SAMPLE COMMENT LETTER TO ASB

[Francois K. Gregoire]

Hi All,

Today, June 10, 2002, is the deadline for comments on the Second Exposure Draft on proposed changes to the 2002 USPAP. You still have some time to read on provide your views.

Take a look at the Exposure Draft (PDF) HERE

Here is a sample comment letter. Agree or disagree, but do make a little time today to write and submit a comment or two on the sections you believe are important to your business and specialty. The ASB will not know your thoughts if you fail to convey them when provided the opportunity.
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June 10, 2002


Mr. Danny Wiley, Chairman
Appraisal Standards Board
The Appraisal Foundation
1029 Vermont Avenue N.W..
Washington, D.C. 20005-3517


RE: Request for Written Comments
Exposure Draft on proposed revisions to the 2002 Edition to the Uniform
Standards of Professional Appraisal Practice


Dear Mr. Wiley:

Thank you for the opportunity to provide comments on the proposed revisions to the
2002 Edition to the Uniform Standards of Professional Appraisal Practice

Section 1 - Standards Rules 1-5 and 7-5 (Property Sales History)

The comment letter submitted in response to the First Exposure Draft expressed
measured support for standardizing the reporting of a three year sales history for all
property types. After further examination of the rationale and analysis of several
comments made by other State Regulators, a question arises concerning the need to
alter the USPAP to bow to the enforcement objectives of some State Regulators. Is this
a purpose of the USPAP?

The PREAMBLE of the 2002 Uniform Standards of Professional Appraisal Practice
states the purpose of the Standards is to establish requirements for professional
appraisal practice and the Standards are for appraisers and users of appraisal
services. My reading does not find the purpose to be aiding a State in their
enforcement efforts.

In the event a State finds a glaring omission in USPAP, one limiting their enforcement
ability, they have the authority by rule or statute, to promulgate a SUPPLEMENTAL
STANDARD to require an appraiser to analyze and report sales history for any
appropriate time period. This would bolster their ability to enforce law and combat
mortgage fraud and illegal flipping. Such a method would be preferred as a means of
accomplishing the change for those States and Jurisdictions with a pressing need for
such a standard. Not all States see the USPAP as an enforcement mechanism.

Absent the adoption of a SUPPLEMENTAL STANDARD by rule or statute, gathering,
analysis and consideration of relevant prior sales and listing data could reasonably be
considered to be required by Standards Rule 1-1(b), ©, as well as 1-2 (f). There does
not appear to be a need to spell everything out in black and white.

Section 2: Advisory Opinion 3 and STATEMENT ON APPRAISAL STANDARDS No. 7
Updating an Appraisal

There is agreement with and support the rationale behind revisions proposed in the
First Exposure Draft.

The language added to Advisory Opinion 3 in an apparent attempt to clarify in the
Second Exposure Draft has the opposite effect. Elimination of the “Clarification of
Nomenclature” from Statement No. 7 was one of the most attractive features of the
original Exposure Draft. This “Clarification” is often cited as the source of confusion and
misunderstanding. Moving the language from Statement 7 to Advisory Opinion 3 merely
changes the source of the confusion. Clarity and simplification is not always attained
with more words. The ASB had a very good start with the language and direction
proposed in the First Exposure Draft.
.
Section 3 - Advisory Opinion on Jurisdictional Exception

The ASB is wise to table this issue until next year. Without compelling rationale, It
would be reasonable to table the proposed Advisory Opinion indefinitely.

The proposal to provide examples of Jurisdictional Exceptions in an Advisory Opinion
appears to be prompted by a vocal minority unwilling to examine applicable laws and
public policy within their jurisdiction and make either a professional or regulatory
decision. Many users and readers of the USPAP are not appraisal professionals. For
example, in Florida, hearings for appraisers charged under an Administrative Complaint
are often held before an Administrative Law Judge (ALJ). Examination of transcripts of
these hearings shows the ALJ often relies on examples provided in Advisory Opinions
literally and without extension. The very real possibility exists that some readers and
users, including Administrative Law Judges, will limit the application of the
Jurisdictional Exception Rule to the illustrations and examples provided in the Advisory
Opinion. This could be unfair to either the Respondent or the State.

Unless the ASB makes a decision to drastically expand the size of the USPAP
document with an exhaustive listing of every conceivable exception, clarity would be
enhanced with slight modifications to the Comment to the Jurisdictional Exception Rule.

In more than one earlier comment letter it was suggested the Jurisdictional Exception
Rule might be clarified more simply by inserting a short segment of text into the rule
itself. It was proposed to insert the text from lines 352 - 356 in the First Exposure Draft
--
In order to properly employ this Rule, the appraiser must ensure that there is proper legal authority in
affect for the particular situation, such as a specific statute, administrative rule,
judicial precedent, or other similar law or public policy. In addition, this Rule requires the
appraiser to specifically identify in the report the part (or parts) of USPAP disregarded and to also
identify the legal authority that justifies this action.

