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VOLUME 46, ISSUE 3
ISSUE DATE: FEBRUARY 3, 2014
RULE PROPOSALS

LAW AND PUBLIC SAFETY
DIVISION OF CONSUMER AFFAIRS
STATE BOARD OF REAL ESTATE APPRAISERS

Proposed Amendments: N.J.A.C. 13:40A-1.1, 1.2, 2.2, 2.3, 2.5, 2A.1, 2A.2, 2A.3, 3.1, 3.2, 3.3, 3.4, 4.3, 4.5, 4.6, 4.7, 4.8, 5.3, 5.6, 5.7, 5.10, and 8.1

January 1, 2015 Real Property Appraiser Qualification Criteria
 
Authorized By: State Board of Real Estate Appraisers, Charles Kirk, Executive Director.
 
Authority: N.J.S.A. 45:14F-8.
 
Calendar Reference: See Summary below for explanation of exception to the calendar requirements.
 
Proposal Number: PRN 2014-022.
 
Submit written comments by April 4, 2014, to:
 
   Charles Kirk, Executive Director
   State Board of Real Estate Appraisers
   Post Office Box 45032
   124 Halsey Street
   Newark, New Jersey 07101
 
The agency proposal follows:
 
Summary

In 1989, Congress passed the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) to address the then-recent savings and loan crisis. Title XI of this legislation required that the only appraisers permitted to perform appraisals for Federally related transactions were to be those regulated by the individual states. Under FIRREA, Federally related transactions are defined as any real estate-related financial transaction that (a) a Federal financial institution, regulatory agency, or [page=275] the Resolution Trust Corporation engages in, contracts for, or regulates; and (b) requires the services of an appraiser. The Federal Financial Institutions Examination Council (FFIEC) stated in their final appraisal rules which transactions do and do not require an appraiser. In general, those transactions that require the services of a state-licensed or state-certified appraiser are the ones with a transaction value of greater than $ 250,000 for the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the National Credit Union Administration.

The regulatory program established under Title XI of FIRREA contained three components: (1) each state government was to establish an appraiser regulatory body to issue licenses and certificates and to address enforcement or disciplinary issues; (2) private-sector expertise regarding appraisal standards and appraiser qualifications was to be provided by The Appraisal Foundation; and (3) a Federal government agency ("Appraisal Subcommittee" or "ASC") was to oversee the program to ensure it remained consistent with the intent of Congress.

The state appraiser regulatory agency is responsible for issuing licenses and certificates to individuals who meet the Real Property Appraiser Qualification Criteria (Criteria) established by the Appraiser Qualifications Board (AQB) of the Appraisal Foundation. The mission of The Appraisal Foundation is to promote professionalism in appraising. This is accomplished through the work of two independent Boards, the Appraisal Standards Board (ASB) and the AQB.

The ASB promulgates the generally-recognized performance standards of the appraisal profession, known as the Uniform Standards of Professional Appraisal Practice (USPAP). The AQB is charged with setting the minimum qualifying education, experience, and continuing education and examination requirements to become and remain a state-certified or licensed appraiser.

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank) amended several sections of Title XI of FIRREA. Dodd-Frank requires that states have in place a policy for issuing a reciprocal certification or license to an appraiser from another state, so long as the appraiser licensing and certification program of the other state is in compliance with the provisions of Title XI of FIRREA, and the appraiser holds a valid certification from a state with requirements for certification that meet or exceed the certification and licensure standards established by the state where an individual seeks reciprocity. Additionally, Dodd-Frank defines a "state licensed appraiser" as "an individual who has satisfied the requirements for state licensing in a state with criteria for the licensing of a real estate appraiser currently that meet or exceed the minimum criteria issued by the AQB for the licensing of real estate appraisers." Therefore, if a state has a licensed category, the minimum qualification criteria issued by the AQB is mandatory. Dodd-Frank also mandates that any minimum qualification requirements established by a state for individuals in the position of "trainee appraiser" and "supervisory appraiser" must meet or exceed the minimum qualification requirements of the AQB. Effective July 1, 2013, the Appraisal Subcommittee began reviewing state programs for compliance with these requirements.

In 2008, the AQB mandated higher standards for the profession. States had the option to implement the 2008 Real Property Appraiser Qualification Criteria via the "segmented approach," which required an applicant to meet the Criteria in effect at the time he or she completed a particular component. In New Jersey, the State Board of Real Estate Appraisers (Board) adopted rules establishing that any component completed prior to January 1, 2008, would satisfy the pre-2008 Criteria, while any component not completed by January 1, 2008, would have to conform to the 2008 Criteria. Any applicant for a license or certification who had not demonstrated completion of all components by December 31, 2009, was required to conform to the 2008 Criteria with regard to every component.

