In the most comprehensive        Louisiana University in 1959. He
 approach we took of the several     worked five years in south Louisi-
                                                                                During Martin’s watch with the
 used, we examined the accu-         ana oil fields and taught high
                                                                             appraisal agency, it has been au-
                                     school math for a year before be-
 mulative data for each classifi-                                            dited four times by the Federal Fi-
                                     coming involved in construction
 cation over a number of years to                                            nancial Institution’s Examination
                                     education with a contractors
 arrive at an average pass ratio.                                            Council Appraisal Subcommittee.
                                     trade group in Monroe, La.
 Included were data on every in-                                             Each review ended with the con-
                                        Before being hired to head up
 dividual who had taken an exam                                              clusion that “Arkansas’ program
                                     Arkansas’ new appraiser regula-
 one or more times before pass-                                              functions effectively and in a man-
                                     tor y agency, Mar tin was em-
 ing. The results in each cat-                                               ner consistent with Title XI of
                                     ployed 22 years by the Arkansas
 egory were:                                                                 FIRREA of 1989.”
                                     Associated General Contractors,
    State License (318 candi-                                                   The Sub-committee’s staff often
                                     first as assistant executive direc-
 dates) had a composite score                                                has touted the Arkansas Board as
                                     tor and then as manager. While
 of 74.97 with a 77% pass rate.                                              one of the top five agencies of its
                                     with this group, his duties ranged
                                                                             kind in the nation.
                                     from assisting in labor contract
           See Opinion, page 4                                                  For 10 of the 13 years since its
                                     negotiations to managing the af-
                                     fairs of the organization’s three di-                See Arkansan, Page 2
Page 2                                                                                                                      The Appraiser

                                                           Board Welcomes Bonnie K. Davis
 Publication of the Arkansas Appraiser
 Licensing and Certification Board, Room                       Gov. Mike Huckabee has appointed Bonnie K. Davis, a Sherwood
 430, 101 East Capitol Ave., Little Rock,                  grandmother who expects to receive her masters degree from the Univer-
 Arkansas, 72201.
                                                           sity of Arkansas at Little Rock in the spring, to represent consumers on the
           Telephone (501) 296-1843
              Fax (501) 296-1844
                                                           Appraiser Licensing and Certification Board.
         E-mail -                        Her term on the Board expires in January 2007.
         Website -                        Davis is married to Air Force
 Nikki Bradley . . . . . . . . . . . . . Fayetteville
                                                           CMSgt. Glen Davis. By a previous
 Michael Clayton . . . . . . . . . . . . . . Camden
                                                           marriage, she has three grown
                                                           sons—Tommy of Bryant, Shane of
 C. Wayne Coats . . . . . . . . . . . . . . Conway
                                                           Little Rock, and Clay of the home,
 Bonnie Davis . . . . . . . . . . . . . . Sherwood
                                                           and two grandchildren.
 Richard Gillespie . . . . . . . . . . . Little Rock           Born in Little Rock, Davis did not
 Scott McKennon . . . . . . . . . . Forrest City           have the opportunity to attend college
 Fred Rausch . . . . . . . . . . . . . . Fort Smith        as a “traditional (right out of high
 Virginia Risinger . . . . . . . . . . . . . . . Strong    school) student” but has made up for
 Thomas Scott . . . . . . . . . . . . . . Little Rock      it since. Clay became ill and confined
 Richard Stephens . . . . . . . . . . Little Rock          to a wheelchair, but he did not let this
                                                           stop him from entering college in 1993
 All inquiries, including those about copy                 to study computer science after his
 deadlines, should be directed to the above
 address and telephone number to:                          mother agreed to help him.
