BP BHEAD INT S

AN ACT Relating to real estate appraisers; amending RCW 18.140.005, 18.140.010, 18.140.020, 18.140.030, 18.140.060, 18.140.110, 18.140.120, 18.140.140, 18.140.150, 18.140.155, 18.140.160, 18.140.170, and 18.140.180; adding a new section to chapter 50.04 RCW; adding new sections to chapter 18.140 RCW; adding a new chapter to Title 60 RCW; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 18.140.005 and 1993 c 30 s 1 are each amended to read as follows:

(1) It is the intent of the legislature that only individuals who meet and maintain minimum standards of competence and conduct ((~~may provide~~)) established under this chapter and sections 14 through 17 of this act for certified or licensed real estate appraisers may provide real estate appraisal services to the public.

(2) It is the further intent of the legislature to provide for a continuing supply of real estate appraisers by encouraging the proper training of new entrants to the profession through the implementation of the trainee real property appraiser classification according to this set of appraiser qualification criteria as promulgated by the appraiser qualifications board of the appraisal foundation.

Sec. 2. RCW 18.140.010 and 1993 c 30 s 2 are each amended to read as follows:

As used in this chapter, the following terms have the meanings indicated unless the context clearly requires otherwise.

(1) "Appraisal" or "real estate appraisal" means an analysis, opinion, or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate, for or in expectation of compensation. An appraisal may be classified by subject matter into either a valuation or an analysis. A "valuation" is an estimate of the value of real estate or real property. An "analysis" is a study of real estate or real property other than estimating value.

(2) "Appraisal report" means any communication, written or oral, of an appraisal, except that all appraisal reports in federally related transactions are required to be written reports.

(3) "Appraisal assignment" means an engagement for which an appraiser is employed or retained to act, or would be perceived by third parties or the public as 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. The term "appraisal assignment" may apply to valuation work and analysis work.

(4) "Certified appraisal" means an appraisal prepared or signed by a state-certified real estate appraiser. A certified appraisal represents to the public that it meets the appraisal standards defined in this chapter.

(5) "Committee" means the real estate appraiser advisory committee of the state of Washington.

(6) "Department" means the department of licensing.

(7) "Director" means the director of the department of licensing.

(8) "Licensed appraisal" means an appraisal prepared or signed by a state-licensed real estate appraiser. A licensed appraisal represents to the public that it meets the appraisal standards defined in this chapter.

(9) "Real estate" means an identified parcel or tract of land, including improvements, if any.

(10) "Real property" means one or more defined interests, benefits, or rights inherent in the ownership of real estate.

(11) "Specialized appraisal services" means all appraisal services which do not fall within the definition of appraisal assignment. The term "specialized appraisal service" may apply to valuation work and to analysis work. Regardless of the intention of the client or employer, if the appraiser would be perceived by third parties or the public as acting as a disinterested third party in rendering an unbiased analysis, opinion, or conclusion, the work is classified as an appraisal assignment and not a specialized appraisal service.

(12) "State-certified general real estate appraiser" means a person certified by the director to develop and communicate real estate appraisals of all types of property. A state-certified general real estate appraiser may designate or identify an appraisal rendered by him or her as a "certified appraisal."

(13) "State-certified residential real estate appraiser" means a person certified by the director to develop and communicate real estate appraisals of all types of residential property of one to four units without regard to transaction value or complexity and nonresidential property having a transaction value as specified in rules adopted by the director. A state certified residential real estate appraiser may designate or identify an appraisal rendered by him or her as a "certified appraisal."

(14) "State-licensed real estate appraiser" means a person licensed by the director to develop and communicate real estate appraisals of noncomplex one to four residential units and complex one to four residential units and nonresidential property having transaction values as specified in rules adopted by the director.

(15) "Supervising appraiser" means either a state-certified general real estate appraiser or a state-certified residential real estate appraiser providing direct supervision to another appraiser certified, licensed, or permitted under this chapter.

(16) "Trainee real property appraiser" means a person who is not certified or licensed under this chapter but is permitted by the director, prior to the commencement of such activity, to assist in the development and communication of real estate appraisals for the purpose of gaining experience consistent with the purpose of this chapter concerning those types of properties that the supervising appraiser is permitted to appraise.

