HF 3122

2nd Engrossment - 86th Legislature (2009 - 2010) Posted on 04/15/2010 01:12pm

A bill for an act
relating to commerce; providing for the licensing and regulation of appraisal
management companies; regulating the real estate appraiser advisory board;
appropriating money; amending Minnesota Statutes 2008, sections 82B.05,
subdivision 5, by adding a subdivision; 82B.06; Minnesota Statutes 2009
Supplement, section 82B.05, subdivision 1; proposing coding for new law as
Minnesota Statutes, chapter 82C.

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

ARTICLE 1

REAL ESTATE APPRAISAL MANAGEMENT COMPANIES

Section 1.

new text begin [82C.01] TITLE.
new text end

new text begin This chapter shall be known as the Minnesota Appraisal Management Company
Licensing and Regulation Act.
new text end

Sec. 2.

new text begin [82C.02] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Terms. new text end

new text begin As used in this chapter, the terms in this section have the
meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Appraisal. new text end

new text begin In conformance with the Uniform Standards of Professional
Appraisal Practice (USPAP), "appraisal" is defined as: (noun) the act or process of
developing an opinion of value; an opinion of value; (adjective) of or pertaining to
appraising and related functions such as appraisal practice or appraisal services. For
purposes of this chapter, all appraisals or assignments that are referred to involve one to
four unit single-family properties.
new text end

new text begin Subd. 3. new text end

new text begin Appraisal assignment. new text end

new text begin "Appraisal assignment" means an engagement for
which an appraiser is employed or retained to act, as a disinterested third party in giving
an unbiased analysis, opinion, or conclusion relating to the nature, quality, value, or utility
of named interests in, or aspects of, identified real estate.
new text end

new text begin Subd. 4. new text end

new text begin Appraisal management company. new text end

new text begin "Appraisal management company"
means a corporation, partnership, sole proprietorship, subsidiary, unit, or other business
entity that directly or indirectly performs the following appraisal management services:
new text end

new text begin (1) administers networks of independent contractors and/or employee appraisers to
perform residential real estate appraisal assignments for clients;
new text end

new text begin (2) receives requests for residential real estate appraisal services from clients and, for
a fee paid by the client, enters into an agreement with one or more independent appraisers
to perform the real estate appraisal services contained in the request; or
new text end

new text begin (3) serves as a third-party broker of appraisal management services between clients
and appraisers.
new text end

new text begin Subd. 5. new text end

new text begin Appraisal management services. new text end

new text begin "Appraisal management services"
means the process of directly or indirectly performing any of the following functions on
behalf of a lender, financial institution, client, or any other person to:
new text end

new text begin (1) administer an appraiser panel;
new text end

new text begin (2) recruit, qualify, verify licensing or certification, and negotiate fees and service
level expectations with persons who are part of an appraiser panel;
new text end

new text begin (3) receive an order for an appraisal from one person, and deliver the order for the
appraisal to an appraiser that is part of an appraiser panel for completion;
new text end

new text begin (4) track and determine the status of orders for appraisals;
new text end

new text begin (5) conduct quality control of a completed appraisal prior to the delivery of the
appraisal to the person that ordered the appraisal; or
new text end

new text begin (6) provide a completed appraisal performed by an appraiser to one or more clients.
new text end

new text begin Subd. 6. new text end

new text begin Appraiser. new text end

new text begin "Appraiser" means a person who is expected to perform
valuation services competently and in a manner that is independent, impartial, and
objective, and who is licensed under chapter 82B.
new text end

new text begin Subd. 7. new text end

new text begin Appraiser panel. new text end

new text begin "Appraiser panel" means a network of licensed or
certified appraisers who are independent contractors to the appraisal management
company that have:
new text end

new text begin (1) responded to an invitation, request, or solicitation from an appraisal management
company, in any form, to perform appraisals for persons that have ordered appraisals
through the appraisal management company, or to perform appraisals for the appraisal
management company directly, on a periodic basis, as requested and assigned by the
appraisal management company; and
new text end

new text begin (2) been selected and approved by an appraisal management company to perform
appraisals for any client of the appraisal management company that has ordered an
appraisal through the appraisal management company, or to perform appraisals for the
appraisal management company directly, on a periodic basis, as assigned by the appraisal
management company.
new text end