On December 9, 2011, the AQB adopted changes to the Criteria that will become effective on January 1, 2015 (2015 Criteria). The 2015 Criteria abandons the segmented approach and requires that both mandated education and experience be completed prior to taking the AQB-approved National Uniform Licensing and Certification Examination. Additionally, all candidates for a real property appraiser credential will be required to undergo background screening. The AQB urged states to perform background checks on existing credential holders as well.

The AQB also changed some of its education requirements. The 2015 Criteria mandate that Certified Residential Appraisers and Certified General Appraisers achieve a bachelor's degree or higher (in any field) from an accredited college or university, and that licensed residential appraisers successfully complete 30 semester credit hours from an accredited college, junior college, community college, or university or achieve an associate's degree or higher in any field. The AQB's Guide Note 8 defines an accredited college or university as one that is accredited by the Commission on Colleges, a regional or national accreditation association, or by an accrediting agency that is recognized by the U.S. Secretary of Education. Credit towards qualifying education requirements may be obtained through the completion of a degree program in real estate from an accredited degree-granting college or university, provided the college or university had its curriculum reviewed and approved by the AQB. The AQB is requiring that distance learning courses have a written, proctored examination. With respect to continuing education course offerings, aside from complying with the requirements to complete the 7-Hour National USPAP Update Course, or its AQB-approved equivalent, appraisers may not receive credit for completion of the same continuing education course offering within an appraiser's continuing education cycle. The AQB has also added topics that appraisers may take to qualify for initial accreditation and/or for the purpose of continuing education.

The AQB has also made changes to its supervisory appraiser and trainee appraiser requirements. Under the 2015 Criteria, state-certified supervising appraisers must be in good standing and not subject to any disciplinary actions within the last three years that affect the supervising appraiser's legal ability to engage in appraisal practice. Additionally, an appraiser must be state certified for a minimum of three years prior to being eligible to become a supervising appraiser. A supervising appraiser may not supervise more than three trainee appraisers at one time, unless a state has established a program to monitor supervising certified appraiser qualifications and supervision oversight requirements for supervisory appraisers. However, a trainee appraiser may have more than one supervising appraiser. Trainee appraisers and supervising appraisers share responsibility to ensure that the trainee appraiser's experience log is current, accurate, and complies with the requirements of the trainee appraiser's credentialing jurisdiction.

Under the 2015 Criteria, both trainee appraisers and supervising appraisers will also be required to complete a course that, at a minimum, complies with the specifications for course content established by the AQB. The course is to be oriented toward the requirements and responsibilities of supervising appraisers and the expectations for trainee appraisers. The course must be completed by the trainee appraiser prior to obtaining a trainee appraiser credential and by the supervising appraiser prior to supervising trainees.

Under its rulemaking authority set forth in N.J.S.A. 45:14F-8.g, the Board is proposing amendments to Subchapters 1, 2, 2A, 3, 4, 5, and 8 to reflect and conform to the 2015 Criteria and to Dodd-Frank requirements. Where the Board's existing rules already conform to the 2015 Criteria, no amendment is required. Where the Board's existing rules incorporate by reference the "Real Property Appraiser Qualification Criteria and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation as amended and supplemented, changes resulting from the AQB's adoption of the 2015 Criteria are incorporated by reference into the rules as well. The Board is also proposing some changes to clarify the existing rules.

Furthermore, several amendments are being proposed in order to comply with ASC recommendations to the Board.

Licensed and certified real estate appraisers are cautioned to reference the AQB's website, www.appraisalfoundation.org, to determine whether a Federal standard that is incorporated by reference in the Board's rules has changed.

The Board is proposing to amend the definition of "Appraisal Qualification Board" set forth in N.J.A.C. 13:40A-1.2, to reflect the AQB's current address.

The Board is proposing to amend N.J.A.C. 13:40A-2.1 to clarify that in order to be eligible for certification as a general real estate appraiser, a [page=276] candidate must successfully complete requirements of education and experience, in addition to examination requirements. Because education, experience, and examination requirements must also be satisfied by candidates seeking to become certified residential real estate appraisers and licensed residential real estate appraisers, the Board is proposing similar amendments to N.J.A.C. 13:40A-2A.1 and 3.1.

The Board is also proposing to amend several provisions that relate to the "segmented approach." The Board is proposing to amend N.J.A.C. 13:40A-1.1, the purpose and scope section, to inform applicants that the "segmented approach" with regard to implementation of the 2008 Criteria, will no longer be valid effective January 1, 2015. As part of new subsection (d), the Board is incorporating by reference, as amended and supplemented, the 2015 Criteria. The 2015 Criteria is available at https://netforum.avectra.com/eweb/StartPage.aspx?Site=taf&WebCode=HomePage. The Board is also proposing to amend N.J.A.C. 13:40A-2.2, which sets forth the requirements that an applicant for certification as a general real estate appraiser must satisfy before being eligible to take the examination. Under the 2008 Criteria, an applicant for certification as a general real estate appraiser could elect to complete the experience requirement subsequent to taking the examination for certification under the "segmented approach." However, the 2015 Criteria specify that after January 1, 2015, both the education and experience requirements must be completed prior to taking the AQB-approved National Uniform Licensing and Certification Examination. Consequently, the Board is proposing to add new subsection (c) to make this clear. The 2015 Criteria will apply to individuals applying for certification as a residential real estate appraiser and to individuals applying for licensure as a real estate appraiser as well; therefore, the Board is also proposing similar amendments as new N.J.A.C. 13:40A-2A.2(c) and 3.2(c).

