2014 Proposed RULE changeS

The North Carolina Appraisal Board has commenced rulemaking for 2014. A public hearing on the proposed change will be held at 9:00 am on May 6, 2014 at the Board’s offices in Raleigh. Written comments will be accepted until May 6, 2014. Comments may be directed to the Board’s legal counsel, Roberta Ouellette (Roberta@ncab.org). They may be faxed to 919-870-4859 or may be sent to 5830 Six Forks Road, Raleigh, NC 27609.

Most of the rules are based on H565, which adopted the new AQB criteria, added the Licensed Residential credential and added a surety bond requirement for AMCs. Some changes to the rules are made to reflect a nomenclature change from “prelicensing” or “precertification” education to “qualifying” education.

57A .0210 Temporary Practice

Adds the requirement that any appraisal report for an appraisal of property located in North Carolina must contain the temporary practice permit number for that assignment.

Removes the ability of a trainee to get a temporary practice permit. Instead, if a trainee does enter the state to inspect a property, the trainee must be accompanied by the trainee’s supervising appraiser. The trainee’s supervisor must be a North Carolina licensed or certified real estate appraiser or have received a temporary practice permit.

57A .0303 Re-examination

Changes the number of times an applicant may take the exam per application from three to five.

57A .0407 Supervision of Trainees

Removes the requirement that Board staff teach the course, and provides that only instructors approved by the Board can teach it.

Makes it clear that trainees must assure that the Appraisal Board has received the Supervisor Declaration Form on or before the day the trainee begins assisting the supervising appraiser.

57B .0104 Course Exemptions for Equivalent Education

Removes the rule that applicants may get an exemption from a qualifying course.

57B .0306 Instructor Requirements

Adds the requirement that to teach the residential appraiser courses, the instructor must be currently certified as a residential or general real estate appraiser.

57B .0605 Continuing Education Credit Hours

Clarifies that no continuing education credit shall be given for courses taken before the student was registered as a trainee or licensed or certified as an appraiser in this state or any other state.

57B .0614 (New rule)

Outlines the requirements for instructors for the trainee/supervisor class.

57C. 0101 Form of Complaints and Other Pleadings

Adds a section that makes it clear the Board will not accept a complaint if the applicable USPAP recordkeeping period for the appraisal involved in the complaint has expired.

APPRAISAL MANAGEMENT COMPANY RULES

57D .0202 Registration Renewal

Specifies that the renewal period for AMCs will be from May 1 through June 30 of each year.

57D .0303 Compliance Manager

Adds a requirement that if the Compliance Manager leaves, the AMC has 15 business days to obtain a new one.

57D .0310 Payment of Fees to Appraisers

Adds a provision outlining how AMCs must comply with the statute requiring payment of fees within 30 days.

The proposed rules and fiscal notes are attached.

21 NCAC 57A .0101 FORM

A person who wishes to file an application for a real estate trainee registration or an appraiser license or certificate may obtain the required form upon request to the Board. The form calls for information such as the applicant's name and address, the applicant's social security number, a passport size photograph of the applicant, places of residence and employment, education, and such other information as may be necessary to identify the applicant and determine his qualifications and fitness for registration registration, licensure, or certification.

History Note: Authority G.S. 93E-1-6(a); 93E-1-10;

Eff. July 1, 1994;

Amended Eff. July 1, 2014; September 1, 2008; April 1, 1999.

21 NCAC 57A . 0102 FILING AND FEES

(a) Each application for registration registration, licensure, or certification shall be accompanied by the required application fee. An additional fee may be charged to defray the cost of any competency examination administered by a private testing service. This additional fee shall be no more than the fee set by the private testing agency. The Board may reject and return to the applicant any application which is incomplete or not accompanied by the required fee or fees. Application fees accompanying complete applications are not refundable.

(b) The application fee shall be that prescribed in G.S. 93E-1-6(b).

(c) Payment of application fees shall be made by certified check, bank check check, or money order payable to the North Carolina Appraisal Board.

History Note: Authority G. S. 93E-1-6; 93E-1-10;

Eff. July 1, 1994;

Amended Eff. July 1, 2014; September 1, 2008; January 1, 2008; August 1, 2002; April 1, 1999.

