Title of Rule and Other Identifying Information: WAC 468-100-102 (1)(b) Standards of appraisals under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended.

     Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Title 49 C.F.R., Part 24 implements the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended, (the uniform act). The uniform act applies to all acquisitions of real property or displacements of persons resulting from federal or federally assisted programs or projects and affects eighteen federal agencies. The uniform act was enacted to provide fair, equitable and consistent treatment without disproportionate injury for persons being displaced as a result of a federal or federally funded projects. The federal regulations adopted changes in February 2005. The changes clarify present requirements, meet modern needs and improve the service to individuals and businesses affected by federal or federally assisted projects while at the same time saving time reducing the burdens of government regulations.

     The purpose of these change is to amend WAC 468-100-102 (1)(b) to reflect regulatory changes made by the Federal Highway Administration (FHWA) to the Federal Regulations in 49 C.F.R. Part 24 Section 24 that became effective on February 3, 2005.

     Reasons Supporting Proposal: To comply with federal regulations.

     Statutory Authority for Adoption: Chapter 8.26 RCW.

     Statute Being Implemented: WAC 468-100-102 (1)(b).

     Rule is necessary because of federal law, the existing rules changed by Docket No. FHWA-2003-14747 - issued on January 4, 2005, and effective on February 3, 2005.

     Name of Proponent: Washington state department of transportation, governmental.

     Name of Agency Personnel Responsible for Drafting: Shirley Hughes, P.O. Box 47338, Olympia, WA 98504-7338, (360) 705-7311; Implementation and Enforcement: Gerry Gallinger, P.O. Box 47338, Olympia, WA 98504-7338, (360) 705-7305.

     Agency Comments or Recommendations, if any, as to Statutory Language, Implementation, Enforcement, and Fiscal Matters: The Washington state department of transportation, based on authority granted in RCW 34.05.350, is using the expedited process to make necessary changes to WAC 468-100-102 (1)(b) to comply with changes made to 49 C.F.R., Part 24, Section 24 which became effective on February 3, 2005.

     The Washington state department of transportation must comply with the federal regulations as supported in 49 C.F.R., Part 24, Section 24. This change was overlooked in our original November 2005 request.

July 24, 2007

John F. Conrad

Assistant Secretary

Engineering and Regional Operations

OTS-9896.1

AMENDATORY SECTION(Amending WSR 06-02-068, filed 1/3/06, effective 2/3/06)

WAC 468-100-102   Criteria for appraisals.   (1) Standards of appraisal: The format and level of documentation for an appraisal depend on the complexity of the appraisal problem. The agency shall develop minimum standards for appraisals consistent with established and commonly accepted appraisal practice for those acquisitions which, by virtue of their low value or simplicity, do not require the in-depth analysis and presentation necessary in a detailed appraisal. A detailed appraisal shall be prepared for all other acquisitions. A detailed appraisal shall reflect nationally recognized appraisal standards. An appraisal must contain sufficient documentation, including valuation data and the appraiser's analysis of that data, to support the appraiser's opinion of value. At a minimum, the appraisal shall contain the following items:

     (a) The purpose and/or the function of the appraisal, a definition of the estate being appraised, and a statement of the assumptions and limiting conditions affecting the appraisal.

     (b) An adequate description of the physical characteristics of the property being appraised (and, in the case of a partial acquisition, an adequate description of the remaining property), including items identified as personal property, a statement of the known and observed encumbrances if any, title information, location, zoning, present use, an analysis of highest and best use, and at least a five-year sales history of the property.

     (c) All relevant and reliable approaches to value consistent with commonly accepted professional appraisal practices. When sufficient market sales data are available to reliably support the fair market value for the specific appraisal problem encountered, the agency, at its discretion, may require only the market approach. If more than one approach is utilized, there shall be an analysis and reconciliation of approaches to value that are sufficient to support the appraiser's opinion of value.

     (d) A description of comparable sales, including a description of all relevant physical, legal, and economic factors such as parties to the transaction, source and method of financing, and verification by a party involved in the transaction.

     (e) A statement of the value of the real property to be acquired and, for a partial acquisition, a statement of the value of the damages and benefits, if any, to the remaining real property.

     (f) The effective date of valuation, date of appraisal, signature, and certification of the appraiser.

     (2) Influence of the project on just compensation. To the extent permitted by applicable law, the appraiser in his "before" valuation shall disregard any decrease or increase in the fair market value of the real property caused by the project for which the property is to be acquired, or by the likelihood that the property would be acquired for the project, other than that due to the physical deterioration within the reasonable control of the owner.

     (3) Owner retention of improvements: If the owner of a real property improvement agrees and is permitted to obtain the right to remove it in whole or in part from the project site, the amount to be offered for the interest in the real property to be acquired shall be the amount determined to be just compensation for the owner's entire interest in the real property. The salvage value (defined in WAC 468-100-002(23)) of the improvement to be removed shall be deducted from the agency's payment.

     (4) Qualifications of appraisers: The agency shall establish criteria for determining the minimum qualifications of appraisers. Appraiser qualifications shall be consistent with the level of difficulty of the appraisal assignment. The agency shall review the experience, education, training, and other qualifications of appraisers, including review appraisers, and utilize only those determined to be qualified.

     (5) Conflict of interest: No appraiser or review appraiser shall have any interest, direct or indirect, in the real property being appraised for the agency that would in any way conflict with the preparation or review of the appraisal. Compensation for making an appraisal shall not be based on the amount of the valuation.

     No person shall attempt to unduly influence or coerce an appraiser, review appraiser, or waiver valuation preparer regarding any valuation or other aspect of an appraisal, review or waiver valuation. Persons functioning as negotiators may not supervise or formally evaluate the performance of any appraiser or review appraiser performing appraisal or appraisal review work.

     No appraiser shall act as a negotiator for real property which that person has appraised, except that the agency may permit the same person to both appraise and negotiate an acquisition where the value of the acquisition is ten thousand dollars, or less.

[Statutory Authority: Chapter 8.26 RCW. 06-02-068, § 468-100-102, filed 1/3/06, effective 2/3/06. Statutory Authority: Chapter 8.26 RCW and WSR 89-17-048 (Order 121). 01-02-027, § 468-100-102, filed 12/22/00, effective 1/22/01. Statutory Authority: Chapter 8.26 RCW. 89-17-048 (Order 121), § 468-100-102, filed 8/14/89, effective 9/14/89.]

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