Sec. 3. RCW 18.140.020 and 1993 c 30 s 3 are each amended to read as follows:

(1) No person other than a state-certified or state-licensed real estate appraiser may receive compensation of any form for a real estate appraisal or an appraisal review.

(2) No person, other than a state-certified or state-licensed real estate appraiser, may assume or use that title or any title, designation, or abbreviation likely to create the impression of certification or licensure as a real estate appraiser by this state.

(3) A person who is not certified or licensed under this chapter shall not ((~~describe or refer to~~)) prepare any appraisal of real estate located in this state ((~~by the term "certified" or "licensed."~~)).

((~~(2)~~)) (4) This section does not preclude a person who is ((~~not~~)) certified or licensed as a state-certified or state-licensed real estate appraiser by another state or territory from appraising real estate in this state for compensation((~~, except~~)) in federally related transactions requiring licensure or certification to perform appraisal services according to 12 U.S.C. 3351(a) or RCW 18.140.155.

(5) No person, other than a person holding a currently valid permit as a trainee real property appraiser issued by the director may assume or use that title or any title, designation, or abbreviation likely to create the impression of trainee status as a real estate appraiser by this state.

(6) A person who is not permitted as a trainee real property appraiser under this chapter shall not indicate participation in the preparation of or prepare any appraisal of real estate located in this state.

Sec. 4. RCW 18.140.030 and 1993 c 30 s 4 are each amended to read as follows:

The director shall have the following powers and duties:

(1) To adopt rules in accordance with chapter 34.05 RCW necessary to implement this chapter;

(2) To receive and approve or deny applications for certification or licensure as a state-certified or state-licensed real estate appraiser under this chapter; to establish appropriate administrative procedures for the processing of such applications; to issue certificates or licenses to qualified applicants pursuant to the provisions of this chapter; and to maintain a register of the names and addresses of individuals who are currently certified or licensed under this chapter;

(3) To establish, provide administrative assistance, and appoint the members for the real estate appraiser advisory committee to enable the committee to act in an advisory capacity to the director;

(4) To solicit bids and enter into contracts with educational testing services or organizations for the preparation of questions and answers for certification or licensure examinations;

(5) To administer or contract for administration of certification or licensure examinations at locations and times as may be required to carry out the responsibilities under this chapter;

(6) To enter into contracts for professional services determined to be necessary for adequate enforcement of this chapter;

(7) To consider recommendations by the real estate appraiser advisory committee relating to the experience, education, and examination requirements for each classification of state-certified appraiser and for licensure;

(8) To impose continuing education requirements as a prerequisite to renewal of certification or licensure;

(9) To consider recommendations by the real estate appraiser advisory committee relating to standards of professional appraisal practice in the enforcement of this chapter;

(10) To investigate all complaints or reports of unprofessional conduct as defined in this chapter and to hold hearings as provided in this chapter;

(11) To establish appropriate administrative procedures for disciplinary proceedings conducted pursuant to the provisions of this chapter;

(12) To compel the attendance of witnesses and production of books, documents, records, and other papers; to administer oaths; and to take testimony and receive evidence concerning all matters within their jurisdiction. These powers may be exercised directly by the director or the director's authorized representatives acting by authority of law;

(13) To take emergency action ordering summary suspension of a license or certification pending proceedings by the director;

(14) To employ such professional, clerical, and technical assistance as may be necessary to properly administer the work of the director;

(15) To establish forms necessary to administer this chapter;

(16) To adopt standards of professional conduct or practice; ((~~and~~))

(17) To do all other things necessary to carry out the provisions of this chapter and minimally meet the requirements of federal guidelines regarding state certification or licensure of appraisers that the director determines are appropriate for state-certified and state-licensed appraisers in this state; and

(18) To receive and approve or deny applications for permits as a trainee real property appraiser under this chapter, to establish appropriate administrative procedures for the processing of such applications; to issue permits to qualified applicants pursuant to the provisions of this chapter; and to maintain a register of the names and addresses of individuals who currently hold valid permits under this chapter.

Sec. 5. RCW 18.140.060 and 1993 c 30 s 6 are each amended to read as follows:

(1) Applications for examinations, original certification ((or)), licensure, permitting, and renewal certification or licensure shall be made in writing to the department on forms approved by the director. Applications for original and renewal certification ((or)), licensure, or a permit shall include a statement confirming that the applicant shall comply with applicable rules and regulations and that the applicant understands the penalties for misconduct.

