Enrolled SB 155: Relating to the registration and regulation of real estate appraisal management companies; relating to the establishment of fees by the Department of Commerce, Community, and Economic Development; relating to the Board of Certified Real Estate Appraisers; relating to real estate appraisers; and providing for an effective date.
00Enrolled SB 155 01 Relating to the registration and regulation of real estate appraisal management companies; 02 relating to the establishment of fees by the Department of Commerce, Community, and 03 Economic Development; relating to the Board of Certified Real Estate Appraisers; relating to 04 real estate appraisers; and providing for an effective date. 05 _______________ 06 * Section 1. AS 08.01.065(c) is amended to read: 07 (c) Except as provided in (f) - (j) [(f) - (i)] of this section, the department shall 08 establish fee levels under (a) of this section so that the total amount of fees collected 09 for an occupation approximately equals the actual regulatory costs for the occupation. 10 The department shall annually review each fee level to determine whether the 11 regulatory costs of each occupation are approximately equal to fee collections related 12 to that occupation. If the review indicates that an occupation's fee collections and 13 regulatory costs are not approximately equal, the department shall calculate fee 14 adjustments and adopt regulations under (a) of this section to implement the
01 adjustments. In January of each year, the department shall report on all fee levels and 02 revisions for the previous year under this subsection to the office of management and 03 budget. If a board regulates an occupation covered by this chapter, the department 04 shall consider the board's recommendations concerning the occupation's fee levels and 05 regulatory costs before revising fee schedules to comply with this subsection. In this 06 subsection, "regulatory costs" means costs of the department that are attributable to 07 regulation of an occupation plus 08 (1) all expenses of the board that regulates the occupation if the board 09 regulates only one occupation; 10 (2) the expenses of a board that are attributable to the occupation if the 11 board regulates more than one occupation. 12 * Sec. 2. AS 08.01.065 is amended by adding a new subsection to read: 13 (j) The department shall establish for real estate appraisal management 14 companies registered under AS 08.87 a registry fee in an amount that equals the 15 amount determined by the federal Appraisal Subcommittee established under 12 16 U.S.C. 3310 as a national registry fee for each real estate appraiser of the appraiser 17 panel of a real estate appraisal management company under 12 U.S.C. 3338 (Title XI, 18 Financial Institutions Reform, Recovery, and Enforcement Act of 1989), as amended 19 by 12 U.S.C. 5301 - 5641 (Dodd-Frank Wall Street Reform and Consumer Protection 20 Act); the department may annually remit fees paid under this subsection to the 21 Appraisal Subcommittee for participation in the national registry for real estate 22 appraisal management companies. 23 * Sec. 3. AS 08.87.020 is amended to read: 24 Sec. 08.87.020. Powers and duties of board. In addition to the powers and 25 duties conferred on the board by AS 08.01, the board shall 26 (1) establish the examination specifications for certification as a 27 general real estate appraiser, as a residential real estate appraiser, and as an 28 institutional real estate appraiser; 29 (2) adopt rules of professional conduct to establish and maintain a high 30 standard of integrity in the real estate appraisal profession; [AND] 31 (3) adopt regulations necessary to carry out the purposes of this
01 chapter, including regulations 02 (A) necessary to comply with the requirements of 03 (i) 12 U.S.C. 3331 - 3355 [12 U.S.C. 3331 - 3351] 04 (Title XI, Financial Institutions Reform, Recovery, and Enforcement 05 Act of 1989), as amended by 12 U.S.C. 5301 - 5641 (Dodd-Frank Wall 06 Street Reform and Consumer Protection Act); the regulations adopted 07 by the board under AS 08.87.110, 08.87.120, 08.87.135, 08.87.220, and 08 08.87.310 may not be more stringent than the corresponding minimum 09 requirements for receiving approval of the state's program of 10 certification of real estate appraisers and registration of real estate 11 appraisal management companies under 12 U.S.C. 3331 - 3355 [12 12 U.S.C. 3331 - 3351] or other federal law; and 13 (ii) 15 U.S.C. 1639e (Truth in Lending Act); 14 (B) establishing registration procedures and standards for a 15 real estate appraisal management company; and 16 (C) establishing the standards for the real estate appraisal 17 management company's appraiser panel, including panel size and 18 member qualifications; and 19 (4) report relevant information regarding a real estate appraisal 20 management company's operations, including a disciplinary action under this 21 chapter or a violation of state or federal law, to the Appraisal Subcommittee 22 established under 12 U.S.C. 3310. 23 * Sec. 4. AS 08.87.020 is amended by adding a new subsection to read: 24 (b) The board may 25 (1) examine the records of a real estate appraisal management 26 company operating in the state; 27 (2) require a real estate appraisal management company to submit 28 reports, information, and documents to the board; 29 (3) investigate alleged violations of this chapter; 30 (4) conduct background investigations as provided in AS 08.87.135(c). 31 * Sec. 5. AS 08.87 is amended by adding new sections to read:
01 Article 2A. Real Estate Appraisal Management Companies. 02 Sec. 08.87.130. Registration required. (a) A person shall register as a real 03 estate appraisal management company with the board to perform appraisal 04 management services if the person 05 (1) provides an appraisal management service 06 (A) to a creditor or secondary mortgage market participant, 07 including an affiliate; and 08 (B) in connection with valuing a borrower's principal dwelling 09 as security for a consumer credit transaction or incorporating consumer credit 10 transactions into a securitization; and 11 (2) oversees an appraiser panel. 12 (b) A person is guilty of a class B misdemeanor if the person engages in 13 business as or holds out as a real estate appraisal management company, or performs 14 or attempts to perform appraisal management services, at a time when the 15 (1) person does not hold a registration issued by the board; or 16 (2) registration issued by the board to the person is suspended, 17 revoked, lapsed, or surrendered. 18 Sec. 08.87.135. Requirements for registration of real estate appraisal 19 management companies. (a) The board shall register a real estate appraisal 20 management company operating in the state if the company applies on a form 21 approved by the board, pays the fee required under AS 08.01.065, and presents 22 evidence satisfactory to the board that the company 23 (1) has designated a controlling person who will be the main point of 24 contact between the board and the company and who meets the requirements under (b) 25 of this section; 26 (2) has, if the company is not a corporation that is domiciled in this 27 state, filed with the department a written consent to service of process on a resident of 28 this state for any court action arising from an activity regulated under this chapter or 29 12 U.S.C. 3331 - 3355 and provided the name and contact information for the 30 company's agent for service of process in this state; 31 (3) requires a real estate appraiser to comply with the Uniform
01 Standards of Professional Appraisal Practice adopted by the Appraisal Standards 02 Board of the Appraisal Foundation when completing appraisals at the company's 03 request; 04 (4) engages only appraisers who are certified under this chapter; 05 (5) has a process to verify that a person who is assigned to serve on an 06 appraiser panel of the company 07 (A) is certified under this chapter and maintains a certification 08 in good standing; and 09 (B) is qualified to conduct federally related transactions under 10 federal law; in this subparagraph, "federally related transaction" means a real 11 estate related transaction that involves an insured depository institution 12 regulated by the United States Comptroller of the Currency, the Board of 13 Governors of the Federal Reserve System, the Federal Deposit Insurance 14 Corporation, or the National Credit Union Administration and requires the 15 services of a real estate appraiser under the interagency appraisal rules; 16 (6) conducts appraisals independently and free from inappropriate 17 influence and coercion as required under 12 U.S.C. 3353; 18 (7) is not directly or indirectly owned in whole or in part by a person 19 that has had a certificate to act as a real estate appraiser denied, cancelled, suspended, 20 revoked, put on probation, or surrendered in lieu of a pending revocation in any state 21 unless the person has later had a certificate to act as a real estate appraiser granted or 22 reinstated by the same state; 23 (8) has posted a surety bond in an amount required by the board, not to 24 exceed $50,000; and 25 (9) is owned by persons who meet the requirements under (c) of this 26 section. 27 (b) A controlling person designated under (a) of this section 28 (1) must be actively certified in a state as a real estate appraiser at all 29 times that the person is designated as a controlling person; 30 (2) may not have had a certificate to act as a real estate appraiser 31 denied, cancelled, suspended, revoked, put on probation, or surrendered in lieu of a
01 pending revocation in any state unless the person has later had the certificate to act as 02 a real estate appraiser granted or reinstated; and 03 (3) must be of good moral character. 04 (c) A person who owns at least 10 percent of a real estate appraisal 05 management company required to be registered under this chapter must be of good 06 moral character as determined by the board and shall submit to a background 07 investigation conducted by the board. 08 (d) The board shall provide a copy of a registration under this section to the 09 Appraisal Subcommittee established under 12 U.S.C. 3310 on a form approved by the 10 subcommittee. 11 (e) A registration under this section is valid for two years and may be renewed 12 upon proof of continued compliance with the requirements under (a) - (c) of this 13 section. 14 Sec. 08.87.140. Mandatory reporting. A real estate appraisal management 15 company or a controlling person, employee, director, officer, or agent of a real estate 16 appraisal management company that has reasonable cause to believe that a real estate 17 appraiser has failed to comply with the Uniform Standards of Professional Appraisal 18 Practice as adopted under 12 U.S.C. 3339 in a manner that materially affects a 19 valuation appraisal shall report the noncompliance to the board and to the Appraisal 20 Subcommittee established under 12 U.S.C. 3310. 