 Jim Martin . . . . . . . . . . . . . . . . . . . Editor       She capitalized on the experience
             Technical editing by:                         by obtaining her own degree in liberal
                  Carol Griffee                            arts and graduating with him in 1999
            Little Rock, Arkansas
          SUBSCRIPTION: $10 a year                         from the University of Arkansas at Bonnie K. Davis
                                                           Little Rock. Now she is working on a
 “The Appraiser” is seeking timely articles or
 comments on practical appraisal subjects                  masters degree in adult education.
 of interest to both residential and nonresi-                  Davis stays busy. In addition to her studies, she is a volunteer “encour-
 dential appraisers from appraisers, lending               ager” (mentor/tutor) at a North Little Rock public school, is an education
 institutions, and other mortgage lenders.
 The articles or letters should be sent to the
                                                           counselor for the Community College of the Air Force at LRAFB, is to be-
 Board’s office at the above address.                      come vice president of the Pulaski County Republican Women, and attends
                                                           Cornerstone Bible Fellowship Church.
       Entered as second class matter:
         United States Postal Service
                                                               Davis said she expects to take any appraisal industry problems brought
         Little Rock, Arkansas 72201                       to by consumers to the Board’s attention and work for solutions.

Arkansan, from Page 1                                      1991, but Arkansas did not elect to     Committee and on the Executive
                                                           join the national group until late      Committee. When he was elected
inception, the Board operated ef-                          1992. Martin’s involvement since        President-Elect, he served as
ficiently and effectively without hav-                     has been deep, beginning as an at       chair of the Conference Program
ing a full time investigator. The level                    large alternate member on the           Committee, which developed and
of complaints, however, escalated                          Board of Directors followed by stints   promoted two annual education
to the point that a full time investi-                     on the Budget and Finance Commit-       conferences, including the
gator had to be hired.                                     tee, the Planning and Policy Commit-    Association’s annual Board of Di-
   Martin also cites the Board’s                           tee, and three times on the Confer-     rector and business meetings.
communication efforts with licens-                         ence Program Committee. He also            Martin and his wife of 42 years,
ees as a major accomplishment.                             served as the President’s appointee     the former Barbara Rose, have two
The Board holds an annual continu-                         to the Executive Committee repre-       grown daughters and a son and
ing education seminar for apprais-                         senting the Board of Directors.         five grandchildren. The Martins
ers and it publishes a newsletter                             After he was recruited to fill the   live in Saline County where they
containing information on pertinent                        vice president vacancy in 2002,         are active in Calvary Baptist
and timely issues.                                         Martin automatically served as          Church in Benton. He is a deacon
   AARO was organized in October                           chair of the Policy and Planning        and director of outreach ministries.
The Appraiser                                                                                                Page 3

A Letter From Chairman                                                         HUD Adopts
McKennon —                                                                     Predatory
   In the last newsletter, I brought      The AQB since has weakened           Lending Rule
to everyone’s attention that a “ma-    its stance and has implemented
jor change” in education require-      what it calls the “Segmented Sce-          Lenders who submit appraisals
ments was coming Jan. 1, 2008.         nario.” Your Board supports this        to the federal Depar tment of
Given the complexity of these          scenario.                               Housing of Urban Development
changes and the impact they will          Under this scenario, the re-         (HUD) that do not meet Federal
have on many registered, li-           quirements are broken down into         Housing Administration (FHA)
censed and certified appraisers        three segments or components:           standards can now be penalized
in Arkansas, please excuse my          Education, Experience, and Ex-          for the act.
redundancy as I revisit this topic.    amination. An applicant would              HUD adopted new rule Aug. 19
These new requirements are just        have to meet the criteria in effect     that it says is designed to make
36 months away!!!!                     at the time he or she completes a       lenders accountable for the qual-
   The education requirements          particular component or segment.        ity of appraisals performed by the
that will increase are:                Any component completed before          appraisers the lenders hire. It
✦ State Licensed will rise from 90     Jan. 1, 2008, would satisfy the         strengthens HUD’s regulations
   hours to 150 hours.                 current criteria, while any compo-      concerning the lenders’ responsi-
✦ Certified Residential will go        nent not completed by Jan. 1,           bilities when they select apprais-
   from 120 hours to 200 hours.        2008, would have to conform to
                                                                               ers to determine the market value
✦ Certified General will increase      the new criteria.