The Board is proposing to amend N.J.A.C. 13:40A-2.3 to change the heading from "Educational requirements for certification as a general real estate appraiser" to "Source of education for certification as a general real estate appraiser" to more accurately reflect the content of the section. The Board is proposing to delete subsection (a) because it is duplicative of N.J.A.C. 13:40A-2.2(a)4 and 5. The Board is proposing to add new subsection (b), which states that credit towards qualifying education requirements may be obtained through the completion of a degree program in real estate from an accredited degree-granting college or university, provided that the college or university has had its curriculum reviewed and approved by the AQB. The Board is proposing to similarly amend N.J.A.C. 13:40A-2A.3, the section that relates to sources of education for certification of residential real estate appraisers. The 2015 criteria mandate that certified general and residential real estate appraisers achieve a bachelor's degree. The addition of this subsection anticipates the 2015 Criteria.

The Board is proposing to amend N.J.A.C. 13:40A-2.5(b), the provision relating to temporary visiting certificates for certified general real estate appraisers. Under the exiting rule, an appraiser certified by another jurisdiction may apply for no more than three temporary certificates, with a limit of appraising three specific properties per temporary certificate, per calendar year. The Board is proposing to delete the language "appraising three specific properties per temporary certificate" in order to comply with recommendations by the ASC.

The Board is proposing to make amendments throughout Subchapter 3 to add the word "residential" wherever the term "licensed real estate appraiser" appears. This change affects the subchapter heading, as well as the text in N.J.A.C. 13:40A-3.1, 3.2, 3.3, and 3.4. The Board is also proposing to amend N.J.A.C. 13:40A-3.2(b) to change the reference to the "examination for certification" to the "examination for licensure" to correct an error in the rule.

The Board is proposing to amend several rules pertaining to trainees and supervising appraisers in order to conform to the 2015 Criteria. The Board is proposing to amend N.J.A.C. 13:40A-4.3(a) to require that an applicant for a trainee permit complete the education requirements within the five-year period prior to the time that he or she submits his or her application to the Board. Under the existing rule, a trainee applicant is required to complete his or her education requirements by the time the applicant submits his or her application to the Board; it is not specific as to when the education must be completed. Additionally, the Board is proposing to add new subsection (b), requiring that a trainee, prior to obtaining his or her credential, complete a course that is oriented to the expectations for trainee appraisers and complies with the specifications for the course content established by the AQB. The Board also is proposing to add N.J.A.C. 13:40A-4.6(e)9 to add a provision that would similarly require a supervising appraiser, prior to supervising any trainees, to complete a course oriented to the requirements and responsibilities of supervisory appraisers and complies with the specifications for the course content established by the AQB. The 2015 Criteria mandates completion of these courses.

The Board is proposing to amend N.J.A.C. 13:40A-4.5(a), the section that relates to the responsibilities of trainees, to require that a trainee work under a supervising appraiser who has not been subject to any disciplinary action within the last three years that affected the supervising appraiser's legal ability to engage in appraisal practice. The Board also is proposing to add language to this subsection that explicitly permits a trainee appraiser to have more than one supervising appraiser. Additionally, the Board is proposing to amend both N.J.A.C. 13:40A-4.5(b) and 4.6(e)2, which relates to the responsibilities of supervising appraisers, to provide that both a trainee and his or her supervising appraiser are responsible for making sure that the trainee's log is accurate and current and meets the requirements set forth in N.J.A.C. 13:40A-4.7. These proposed amendments conform the Board's requirements to Federal standards. In addition, the Board proposes amending N.J.A.C. 13:40A-4.5(a) and recodified 4.6(e)2 to delete reference to "licensed" appraisers because, as of January 1, 2008, only certified real estate appraisers are eligible to serve as a supervising appraiser.

The Board is proposing to amend N.J.A.C. 13:40A-4.6(c) to prohibit anyone from becoming a supervising appraiser unless he or she has held a certification from the Board for at least three years, instead of two years under the existing rule. The Board must make this change to conform to the 2015 Criteria.

The Board is proposing to further amend N.J.A.C. 13:40A-4.6 to delete existing subsection (d), in order to eliminate any reference to licensed appraisers serving as supervising appraisers. Recodified subsection (d) is also amended to remove reference to the January 1, 2008 date. Since January 1, 2008, only certified appraisers have been eligible to be supervising appraisers.