(2) The appropriate fees shall accompany all applications for examination, reexamination, original certification or licensure, ((~~and~~)) renewal certification ((or)), licensure, or permitting.

Sec. 6. RCW 18.140.110 and 1993 c 30 s 11 are each amended to read as follows:

Every applicant for licensing ((or)), certification, or permitting who is not a resident of this state shall submit, with the application for licensing ((or)), certification, or permitting, an irrevocable consent that service of process upon him or her may be made by service on the director if, in an action against the applicant in a court of this state arising out of the applicant's activities as a state-licensed or state-certified real estate or trainee real property appraiser, the plaintiff cannot, in the exercise of due diligence, obtain personal service upon the applicant.

Sec. 7. RCW 18.140.120 and 1993 c 30 s 12 are each amended to read as follows:

An applicant for licensure ((or)), certification, or permitting who is currently licensed ((or)), certified, or permitted and in good standing under the laws of another state may obtain ((a)) an equivalent license ((or)), certificate, or permit as a Washington state-licensed or state-certified real estate or trainee real property appraiser without being required to satisfy the examination requirements of this chapter if: The director determines that the licensure ((or)), certification, or permitting requirements are substantially similar to those found in Washington state; and that the other state has a written reciprocal agreement to provide similar treatment to holders of Washington state licenses ((~~and/or~~)), certificates, and/or permits.

Sec. 8. RCW 18.140.140 and 1993 c 30 s 14 are each amended to read as follows:

(1) A license ((or)), certificate, or permit issued under this chapter shall bear the signature or facsimile signature of the director and a license ((or)), certificate, or permit number assigned by the director.

(2) Each state-licensed or state-certified real estate appraiser shall place his or her certificate number adjacent to or immediately below the title "state-licensed real estate appraiser," "state-certified residential real estate appraiser," or "state-certified general real estate appraiser" when used in an appraisal report or in a contract or other instrument used by the licensee ((or)), certificate holder, or permit holder in conducting real property appraisal activities.

Sec. 9. RCW 18.140.150 and 1993 c 30 s 15 are each amended to read as follows:

(1) The term "state-licensed" or "state-certified real estate appraiser" may only be used to refer to individuals who hold the license ((or)), certificate, or permit and may not be used following or immediately in connection with the name or signature of a firm, partnership, corporation, or group, or in such manner that it might be interpreted as referring to a firm, partnership, corporation, group, or anyone other than an individual holder of the license ((or)), certificate, or permit.

(2) No license ((or)), certificate, or permit may be issued under this chapter to a corporation, partnership, firm, or group. This shall not be construed to prevent a state-licensed or state-certified appraiser from signing an appraisal report on behalf of a corporation, partnership, firm, or group practice.

Sec. 10. RCW 18.140.155 and 1993 c 30 s 16 are each amended to read as follows:

(1) A real estate appraiser from another state who is licensed or certified by another state may apply for registration to receive temporary licensing or certification in Washington by paying a fee and filing a notarized application with the department on a form provided by the department.

(2) Licensing and certification privileges granted under the provisions of this section shall expire ninety days from issuance. Licensing or certification shall not be renewed, nor shall an applicant receive more than two registrations within any twelve-month period.

(3) Persons granted temporary licensing ((or)), certification, or permitting privileges under this section shall not advertise or otherwise hold themselves out as being licensed ((or)), certified, or permitted by the state of Washington.

(4) Persons granted temporary licensure ((or)), certification, or permitting are subject to all provisions under this chapter.

Sec. 11. RCW 18.140.160 and 1993 c 30 s 17 are each amended to read as follows:

An application for licensure ((or)), certification, or permitting may be denied. The director may impose any one or more of the following sanctions against state-licensed or state-certified or trainee appraisers: Suspend, revoke, or levy a fine not to exceed one thousand dollars for each offense and/or otherwise discipline in accordance with the provisions of this chapter, for any of the following acts or omissions:

(1) Failing to meet the minimum qualifications for state licensure ((or)), certification, or permitting established by or pursuant to this chapter;

(2) Procuring or attempting to procure state licensure ((or)), certification, or permitting under this chapter by knowingly making a false statement, knowingly submitting false information, or knowingly making a material misrepresentation on any application filed with the director;