21 NCAC 57A .0201 Qualifications for Trainee Registration and Appraiser Licensure and Certification

(a) Applicants for trainee registration, licensure as a licensed residential real estate appraiser, and for certification as a certified real estate appraiser must satisfy the qualification requirements stated in G.S. 93E-1-6 and in this Section.

(b) Applicants for trainee registration shall have completed, within the five-year period immediately preceding the date application is made, 90 hours of education as set forth in 21 NCAC 57B .0101 or education found by the Board to be equivalent to such courses. Applicants for trainee registration must possess a high school diploma or its equivalent.

(c) Applicants for licensure as a licensed residential real estate appraiser shall have completed 150 hours of education as set forth in 21 NCAC 57B .0102 or education found by the Board to be equivalent to such courses. In addition, applicant for licensure as a licensed residential real estate appraiser must hold an Associate’s degree, or higher, from an accredited college, community college or university. Applicants shall have obtained at least 2,500 hours of appraisal experience acquired over a minimum period of two calendar years. Applicants must have been engaged in real estate appraising for at least two calendar years prior to the date application is made. At least 50 percent of this appraisal experience must have been of one to four family residential properties in which the sales comparison approach was utilized in the appraisal process.

(c) (d) Applicants for certification as a certified residential real estate appraiser shall have completed 200 hours of education as set forth in 21 NCAC 57B .0102 or education found by the Board to be equivalent to such courses. In addition, applicants for certification as a certified residential real estate appraiser must hold a Bachelor’s degree, an Associate's degree, or higher, from an accredited college, junior college, community college, or university. In lieu of the Associate's degree requirements, applicants shall have successfully completed 21 semester credit hours in the following collegiate subject matter courses from an accredited college or university: English composition; principles of economics (macro or micro); finance; algebra; geometry or higher mathematics; statistics; introduction of computers, including word processing and spreadsheets; and business or real estate law. Applicants shall have obtained at least 2,500 hours of appraisal experience acquired over a minimum period of two calendar years. Applicants must have been engaged in real estate appraising for at least two calendar years prior to the date application is made. At least 50 percent of this appraisal experience must have been of one to four family residential properties in which the sales comparison approach was utilized in the appraisal process.

(d)(e) Applicants for certification as a certified general real estate appraiser shall have completed 300 hours of education as set forth in 21 NCAC 57B .0103 or education found by the Board to be equivalent to such courses. In addition, applicants for certification as a certified general estate appraiser must hold a Bachelor's degree or higher from an accredited college or university. In lieu of the Bachelor's degree requirements, applicants shall have successfully completed 30 semester credit hours in the following collegiate subject matter courses from an accredited college university: English composition, micro economics, macro economics, finance, algebra, geometry or higher mathematics, statistics, introduction of computers, including word processing and spreadsheets, business or real estate law, and two elective courses in accounting, geography, business management or real estate. Applicants shall have obtained at least 3,000 hours of appraisal experience acquired over a minimum period of two and a half calendar years of which at least 50 percent must have been in appraising non-residential real estate. Applicants must have been engaged in real estate appraising for at least two and one-half calendar years prior to the date application is made. At least 50 percent of the non-residential appraisal experience must have been of special use properties such as schools, churches, or hospitals in which the income approach is not applicable or of improved properties in which the income approach was utilized in the appraisal process.

(e)(f) Applicants for licensure or certification who are currently registered trainees must submit a copy of their complete appraisal log. Applicants for certification who are currently licensed or certified appraisers must submit an appraisal log showing that they possess the requisite amount and length of experience as set forth in Paragraphs (c) and (d) of this Rule. All applicants shall provide to the Board copies of appraisal reports and work files in support of experience credit. In order for an appraisal to be given experience credit, it must comply with the Uniform Standards of Professional Appraisal Practice (USPAP) and with any applicable state statutes or rules.

(f)(g) When a trainee or a licensed real estate appraiser becomes a certified real estate appraiser, his or her previous registration or licensure shall be immediately canceled by the Board. When a certified residential real estate appraiser becomes certified as a general real estate appraiser, his or her previous certification shall be immediately canceled by the Board.

(g)(h) In the event that the Board asks an applicant to submit updated information or provide further information necessary to complete the application and the applicant fails to submit such information within 90 days following the Board's request, the Board shall cancel the applicant's application and the application fee shall be retained by the Board. An applicant whose application has been cancelled and who wishes to obtain a registration registration, license, or certificate must start the licensing process over by filing a complete application with the Board and paying all required fees.