The Board is proposing to amend N.J.A.C. 13:40A-4.7, the section that sets forth the information required in the trainee's log, to include data required by the ASC and as set forth in AQB Guide Note 6 to subsection (a).

The Board is also proposing to add new N.J.A.C. 13:40A-4.8(d) to provide that beginning on July 1, 2013, an individual holding a training permit for more than two years may no longer be granted an extension of time, while remaining in active status, to satisfy his or her continuing education requirements. Individuals holding a training permit, however, may seek to be placed on inactive status due to extenuating circumstances. This change is required by the ASC.

The Board is proposing to amend Subchapter 5, the subchapter that relates to continuing professional education, in order to conform to the 2015 Criteria. The Board is proposing to add new N.J.A.C. 13:40A-5.3(c) to prohibit certified or licensed appraisers from receiving continuing education credit for taking the same course (other than the 7-hour National USPAP Update Course or its AQB equivalent) more than once during a biennial period preceding application for renewal.

The Board is proposing to amend N.J.A.C. 13:40A-5.6(a) to add several new topics to the list of examples of qualifying course topics for continuing education credit (green building, seller concessions, and developing opinions on real estate value...). Additionally, the Board is proposing to add new N.J.A.C. 13:40A-5.7(a)8 to provide that distance learning courses must have a written, proctored examination. These amendments will insure that the Board's continuing education rules comply with the 2015 Criteria.

The Board is proposing to amend N.J.A.C. 13:40A-5.10(b) to require that if an applicant for biennial renewal is not able to satisfy his or her continuing education requirements for the preceding cycle due to extenuating circumstances, the credential holder shall be placed on inactive status for a period of up to 90 days pending completion of all continuing education requirements. This change is being mandated by the ASC.

[page=277] The Board is proposing to amend N.J.A.C. 13:40A-8.1, the section that relates to certification or licensure by endorsement. In paragraph (a)2, the Board is proposing to require that if an individual possessing a certification or a license from another state seeks certification or licensure in New Jersey by endorsement, the state in which the individual is certified or licensed must meet or exceed all minimum standards set forth by both the AQB and the Board. The existing rule requires that standards of the other state comply with the minimum standards of the AQB only. The proposed amendment reflects the reciprocity policy set forth in Dodd-Frank.

The Board has determined that the comment period for this notice of proposal shall be 60 days; therefore, pursuant to N.J.A.C. 1:30-3.3(a)5, this notice is excepted from the rulemaking calendar requirement.
 
Social Impact

The proposed amendments will have a positive social impact. By requiring that State appraisers comply with the 2015 Criteria, consumers involved in Federally related transactions can be assured that certified and licensed appraisers meet certain minimum Federal standards, and may participate in Federally related transactions in the State. The substantive requirements themselves may not result from the proposed amendments, inasmuch as rules already adopted under the Board's enabling act presently incorporate the 2015 Criteria by reference, hence, a change in the 2015 Criteria does not always require an amendment to the Board's rules.

The 2015 Criteria impose more stringent standards upon prospective licensed or certified appraisers, requiring them to complete a more advanced level of education and to complete all of the Federally mandated experience requirements prior to taking the national licensing or certification examinations. These more stringent standards will insure that highly qualified individuals engage in the practice of real estate appraising.

The proposed new requirements imposed by the 2015 Criteria on trainee appraisers and supervising appraisers will also have a positive social impact. By requiring that certified appraisers complete an additional year of appraisal experience in order to become supervising appraisers, that supervisors and trainees maintain joint responsibility for the trainee log, and that supervisors and trainees complete coursework designed to educate them about the requirements, responsibilities, and expectations of their jobs, the training process will improve to produce more qualified appraisers.

The proposed amendments to the continuing education requirements mandated by the 2015 Criteria will also have a positive social impact on appraisers. The 2015 Criteria expand the types of courses that will qualify for continuing education credits, thus offering appraisers more choices. The limitations imposed by the 2015 Criteria, such as not permitting appraisers to receive credit for the same course more than once per continuing education cycle, and requiring that distance learning courses have a proctored, written examination, improve on the integrity of the continuing education process. Additionally, the ASC requirement that a credential holder be placed on inactive status if he or she does not fulfill his or her continuing education requirements will be a strong incentive for appraisers to maintain professional competency in a timely manner.

The amendment to Subchapter 8, requiring that individuals with licenses or certificates from other states meet minimum Federal and State requirements for licensure or certification in New Jersey, will also have a positive social impact, because it will insure that all appraisers practicing in the State have met the same high standards for licensure or certification.

Although these amendments may make it somewhat more difficult for prospective appraisers to meet the educational and experiential criteria for licensure and/or certification, these amendments are necessary to be in compliance with the minimal standards established by AQB, ASC, and under Dodd-Frank.
 