                                                                               of properties that will be security
   from 180 hours to 300 hours.           For example: an applicant for a
   Your Arkansas board has been        Certified General credential com-
                                                                               for FHA insured mortgages.
quite vocal with the Appraisal         pletes all of the current required         “The rule will help assure that
Qualifications Board (AQB) about       180 hours of qualifying education       home buyers will receive accu-
its proposed implementation of         and the required 30 months and          rate statements of appraised val-
the rules and regulations and is       3,000 hours of experience in 2007       ues on homes they purchase us-
monitoring closely its interpreta-     for a particular classification and     ing FHA mortgage insurance,”
tion of the implementation proce-      submits proper documentation to         said Federal Housing Commis-
dures.                                 the Arkansas Board before Jan. 1,       sioner John C. Weicher, Assistant
   The initial stance the AQB took     2008. He or she will be allowed         HUD Secretary for Housing.
was very rigid in that any creden-     to take the examination in 2008.           Holding lenders accountable
tial (license) issued by a state          It is critical, therefore, that if   when appraisers they select en-
appraiser regulatory body on or        you complete the required educa-        gage in fraudulent activities is an-
after Jan. 1, 2008, had to be in       tion between now and the end of         other step this Administration is
compliance will all components of      2007 that you notify the Arkansas       taking to protect home buyers,
the new AQB criteria. The AQB          Board and provide the proper            particularly minorities, from un-
calls this the “Firm Date Sce-         documentation of your education         scrupulous predatory lending
nario.”                                hours BEFORE DECEMBER 31,               practices,” Weicher continued.
   Under this scenario, it would       2007! Failure to do this will result       Predatory lending occurs when
not matter when an applicant com-      in your having to meet the en-          home purchasers become unwit-
pleted his or her education, expe-     hanced education criteria going         ting victims of lenders, sellers
rience, and examination; if the li-    into 2008.                              and appraisers, often working to-
cense was issued on or after Jan.         If you have any questions            gether. The unsuspecting home
1, 2008, the applicant must meet       about these issues/changes,             buyers either purchase homes
the requirements for all compo-        please call our office.
                                                                               with sales prices far in excess of
nents of the new criteria. For ob-        In closing, the Arkansas Ap-
                                                                               the fair market value, or are over-
vious reasons, your Board was          praiser Licensing and Certifica-
adamantly opposed to this imple-       tion Board wishes each and ev-
                                                                               charged substantially with costs
mentation procedure and said so        eryone Happy Holidays and a             associated with obtaining a mort-
to the AQB.                            prosperous 2005.                        gage.
Page 4                                                                                                    The Appraiser

Opinion, from Page 1                   viduals in this three year cycle       Certified Residential - 60%; and
                                       who were taking an exam for the        Certified General - 44%. These
Certified Residential (322 candi-      second (or more) time and found        numbers include all “repeaters,”
dates) had a composite score of        that State License candidates          and it should be noted that some
76.36 and a 66% pass rate. Cer-        passed on retesting at a 6% rate;      other PES states do not offer mul-
tified General (72 candidates)         Certified Residential were at 7%,      tiple opportunities to retake exams.
had a composite score of 73.22         and Certified General had a 28%           We looked as well at the test
and a 39% pass rate.                   rate. A composite of those retested    scores for the 15 content areas in
   Another approach was to de-         in the three classifications yielded   which candidates were making the
termine how well the firsttimers       49 tested with only 6 passing for an   lowest scores and ranked the top
scored on the respective exams.        across-the-board 12% pass rate.        five for each classification. (A
To do this, we analyzed the avail-        We analyzed as well all the         score of 75 is considered passing.)