(3) Paying money other than the fees provided for by this chapter to any employee of the director or the committee to procure state licensure ((or)), certification, or permitting under this chapter;

(4) Obtaining a license ((or)), certification, or permit through the mistake or inadvertence of the director;

(5) Conviction of any gross misdemeanor or felony or the commission of any act involving moral turpitude, dishonesty, or corruption whether or not the act constitutes a crime. If the act constitutes a crime, conviction in a criminal proceeding is not a condition precedent to disciplinary action. Upon such a conviction, however, the judgment and sentence is conclusive evidence at the ensuing disciplinary hearing of the guilt of the license ((or)), certificate, or permit holder or applicant of the crime described in the indictment or information, and of the person's violation of the statute on which it is based. For the purposes of this section, conviction includes all instances in which a plea of guilty or nolo contendere is the basis for the conviction and all proceedings in which the sentence has been deferred or suspended. Nothing in this section abrogates rights guaranteed under chapter 9.96A RCW;

(6) Failure or refusal without good cause to exercise reasonable diligence in developing an appraisal, preparing an appraisal report, or communicating an appraisal;

(7) Negligence or incompetence in developing an appraisal, preparing an appraisal report, or communicating an appraisal;

(8) Continuing to act as a state-licensed or state-certified real estate or trainee real property appraiser when his or her license or certificate is on an expired status;

(9) Failing, upon demand, to disclose any information within his or her knowledge to, or to produce any document, book, or record in his or her possession for inspection of the director or the director's authorized representatives acting by authority of law;

(10) Violating any provision of this chapter or any lawful rule or regulation made by the director pursuant thereto;

(11) Advertising in a false, fraudulent, or misleading manner;

(12) Suspension, revocation, or restriction of the individual's license ((or)), certification, or permit to practice the profession by competent authority in any state, federal, or foreign jurisdiction, with a certified copy of the order, stipulation, or agreement being conclusive evidence of the revocation, suspension, or restriction;

(13) Failing to comply with an order issued by the director;

(14) Committing any act of fraudulent or dishonest dealing or a crime involving moral turpitude, with a certified copy of the final holding of any court of competent jurisdiction in such matter being conclusive evidence in any hearing under this chapter; and

(15) Issuing an appraisal report on any real property in which the appraiser has an interest unless his or her interest is clearly stated in the appraisal report.

Sec. 12. RCW 18.140.170 and 1993 c 30 s 18 are each amended to read as follows:

The director may investigate the actions of a state-licensed or state-certified real estate or trainee real property appraiser or an applicant for licensure ((or)), certification, or permitting or relicensure or recertification. Upon receipt of information indicating that a state-licensed or state-certified real estate or trainee real property appraiser under this chapter may have violated this chapter, the director shall cause one or more of the staff investigators to make an investigation of the facts to determine whether or not there is admissible evidence of any such violation. If technical assistance is required, a staff investigator may consult with one or more of the members of the committee.

In any investigation made by the director's investigative staff, the director shall have the power to compel the attendance of witnesses and the production of books, documents, records, and other papers, to administer oaths, and to take testimony and receive evidence concerning all matters within the director's jurisdiction.

If the director determines, upon investigation, that a state-licensed or state-certified real estate or trainee real property appraiser under this chapter has violated this chapter, a statement of charges shall be prepared and served upon the state-licensed or state-certified real estate or trainee real property appraiser. This statement of charges shall require the accused party to file an answer to the statement of charges within twenty days of the date of service.

In responding to a statement of charges, the accused party may admit to the allegations, deny the allegations, or otherwise plead. Failure to make a timely response shall be deemed an admission of the allegations contained in the statement of charges and will result in a default whereupon the director may enter an order under RCW 34.05.440. If a hearing is requested, the time of the hearing shall be scheduled but the hearing shall not be held earlier than thirty days after service of the charges upon the accused. A notice of hearing shall be issued at least twenty days prior to the hearing, specifying the time, date, and place of hearing.

