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Minnesota Legislature

Office of the Revisor of Statutes

SF 2068

as introduced - 91st Legislature (2019 - 2020) Posted on 04/05/2019 12:04pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to commerce; modifying the regulation of real estate appraisers;amending
Minnesota Statutes 2018, sections 82B.021, subdivisions 14, 15, by adding a
subdivision; 82B.035, by adding a subdivision; 82B.07; 82B.071, subdivision 1;
82B.072; 82B.073, by adding a subdivision; 82B.08, subdivision 8; 82B.09,
subdivision 3; 82B.094; 82B.095, by adding subdivisions; 82B.105; 82B.11,
subdivision 6, by adding a subdivision; 82B.19, subdivisions 1, 2, by adding a
subdivision; 82B.20, subdivisions 1, 2; 82B.21; 82B.22; repealing Minnesota
Statutes 2018, sections 82B.021, subdivision 17; 82B.071, subdivision 2; 82B.095,
subdivision 2; 82B.10, subdivisions 1, 2, 3, 4, 5, 6, 8, 9; 82B.11, subdivision 2;
82B.12; 82B.13, subdivisions 1, 1a, 3, 4, 5, 6, 7, 8; 82B.14; 82B.195, subdivisions
2, 3.

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

Section 1.

Minnesota Statutes 2018, section 82B.021, is amended by adding a subdivision
to read:


new text begin Subd. 7a. new text end

new text begin Appraisal review. new text end

new text begin "Appraisal review" means the act or process of developing
an opinion about the quality of another appraiser's work that was performed as part of an
appraisal assignment. Appraisal review does not include an examination of an appraisal for
grammatical, typographical, mathematical, or other similar administrative errors that do not
involve the appraiser's professional judgment, including compliance with the elements of
the client's statement of work.
new text end

Sec. 2.

Minnesota Statutes 2018, section 82B.021, subdivision 14, is amended to read:


Subd. 14.

deleted text beginFederaldeleted text end Appraisal Subcommittee.

"deleted text beginFederaldeleted text end Appraisal Subcommittee" means
the appraisal subcommittee of the Federal Financial Institutions Examinations Council under
United States Code, title 12, section 3301 et seq.

Sec. 3.

Minnesota Statutes 2018, section 82B.021, subdivision 15, is amended to read:


Subd. 15.

Federal financial institutions regulatory agency.

"Federal financial
institutions regulatory agency" means the Board of Governors of the Federal Reserve System,new text begin
the Bureau of Consumer Protection,
new text end the Federal Deposit Insurance Corporation, the Office
of the Comptroller of the Currency, deleted text beginthe Office of Thrift Supervision,deleted text end or the National Credit
Union Administration.

Sec. 4.

Minnesota Statutes 2018, section 82B.035, is amended by adding a subdivision to
read:


new text begin Subd. 5. new text end

new text begin Appraisal review. new text end

new text begin This chapter does not prohibit a person who is licensed as
a real estate appraiser in another jurisdiction from performing an appraisal review of an
appraisal of real estate or real property in Minnesota, if the appraiser does not offer an
opinion of value as part of the appraisal review and no part of the appraisal review is
performed by the appraiser within the boundaries of Minnesota.
new text end

Sec. 5.

Minnesota Statutes 2018, section 82B.07, is amended to read:


82B.07 POWERS OF THE COMMISSIONER.

The commissioner shall:

(1) receive applications for licenses;

(2) establish the procedures for processing applications for licensing;

(3) issue a license for appraisers;

(4) maintain a registry of the names and addresses of people licensed under this chapter;

(5) keep records and all application materials submitted to the commissioner;

(6) conduct investigationsnew text begin in accordance with section 45.027new text end;

(7) deny, revoke, and suspend licensesnew text begin in accordance with section 45.027new text end; and

(8) take other actions necessary to carry out the purposes of this chapter.

Sec. 6.

Minnesota Statutes 2018, section 82B.071, subdivision 1, is amended to read:


Subdivision 1.

Examination of records.

The commissioner may make examinations
within or without this state of each real estate appraiser's records at such reasonable time
and in such scope as is necessary to enforce the provisions of this chapternew text begin and in accordance
with section 45.027
new text end.

Sec. 7.

Minnesota Statutes 2018, section 82B.072, is amended to read:


82B.072 FORMAL COMPLAINTS.

For the purposes of this chapter, an deleted text begininquiry allegingdeleted text endnew text begin allegation ofnew text end noncompliance with
this chapter that does not result in a disciplinary action, including any informal disposition
of a case or an action pursuant to this chapter or section 45.027, does not constitute a formal
complaint under this chapter or section 45.027.

Sec. 8.

Minnesota Statutes 2018, section 82B.073, is amended by adding a subdivision to
read:


new text begin Subd. 2a. new text end

new text begin Compensation. new text end

new text begin Members of the board must be compensated in accordance
with section 15.059.
new text end

Sec. 9.

Minnesota Statutes 2018, section 82B.08, subdivision 8, is amended to read:


Subd. 8.

Cancellation of license.

A real estate appraiser's license deleted text beginmustdeleted text endnew text begin maynew text end be canceled
by the commissioner for failure of a licensee to complete continuing education requirements.
In this case, the license must be returned to the commissioner within ten days of receipt of
notice of cancellation.

Sec. 10.

Minnesota Statutes 2018, section 82B.09, subdivision 3, is amended to read:


Subd. 3.

Fees to deleted text beginFederaldeleted text end Appraisal Subcommittee.

In addition to the fees required for
licensure under this section, the commissioner must collect and remit such other fees as are
required by the deleted text beginFederaldeleted text end Appraisal Subcommittee.

Sec. 11.

Minnesota Statutes 2018, section 82B.094, is amended to read:


82B.094 SUPERVISION OF TRAINEE REAL PROPERTY APPRAISERS.