able data from a three year period     candidates tested by states that          This is what we found: State
reflecting six exam cycles. These      have PERS contracts. This pro-         License (318 candidates), the
results also were enlightening.        duced: State License - 1,303           average score was 62 on the
They were:                             candidates and a pass rate of          Income Approach subject, mak-
   State License - 39 candidates       77%; Certified Residential -           ing it rank first; #2 was Sales
passed, producing an 87 % pass         1,235 candidates with a 60%            Comparison Approach at 65.60;
rate; Certified Residential - 37       pass rate, and Certified General       #3 Legal Considerations at
candidates, or a 78.4% pass rate;      - 1,300 candidates and a 39%           6 5 . 6 6 ; # 4 Ty p e s o f Va l u e a t
   Certified General - 15 candi-       pass rate.                             66.48; #5 Site Value Analysis,
dates passed for a 60% success            Scores of Arkansas candidates       67.48. Two other exam areas
rate.                                  were slightly lower than these aver-   that were below passing were
   We also analyzed those indi-        ages, i.e., State License - 68%;       Uniform Standards at 67.71 and
                                                                              Influences on Value at 74.97.
                                                                                 Also, Certified Residential
                                                                              (322 candidates) #1 Influence on
               Education Offerings                                            Values, 59.75; #2 Income Ap-
                                                                              proach, 61.80; #3 Site Value,
                                                                              66.71; #4 Real Estate Markets,
   AR Chapter of The Appraisal Institute - Contact Jennifer Coleman at        68.36; #5 Highest and Best Use,
   (501) 227-5781. All classes will be held in Little Rock.                   74.18.
                                                                                 Certified General (72 candi-
                                                                              dates) #1 Influences on Value,
   The Columbia Institute - Call 1-800-460-3147 for information.              40.28; #2 Valuation, 49.07; #3
                                                                              Market Analysis, 62.63; #4 Cost
   Delta Seminars - Contact Mickey Lee at (870) 731-8008 for course           Approach; #5 Sales Comparison
   schedules.                                                                 Approach 64.35.
                                                                                 The composite scores revealed
   Lifetime Learning - Contact Dennis McElroy at (417) 887-2221.              three other subject matters scor-
   All classes are held in Springfield, Mo.                                   ing below passing. They were In-
                                                                              come Approach, 71.18; Site
   The Lincoln Graduate Center - Call 1-800-531-5333 for information.         Value, 72.92; and Legal Consider-
                                                                              ations, 73.26.
   McKissock Appraisal School - Call 1-800-328-2008.                             The Board hopes this informa-
                                                                              tion is helpful to education provid-
                                                                              ers who may wish to reallocate
   National Association of Independent Fee Appraisers -
                                                                              the time they give to different sub-
   Call 1-800-335-1751 for information.                                       ject matters. It also should help
                                                                              appraisal candidates by showing
   RCI Career Enhancements - Call David Reinold (479) 968-7752.               them where they need to focus
                                                                              their attention as they prepare for
The Appraiser                                                                                                      Page 5

Board Reaches Out-of-Court Agreement
   The Arkansas Appraiser Licens-            edges that it supports the enact-      ment agreement during a special
ing and Certification Board; its di-         ment of legislation to establish a     conference call meeting Oct. 5, af-
rector, Jim Martin, and its investi-         statute of limitations period for      ter which a motion for dismissal of
gator, Mary Lou Brainerd, have               complaints. The Board hereby           the lawsuit was submitted to and
agreed to a settlement with the Ar-          acknowledges that it is in sup-        signed by Pulaski County Circuit
kansas Appraisal Foundation, Inc.;           port of a five year statute of limi-   Court Judge Willard Proctor Jr.
the Affiliated Real Estate Apprais-          tations, but it would not oppose       The settlement brings finality to the
ers of Arkansas; and Tom M. Ferstl.          legislation limited to establishing    litigation and will result in an im-
   The Foundation, AREAA, and                a three-year statute of limitations    proved procedure for processing
Ferstl sued the Board, Martin, and           period.                                complaints filed against appraisers
Brainerd after the Board received            The settlement was tentatively         by members of the public. Any per-
complaints against AREAA and              reached after a meeting that in-          son who has a suggested rule or pro-
Ferstl. The complaints were dis-          cluded the Board. Mr. Martin. Mrs.        cedure may submit such a proposal
missed on April 2, 2004, by the           Brainerd, Mike Pearce on behalf of        to the Board at any time. The Board
Board due to lack of jurisdiction.        the Foundation, Mr. Ferstl, and at-       requests that the proposed rule or
The agreement is a compromise             torneys for the various parties.          suggested language be submitted in
and settlement of disputed claims,           The Board approved the settle-         writing for its consideration.
and is not to be construed as an
admission of liability or wrongdoing.