Economic Impact

The Board anticipates that the proposed amendments will have an economic impact on certified and licensed real estate appraisers. The rules incorporate by reference AQB mandated changes to certified and licensed appraisers education requirements. These requirements have been made more rigorous under the 2015 Criteria. Under the 2015 Criteria, certified general and residential appraisers must hold a bachelor's degree or higher, in any field, from an accredited college or university. Under the existing requirements, a certified residential real estate appraiser is required to complete only 21 semester credits in specified subject matter from an accredited college or university or an associate's degree or higher, and a certified general real estate appraiser is required to complete only 30 semester credit hours in specific subject matter from an accredited college or university, or a bachelor's degree or higher. Furthermore, there are no college level education requirements at present for licensed residential appraisers. However, under the 2015 Criteria, licensed residential real estate appraisers will be required to complete 30 semester credit hours of college level education from an accredited college, junior college, community college, or university or an associate's degree or higher in any field. The tuition costs associated with these rigorous education requirements will have an economic impact on all prospective appraisers, and appraisers seeking to upgrade their status.

Colleges may benefit economically from the proposed amendments to the extent that the 2015 Criteria require all licensed and certified appraisers to complete college level courses.
 
Federal Standards Statement

A Federal standards analysis is not required because the proposed amendments, as discussed in the Summary above, do not exceed, and in some cases, incorporate by reference, standards and requirements set forth by the Appraiser Qualification Board of the Appraisal Foundation, which may be viewed as establishing and setting forth Federal standards and requirements.
 
Jobs Impact

The proposed amendments will not result in the generation or loss of jobs in New Jersey.
 
Agriculture Industry Impact

The Board believes the proposed amendments will have no impact upon the agriculture industry in New Jersey.
 
Regulatory Flexibility Analysis

If, for the purposes of the Regulatory Flexibility Act, N.J.S.A. 52:14B-16 et seq. (the Act), any of the approximately 2,870 real estate appraisers licensed or certified by the Board are deemed "small businesses," then the following analysis applies.

The proposed amendments do not impose any new recordkeeping or reporting requirements upon licensees or certificate holders. They do, however, impose compliance requirements upon appraisers and prospective appraisers. Applicants applying for admission to the examination required for licensure or certification must comply with the qualifying educational standards established by the AQB and complete both the education and experience requirements established by the AQB prior to taking the AQB-approved National Uniform Licensing and Certification Examination. Applicants must also successfully complete the education, experience, and examination requirements established by the AQB in order to be eligible for licensure or certification. Appraisers must complete their continuing education requirements or be placed on inactive status. Trainees and supervising appraisers must complete coursework outlining the requirements and responsibilities of supervising appraisers and the expectations for trainees prior to being permitted to supervise trainees or to obtaining a trainee credential. Trainee logs must also be in compliance with AQB standards.

Ultimately, any additional requirements imposed upon applicants, licensees, and certificate holders are strongly outweighed by the protection the requirements afford to the public. In order to ensure that these protections are afforded to all consumers, the Board believes that the proposed amendments must be uniformly applied and has not provided differing compliance requirements for any licensees or certificate holders based on the size of the business. No professional services will be needed to comply with the proposed amendments.
 
Housing Affordability Impact Analysis

The proposed amendments will have an insignificant impact on affordable housing in New Jersey and there is an extreme unlikelihood that the rules would evoke a change in the average costs associated with housing because the proposed amendments concern requirements for the [page=278] licensing and certification of real estate appraisers, responsibilities of supervising and trainee appraisers, continuing education requirements for real estate appraisers, and licensing by endorsement of real estate appraisers from other states.
 
Smart Growth Development Impact Analysis

The proposed amendments will have an insignificant impact on smart growth and there is an extreme unlikelihood that the rules would evoke a change in housing production in Planning Areas 1 or 2 or within designated centers under the State Development and Redevelopment Plan in New Jersey because the proposed amendments concern requirements for the licensing and certification of real estate appraisers, responsibilities of supervising and trainee appraisers, continuing education requirements for real estate appraisers, and licensing by endorsement of real estate appraisers from other states.
 
Full text of the proposal follows (additions indicated in boldface thus; deletions indicated in brackets [thus]):
 
SUBCHAPTER 1.    PURPOSE AND SCOPE; DEFINITIONS
 
13:40A-1.1   Purpose and scope
 
(a)-(c) (No change.)
 
(d) Beginning on January 1, 2015, in order to implement the Real Property Appraiser Qualification Criteria that go into effect on that date (2015 Criteria), the segmented approach set forth in (c) above will no longer be in effect, and all persons applying for licensure or certification will be required to satisfy the education and experience requirements contained in the 2015 Criteria, which is incorporated herein by reference, as amended and supplemented, and available at http://netforum.avectra.com/eweb/StartPage.aspx?Site=taf&WebCode=HomePage , prior to taking the AQB-approved National Uniform Licensing and Certification Examination.
 