-- after line 480 on page 13 of the 2002 USPAP. This clarifies the Jurisdictional
Exception Rule.

Section 4 - Advisory Opinion on Appraising properties Impacted by Environmental
Contamination.

The original comment letter recommended against including the proposed Advisory
Opinion in USPAP.

With the Second Exposure Draft, it’s not clear if the proposal is a modification or
replacement of Advisory Opinion 9 or a new advisory Opinion.

The addition of an Advisory Opinion in the USPAP such as the one proposed, will
surely prompt calls for Advisory Opinions to cover other special situations and
appraisal problems. Please do not succumb to calls to address every eventuality,
problem or situation encountered by appraisers and regulators as an Advisory Opinion.

If, despite this plea, the ASB finds it absolutely necessary to provide advice on this
subject, Option 1 appears to do the least harm.

Section 5 Revisions to STANDARD 3

There is support for the rationale behind revisions originally proposed, but not for the
revisions in the Second Exposure Draft.

The second iteration of the proposed revisions to Standard 3 does not clarify or
simplify. It seems as though the ASB is attempting to cover every last eventuality and
demonstrates the futility of the task with their effort. The two bullet points added at lines
873 through 876 are unnecessary and redundant.

A comment made previously is appropriately repeated here. The goal of clarity and
simplification is not always attained with more words.

Section 6 Segmentation of USPAP by Appraisal Discipline

Thanks to the Appraisal Standards Board for keeping this initiative at the fore and
exploring several options to improve the understanding and usefulness of the USPAP
document. Your efforts are worthy of a salute.

You have support for the pursuit of Option #1 on line number 1084, page 34 of the
Second Exposure Draft. It’s clear the ASB intends incremental rather than wholesale
improvement.

Please develop a plan and timeline for a major reorganization which embraces a
foundation and format flexible enough for the annual modifications which the
constituencies must endure.

Section 7 - Certifications for Multi-discipline Reports

There was little support for the changes proposed in the original Exposure Draft. The
Second Exposure Draft does not change the level of support.

The additional language proposed works against the goals stated in Section 6 -
Segmentation of USPAP by Appraisal Discipline. The rationale cited in the Exposure
Draft references primarily users of appraisal services rather than providers of appraisal
services and cites limited examples and application. Making changes as significant as
those proposed with minimal rationale and applicability does not serve to simplify the
USPAP, nor does it make it more understandable.

Section 8 - Definition of Subject Property

The original comment to this proposal stated the lack of a definition of this term is
common in many real estate and real estate appraisal texts and does not appear to be
a deficiency.

In my opinion, the failure to include a definition of subject property in the USPAP does
not hamper enforcement actions of state regulatory boards. Including the proposed
definition may cause more problems than any puzzle caused by omission. In some
cases, subject property is defined by law, by rule, judicial precedent, custom or public
policy. There is no assurance including the definition would make USPAP more clear
and enforceable.

To demonstrate the problem with providing such a definition in the USPAP, the ASB
has provided two within the short span of two months.

Please do not include either definition in the 2003 Uniform Standards of Professional
Appraisal Practice.

Section 9 - USPAP Compliance

Compliance with the USPAP is required by law and by clients.

Borrowing from the PREAMBLE of the 1987 Uniform Standards of Professional
Appraisal Practice, “The Users of appraisal services should demand work performed in
conformance with these standards”.

Don’t these statements provide answers to the question posed on line 1610?

Although some of the suggestions made by the ASB in the Second Exposure Draft on
proposed revisions to the 2002 have been discussed by the Florida Real Estate
Appraisal Board, this response cannot be construed as a position of the FREAB. Due
to the timing of your release, the limited time allowed for comment, the FREAB meeting
schedule, our statutory obligation to enforce the appraisal license law and the
requirements in Florida Law governing properly noticed and public meetings, there was
no opportunity to circulate this letter among FREAB members for their editing and final
approval.

We ask the Appraisal Standards Board to consider the constraints, limitations and
requirements of each State’s laws governing meetings when deciding upon the timing
of your Exposure Draft release and response time allowed. The number and depth of
comments you receive are affected by limitations well beyond a board’s ability to
remedy.

The Appraisal Standards Board is also requested to examine the possibility of opening
all meetings to public attendance. Many States, Florida in particular, have strict
requirements for public notice and access to meetings. As a result, decisions made in
meetings behind closed doors do not garner support from board members accustomed
to “government in the sunshine”.