21 Sec. 08.87.142. Statement of fees. (a) When reporting to a borrower, an 22 appraisal management company shall separately state the fees 23 (1) paid to an appraiser for the completion of an appraisal; and 24 (2) charged to the borrower for appraisal management services by the 25 appraisal management company. 26 (b) An appraisal management company may not include any fees for appraisal 27 services listed in (a)(1) of this section as charges for an appraisal management service 28 listed in (a)(2) of this section. 29 Sec. 08.87.145. Retention of records and inspection. A registered real estate 30 appraisal management company or a real estate appraisal management company that 31 has applied for registration shall allow the board to inspect and shall retain, for not less
01 than the later of either five years after the date a file is submitted to the company or 02 two years after final disposition of a related judicial proceeding, 03 (1) copies of all records related to requests for the company's appraisal 04 management services and the real estate appraisers who perform the appraisals; 05 (2) a written record of all substantive communications between a real 06 estate appraisal management company registered under this chapter and a real estate 07 appraiser relating to an appraisal or participation in an appraiser panel. 08 Sec. 08.87.150. Reporting requirements for federally regulated real estate 09 appraisal management companies. (a) A real estate appraisal management company 10 that is owned and controlled by an insured depository institution as defined in 12 11 U.S.C. 1813 and regulated by the United States Comptroller of the Currency, the 12 Board of Governors of the Federal Reserve System, or the Federal Deposit Insurance 13 Corporation, shall annually submit to the board information that the board is required 14 to submit to the Appraisal Subcommittee established under 12 U.S.C. 3310, including 15 a 16 (1) report of intent to operate in the state; and 17 (2) disclosure of whether the company is directly or indirectly owned 18 in whole or in part by any person that has had a certificate to act as a real estate 19 appraiser denied, cancelled, suspended, revoked, put on probation, or surrendered in 20 lieu of a pending revocation in any state. 21 (b) If a person has had disciplinary action taken against the person under 22 (a)(2) of this section, the board shall collect information related to whether the 23 certificate to act as a real estate appraiser was denied, cancelled, suspended, revoked, 24 put on probation, or surrendered in lieu of a pending revocation for a substantive cause 25 and whether the person has later had the certificate to act as a real estate appraiser 26 reinstated by the same state. 27 Sec. 08.87.155. Exemptions. AS 08.87.130 - 08.87.150, 08.87.215, and 28 08.87.220 do not apply to a 29 (1) person who is employed by a department or division of an entity 30 that provides appraisal management services only to that entity; 31 (2) real estate appraisal management company that is
01 (A) owned and controlled by an insured depository institution; 02 and 03 (B) regulated by the Consumer Financial Protection Bureau, 04 the Federal Housing Finance Agency, the Board of Governors of the Federal 05 Reserve System, the Federal Deposit Insurance Corporation, the United States 06 Comptroller of the Currency, or the National Credit Union Administration; or 07 (3) real estate appraiser who enters into an agreement with another real 08 estate appraiser for the performance of an appraisal that upon completion results in a 09 report signed by both the real estate appraiser who completed the appraisal and the 10 real estate appraiser who requested completion of the appraisal. 11 * Sec. 6. AS 08.87 is amended by adding new sections to article 3 to read: 12 Sec. 08.87.215. Prohibited practices; real estate appraisal management 13 companies. (a) A real estate appraisal management company may not, while 14 registered in the state, retain or enter into a business relationship with an employee, 15 contractor, or agent whose certificate to act as a real estate appraiser is denied, 16 cancelled, suspended, revoked, put on probation, or surrendered in lieu of a pending 17 revocation in any state unless the employee, contractor, or agent has later had a 18 certificate to act as a real estate appraiser granted or reinstated by the same state. 19 (b) A real estate appraisal management company or a controlling person, 20 employee, director, officer, or agent of a real estate appraisal management company 21 may not 22 (1) seek to influence a real estate appraiser through intimidation, 23 coercion, extortion, or bribery; 24 (2) condition payment of an appraisal fee on a real estate appraiser's 25 opinion, conclusion, or valuation; 26 (3) request that a real estate appraiser report a predetermined opinion, 27 conclusion, or valuation; 28 (4) alter, amend, or change an appraisal report submitted by a real 29 estate appraiser without the real estate appraiser's written consent; 30 (5) require a real estate appraiser to sign an indemnification agreement 31 for a claim that does not arise from a service performed by the real estate appraiser;