new text begin Subd. 8. new text end

new text begin Appraisal review. new text end

new text begin "Appraisal review" means the act of developing
and communicating an opinion about the quality of another appraiser's work that was
performed as part of an appraisal assignment, except that an examination of an appraisal
for grammatical, typographical, or other similar errors that do not make a substantive
valuation change shall not be an appraisal review.
new text end

new text begin Subd. 9. new text end

new text begin Client. new text end

new text begin "Client" means any person or entity that contracts with, or
otherwise enters into an agreement with, an appraisal management company for the
performance of real estate appraisal services or appraisal management services. For
purposes of this chapter, the appraisal management company is the party engaging the
independent appraiser and can be the appraiser's client. However, this does not preclude
an appraisal management company from acting as a duly authorized agent for a lender.
new text end

new text begin Subd. 10. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of commerce.
new text end

new text begin Subd. 11. new text end

new text begin Controlling person. new text end

new text begin "Controlling person" means:
new text end

new text begin (1) any owner, officer, or director of an appraisal management company seeking to
offer appraisal management services in this state;
new text end

new text begin (2) an individual employed, appointed, or authorized by an appraisal management
company that has the authority to enter into a contractual relationship with other persons
for the performance of appraisal management services and has the authority to enter into
agreements with appraisers for the performance of appraisals;
new text end

new text begin (3) an individual who possesses, directly or indirectly, the power to direct or cause
the direction of the management or policies of an appraisal management company; or
new text end

new text begin (4) an individual who enters into:
new text end

new text begin (i) contractual relationships with clients for the performance of appraisal
management services; and
new text end

new text begin (ii) agreements with employed and independent appraisers for the performance
of real estate appraisal services.
new text end

new text begin Subd. 12. new text end

new text begin Employee. new text end

new text begin "Employee" means an individual who is treated as an
employee for purposes of compliance with federal income tax laws.
new text end

new text begin Subd. 13. new text end

new text begin Person. new text end

new text begin "Person" means a natural person, firm, partnership, limited
liability partnership, corporation, association, limited liability company, or other form of
business organization and the officers, directors, employees, or agents of that person.
new text end

new text begin Subd. 14. new text end

new text begin USPAP. new text end

new text begin "USPAP" means the Uniform Standards of Professional
Appraisal Practice as established by the Appraisal Foundation. State and federal regulatory
authorities enforce the content of the current or applicable edition of USPAP.
new text end

Sec. 3.

new text begin [82C.03] LICENSING.
new text end

new text begin Subdivision 1. new text end

new text begin Requirement. new text end

new text begin It is unlawful for a person, corporation, partnership,
sole proprietorship, subsidiary, unit, or other business entity to directly or indirectly
engage or attempt to engage in business as an appraisal management company, to directly
or indirectly engage or attempt to perform appraisal management services, or to advertise
or hold itself out as engaging in or conducting business as an appraisal management
company without first obtaining a license issued by the commissioner under the provisions
of this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Owner requirements. new text end

new text begin (a) An appraisal management company applying to
the commissioner for a license in this state may not be more than ten percent owned by
any person that is currently subject to any cease and desist order or injunctive order that
would preclude involvement with an appraisal management company, or that has ever:
new text end

new text begin (1) voluntarily surrendered in lieu of disciplinary action an appraiser certification,
registration or license, or an appraisal management company license;
new text end

new text begin (2) been the subject of a final order revoking or denying an appraiser certification,
registration or license, or an appraisal management company license; or
new text end

new text begin (3) a final order barring involvement in any industry or profession issued by this or
another state or federal regulatory agency.
new text end

new text begin (b) A person that owns more than ten percent of an appraisal management company
in this state shall:
new text end

new text begin (1) be of good moral character, as determined by the commissioner;
new text end

new text begin (2) submit to a background investigation, as determined by the commissioner; and
new text end

new text begin (3) certify to the commissioner that the person has never been the subject of an order
of certificate, registration or license suspension, revocation, or denial; cease and desist
order; injunctive order; or order barring involvement in an industry or profession issued
by this or another state or federal regulatory agency.
new text end