13:40A-1.2   Definitions
 
The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise:
 
. . .
 
"Appraisal Qualification Board (AQB)" means the independent board of the Appraisal Foundation, which under the provisions of Title XI of the Financial Institution Reform, Recovery and Enforcement Act of 1989 (FIRREA) establishes the minimum education, experience, and examination requirements for real property appraisers to obtain a state certification or license. The address and phone number of the AQB is [1029 Vermont Avenue, NW Suite 900] 1155 15th Street, NW Suite 1111,Washington, DC 20005[-3517], (202) 347-7722. The website for the AQB is www.appraisalfoundation.org.
 
. . .
 
13:40A-2.1   Eligibility for certification as a general real estate appraiser
 
In order to be eligible for certification as a general real estate appraiser, an applicant shall be required to successfully complete the education and experience requirements set forth in N.J.A.C. 13:40A-2.2 and shall successfully complete the [Board approved] Board-approved examination for the certification of general real estate appraisers.
 
13:40A-2.2   Eligibility for admission to examination
 
(a)-(b) (No change.)
 
(c) Beginning on January 1, 2015, in order to implement the 2015 Criteria that go into effect on that date, the segmented approach described in (b) above will no longer be in effect, applicants for certification as a general real estate appraiser shall complete the experience requirement under N.J.A.C. 13:40A-2.4 prior to taking the examination for certification.
 
13:40A-2.3   [Educational requirements] Source of education for certification as a general real estate appraiser
 
[(a) In order to be eligible to take the examination for certification as a general real estate appraiser, an applicant shall complete, by the time the application is submitted to the Board, the educational requirements for a general real estate appraiser as established by "The Real Property Appraiser Qualification and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation as amended and supplemented, which are incorporated herein by reference as part of this rule.]
 
[(b)] (a) (No change in text.)
 
(b) Credit towards qualifying educational requirements may be obtained via the completion of a degree program in real estate from an accredited degree-granting college or university provided the college or university has had its curriculum reviewed and approved by the AQB.
 
13:40A-2.5   Temporary visiting certificate; certified general real estate appraiser
 
(a) (No change.)
 
(b) An appraiser certified by another jurisdiction may apply for no more than three temporary certificates, [with a limit of appraising three specific properties per temporary certificate,] within one calendar year, except that the Board may waive the limitation based on a showing of good cause by the applicant.
 
(c)-(e) (No change.)
 
13:40A-2A.1   Eligibility for certification as a residential real estate appraiser
 
In order to be eligible for certification as a residential real estate appraiser, an applicant shall be required to successfully complete the education and experience requirements set forth in N.J.A.C. 13:40A-2A.2 and shall successfully complete the [Board approved] Board-approved examination for the certification of residential real estate appraisers.
 
13:40A-2A.2   Eligibility for admission to examination
 
(a)-(b) (No change.)
 
(c) Beginning on January 1, 2015, in order to implement the 2015 Criteria that go into effect on that date, the segmented approach described in (b) above will no longer be in effect, applicants for certification as a residential real estate appraiser shall complete the experience requirement under N.J.A.C. 13:40A-2A.4 prior to taking the examination for certification.
 
13:40A-2A.3   [Educational requirements] Source of education for certification as a residential real estate appraiser
 
[(a) In order to be eligible to take the examination for certification as a residential real estate appraiser, an applicant shall complete, by the time the application is submitted to the Board, the educational requirements for a residential real estate appraiser as established by "The Real Property Appraiser Qualification and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation as amended and supplemented, which are incorporated herein by reference as part of this rule.]
 
[(b)] (a) (No change in text.)
 
(b) Credit towards qualifying education requirements may be obtained via the completion of a degree program in real estate from an accredited degree-granting college or university provided the college or university has had its curriculum reviewed and approved by the AQB.
 
SUBCHAPTER 3.    LICENSING OF RESIDENTIAL REAL ESTATE APPRAISERS
 
13:40A-3.1   Eligibility for licensure
 
In order to be eligible for licensure as a residential real estate appraiser, an applicant shall be required to successfully complete the education and experience requirements set forth in N.J.A.C. 13:40A-3.2 and shall successfully complete the Board-approved examination for the licensure of residential real estate appraisers.
 
13:40A-3.2   Eligibility for admission to examination
 
(a) An applicant for licensure as a residential real estate appraiser shall present the following:
 
1.-6. (No change.)
 
(b) During the time period in which the segmented approach is applicable, applicants for licensure as a licensed residential real estate appraiser may elect to complete the experience requirement subsequent to taking the examination for [certification] licensure.
 