The lawsuit was settled in order to
bring finality to the litigation.
   As part of the agreement, the
                                                     TIC OF PU             EARI
                                                  N OTIC E OF PU B L I C H EARI N G
Board agreed to publish the follow-            Notice is hereby given pursuant to A.C.A. 25-15-204(a) that the
ing four paragraphs from the settle-
ment agreement:                              Arkansas Appraiser Licensing and Certification Board will hold a public
1. The Board agrees to adopt an              hearing on Tuesday, January 4, 2005, at 1:30 p.m. in the Board’s Con-
   administrative rule that an ap-
                                             ference Room at 101 E. Capitol Ave., Suite 430, Little Rock, Arkansas,
   praiser is not required to provide
   his or her appraisal report and           on proposed amendments to its rules on the practice of real estate ap-
   complete working file until the           praisers.
   Board or a panel or committee of
   the Board determines that the               The amendments to Section 1-D of the current rules and regulations
   Board has jurisdiction over the           establish a procedure by which a Board Panel will determine jurisdic-
   complaint and the complaint al-           tion over a complaint in advance of the staff requesting an appraiser’s
   leges a violation of the Uniform
   Standards of Professional Ap-             work file or initiating an investigation. The revised rule requires the
   praisal Practice, the Board’s             Board staff to respond only to inquiries about specific complaints when
   Rules and Regulations, or Ark.
                                             those inquiries are made pursuant to a Freedom of Information request.
   Code Ann. S 17-14-101 et seq.
2. The Board agrees to adopt an                Interested persons may appear and express their views on the pro-
   administrative rule that records          posed revisions to the Board’s Rules and Regulations at the public
   of ongoing disciplinary proceed-
   ings and investigations shall not         hearing. Oral statements will be accepted, but for accuracy of record,
   be disseminated by the Board or           important facts and arguments should be submitted in writing at the
   its staff to the public unless a re-      hearing or to the Executive Director of the Board before the hearing.
   quest has been made pursuant
   to the Arkansas Freedom of In-            For more information, or to obtain a copy of the proposed revised
   formation Act or unless otherwise         Rule, write to the Appraiser Licensing and Certification Board at 101
   required by law.
                                             E. Capitol Ave., Suite 430, Little Rock, AR 72201 or call (501) 296-
3. The Board agrees to adopt an
   administrative rule in compli-            1843. The proposed rule change is available on the Board’s website
   ance with Ark. Code Ann. S 25-            at
4. The Board hereby acknowl-
Page 6                                                                                                         The Appraiser

Board Returns
To One Seminar
For Next Year                                                    Report
   At its November meeting, the Ar-
                                           Most Often Seen Mistake Noted
kansas Appraiser Licensing and
                                                                      By Mary Lou Brainerd
Certification Board decided to re-                                     Board Investigator
turn to its original format by making
its “Day With the Board” seminar in          Since the year began, 25 Prob-          Information from other state
2005 a one day event in Little            able Cause Panels have met to           boards indicates that there has
                                          consider 64 cases of complaints         been a sharp increase in the num-
Rock, but it will be at a facility that
                                          against Arkansas appraisers.            ber of complaints almost every-
will accommodate 400 to 600 par-          Their recommendations were pre-         where that began in 2002 and car-
ticipants.                                sented to and ratified by the full      ried over into 2004.