(h)(i) An applicant may request that his or her application be withdrawn at any time before final action is taken by the Appraisal Board on the application.

(i)(j) If an applicant has a current open complaint before the North Carolina Appraisal Board or an appraiser licensing board from any other state, or if the applicant has pending criminal charges in this or any state, the application shall be accepted but no further action shall be taken on the application until the complaint or criminal charges are resolved. For the purposes of this Section, criminal charges do not include speeding tickets or traffic infractions.

History Note: Authority G.S. 93E-1-6(a); 93E-1-10;

Eff. July 1, 1994;

Amended Eff. July 1, 2014; January 1, 2013; July 1, 2010; September 1, 2008; January 1, 2008; March 1, 2007; April 1, 2006, July 1, 2005; August 1, 2002; April 1, 1999.

21 NCAC 57A .0204 CONTINUING EDUCATION

(a) All registered trainees, real estate appraiser licensees licensees, and certificate holders shall, upon the renewal of their registration, license license, or certificate in every odd-numbered year, present evidence satisfactory to the Board of having obtained continuing education as required by this Section. Trainees and appraisers who initially registered with the Board after January 1 of an odd numbered year are not required to show continuing education credit for renewal of their registration in that odd numbered year.

(b) Each trainee, licensee licensee, and certificate holder who must complete continuing education pursuant to Paragraph (a) of this Rule must complete 28 hours of continuing education before June 1 of every odd numbered year. Except as provided in Paragraphs (g) and (h) of this Rule, such education must have been obtained by taking courses approved by the Board for continuing education purposes, at schools approved by the Board to offer such courses. Such education must relate to real estate appraisal and must contribute to the goal of improving the knowledge, skill and competence of trainees, and licensed and certified real estate appraisers. There is no exemption from the continuing education requirement for trainees or appraisers whose registered, licensed or certified status has been upgraded to the level of licensed residential, certified residential residential, or certified general appraiser since the issuance or most recent renewal of their registration, license license, or certificate, and courses taken to satisfy the requirements of a higher level of certification shall not be applied toward the continuing education requirement. Trainees, licensees licensees, and certificate holders shall not take the same continuing education course more than once during the two year continuing education cycle.

(c) Each appraisal continuing education course must involve a minimum of three and one-half classroom hours of instruction on real estate appraisal or related topics such as the application of appraisal concepts and methodology to the appraisal of various types of property; specialized appraisal techniques; laws, rules or guidelines relating to appraisal; standards of practice and ethics; building construction; financial or investment analysis; land use planning or controls; feasibility analysis; statistics; accounting; or similar topics. The trainee, license licensee, or certificate holder must have attended at least 90 percent of the scheduled classroom hours for the course in order to receive credit for the course.

(d) Each trainee, licensee licensee, and certificate holder who is required to complete continuing education pursuant to Paragraph (a) of this Rule must, as part of the 28 hours of continuing education required in Paragraph (b) of this Rule, complete the seven hour National USPAP update course between October 1 of an odd-numbered year and June 1 of an even numbered year, as required by the Appraiser Qualifications Board of the Appraisal Foundation, or its equivalent. USPAP is updated every even numbered year, and each trainee, licensee licensee, and certificate holder shall take the most recent USPAP update course prior to June 1 of every even numbered year.

(e) A trainee, licensee licensee, or certificate holder who elects to take approved continuing education courses in excess of the requirement shall not carry over into the subsequent years any continuing education credit.

(f) Course sponsors must provide a certificate of course completion to each trainee, licensee licensee, and certificate holder successfully completing a course. In addition, course sponsors must send directly to the Board a certified roster of all who successfully completed the course. This roster must be sent within 15 days of completion of the course, but not later than June 15 of each year. In order to renew a registration, license license, or certificate in a timely manner, the Board must receive proper proof of satisfaction of the continuing education requirement prior to processing a registration, license license, or certificate renewal application. If proper proof of having satisfied the continuing education requirement is not provided, the registration, license license, or certificate shall expire and the trainee, licensee licensee, or certificate holder shall be subject to the provisions of Rules .0203(e) and .0206 of this Section.