new text begin Subd. 3. new text end

new text begin Designated controlling person requirements. new text end

new text begin (a) Designation. Each
appraisal management company applying to the commissioner for a license in this state
shall designate a controlling person that will be the main contact for all communication
between the commissioner and the appraisal management company.
new text end

new text begin (b) Requirements. In order to serve as a designated controlling person of an
appraisal management company, a person must:
new text end

new text begin (1) certify to the commissioner that the person is not currently subject to any cease
and desist order or injunctive order that would preclude involvement with an appraisal
management company, and has never been the subject of an order suspending, revoking,
or denying a certification, registration, or license for real estate services, or a final order
barring involvement in any industry or profession issued by this or another state or federal
regulatory agency;
new text end

new text begin (2) be of good moral character, as determined by the commissioner; and
new text end

new text begin (3) submit to a background investigation, as determined by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Application for license. new text end

new text begin Application for an appraisal management
company license must be submitted on a form prescribed by the commissioner.
new text end

new text begin Subd. 5. new text end

new text begin Minimum information. new text end

new text begin The application must, at a minimum, include
the following information:
new text end

new text begin (1) the name of the entity seeking registration;
new text end

new text begin (2) the business address or addresses of the entity seeking registration;
new text end

new text begin (3) telephone contact and e-mail information of the entity seeking registration;
new text end

new text begin (4) if the entity is not a corporation that is domiciled in this state, the name and
contact information for the company's agent for service of process in this state;
new text end

new text begin (5) the name, address, and contact information for an individual or corporation,
partnership, limited liability company, association, or other business entity that owns ten
percent or more of the appraisal management company;
new text end

new text begin (6) the name, address, and contact information for a controlling person or persons;
new text end

new text begin (7) a certification that the entity has a system and process in place to verify that a
person being added to the employment or appraiser panel of the appraisal management
company for appraisal services within this state holds an active appraisal license in this
state pursuant to chapter 82B if a license is required to perform appraisals;
new text end

new text begin (8) a certification that the entity has a system in place to review the work of all
employed and independent appraisers that are performing real estate appraisal services
for the appraisal management company on a periodic basis to verify that the real estate
appraisal assignments are being conducted in accordance with USPAP and chapter 82B;
new text end

new text begin (9) a certification that the entity maintains a detailed record of each service request
that it receives and the independent appraiser that performs the real estate appraisal
services for the appraisal management company, pursuant to section 82C.13;
new text end

new text begin (10) a certification that the employees of the appraisal management company will be
appropriately trained and familiar with the appraisal process;
new text end

new text begin (11) a certification that the appraisal management company has a system and
process in place to verify that a person being added to the appraiser panel of the appraisal
management company holds a license in good standing in this state pursuant to chapter
82B; and
new text end

new text begin (12) an irrevocable Uniform Consent to Service of Process, pursuant to section
82C.07.
new text end

new text begin Subd. 6. new text end

new text begin Effective date of license. new text end

new text begin Initial licenses issued under this chapter are
effective upon issuance and remain valid, subject to denial, suspension, or revocation
under this chapter, until the following August 31.
new text end

Sec. 4.

new text begin [82C.04] TERM OF LICENSE.
new text end

new text begin Initial licenses issued under this chapter are valid for a period not to exceed one
year. Each initial license must expire on August 31 of the expiration year assigned by
the commissioner.
new text end

Sec. 5.

new text begin [82C.05] LICENSE RENEWAL.
new text end

new text begin Subdivision 1. new text end

new text begin Term. new text end

new text begin Licenses renewed under this chapter are valid for a period
of 12 months.
new text end

new text begin Subd. 2. new text end

new text begin Timely renewal. new text end

new text begin (a) Application for timely renewal of a license is
considered timely filed if received by the commissioner before the date of the license
expiration.
new text end

new text begin (b) An application for renewal is considered properly filed if made upon a form
prescribed by the commissioner, accompanied by fees prescribed by this chapter, and
containing any information the commissioner requires.
new text end

new text begin (c) A licensee failing to make timely application for renewal of the license is
unlicensed until the renewal license has been issued by the commissioner and is received
by the licensee.
new text end

new text begin Subd. 3. new text end

new text begin Contents of renewal application. new text end

new text begin Application for the renewal of an
existing license must contain the information specified in section 82C.03. However, only
the requested information having changed from the most recent prior application need
be submitted.
new text end

new text begin Subd. 4. new text end

new text begin Cancellation. new text end

new text begin A licensee ceasing an activity or activities regulated by this
chapter and desiring to no longer be licensed shall so inform the commissioner in writing
and, at the same time, surrender the license and all other symbols or indicia of licensure.
new text end

