1. Arizona Appraiser Law Presented by: Dennis Badger 3 Hours Continuing Education 1

2. 2 Before we begin… Thank-you Arizona Board of Appraisal – Board Members – Kevin R. Yeanoplos, Chairperson – B. Michael Petrus II, Vice Chairperson – Erik Clinite – James B. Heaslet. – Mark Keller – Joe T. Stroud – Frank Ugenti

3. 3 Before we begin… Thank-you Arizona Board of Appraisal – Debra Rudd, Executive Director – And Staff

4. 4 Break times Restroom locations Be considerate of those near you Turn off cell phones No recording Attendance sheet Certificates and evaluation forms Announcements…

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6. Our Goals and Objectives… Highlight the importance of Arizona Statutes, Regulations and Substantive Policy Statements Increase our knowledge of items addressed within the appraisal laws and regulations Enhance our knowledge of key provisions of the appraisal laws and regulations 6

7. Arizona Revised Statutes Title 32, Chapter 36 Consists of Five (5) Articles – Article 1 – General Provisions – Article 2 – Licensing and Certification – Article 3 – Regulation – Article 4 – Property Tax Agents – Article 5 – Appraisal Management Companies 7

8. Article 1 – General Provisions – 323601 Definitions – 323602 Applicability of chapter – 323603 License or certificate use; exception – 323604 State board of appraisal – 323605 State board of appraisal; duties – 323606 Executive director; duties – 323607 Fees – 323608 Board of appraisal fund – 323609 Confidential records – 323610 Uniform standards of professional appraisal practice; state standards; – exception 8

9. Article 1 – General Provisions Definitions Appraisal or real estate appraisal – means a statement independently and impartially prepared by an individual setting forth an opinion as to the market value of real property as of a specific date and supported by the presentation and analysis of relevant market information. 9

10. Article 1 – General Provisions Definitions Appraisal assignment – Means an engagement for which a real estate appraiser is employed or retained to act, or would be perceived by third parties or the public in acting, as a disinterested third party in rendering an unbiased analysis, opinion or conclusion relating to the nature, quality, value or utility of specified interests in or aspects of identified real estate. 10

11. Article 1 – General Provisions Definitions Appraisal report – Means any communication, written or oral, of an appraisal. 11

12. Article 1 – General Provisions Definitions Appraisal review – Means the act of reviewing or the report that follows a review of an appraisal assignment or appraisal report in which a real estate appraiser forms an opinion as to the adequacy and appropriateness of the report being reviewed. 12

13. Article 1 – General Provisions Definitions Appraisal review – Means the act of reviewing or the report that follows a review of an appraisal assignment or appraisal report in which a real estate appraiser forms an opinion as to the adequacy and appropriateness of the report being reviewed. 13

14. Article 1 – General Provisions Definitions Board – Means the state board of appraisal. 14

15. Article 1 – General Provisions Definitions Complex one to four residential units – Means property that is atypical for the marketplace. Atypical factors may include architectural style, age of improvements, size of improvements, size of lot, neighborhood land use, potential environmental hazard liability, leasehold interests, limited readily available comparable sales data or other unusual factors. 15

16. Article 1 – General Provisions Definitions Federally related transaction – Means any real estate related financial transaction that a federal financial institution's regulatory agency or the resolution trust corporation engages in, contracts for or regulates and that requires an appraisal. 16

17. Article 1 – General Provisions Definitions Property tax agent – Means an individual who is designated by a person or is an employee of an entity designated as an agent pursuant to section 42-16001, who acts on behalf of a person who owns, controls or possesses property valued by a county assessor and who receives a fee for the analysis of any matter relating to the review of the valuation of the person's property before the assessor. (contd) 17

18. Article 1 – General Provisions Definitions Contd Property tax agent – Property tax agent does not include a person who is admitted to practice law in this state, an employee of the person owning, controlling or possessing the property or an employee of an entity designated pursuant to section 42-16001, if the employee is performing a secretarial, clerical or administrative support function. 18

19. Article 1 – General Provisions Definitions Real estate – Means an identified parcel or tract of land, including improvements, if any. 19

20. Article 1 – General Provisions Definitions Real estate related financial transaction – Means any transaction involving the sale, lease, purchase, investment in or exchange of real property, including interests in property or the financing of property, the refinancing of real property or interests in real property and the use of real property or interests in property as security for a loan or investment including mortgage-backed securities. 20

21. Article 1 – General Provisions Definitions Real property – Means one or more defined interests, benefits and rights inherent in the ownership of real estate. 21