Sec. 13. RCW 18.140.180 and 1993 c 30 s 20 are each amended to read as follows:

The administrative hearing on the allegations in the statement of charges may be heard by an administrative law judge appointed under chapter 34.12 RCW at the time and place prescribed by the director and in accordance with the provisions of the Administrative Procedure Act, chapter 34.05 RCW. If the administrative law judge determines that a state-licensed or state-certified real estate or trainee real property appraiser is guilty of a violation of any of the provisions of this chapter, a formal decision shall be prepared that contains findings of fact and recommendations to the director concerning the appropriate disciplinary action to be taken.

In such event the director shall enter an order to that effect and shall file the same in his or her office and immediately mail a copy thereof to the affected party at the addresses of record with the department. Such order shall not be operative for a period of ten days from the date thereof. Any party aggrieved by a final decision by the director in an adjudicative proceeding whether such decision is affirmative or negative in form, is entitled to a judicial review in the superior court under the provisions of the Administrative Procedure Act, chapter 34.05 RCW.

NEW SECTION. Sec. 14. A new section is added to chapter 50.04 RCW to read as follows:

The term "employment" does not include services performed by an appraisal practitioner certified, licensed, or permitted under chapter 18.140 RCW in an appraisal business if the use of the business facilities is contingent upon compensation to the owner of the business facilities and the person receives no compensation from the owner for the services performed.

NEW SECTION. Sec. 15. A real estate appraiser certified or licensed under chapter 18.140 RCW has a lien for compensation, whether specially agreed upon or implied, as follows: (1) Upon the papers of the client, that have come into his or her possession in the course of professional employment; (2) upon money in his or her hands belonging to the client; and (3) upon other real and personal property belonging to the client to the extent of the value of any services performed by him or her, or if the services were rendered under a special agreement, for the sum due under such agreement, from the time of filing notice of such lien or claim with the clerk of the court in which such papers, money, and property is located, showing name of claimant, amount claimed, and date of filing notice.

NEW SECTION. Sec. 16. When an appraiser refuses to deliver over money, papers, or property to a person from or for whom he or she has received them in the course of professional employment, he or she may be required by an order of any judge of a court of record, to do so within a specified time, or show cause why he or she should not be punished for a contempt.

NEW SECTION. Sec. 17. If the appraiser claims a lien, upon the money, papers, or property, the court or judge may: (1) Impose as a condition of making the order, that the client give security in a form and amount to be directed, to satisfy the lien, when determined in an action; (2) inquire into the facts on which the claim of a lien is founded and make a determination; or (3) refer it and make a determination based upon the report.

NEW SECTION. Sec. 18. (1) A trainee real property appraiser may not provide appraisal services other than through and under the direct supervision of a state-certified general real estate appraiser or a state-certified residential real estate appraiser.

(2) A person may be issued only one permit to be valid for a term not exceeding five years as a trainee real property appraiser during a period of not less than ten years from the date of issuance unless either such period is interrupted by service in the armed forces of the United States of America.

NEW SECTION. Sec. 19. (1) There shall be one category of trainee real property appraiser. The scope of practice for the trainee shall be the appraisal of those properties which the supervising appraiser is permitted to appraise.

(2) The trainee real property appraiser shall be subject to the uniform standards of professional appraisal practice.

(3) The trainee real property appraiser shall be entitled to obtain copies of the appraisal report he or she prepared. The supervising appraiser shall keep copies of appraisal reports for a period of at least five years or at least two years after final disposition of any judicial proceeding in which testimony was given or such other time as the director may prescribe, whichever period expires last.

NEW SECTION. Sec. 20. (1) Whether or not an examination is required for permitting as a trainee real property appraiser, an applicant shall present evidence satisfactory to the director that he or she has successfully completed the education requirements adopted by the director.

(2) The director shall adopt in rule education requirements which are not less than those promulgated by the appraiser qualification board of the appraisal foundation in its criteria for the trainee real property appraiser classification.

NEW SECTION. Sec. 21. (1) The director may elect to prescribe an examination for permitting as a trainee real property appraiser whether or not an examination is a requirement of the trainee real property appraiser classification criteria promulgated by the appraiser qualification board of the appraisal foundation.

(2) The examination shall be not less stringent than one endorsed by the appraiser qualification board.

NEW SECTION. Sec. 22. Sections 15 through 17 of this act constitute a new chapter in Title 60 RCW.

NEW SECTION. Sec. 23. Sections 18 through 21 of this act are each added to chapter 18.140 RCW.

NEW SECTION. Sec. 24. This act takes effect July 1, 1994.