Sec. 6.

new text begin [82C.06] EXEMPTIONS.
new text end

new text begin This chapter does not apply to:
new text end

new text begin (1) a person that exclusively employs appraisers on an employer and employee
basis for the performance of appraisals, and:
new text end

new text begin (i) the employer is responsible for ensuring that the appraisals are performed by
employees in accordance with USPAP; and
new text end

new text begin (ii) the employer accepts all liability associated with the performance of the
appraisal by the employee;
new text end

new text begin (2) a department or unit within a financial institution that is subject to direct
regulation by an agency of the United States government, or to regulation by an agency of
this state, that receives a request for the performance of an appraisal from one employee of
the financial institution, and another employee of the same financial institution assigns the
request for the appraisal to an appraiser that is an independent contractor to the institution,
except that an appraisal management company that is a wholly owned subsidiary of
a financial institution shall not be considered a department or unit within a financial
institution to which the provisions of this chapter do not apply;
new text end

new text begin (3) a person that enters into an agreement, whether written or otherwise, with an
appraiser for the performance of an appraisal, and upon the completion of the appraisal,
the report of the appraiser performing the appraisal is signed by both the appraiser who
completed the appraisal and the appraiser who requested the completion of the appraisal,
except that an appraisal management company may not avoid the requirements of this
chapter by requiring that an employee of the appraisal management company that is an
appraiser to sign an appraisal that is completed by an appraiser that is part of the appraisal
panel of the appraisal management company; or
new text end

new text begin (4) any governmental agency performing appraisals on behalf of that level of
government or any agency performing ad valorem tax appraisals for county assessors.
new text end

Sec. 7.

new text begin [82C.07] CONSENT TO SERVICE OF PROCESS.
new text end

new text begin Each entity applying for a license as an appraisal management company in this state
shall complete an irrevocable Uniform Consent to Service of Process as prescribed by
the commissioner.
new text end

Sec. 8.

new text begin [82C.08] LICENSING FEES.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment and retention. new text end

new text begin The fees shall be retained by the
commissioner for the sole purpose of administering this licensing and regulation program.
new text end

new text begin Subd. 2. new text end

new text begin Amounts. new text end

new text begin (a) Each application for initial licensure shall be accompanied
by a fee of $5,000.
new text end

new text begin (b) Each application for renewal of the license must be received prior to the two-year
expiration period with the renewal fee of $2,500.
new text end

new text begin Subd. 3. new text end

new text begin Forfeiture. new text end

new text begin All fees are nonrefundable except that an overpayment of a fee
must be refunded upon proper application.
new text end

Sec. 9.

new text begin [82C.09] INVESTIGATIONS AND SUBPOENAS.
new text end

new text begin The commissioner has under this chapter the same powers with respect to chapter
45.027, including the authority to impose a civil penalty not to exceed $10,000 per
violation.
new text end

Sec. 10.

new text begin [82C.10] EMPLOYEE REQUIREMENTS.
new text end

new text begin An employee of the appraisal management company that has the responsibility to
review the work of employed and independent appraisers where the subject properties are
located within this state, which include the reviewer's opinion of value or concurrence
with the original appraiser's value, must be licensed according to chapter 82B and perform
the review assignments in compliance with USPAP and chapter 82B. This requirement
does not apply to employees who review appraisals for completeness and compliance in
connection with an appraisal management company's internal quality control processes,
but who do not perform appraisal reviews that are subject to Standard 3 of USPAP.
new text end

Sec. 11.

new text begin [82C.11] LIMITATIONS.
new text end

new text begin An appraisal management company licensed in this state pursuant to this chapter
may enter into contracts or agreements for appraisal assignments in this state only with
an employee or independent appraiser holding an active Minnesota real estate appraiser
license pursuant to chapter 82B.
new text end

Sec. 12.