01 (6) prohibit an appraiser from recording in the body of the report 02 submitted by the appraiser to the appraisal management company the fee that the 03 appraiser was paid by the company for the performance of the appraisal; 04 (7) prohibit lawful communication between a real estate appraiser and 05 any other person who the real estate appraiser determines possesses information 06 relevant to the appraisal; 07 (8) engage in an act or practice with intent to impair a real estate 08 appraiser's independence, objectivity, and impartiality; 09 (9) knowingly make a false statement, submit false information, or fail 10 to provide complete information in response to a question in an application for 11 registration or renewal of a registration; or 12 (10) violate this chapter or a regulation adopted under this chapter. 13 Sec. 08.87.220. Disciplinary proceedings; real estate appraisal 14 management companies. The board may take disciplinary action under AS 08.01.075 15 or suspend or revoke a registration of a real estate appraisal management company if it 16 finds that the 17 (1) company or a controlling person, employee, director, officer, or 18 agent of a real estate appraisal management company has violated a provision of this 19 chapter or a regulation adopted by the board under this chapter; 20 (2) company or a controlling person of the company has had a 21 certificate to act as a real estate appraiser or a registration as a real estate appraisal 22 management company denied, cancelled, suspended, revoked, put on probation, or 23 surrendered in lieu of a pending revocation in any state; 24 (3) company fails to comply with the Uniform Standards of 25 Professional Appraisal Practice under 12 U.S.C. 3339; 26 (4) company performs appraisal management services in a manner that 27 causes injury or loss to the public; 28 (5) company has ceased to operate in the state as a real estate appraisal 29 management company; or 30 (6) company used fraud, deception, misrepresentation, or bribery in 31 securing a registration under this chapter.
01 * Sec. 7. AS 08.87.900 is amended by adding new paragraphs to read: 02 (14) "appraisal management services" includes the performance of any 03 of the following functions on behalf of a lender, financial institution, or other person: 04 (A) administration of an appraiser panel; 05 (B) recruitment, retention, or selection of real estate appraisers 06 for the performance of appraisal services; 07 (C) contracting with real estate appraisers to perform 08 appraisals; 09 (D) review of a completed appraisal before the delivery of the 10 appraisal or review assignment to the person that ordered the appraisal; 11 (15) "appraiser panel" means a group of licensed or certified real estate 12 appraisers who perform appraisals as independent contractors for a real estate 13 appraisal management company; 14 (16) "borrower" means a person who applies for a mortgage loan; 15 (17) "company" means a real estate appraisal management company 16 required to register under AS 08.87.130 that performs appraisal management services; 17 (18) "controlling person" means a person who 18 (A) owns more than 10 percent of a real estate appraisal 19 management company; 20 (B) is an officer or director of a real estate appraisal 21 management company; 22 (C) is employed and authorized by a real estate appraisal 23 management company to enter into a contractual relationship with another 24 person for the performance of appraisal management services or with a real 25 estate appraiser to perform an appraisal; or 26 (D) has the authority to direct the management or policies of a 27 real estate appraisal management company; 28 (19) "principal dwelling" means a residential structure or mobile home 29 that contains one to four units but does not include a vacation or second home unless 30 the borrower buys or builds a new dwelling that will become the primary location that 31 the borrower inhabits within a year after the purchase or completion of construction.
01 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 02 read: 03 APPLICABILITY. (a) This Act applies to a person offering or engaged in providing 04 appraisal management services for an appraisal on or after the effective date of secs. 1 - 7 of 05 this Act. In this subsection, "appraisal management services" has the meaning given in 06 AS 08.87.900. 07 (b) Notwithstanding the effective date of sec. 5 this Act, the Department of 08 Commerce, Community, and Economic Development and the Board of Certified Real Estate 09 Appraisers may not enforce the registration requirement under AS 08.87.130, added by sec. 5 10 of this Act, until March 1, 2019. 11 * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to 12 read: 13 TRANSITION: REGULATIONS. The Department of Commerce, Community, and 14 Economic Development and the Board of Certified Real Estate Appraisers may adopt 15 regulations necessary to implement the changes made by this Act. The regulations take effect 16 under AS 44.62 (Administrative Procedure Act), but not before the effective date of the law 17 implemented by the regulation. 18 * Sec. 10. Section 9 of this Act takes effect immediately under AS 01.10.070(c). 19 * Sec. 11. Except as provided in sec. 10 of this Act, this Act takes effect January 1, 2019.