(a) Applicants for residential licensing must have at least 2,000 hours of real estate appraisal experience over a period of not less than 24 months. [At least 75 percent of that experience must be residential appraisal experience.]

(b) Applicants for residential certification must have at least 2,500 hours of real estate appraisal experience over a period of not less than 24 months. [At least 75 percent of that experience must be residential appraisal experience.] The residential experience must include experience in single-family, two- to four-family, cooperatives, condominiums, or other residential experience. [At least 80 percent of the residential experience must be in the single-family category. At least 10 percent of the residential experience must be in each of the remaining residential categories set forth in § 1102.3 of this Part.]

(c) Applicants for general certification must have at least 3,000 hours of experience over a period of not less than 30 months, of which, a minimum of 1500 hours must be in non-residential appraisal work. Such appraisal experience must be obtained over a period of not less than 24 months. [At least 75 percent of that experience must be general real estate experience. The general experience must include experience in multi-family properties, commercial, industrial or other non-residential categories. At least 60 percent of the general experience must be in one of the general categories as set forth in § 1102.3 of this Part. At least 20 percent of the general experience must be in each of the remaining categories.]

Subdivision (a) of 19 NYCRR § 1102.3 is amended to read as follows:

(a) Hours of experience shall be credited to an applicant based on actual time spent on appraisal assignments up to a maximum numbers of hours in accordance with the following schedule. [However, to ensure that experience is distributed over a reasonable period of time, an applicant may not claim or be credited with more than 400 experience hours for any calendar quarter.]

APPRAISAL EXPERIENCE SCHEDULE

Subdivisions (a), (b), (c), and (d) of 19 NYCRR § 1102.4 are repealed as follows:

[(a) For standard appraisals, an applicant shall receive full credit for an appraisal if the applicant performed at least 75 percent of the work associated with the appraisal even if the applicant’s work was reviewed by a supervising appraiser who signed the appraisal report. For the purposes of this section, the work associated with an appraisal shall include preparation of the appraisal report.

(b) For standard appraisals, an applicant shall receive pro rata credit for performing less than 75 percent of the work associated with an appraisal. For example, if an applicant performed 50 percent of the work associated with an appraisal, the applicant may claim 50 percent of the experience credit associated with performing that type of appraisal. However, an applicant shall not receive any credit for an appraisal if the applicant performed less than 25 percent of the work associated with the appraisal.

(c) For review appraisals, an applicant shall receive 25 percent of the hours normally credited for an appraisal if the applicant performed a review appraisal, which shall include a field review, a documentary review, or a combination of both.

(d) An applicant shall have the burden of establishing to the satisfaction of the Department of State that the applicant actually performed the work associated with the appraisal or appraisals which the applicant claims appraisal-experience credit.]

19 NYCRR § 1102.4 is added to read as follows:

§ 1102.4 Acceptable experience

Subdivisions (b), and (c) of 19 NYCRR § 1103.4 are amended to read as follows:

(b) Supervising appraiser qualifications. Persons wishing to become a supervisor of one or more appraiser assistants must provide evidence of having a general or residential appraiser certification in New York State and must have been state certified for a minimum of three years[.] and complete the Supervisory Appraiser/Trainee Appraiser course.

(1) Notwithstanding any other law, rule or regulation, all supervisory appraisers must complete the Supervisory Appraiser/Trainee Appraiser course no later than December 31, 2015 or prior to entering into any new Supervisory/Trainee Appraiser relationship after January 1, 2015.

(c) Ineligibility. An individual who has had a real estate broker, salesperson or an appraisal license or certification revoked or suspended or has been subject to any disciplinary action that affects the Supervisory Appraiser’s legal eligibility to engage in appraisal practice within the last three years is ineligible to receive instructor approval from the Department and is ineligible to supervise appraiser assistants.

Subdivision (b)(1) of 19 NYCRR § 1104.1 is amended to read as follows:

(1) the state or territory’s certification and licensing program is in compliance with the provisions of [has not been disapproved by the appraisal subcommittee of the Federal Financial Institutions Examination Council pursuant to] Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989;

1. Statutory authority:

Executive Law section 160-d (Art. 6-E) authorizes the New York State Board of Real Estate Appraisal (the “Board”) to adopt regulations in aid or furtherance of the statute. One of the purposes of Executive Law Article 6-E is to ensure the qualification of licensed and certified real estate appraisers. To meet this purpose, the Department of State (the “Department”), in conjunction with the Board, has issued rules and regulations which are found at Chapter XXXI of Title 19 of the NYCRR and is proposing this rulemaking.

2. Legislative objectives:

Pursuant to Executive Law Article 6-E, the Department, in conjunction with the Board, licenses and regulates real estate appraisers. To provide protections against unqualified appraisers, the statute requires licensees and certificate holders to satisfy minimum educational requirements. The proposed rule advances this legislative objective by ensuring that appraiser applicants satisfy the minimum educational standards required for licensure or certification.

3. Needs and benefits:

The Federal Appraisal Qualifications Board (the “AQB”), in accordance with the authority granted to said body pursuant to Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Title XI), establishes minimum qualification standards for real property appraisers. States are required to implement appraiser standards that are no less stringent than those issued by the AQB.