(g) A current or former trainee, licensee licensee, or certificate holder may request that the Board grant continuing education credit for a course taken by the trainee, licensee licensee, or certificate holder that is not approved by the Board, or for appraisal education activity equivalent to a Board-approved course, by making such request and submitting a non-refundable fee of fifty dollars ($50.00) as set out in G.S. 93E-1-8(d) for each course or type of appraisal education activity to be evaluated. Continuing education credit for a non-approved course shall be granted only if the trainee, licensee licensee, or certificate holder provides satisfactory proof of course completion and the Board finds that the course satisfies the requirements for approval of appraisal continuing education courses with regard to subject matter, course length, instructor qualifications, and student attendance. Appraisal education activities for which credit may be awarded include teaching appraisal courses, authorship of appraisal textbooks, and development of instructional materials on appraisal subjects. Up to 14 hours of continuing education credit may be granted in each continuing education cycle for participation in appraisal education activities. Trainees or licensed or certified appraisers who have taught an appraisal course or courses approved by the Board for continuing education credit are deemed to have taken an equivalent course and are not subject to the fee prescribed in G.S. 93E-1-8 (d),

provided they submit verification satisfactory to the Board of having taught the course(s). A trainee, licensee licensee, or certificate holder who teaches a Board-approved continuing education course may not receive continuing education credit for the same course more than once every two years, regardless of how often he teaches the course. Requests for equivalent approval for continuing education credit must be received before June 15 of an odd-numbered year to be credited towards the continuing education requirement for that odd-numbered year. Equivalent approval shall be granted only for courses that are 7 hours or longer, and shall only be granted for a minimum of 7 hours.

(h) A trainee, licensee licensee, or certificate holder may receive continuing education credit by taking any of the Board-approved precertification courses, other than Basic Appraisal Principles and Basic Appraisal Procedures, or their approved equivalents. Trainee, licensees licensees, and certificate holders who wish to use a precertification course for continuing education credit must comply with the provisions of 21 NCAC 57B .0604.

(i) A licensee or certificate holder who resides in another state, is currently credentialed in another state and is active on the National Registry in another state may satisfy the requirements of this section section, other than the seven hour National USPAP update course requirement in Subsection (d) of this Rule, by providing a current letter of good standing from another state showing that the licensee or certificate holder has met all continuing education requirements in the other state, including the most recent edition of USPAP. state. A licensee or certificate holder who became licensed in North Carolina by licensure or certification with another state and now resides in North Carolina may renew by letter of good standing for his or her first renewal as a resident of North Carolina only if the appraiser moved to North Carolina on or after January 1 of an odd numbered year. If an appraiser was a resident of this state before January 1 of an odd-numbered year, the appraiser must comply with the requirements of this section regardless of how the license or certificate was obtained.

(j) A trainee, licensee licensee, or certificate holder who returns from active military duty on or after February 1 of an odd-numbered year is allowed to renew his or her registration, license license, or certificate in that odd-numbered year even if the required continuing education is not completed before June 1 of that year. All required continuing education must be completed within 180 days of when the trainee, licensee licensee, or certificate holder returns from active duty. Failure to complete the required continuing education within 180 days is grounds for revocation. This Rule applies to an individual who is serving in the armed forces of the United States and to whom G.S. 105-249.2 grants an extension of time to file a tax return.

History Note: Authority G.S. 93B-15; 93E-1-7(a); 93E-1-10;

Eff. July 1, 1994;

Amended Eff. July 1, 2014; January 1, 2013; July 1, 2011; July 1, 2010; January 1, 2008; March 1, 2007; March 1, 2006; July 1, 2005; July 1, 2003; August 1, 2002; April 1, 1999

21 NCAC 57A .0206 Expired Registration, License or Certificate

(a) Expired registrations, licenses licenses, and certificates may be reinstated within 12 months after expiration upon proper application, payment to the Board of the renewal and late filing fees as set out in G.S. 93E-1-7 and

provision of proof of having obtained the continuing education that would have been required had the registration, license or certificate been continuously renewed.

(b) If a registration registration, license, or certificate has been expired for more than 12 months, but less than 24 months, an applicant may apply for reinstatement. In order to be considered for reinstatement, the applicant must pay the filing fee as set out in G.S. 93E-1-7 and include in the application proof that the applicant has obtained the continuing education that would have been required had the registration registration, license, or certificate been continuously renewed. In addition, the Board may consider whether the applicant for reinstatement has any prior or current disciplinary actions, and may examine the applicant's fitness for registration registration, licensure, or certification before granting the request for reinstatement. A completed application for reinstatement must be received by June 1 of the second 12 months or it shall not be accepted.