The opportunity to provide comment on the proposed revisions to the 2002 Edition of
the Uniform Standards of Professional Appraisal Practice is sincerely appreciated.
Thank you.

Sincerely,


Francois K. Gregoire IFA RAA
Chairman, Florida Real Estate Appraisal Board

 

[David C. Johnson]

<span style='color:darkblue'>Thanks, Frank.

Nice work.

I will cite just one of several "passages" from your letter that I particularly appreciate:

"The Appraisal Standards Board is also requested to examine
the possibility of opening all meetings to public attendance.
Many States, Florida in particular, have strict requirements for
public notice and access to meetings. As a result, decisions
made in meetings behind closed doors do not garner support
from board members accustomed to 'government in the sunshine'. "

Its good to have you in the watchtower. I would imagine several of us, like me, are concerned that we may not be adequately versed to comment intelligently (while, for one, as you know, I often remain undeterred). Do you recommend only email as the deadline draws nigh?

Regards,

David C. Johnson</span>

_____________

Never mind -- Nigh nothing! Just like you said -- Today!!

I just went to your post's hyperlink and found their own conspicuous hyperlink for emailing comments, along with the PDFed exposure draft.

Couldn't be simpler. Good thing.

(Glad I beat you to a response to this post with this revision.)

Thanks again.

dcj

 

[John SRA]

Frank,

I always appreciate reading your personal responses, as well as NAR's responses to the ABS's exposure drafts. I don't always agree, but I do like reading the ratinale and reasoning.

I am surprised by your "open meeting" comment. The ASB meetings are open. In fact, I have heard the current chair practically beg appraisers to attend meetings and provide input. Over the years I have attended many ASB meetings. All one has to do is show up.

The changes that the ASB made yesterday in Boston were made in a public meeting that anyone could attend. It is just a shame that so few appraisers participate in the process.

Have a great day

JC

 

[Francois K. Gregoire]

I am surprised by your "open meeting" comment. The ASB meetings are open. In fact, I have heard the current chair practically beg appraisers to attend meetings and provide input. Over the years I have attended many ASB meetings. All one has to do is show up.

The changes that the ASB made yesterday in Boston were made in a public meeting that anyone could attend. It is just a shame that so few appraisers participate in the process.

Have a great day

JC

John,

Thanks for taking the time to read the letter. The open meeting comment is prompted by my experience with the AQB. It could be an error to assume the ASB operates in the same manner. The AQB has a part of their meeting open to the public, but meets privately prior to the public meeting and privately after the public meeting. If the ASB operates differently, I stand corrected and will write to withdraw the comment.

If you have a chance, it sure would be appreciated if you could provide some information about what went on; the tone, any changes proposed, the direction, etc.

Thanks much,

 

[John SRA]

Frank,

I was not able to be in the audience for the Boston ASB meeting, but I did get a short report from someone who was there.

Of the nine sections in the exposure draft, the ASB took action of five or six of them. The biggest news for residential appraisers is that the sales history requirement was changed to three years for all property types.

I look forward to reading through meeting reports form those who did attend.

JC

 

[Francois K. Gregoire]

John,

Yesterday, the following synopsis was forwarded by Doug Smith of SW Montana (thanks Doug). It was provided by Barry Shea, a member of TAFAC and the New Hampshire Appraiser Regulatory Board (thanks Barry).

Notice, there is a closed session mentioned.

The ASB held a public meeting in Boston yesterday. The ASB received input in the morning, went into a non-public session for deliberations; they then reconvened the public meeting and voted publicly on the 9 sections of the exposure draft. I am sure the official meeting summary will soon be available from the foundation, here's an unofficial summary:

Section 1: Sales History and breaking out Reconciliation to a separate Stds Rule. They voted to go to 3 years for all properties. Reconciliation will be a separate Stds Rule.

Section 2: Update : This was approved with some modification. Record keeping will be addressed and original report can be included by reference only when update is done for the original client by the original appraiser.

Section 3: Jurisdictional Exception - tabled

Section 4: Environmental AO. Option 1 (the shorter of the two) was passed with the inclusion of some of the definitions from Option 2. This will replace the existing Advisory Opinion 9.

Section 5: Standard 3, Appraisal Review ? Adopted with an edit. The reviewer's report must summarize (not state) additional data relied upon when the reviewer expresses his or her own value opinion.

Section 6: Segmentation - Adopted. This merely adds some additional notations in the document to identify to which discipline(s) each of the Statements and Advisory Opinions apply.

Section 7: Multi-discipline certifications - No action taken. The ASB will continue to study.

Section 8: Definition of subject property - No action taken. The ASB will continue to study.

Section 9: USPAP Compliance - The ASB adopted the language that was in the first exposure draft.