22. Article 1 – General Provisions Definitions Review appraiser – Means a person who engages in the activity of reviewing and evaluating the appraisal work of others from the perspective of an appraiser, generally for compensation as a separate skill. This includes the function of reviewing an appraisal report or a file memorandum setting forth the results of the review process. 22

23. Article 1 – General Provisions Definitions Standards of professional appraisal practice – Means the uniform standards of professional appraisal practice adopted by the board. 23

24. Article 1 – General Provisions Definitions State licensed or state certified appraiser – Means a person who develops and communicates appraisals and who holds a current, valid license or certificate issued to him under the provisions of this chapter. 24

25. Article 1 – General Provisions Definitions Value – Means the monetary relationship between properties and those who buy, sell or use those properties. 25

26. Article 1 – General Provisions – 323601 Definitions – 323602 Applicability of chapter – 323603 License or certificate use; exception – 323604 State board of appraisal – 323605 State board of appraisal; duties – 323606 Executive director; duties – 323607 Fees – 323608 Board of appraisal fund – 323609 Confidential records – 323610 Uniform standards of professional appraisal practice; state standards; – exception 26

27. Article 2 – Licensing and Certification – 323611 Licensure and certification process – 323612 Classifications of licensure and certification – 323613 Application and qualification requirements for issuance of – License – 323614 Application and qualification requirements for certification – 323615 Experience requirement for licensure or certification – 323616 Terms of license or certificate 27

28. Article 2 – Licensing and Certification – 323617 Nonresident temporary licensure or certification – 323618 Nonresident licensure or certification by reciprocity – 323619 Renewal of license or certificate; fees – 323620 Basis for denial of a license or certificate – 323621 Addresses; telephone numbers; notification of change – 323622 Licenses and certificates – 323623 Use of term – 323624 Professional corporations and partnerships 28

29. Article 2 – Licensing and Certification – 323624 Professional corporations and partnerships – 323625 Continuing education – 323626 Scarcity determination; resident temporary licenses and certificates; Exemption – 323627 Inactive license or certificate status; reactivation application; Renewal application and fee; continuing education – 323628 Inactive license or certificate status during military duty; Reactivation application; renewal application and fee; continuing education 29

30. Article 3 - Regulation – 323631 Disciplinary proceedings – 323632 Hearing and judicial review – 323633 Undue influence; classification – 323634 Prohibition against discrimination – 323635 Standards of practice – 323636 Contingent fees – 323637 Retention of records; definition – 323638 Violation; classification – 323639 Damages; injunctive relief – 323640 Prohibition; indemnification agreement 30

31. Article 4 – Property Tax Agents – 323651 Definitions – 323652 Registration; renewal; fees – 323653 Property tax agent conduct – 323654 Disciplinary actions – 323655 Rules – 323656 Confidential records 31

32. Article 5 – Appraisal Management Companies – 323661 Definitions – 323662 Registration – 323663 Exemptions – 323664 Registration forms – 323665 Expiration of registration – 323666 Consent to service of process – 323667 Fee; bond – 323668 Owner requirements – 323669 Controlling person – 323670 Employee requirements 32

33. Article 5 – Appraisal Management Companies – 323671 Agreements with independent appraisers; limitations – 323672 Annual certifications – 323673 Disclosure of fees – 323674 Appraiser independence; prohibitions – 323675 Payment – 323676 Appraisal reports; alteration; use – 323677 Adjudication of disputes – 323678 Enforcement – 323679 Disciplinary hearings – 323680 Rule making authority 33

34. Arizona Administrative Code Title 4, Chapter 46. Consists of Seven (7) Articles – Article 1 – General Provisions – Article 2 – Licensing and Certification – Article 3 – Hearings and Disciplinary Proceedings – Article 4 – Standards of Practice – Article 5 – Course Approval – Article 6 – Property Tax Agents – Article 7 – General Provisions - Fees 34

35. SB 1316 SB 1316 will become effective September 13, 2013 See Arizona Appraiser Law Seminar Handout, pages 49-66 SB 1316 FAQs appear Appraiser Law Seminar Handout, pages 47-48 35

36. Substantive Policy Statements – SPS #1, Guidelines for Board Complaint Resolution – SPS #2, Guidelines for Supervising Appraisers and Trainees – SPS #3, Guidelines for Issuance of Cease and Desist Letters – SPS #4, Guidelines for Accepting Qualifying Education to be used as Continuing Education – SPS #5, Guidelines for Evaluating Experience from a Licensed or a Certified Residential Appraiser Working Toward a New Classification 36

37. Substantive Policy Statements – SPS #6, Guidelines for Evaluating Complex Experience From Applicants Seeking Certification as a Certified Residential Appraiser – SPS #7, Adoption of the 20122013 Uniform Standards of Professional Appraisal Practice 37