In addition, as part of the Governor’s Lean Initiative, the Department has reviewed internal processes for reviewing and issuing appraiser certifications and licenses. The Department and the Board have determined that portions of the existing application requirements exceed AQB standards and are unnecessarily complicated and burdensome to applicants.

By adopting the regulations as proposed, the Department will remove unnecessary application review processes, as well as conform current qualification standards to recent updates to federal law imposed by the AQB.

4. Costs:

a. Costs to regulated parties:

The Department does not anticipate that regulated parties will have any additional costs associated with this rulemaking.

b. Costs to the Department of State:

The Department does not anticipate any additional costs to implement the rule. Existing staff will continue to handle the processing of applications for both individual applicants and for occupational schools seeking approvals for courses that may incorporate the proposed changes.

5. Local government mandates:

The rule does not impose any program, service, duty or responsibility upon any county, city, town, village, school district or other special district.

6. Paperwork:

In applying for an appraisal license or certification, applicants are required to complete an application establishing that they have satisfied the minimum standards required by statute for the relevant license or certification. The proposed rule would retain this existing requirement.

7. Duplication:

This rule does not duplicate, overlap or conflict with any other state or federal requirement.

8. Alternatives:

The Department considered not proposing the instant rulemaking. It was determined, however, that the proposed regulatory amendments are necessary to meet the Department’s obligation to ensure that licenses are granted to qualified applicants in compliance with minimum federal standards established by the AQB. In addition, not proposing this rulemaking would keep in place unnecessary requirements that have burdened and complicated the review process for appraiser applications.

9. Federal standards:

The AQB, in accordance with the authority granted to said body pursuant to Title XI, establishes minimum qualification standards for real property appraisers. States are required to implement appraiser standards that are no less stringent than those issued by the AQB.

10. Compliance schedule:

The rule will be effective January 1, 2015. Insofar as the AQB and the Department have conducted outreach to the regulated public concerning the proposed changes, and have considered changes that would be effected by this rulemaking, it is believed that licensees and prospective licensees will be able to comply with the rule.

1. Effect of rule:

To provide protections against unqualified appraisers, Article 6-E of the Executive Law requires appraisal licensees and certificate holders to satisfy minimum experiential and other requirements. The proposed rule advances this legislative objective by ensuring that appraiser applicants satisfy the minimum standards required for licensure or certification as established by state and federal standards. The Federal Appraisal Qualifications Board (the “AQB”), in accordance with the authority granted to said body pursuant to Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Title XI), establishes minimum qualification standards for real property appraisers. States are required to implement appraiser standards that are no less stringent than those issued by the AQB.

As part of the Governor’s Lean Initiative, the Department of State (the “Department”) has reviewed internal processes for reviewing and issuing appraiser certifications and licenses. The Department and the New York State Board of Real Estate Appraisal (the “Board”) have determined that portions of the existing application requirements exceed AQB standards and are unnecessarily complicated and burdensome to applicants.

By adopting the regulations as proposed, the Department will remove unnecessary application review processes as well as conform current qualification standards to recent updates imposed by the AQB. Specifically, the proposed rulemaking will achieve the following: 1) remove percentage distribution requirements of appraiser experience under the minimum hour requirements; 2) update general certification requirements to conform to AQB standards; 3) clarify that credit hours for experience will be based on actual time spent on preparing an appraisal; 4) update qualifications of appraiser supervisors to conform to AQB standards; and 5) update reciprocity requirements for certification and/or licensure to conform to AQB standards.

The rule does not apply to local governments.

2. Compliance requirements:

Insomuch as the proposed rulemaking applies to individuals seeking licensure and/or certification, small businesses and local governments will not have additional reporting, recordkeeping or other affirmative obligations with the implementation of these regulations. The existing statutes and regulations already require minimum standards for licensure; the proposed rulemaking merely updates these current requirements to satisfy recently updated AQB standards. Further, the proposed rulemaking will clarify and simplify the application requirements, thus easing compliance for applicants.

3. Professional services:

Small businesses and local governments will not need professional services to comply with this rule. Further, applicants seeking licensure or certification will not need to rely on any new professional services in order to comply with the rule. Applicants and licensees are already required to satisfy minimum qualifications pursuant to Article 6-E of the Executive Law and AQB standards.

4. Compliance costs:

The Department does not anticipate additional costs to appraiser applicants and/or licensees as a result of this rulemaking.

The rule does not impose any compliance costs on local governments.

5. Economic and technological feasibility:

Small businesses and local governments will not incur any significant costs as a result of the implementation of, or require technical expertise to comply with, these rules.

6. Minimizing adverse impact:

The Department did not identify any alternatives which would achieve the results of the proposed rules and at the same time be less restrictive and less burdensome in terms of compliance. The rule does not impose any additional reporting or record keeping requirements on licensees and does not require prospective licensees to take any affirmative acts to comply with the rule other than those acts that are already required pursuant to Executive Law, Article 6-E and the AQB standards.