   This year the Board experi-            Board.                                     The heavy workload many ap-
mented with a two session seminar            Of the 64 cases, 32 were re-         praisers have had during this time
                                          ferred to Non-Judicial Hearings (in-    of low interest rates could account
with one held in Springdale and the
                                          formal conferences), 22 were dis-       for many of the errors that have led
other in North Little Rock. Although      missed, 6 were dismissed with let-      to complaints.
both were overwhelming suc-               ters of caution issued to the ap-          The mistake I see most often is
cesses, the Board decided that the        praisers, and 4 (one involving two      the failure to identify the USE and
impact on the staff and the agency’s      complaints against the same ap-         USER of each repor t. There
                                          praiser) were referred to full Board    seems to be confusion between the
travel budget plus the extraordinary      hearings.                               terms user and client and between
effort it took to coordinate speakers        There have been 26 Non-Judicial      use and purpose.
and programs for the two was too          Hearings (informal conferences)            Standards Rule 2-2 (a) (i); 2-2
great.                                    this year. The hearings were made       (b) (i) asks for both the client and
                                          up of 19 panels whose recommen-         the intended user(s) to be identified.
   The Board is continuing to con-
                                          dations were presented to and rati-     Standards Rule 2-2 (a)
sider the possibility of holding two      fied by the full Board. Sixteen of         (ii); 2-2 (b) (ii) and 2-2 ( c )(ii) ask
seminar sessions on an every              these cases ended in consent            for the intended use to be identified.
other year basis.                         agreements, 6 were dismissed, and       Standards Rule 2-2 (a) (v); 2-2 (b)
   Any organization of appraisers         4 were dismissed with letters of        (v) and 2-2 ( c )(v) discusses the
                                          caution.                                requirement for the purpose to be
wanting to coordinate a similar
                                             Each panel is made up of at          identified. The purpose has more to
seminar using Board members               least two Board members — usu-          do with the type of value being
and/or the staff’s participation has      ally the same members who               sought, and the use has more to do
a commitment from the Board that          served on the Probable Cause            with the understanding you have
it will be involved. However, con-        Panel if the case was referred for      with the client about the actual rea-
                                          Non-Judicial Hearing.                   son the report is being prepared.
tinuing education credit for those           Through Nov. 18, 59 written          All of this information leads to your
participating in such seminars must       complaints had been received by         scope of work.
be considered and/ or preapproved         the Board office this year. This is        Any time you have a question
by the Board before the organiza-         up slightly from the same time pe-      about an assignment, pick up the
                                          riod last year.                         phone and call me.
tion starts promoting the event.
The Appraiser                                                                                                              Page 7

ASB Provides Questions and Answers
(Editor’s Note: The Appraisal Stan-
dards Board ((ASB)) does not establish        my supervisory appraiser check the          to redact all confidential information
new standards or interpret existing           box indicating he “Did Inspect” the         from the report before providing it as
ones. The ASB issues these ques-
tions and answers to inform apprais-          interior of the property?                   a sample. As stated in the Comment
ers, regulators, and users of appraisal                                                   in the USPAP Ethics Rule, When all
services of its responses to questions        RESPONSE: No. It would be
that have been raised; to illustrate the
                                                                                          confidential elements of confidential
                                              misleading for an appraiser to indicate
applicability of the Uniform Standards of                                                 information are removed through
Professional Appraisal Practice               that a physical inspection was
                                                                                          redaction or the process of
((USPAP)) in specific situations; and         performed when, in fact, the appraiser
to offer advice for the resolution of ap-                                                 aggregation, client authorization is not
praisal issues and problems.)                 only viewed photographs of the
                                                                                          required for the disclosure of the
                                              property. To do this would violate
                                                                                          remaining information, as modified.
QUESTION: The Management                      USPAP’s prohibition against the
section of the USPAP Ethics Rule              communication of a misleading or            QUESTION: My client, a federally
requires an appraiser to disclose,            fraudulent report (Conduct section of       insured financial institution, has asked
…”fees, commissions, or things of             the Ethics Rule).                           me to provide a “value in use”
value” paid in connection with the                                                        appraisal instead of a market value
                                              QUESTION: I’ve been looking for
procurement of an assignment. If a                                                        appraisal. May I do this?