(c) An application for reinstatement shall not be granted if the registration registration, license, or certificate has been expired for more than 24 months.

(d) Reinstatement is effective the date it is issued by the Board. It is not retroactive.

(e) A trainee or appraiser whose registration registration, license, or certification has expired and who is returning from active military duty may renew his or her registration registration, license, or certificate when the trainee or appraiser returns from active duty without payment of a late filing fee as long as the trainee or certificate holder appraiser renews the registration registration, license, or certificate within 180 days of when the trainee or certificate holder appraiser returns from active duty.

(f) A license holder whose license has been expired for more than 12 months may not apply for reinstatement.

History Note Authority G.S. 93E-1-6(b); 93E-1-7; 93E-1-10;

Eff. July 1, 1994;

Amended Eff. July 1, 2014; January 1, 2011; September 1, 2008; March 1, 2007; July 1, 2005; August 1, 2002; April 1, 1999.

21 NCAC 57A .0210 TEMPORARY PRACTICE

(a) A real estate appraiser who does not reside in North Carolina and who is licensed or certified by the appraiser licensing or certifying agency in another state may apply to receive temporary appraiser licensing or certification privileges in this State by filing a notarized application with the Board.

(b) Upon filing a completed application accompanied by the fee prescribed in G.S. 93E-1-9(c) and otherwise satisfying the Appraisal Board as to his or her qualifications and eligibility for temporary licensing or certification privileges, an applicant shall be granted a temporary practice permit by the Board authorizing the applicant to perform in this State the appraisal assignment described in such application, provided that the length of time projected by the applicant for completion of the assignment is reasonable given the scope and complexity of the assignment. The fee must be paid by money order, certified check check, or cashier's check. The Board may consider whether an applicant's trainee registration or appraiser license or certification is or has been subject to discipline in their resident state or any other state, and may consider all other information outlined in Rule .0202 of this Section.

(c) Privileges granted under the provisions of this Rule shall expire upon the expiration date set forth in the temporary practice permit. However, upon a showing by the permittee satisfactory to the Appraisal Board that, notwithstanding the permittee's attention to the appraisal assignment, additional time is needed to complete the assignment, the Board shall extend the temporary practice privileges granted under the permittee's temporary practice permit to afford him additional time to complete the appraisal assignment. Such request for extension must be received before the original temporary practice permit expires or it shall not be granted.

(d) Persons granted temporary practice privileges under this Rule shall not advertise or otherwise hold themselves out as being a North Carolina trainee or licensed or certified appraiser. Any appraisal report for an appraisal of property located in North Carolina must contain a copy of the temporary practice number for that assignment.

(e) A trainee may not apply for a temporary practice permit. permit, and the provisions of Sections (a), (b), (c) and (d) above apply. The supervising appraiser for the trainee must be a North Carolina licensed or certified appraiser. If not, the supervising appraiser must be licensed or certified as a real estate appraiser in another state and must also receive a temporary practice permit for the same assignment as the trainee. The term "trainee" shall include apprentices and others who are licensed and regulated by a state agency to perform real estate appraisals under the supervision of a certified appraiser. If the supervisor is not certified in North Carolina, the supervisor is not required to comply with the provisions of 21 NCAC 57A .0407 in order to supervise a trainee who is appraising in this state pursuant to the temporary practice permit. The supervisor shall actively and personally supervise the trainee on the assignment, and must accompany the trainee on all inspections of property located in this state for the assignment. If a trainee does enter the state to inspect a property located in this state, the trainee must be accompanied by the trainee’s supervising appraiser. The trainee’s supervisor must be a North Carolina licensed or certified real estate appraiser. If not, the supervising appraiser must be licensed or certified as a real estate appraiser in another state and must receive a temporary practice permit for the assignment.

(f) An applicant for a temporary practice permit shall not begin performing any appraisal work in this State until the temporary practice permit has been issued by the Board. If an applicant does begin work before the permit is issued, the temporary practice permit shall be denied.

History Note: Authority G.S. 93E-1-9(c) and (d); 93E-1-10; Title XI, Section 1122(a); 12 U.S.C. 3351(a);

Eff. July 1, 1994;

Amended Eff. July 1, 2014; Septembe