[page=279] (c) Beginning on January 1, 2015, in order to implement the 2015 Criteria that go into effect on that date, the segmented approach described in (b) above will no longer be in effect, applicants for licensure as a licensed residential real estate appraiser shall complete the experience requirements under N.J.A.C. 13:40A-3.4 prior to taking the examination for licensure.
 
13:40A-3.3   [Educational] Education requirements for licensure
 
(a) In order to be eligible to take the examination for licensure as a licensed residential real estate appraiser, an applicant shall complete, by the time the application is submitted to the Board, the [educational] education requirements for a licensed residential real estate appraiser as established by "The Real Property Appraiser Qualification Criteria and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation as amended and supplemented, which are incorporated herein by reference as part of this rule.
 
(b) (No change.)
 
13:40A-3.4   Experience requirements for licensure
 
(a) Each applicant applying for licensure as a licensed residential real estate appraiser shall complete, by the time the application is submitted to the Board, the experience requirements for a licensed residential real estate appraiser as established by "The Real Property Appraiser Qualification Criteria and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation as amended and supplemented, which are incorporated herein by reference as part of this rule.
 
(b) (No change.)
 
SUBCHAPTER 4.    TRAINEE PERMITS
 
13:40A-4.3   [Educational] Education requirements
 
(a) Each applicant applying for a trainee permit shall complete, [by] within a five-year period prior to the time the application is submitted to the Board, the [educational] education requirements for a trainee as established by "The Real Property Appraiser Qualification Criteria and Interpretation of the Criteria" as promulgated by the AQB of the Appraisal Foundation, as amended and supplemented, which are incorporated herein by reference as part of this rule.
 
(b) Prior to obtaining a trainee appraiser credential, a trainee applicant shall complete a course that, at a minimum, is oriented to the expectations for trainee appraisers and complies with the specifications for the course content established by the AQB.
 
13:40A-4.5   Responsibilities of trainee
 
(a) The holder of a trainee permit issued by the Board shall work only under the "direct supervision," as that term is defined in N.J.A.C. 13:40A-4.6, of a "supervising appraiser," who shall be an individual [licensed or] certified in good standing by the Board, who has not been subject to any disciplinary action within the previous three years that affected the supervising appraiser's legal ability to engage in appraisal practice, and who has acknowledged in writing an agreement to perform the responsibilities of a supervising appraiser set forth in N.J.A.C. 13:40A-4.6. Prior to commencing any work as a trainee, the holder of a trainee permit shall inform the Board in writing of the identity of any individual(s) who have agreed to serve as a "supervising appraiser" for the trainee. The holder of a trainee permit shall inform the Board in writing, within seven days, in the event that any individual previously designated as a "supervising appraiser" ceases to agree to perform the responsibilities of a "supervising appraiser," or in the event that any individual not previously designated as a "supervising appraiser" agrees to supervise the work product of the trainee. A trainee may have more than one approved "supervising appraiser."
 
(b) The holder of a trainee permit issued by the Board shall have the following duties and responsibilities:
 
1. The trainee shall maintain and submit to the Board upon application for permit renewal a log, which meets the requirements set forth in N.J.A.C. 13:40A-4.7[;]. The trainee and his or her "supervising appraiser" shall have the shared responsibility to make sure that the log is accurate and current and meets the requirements set forth in N.J.A.C. 13:40A-4.7;
 
2.-6. (No change.)
 
(c)-(d) (No change.)
 
13:40A-4.6   Responsibilities of supervising appraiser
 
(a)-(b) (No change.)
 
(c) No appraiser shall serve as a supervising appraiser until he or she has [been a licensee of] held a certification from the Board for at least [two] three years.
 
[(d) Beginning on January 1, 2008, licensed real estate appraisers shall no longer be approved to serve as supervising appraisers. Beginning on February 5, 2007, the Board will no longer accept applications by trainees who seek approval of a licensed real estate appraiser as a supervising appraiser.]
 
[(e)] (d) [Beginning on January 1, 2008, only] Only those individuals who are certified by the Board as either a [State certified] State-certified general real estate appraiser or a [State certified] State-certified residential real estate appraiser shall be a supervising appraiser.
 
[(f)] (e) A supervising appraiser shall have the following duties and responsibilities:
 
1. (No change.)
 
2. The supervising appraiser shall, at least once a month, sign the log required to be kept by the trainee pursuant to N.J.A.C. 13:40A-4.7 and shall set forth thereon his or her [license or] certification number. A "supervising appraiser" and any trainee that he or she is supervising shall have the shared responsibility to make sure that the log is accurate and current and meets the requirements set forth in N.J.A.C. 13:40A-4.7.
 
3.-4. (No change.)
 
5. A supervising appraiser shall not supervise more than three trainees at one time[;].
 
6.-8. (No change.)
 
9. Prior to supervising trainee appraisers, a supervising appraiser shall complete a course that, at a minimum, is oriented to the requirements and responsibilities of supervising appraisers and complies with the specifications for the course content established by the AQB.
 