                                              new clients and have found that many
referral fee was paid in connection
                                              request sample appraisals for review,       RESPONSE: USPAP does not
with the assignment, must the amount
                                              but I’m concerned this would violate        dictate the use of any specific type or
of the fee be disclosed or is it sufficient
                                              appraiser-client confidentiality. To        definition of value, but they must be
simply to disclose that a fee was paid?
                                              alleviate this problem, I’m considering     appropriate for the intended use and
RESPONSE: Disclosing that a                   including the following disclaimer in the   intended users.
payment was made in the appraisal             “fine print” of my reports:
                                                                                          For federally related transactions,
certification and in any transmittal letter
                                              “The appraiser reserves the right to        federally insured financial institutions
where the conclusions are stated is
                                              utilize this report in its entirety as      require an opinion of market value, as
sufficient to meet the requirement. But
                                              sample work for the purpose of              defined by regulations. Therefore, if
this is a minimum requirement, and it
                                              soliciting prospective clients unless       you provide a value in use, you also
does not prohibit full disclosure of the
                                              written refusal is received from the        may have to provide a market value,
fee amount.
                                              client.”                                    depending on the intended use.
QUESTION: I am a licensed trainee
                                              Does USPAP allow me to do this?             QUESTION: I just inspected a
with about six months of experience.
                                                                                          property and found an adverse
My supervisory appraiser recently             RESPONSE: No. The client, not
                                                                                          condition. I informed my client (a
deemed me competent to do                     the appraiser, determines who may
                                                                                          bank), and was told not to proceed
inspections on my own; however,               receive the appraisal report. Including
                                                                                          because it cannot lend on such
many of our clients require the               a statement like you have suggested
                                                                                          property. Under USPAP, am I
supervisory appraiser to inspect the          does not constitute client authorization
                                                                                          obligated to inform any other party,
property physically as well. If I do the      to distribute copies of the report.
                                                                                          such as the city or county health
inspection my myself but take
                                              One solution is to obtain client            department?
numerous representative photos of the
                                              authorization to use each report as a
interior of the subject property, may                                                     RESPONSE: No.
                                              work sample. An alternative may be
Page 8                                                                                                      The Appraiser

State Registered                                                                STATUS REPORT
                                                                              As of December, 2004:
Renewals Due Dec. 31                                                          State Certified General ........ 463
                                                                              State Certified Residential ... 328
  Appraisers holding State Registrations are reminded their registration is   State Licensed ..................... 136
on a calendar year basis, and they must be renewed with the Board by Dec.     State Registered .................. 448
31, 2004.                                                                          (Includes temporary and
                                                                                    nonresident appraisers)
  At the time the appraiser is preparing his/her renewal, these two points
should be weighed:                                                                NEXT LICENSING,
                                                                                CERTIFICATION EXAM
✦ If the appraiser has been Registered for more than one full year, he or
  she is required to submit 14 hours of acceptable continuing education.            April 2, 2005
                                                                              DEADLINE TO APPLY: Feb. 4, 2005
✦ Individuals who became Registered after July 1, 2003, and before June          Potential applicants should
  30, 2004, are required to have had a 15-hour Uniform Standards course       contact the Board’s staff for current
  in order to renew.                                                          information about application
                                                                              process, exam schedules, fees,
   In addition, State Registered appraisers should note that the Arkansas     and other licensing matters by
Appraiser Licensing and Certification Board has increased the annual fee      calling (501) 296-1843, or use the
to $100, and it should accompany the statement along with any certificates    website at
documenting continuing education.                                                Or write to the Appraiser
                                                                              Licensing and Certification Board,
  Statements have been sent to all the registered appraisers containing the   101 E. Capitol Ave., Suite 430,
applicable information about each person’s criteria for renewal. Questions    Little Rock, Arkansas 72201.
about the renewal process may be directed to the Board’s office.

                                                                                                      PRSRT STD
                                                                                                     U.S. POSTAGE
                                                                                                   LITTLE ROCK, AR
                                                                                                   PERMIT NO. 1069

                    101 E. Capitol, Suite 430
                  Little Rock, Arkansas 72201

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