7. Small business and local government participation:

No significant comments have been received regarding the proposed rulemaking. On April 8, 2014 the Department and the New York State Board of Real Estate Appraisal discussed at an open meeting the updated AQB requirements as well as removing current standards which the Department identified as unnecessary and unduly complicated for applicants. In addition, the Notice of Proposed Rule Making will be published by the Department of State in the State Register. The publication of the rule in the State Register will provide further notice of the proposed rulemaking to all interested parties, including those in rural areas. Additional comments will be received and entertained during the public comment period associated with this Notice of Proposed Rulemaking.

8. Compliance:

The rule will be effective January 1, 2015.

9. Cure period:

The Department is not providing for a cure period prior to enforcement of these regulations. Prior to proposing this rule, information regarding the updated AQB requirements was provided on the Department’s website and discussed at an open meeting. In addition, since the proposed rulemaking seeks to ease current requirements on appraiser applicants, a cure period is not necessary. Further, the proposed rulemaking is necessary to ensure that the applicants seeking licensure and/or certification satisfy minimum standards established by federal guidelines.

1. Types and estimated numbers of rural areas:

The proposed rulemaking is not expected to have any adverse impact on rural areas. The Federal Appraisal Qualifications Board (the “AQB”), in accordance with the authority granted to said body pursuant to Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Title XI), establishes minimum qualification standards for real property appraisers. States are required to implement appraiser standards that are no less stringent than those issued by the AQB. The proposed rulemaking seeks to update current appraiser requirements to meet updated AQB standards while simultaneously removing unnecessary requirements to licensure/certification.

2. Reporting, recordkeeping and other compliance requirements; and professional services:

The Department does not anticipate any additional reporting, recordkeeping or other compliance requirements of this rule or that professional services are likely to be needed in rural areas to comply with the rule. Existing statutes and regulations already require minimum education requirements for licensure; the rulemaking will not impose any new reporting, record-keeping or other compliance requirements on public or private entities in rural areas other than those acts that are already required pursuant to Executive Law, Article 6-E and the AQB standards.

3. Costs:

The proposed rulemaking does not impose any costs on rural areas to comply this rule.

4. Minimizing adverse impact:

The Department did not identify any alternatives which would achieve the results of the proposed rule and at the same time be less restrictive and less burdensome.

5. Rural area participation:

No significant comments have been received regarding the proposed rulemaking. On April 8, 2014 the Department and the New York State Board of Real Estate Appraisal discussed at an open meeting the updated AQB requirements as well as removing current standards which the Department identified as unnecessary and unduly complicated for applicants. In addition, the Notice of Proposed Rule Making will be published by the Department of State in the State Register. Publication of the Notice in the State Register will provide notice of the proposed rulemaking to all interested parties, including those in rural areas. Additional comments will be received and entertained during the public comment period associated with this Notice of Proposed Rulemaking.

1. Nature of impact:

The proposed rulemaking will not have an adverse impact on employment opportunities. The Federal Appraisal Qualifications Board (the “AQB”), in accordance with the authority granted to said body pursuant to Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Title XI), establishes minimum qualification standards for real property appraisers. States are required to implement appraiser standards that are no less stringent than those issued by the AQB.

As part of the Governor’s Lean Initiative, the Department of State (the “Department”) has reviewed internal processes for reviewing and issuing appraiser certifications and licenses. The Department and the New York State Board of Real Estate Appraisal (the “Board”) have determined that portions of the existing application requirements exceed AQB standards. These processes, which are required by the current State regulations, are not necessary to establish an applicant’s qualifications or competency and have been unnecessarily complicating the application process, thereby leading to delays in licensure. The Department has determined that the current requirements have contributed to an almost 90% rejection rate of applicants’ initial applications, which, in some cases, has resulted in delays of up to 30 additional days before new licenses can be granted.

The proposed rulemaking would remove unnecessary application review processes as well as conform current qualification standards to recent updates in the federal law imposed by the AQB. Specifically, the proposed rulemaking would achieve the following: 1) remove percentage distribution requirements for appraiser experience under the minimum hour requirements; 2) update general certification requirements to conform to AQB standards; 3) clarify that credit hours for experience will be based on actual time spent on preparing an appraisal; 4) update qualifications of appraiser supervisors to conform to AQB standards; and 5) update reciprocity requirements for certification and/or licensure to conform to AQB standards.

2. Categories and numbers affected:

The proposed rulemaking will not have any adverse impact on employment opportunities. The instant rulemaking merely conforms existing regulations to updated minimum standards established by the AQB. In addition, the proposed rulemaking eases the burden on appraiser applicants by removing unnecessarily complicated review processes and standards. The rulemaking will not have any foreseeable impact on jobs or employment opportunities for real estate appraisers.

3. Regions of adverse impact:

The proposed rulemaking will not have any disproportionate regional adverse impact on jobs or employment opportunities.

4. Minimizing adverse impact:

The proposed rulemaking will not have any adverse impact on employment opportunities. Moreover, the Department did not identify any alternatives which would achieve the results of the proposed rules and at the same time be less restrictive and less burdensome in terms of compliance.