new text begin [82C.12] ADHERENCE TO STANDARDS.
new text end

new text begin An appraisal management company must have a system in place to review the
work of all employed and independent appraisers that are performing real estate appraisal
assignments for the appraisal management company on a periodic basis to verify that
the real estate appraisal services are being conducted in accordance with USPAP and
chapter 82B. An appraisal management company is required to make referrals directly to
state appraiser regulatory authorities when a state licensed or certified appraiser violates
USPAP, applicable state law, or engages in other unethical or unprofessional conduct.
new text end

Sec. 13.

new text begin [82C.13] RECORD KEEPING.
new text end

new text begin An appraisal management company must maintain a detailed record of each service
request that it receives and the employee appraiser or independent appraiser that performs
the appraisal assignment for the appraisal management company.
new text end

new text begin Records must be kept for a period of at least five years after the appraisal assignment
request is sent to the independent appraiser or completion of the appraisal report,
whichever period expires later.
new text end

Sec. 14.

new text begin [82C.14] APPRAISER INDEPENDENCE; PROHIBITIONS.
new text end

new text begin (a) It is unlawful for any employee, director, officer, or agent of an appraisal
management company licensed in this state pursuant to this chapter to influence or attempt
to influence the development, reporting, or review of an appraisal through coercion,
extortion, collusion, compensation, inducement, intimidation, or bribery, including but
not limited to:
new text end

new text begin (1) withholding or threatening to withhold timely payment for an appraisal;
new text end

new text begin (2) withholding or threatening to withhold future business or assignments for an
employed or independent appraiser, or demoting or terminating or threatening to demote
or terminate an employed or independent appraiser;
new text end

new text begin (3) expressly or impliedly promising future business, assignments, promotions, or
increased compensation for an employed or independent appraiser;
new text end

new text begin (4) conditioning the request for an appraisal assignment on the payment of an
appraisal fee or salary or bonus on the opinion, conclusion, or valuation to be reached,
or on a preliminary estimate or opinion requested from an employed or independent
appraiser;
new text end

new text begin (5) requesting that an employed or independent appraiser provide an estimated,
predetermined, or desired valuation in an appraisal report, or provide estimated values or
comparable sales at any time prior to the completion of an appraisal assignment;
new text end

new text begin (6) providing to an employed or independent appraiser an anticipated, estimated,
encouraged, or desired value for a subject property or a proposed or target amount to be
loaned to the borrower, except that a copy of the sales contract for purchase transactions
may be provided;
new text end

new text begin (7) providing to an employed or independent appraiser, or any entity or person
related to the appraiser, stock, or other financial or nonfinancial benefits;
new text end

new text begin (8) allowing the removal of an employed or independent appraiser from a list of
qualified appraisers used by any entity, without prior written notice to the appraiser, which
notice must include documented evidence of the appraiser's violation of USPAP, chapter
82B, substandard performance, or otherwise improper or unprofessional behavior;
new text end

new text begin (9) request or require any employed or independent appraiser to provide the
appraisal management company or any of its employees, or any of its clients, with the
appraiser's digital signature;
new text end

new text begin (10) alter, amend, or change an appraisal report submitted by an appraiser, to include
removing or applying a signature, adding or deleting information from the appraisal report;
new text end

new text begin (11) require the appraiser to collect the fee from a borrower, homeowner, or other
person;
new text end

new text begin (12) require an appraiser to sign any indemnification agreement that would require
the appraiser to defend and hold harmless the appraisal management company or any of its
agents, or employees for any liability, damage, losses, or claims arising out of the services
performed by the appraisal management company or its agents, employees, or independent
contractors and not the services performed by the appraiser;
new text end

new text begin (13) use an appraiser directly selected or referred by any member of a loan
production staff for an individual assignment; or
new text end

new text begin (14) any other act or practice that impairs or attempts to impair an appraiser's
independence, objectivity, or impartiality.
new text end

new text begin (b) Nothing in paragraph (a) prohibits the appraisal management company from
requesting that an independent appraiser:
new text end

new text begin (1) consider additional appropriate property information;
new text end

new text begin (2) provide further detail, substantiation, or explanation for the appraiser's value
conclusion; or
new text end

new text begin (3) correct objective factual errors in an appraisal report.
new text end

Sec. 15.