[9.] 10. (No change in text.)
 
13:40A-4.7   Real estate appraiser trainee log
 
(a) A real estate appraiser trainee shall maintain a log on forms provided by the Board, which shall include the following information concerning each appraisal assignment in which the trainee participates:
 
1.-3. (No change.)
 
4. A description of the work performed and the scope of review and supervision; [and]
 
5. The number of hours claimed for the assignment[.];
 
6. The type of property;
 
7. The date of report;
 
8. The number of actual work hours by the trainee on the assignment; and
 
9. The signature and certification number of the supervising appraiser. Separate logs shall be maintained for each supervising appraiser, if applicable.
 
(b)-(d) (No change.)
 
13:40A-4.8   Continuing education requirements
 
(a)-(c) (No change.)
 
(d) Beginning on July 1, 2013, an individual holding a trainee permit for more than two years may no longer be granted an extension of time to satisfy continuing education requirements as provided in N.J.A.C. 13:40A-5.10(a). As provided in N.J.A.C. 13:40A-5.10(b), an individual holding a trainee permit may request, due to extenuating circumstances, to be placed on inactive status to complete all continuing education requirements.
 
SUBCHAPTER 5.    CONTINUING PROFESSIONAL EDUCATION
 
13:40A-5.3   Continuing education credit-hour requirements; carryover prohibited; repeat of same course prohibited
 
(a)-(b) (No change.)
 
(c) Aside from complying with the requirement to complete the 7-Hour National USPAP Update Course (or its AQB-approved equivalent) set forth in N.J.A.C. 13:40A-5.4, a certified or licensed appraiser shall not receive credit for completion of the same [page=280] continuing education course more than once during a biennial period preceding application for renewal.
 
13:40A-5.6   Acceptable course topics
 
(a) The Board shall approve only those continuing education activities and course topics as are deemed by the Board to be consistent with the purpose of continuing education. Examples of such course topics may include, but are not limited to: changes in the Uniform Standards of Professional Appraisal Practice; ad valorem taxation; arbitration; business courses related to practice of real estate appraisal; construction estimating; land use planning; zoning and taxation; management, leasing, brokerage, timesharing; property development; real estate appraisal (valuation/evaluations), law, litigation, financing, and investment; real estate appraisal related computer applications; real estate securities and syndication; [and] real property exchange; green building; seller concessions; and developing opinions on real estate value in appraisals that also include personal property and/or business value.
 
(b)-(c) (No change.)
 
13:40A-5.7   Sources of continuing education
 
(a) The licensee or certificate holder may obtain continuing education credits for the following:
 
1.-5. (No change.)
 
6. Participation, other than as a student, in appraisal education processes and programs, as approved by the Board.
 
i. Examples of activities for which credit may be granted include teaching appraisal courses, developing appraisal programs, authoring appraisal textbooks or articles, or participating in other like activities deemed by the Board to be equivalent to obtaining continuing education[;].
 
ii. No more than one-half of the total hours of credit required per biennial renewal cycle may be awarded for activities qualifying under this paragraph; [and]
 
7. Courses approved for initial certification and licensing[.]; and
 
8. Distance learning courses on qualifying topics where a written, proctored examination is required. The term "written" refers to an examination that might be written on paper or administered electronically on a computer workstation or other device.
 
(b) (No change.)
 
13:40A-5.10   Extensions
 
(a) (No change.)
 
(b) [In the event] If, upon application by a credential holder, the Board determines that an applicant for biennial renewal is not able to satisfy continuing education requirements for the preceding cycle due to extenuating circumstances [as set forth in (a) above], the credential holder shall be placed in [active] inactive status for a period of up to 90 days pending completion of all continuing education requirements, as set forth in the Real Property Appraiser Qualification Criteria and Interpretations of the Criteria, as promulgated by the AQB of the Appraisal Foundation, as amended and supplemented and incorporated herein by reference as part of this rule.
 
SUBCHAPTER 8.    CERTIFICATION OR LICENSURE BY ENDORSEMENT
 
13:40A-8.1   Certification or licensure by endorsement
 
(a) An individual possessing a certification to practice general real estate appraising or residential real estate appraising, or an individual possessing a license to practice residential real estate appraising in any state of the United States other than New Jersey, may apply for, and shall be granted, New Jersey certification by endorsement or licensure by endorsement provided that the individual's certification or license to practice is in good standing in all jurisdictions in which that individual holds a certification or licensure[,] and:
 
1. [Undergoes] The individual undergoes a criminal history background check; and
 
2. The requirements for securing certification or licensure in any one state in which the individual holds a certification or license meet or exceed all minimum standards for certification or licensure set forth by the Appraiser Qualifications Board (AQB) of the Appraisal Foundation and all minimum standards required for certification or licensure by the Board as set forth in this chapter.
 
(b) (No change.)


 

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