new text begin [82C.15] ADJUDICATION OF DISPUTES BETWEEN AN APPRAISAL
MANAGEMENT COMPANY AND AN INDEPENDENT APPRAISER.
new text end

new text begin Except within the first 30 days after an independent appraiser is first added to the
appraiser panel of an appraisal management company, an appraisal management company
may not remove an appraiser from its appraiser panel, or otherwise refuse to assign
requests for real estate appraisal services to an independent appraiser without:
new text end

new text begin (1) notifying the appraiser in writing of the reasons why the appraiser is being
removed from the appraiser panel or is not receiving appraisal requests from the appraisal
management company;
new text end

new text begin (2) if the appraiser is being removed from the panel for illegal conduct, having
determined that the appraiser has violated USPAP, or chapter 82B, taking into account the
nature of the alleged conduct or violation; and
new text end

new text begin (3) providing an opportunity for the appraiser to respond and appeal the notification
of the appraisal management company.
new text end

Sec. 16.

new text begin [82C.16] DENIAL, SUSPENSION, REVOCATION OF LICENSES.
new text end

new text begin Subdivision 1. new text end

new text begin Powers of commissioner. new text end

new text begin The commissioner may by order take any
or all of the following actions:
new text end

new text begin (1) bar a person from serving as an officer, director, partner, controlling person, or
any similar role at an appraisal management company, if such person has ever been the
subject of a final order suspending, revoking or denying a certification, registration or
license as a real estate agent, broker, or appraiser, or a final order barring involvement in
any industry or profession issued by this or another state or federal regulatory agency;
new text end

new text begin (2) deny, suspend, or revoke an appraisal management company license;
new text end

new text begin (3) censure an appraisal management company license; and
new text end

new text begin (4) impose a civil penalty as provided for in chapter 45.027.
new text end

new text begin (b) In order to take the action in paragraph (a), the commissioner must find:
new text end

new text begin (1) that the order is in the public interest; and
new text end

new text begin (2) that an officer, director, partner, employee, agent, controlling person or persons,
or any person occupying a similar status or performing similar functions, has:
new text end

new text begin (i) violated any provision of this chapter;
new text end

new text begin (ii) filed an application for a license that is incomplete in any material respect or
contains a statement that, in light of the circumstances under which it is made, is false or
misleading with respect to a material fact;
new text end

new text begin (iii) failed to maintain compliance with the affirmations made under section 80C.03,
subdivision 5;
new text end

new text begin (iv) violated a standard of conduct or engaged in a fraudulent, coercive, deceptive,
or dishonest act or practice, whether or not the act or practice involves the appraisal
management company;
new text end

new text begin (v) engaged in an act or practice, whether or not the act or practice involves the
business of appraisal management, appraisal assignments, or real estate mortgage related
practices, that demonstrates untrustworthiness, financial irresponsibility, or incompetence;
new text end

new text begin (vi) pled guilty, with or without explicitly admitting guilt, pled nolo contendere,
or been convicted of a felony, gross misdemeanor, or a misdemeanor involving moral
turpitude;
new text end

new text begin (vii) paid a civil penalty or been the subject of disciplinary action by the
commissioner, or an order of suspension or revocation, cease and desist order, or
injunction order, or an order barring involvement in an industry or profession issued by
this or any other state or federal regulatory agency or government-sponsored enterprise,
or by the secretary of Housing and Urban Development;
new text end

new text begin (viii) been found by a court of competent jurisdiction to have engaged in conduct
evidencing gross negligence, fraud, misrepresentation, or deceit;
new text end

new text begin (ix) refused to cooperate with an investigation or examination by the commissioner;
new text end

new text begin (x) failed to pay any fee or assessment imposed by the commissioner; or
new text end

new text begin (xi) failed to comply with state and federal tax obligations.
new text end

new text begin Subd. 2. new text end

new text begin Orders of the commissioner. new text end

new text begin To begin a proceeding under this section,
the commissioner shall issue an order requiring the subject of the proceeding to show
cause why action should not be taken against the licensee according to this section. The
order must be calculated to give reasonable notice of the time and place for the hearing
and must state the reasons for entry of the order. The commissioner may by order
summarily suspend a license pending a final determination of an order to show cause. If a
license is summarily suspended, pending final determination of an order to show cause, a
hearing on the merits must be held within 30 days of the issuance of the order of summary
suspension. All hearings must be conducted under chapter 14. After the hearing, the
commissioner shall enter an order disposing of the matter as the facts require. If the
subject of the order fails to appear at a hearing after having been duly notified of it, the
subject is considered in default, and the proceeding may be determined against the subject
of the order upon consideration of the order to show cause, the allegations of which may
be considered to be true.
new text end

new text begin Subd. 3. new text end

new text begin Actions against lapsed license. new text end

new text begin If a license lapses, is surrendered,
withdrawn, terminated, or otherwise becomes ineffective, the commissioner may institute
a proceeding under this subdivision within two years after the license was last effective
and enter a revocation or suspension order as of the last date which the license was in
effect, and may impose a civil penalty as provided for in this section or section 45.027.
new text end

Sec. 17. new text begin APPROPRIATION.
new text end

new text begin $223,000 in fiscal year 2011 is appropriated from the general fund to the
commissioner of commerce for implementing this article. The base appropriation for this
program is $119,000 in fiscal year 2012 and $123,000 in fiscal year 2013.
new text end

ARTICLE 2

REAL ESTATE APPRAISER ADVISORY BOARD

Section 1.

Minnesota Statutes 2009 Supplement, section 82B.05, subdivision 1, is
amended to read:

Subdivision 1.

Members.

The Real Estate Appraiser Advisory Board consists of
deleted text begin 15 deleted text end new text begin nine new text end members appointed by the commissioner of commerce. Three of the members
must be deleted text begin public members, four must be deleted text end consumers of appraisal services, new text begin of whom one
member must be employed in the financial lending industry, new text end and deleted text begin eight deleted text end new text begin six new text end must be real
estate appraisers new text begin who are currently licensed in good standing, new text end of whom deleted text begin not less than two deleted text end
new text begin three new text end members must be deleted text begin trainee real property appraisers, licensed real property appraisers,
or deleted text end certified residential real property appraisers deleted text begin , not less than two deleted text end new text begin and three new text end members must
be certified general real property appraisers deleted text begin , and not less than deleted text end new text begin . At least new text end one member new text begin of the
board new text end must be certified by the Appraisal Qualification Board of the Appraisal Foundation
to teach the Uniform Standards of Professional Appraisal Practice. new text begin Each of the three
categories of members must include at least one member who lives or works outside of the
seven-county metropolitan area. new text end The board is governed by section 15.0575.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2011.
new text end

Sec. 2.

Minnesota Statutes 2008, section 82B.05, subdivision 5, is amended to read:

Subd. 5.

Conduct of meetings.

Places of regular board meetings must be decided
by the vote of members. Written notice must be given to each member of the time and
place of each meeting of the board at least ten days before the scheduled date of regular
board meetings. The board shall establish procedures for emergency board meetings and
other operational procedures, subject to the approval of the commissioner.

The members of the board shall elect a chair from among the members to preside
at board meetings.

A quorum of the board is deleted text begin eight deleted text end new text begin five new text end members.

The board shall meet at least once every six months as determined by a majority
vote of the members or a call of the commissioner.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2011.
new text end

Sec. 3.

Minnesota Statutes 2008, section 82B.05, is amended by adding a subdivision
to read:

new text begin Subd. 7. new text end

new text begin Enforcement data. new text end

new text begin The commissioner shall, on a regular basis, provide
the board with the commissioner's public enforcement data.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2011.
new text end

Sec. 4.

Minnesota Statutes 2008, section 82B.06, is amended to read:

82B.06 POWERS OF THE BOARD.

The board shall make recommendations to the commissioner as the commissioner
requests new text begin or at the board's own initiative new text end on:

(1) rules with respect to each category of licensed real estate appraiser, the type of
educational experience, appraisal experience, and equivalent experience that will meet
the requirements of this chapter;

(2) examination specifications for each category of licensed real estate appraiser,
to assist in providing or obtaining appropriate examination questions and answers, and
procedures for grading examinations;

(3) rules with respect to each category of licensed real estate appraiser, the
continuing education requirements for the renewal of licensing that will meet the
requirements provided in this chapter;

(4) periodic review of the standards for the development and communication of
real estate appraisals provided in this chapter and rules explaining and interpreting the
standards; and

(5) other matters necessary in carrying out the provisions of this chapter.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2011.
new text end