(a) A certified residential real property appraiser or a certified general real property
appraiser, in good standing, may engage a trainee real property appraiser to assist in the
performance of real estate appraisals, provided that the certified residential real property
appraiser or a certified general real property appraiser:

(1) has been licensed in good standing as either a certified residential real property
appraiser or a certified general real property appraiser for the three-year period immediately
preceding the individual's application to become a supervisor;

(2) has completed a six-hour course, approved in advance by the commissioner and
provided by an education provider approved by the commissioner, that is specifically oriented
to the requirements and responsibilities of supervisory appraisers and trainee appraisers. A
course approved by the commissioner for the purposes of this section must be given the
course title "Minnesota Supervisor/Trainee Appraiser Course";

(3) has not been the subject of any license or certificate suspension or revocation or has
not been prohibited from supervising activities in this state or any other state within the
three years immediately preceding the individual's application to become a supervisor;

(4) has no more than three trainee real property appraisers working under supervision
at any one time;

(5) actively and personally supervises the trainee real property appraiserdeleted text begin, which includes
ensuring that research of general and specific data has been adequately conducted and
properly reported, application of appraisal principles and methodologies has been properly
applied, that the analysis is sound and adequately reported, and that any analyses, opinions,
or conclusions are adequately developed and reported so that the appraisal report is not
misleading
deleted text end;

deleted text begin (6) discusses with the trainee real property appraiser any necessary and appropriate
changes that are made to a report, involving any trainee appraiser, before it is transmitted
to the client. Changes not discussed with the trainee real property appraiser that are made
by the supervising appraiser must be provided in writing to the trainee real property appraiser
upon completion of the appraisal report;
deleted text end

deleted text begin (7)deleted text endnew text begin (6)new text end accompanies the trainee real property appraiser on the inspections of the subject
properties and drive-by inspections of the comparable sales on all appraisal assignments
for which the trainee will perform work until the trainee appraiser is determined to be
competent, in accordance with the competency rule of USPAP for the property type;

deleted text begin (8)deleted text endnew text begin (7)new text end accepts full responsibility for the appraisal report by signing and certifying that
the report complies with USPAP; and

deleted text begin (9)deleted text endnew text begin (8)new text end reviews and signs the trainee real property appraiser's appraisal report or reports
or if the trainee appraiser is not signing the report, states in the appraisal the name of the
trainee and scope of the trainee's significant contribution to the report.

(b) The supervising appraiser must review and sign the applicable experience log required
to be kept by the trainee real property appraiser.

(c) The supervising appraiser must notify the commissioner within ten days when the
supervision of a trainee real property appraiser has terminated or when the trainee appraiser
is no longer under the supervision of the supervising appraiser.

(d) The supervising appraiser must maintain a separate work file for each appraisal
assignment.

(e) The supervising appraiser must verify that any trainee real property appraiser that is
subject to supervision is properly licensed and in good standing with the commissioner.

Sec. 12.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 3. new text end

new text begin Conformance to Appraisal Qualifications Board criteria. new text end

new text begin (a) The
requirements to obtain a trainee real property appraiser, licensed real property appraiser,
certified residential real property appraiser, or certified general real property appraiser
license are the education, examination, and experience requirements established by the
Appraiser Qualifications Board of the Appraisal Foundation and published in the most
recent version of the Real Property Appraiser Qualification Criteria.
new text end

new text begin (b) An applicant must complete the applicable education and experience requirements
before taking the required examination.
new text end

Sec. 13.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 4. new text end

new text begin Reexamination. new text end

new text begin (a) An examination is required to renew a license if the license:
new text end

new text begin (1) has been suspended;
new text end

new text begin (2) has been ineffective for two or more years; or
new text end

new text begin (3) has not been renewed for two or more years.
new text end

new text begin (b) Notwithstanding paragraph (a), an examination is not required for an individual who
has failed to renew an existing license due to absence from Minnesota while on active duty
with the United States armed services.
new text end

Sec. 14.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 5. new text end

new text begin Examination frequency. new text end

new text begin The commissioner may hold examinations at times
and places the commissioner determines reasonable.
new text end

Sec. 15.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 6. new text end

new text begin Period for application. new text end

new text begin An applicant who obtains an acceptable examination
score must file an application and obtain a license within two years of the date of the
successful completion of the examination. An applicant who fails to meet this requirement
must take another examination in order to qualify for a license.
new text end

Sec. 16.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 7. new text end

new text begin Renewal; examination. new text end

new text begin Except as provided in subdivision 4, an examination
is not required to renew a license.
new text end

Sec. 17.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 8. new text end

new text begin Examination eligibility; revocation. new text end

new text begin An applicant is prohibited from taking
an examination if the applicant's real estate appraiser license has been revoked in Minnesota
or another state during the two years prior to the application date.
new text end

Sec. 18.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 9. new text end

new text begin Fees. new text end

new text begin The commissioner may assess an examination fee in an amount equal to
the actual direct costs to hold the examination.
new text end

Sec. 19.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 10. new text end

new text begin Cheating. new text end

new text begin The commissioner must not accept the scores of an individual who
has cheated on an examination. Cheating on a real estate appraiser examination is grounds
to deny an application for an appraiser's license.
new text end

Sec. 20.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 11. new text end

new text begin Supervisory and trainer appraiser course. new text end

new text begin In addition to the education
required under subdivision 3, an applicant for a trainee real property appraiser license must
complete a six-hour course that covers the requirements and responsibilities of supervisory
appraisers and trainee appraisers. A course approved by the commissioner under this
subdivision must be titled "Minnesota Supervisor and Trainee Appraiser Course." This
course does not count as qualifying education to upgrade to a higher level of an appraiser
license.
new text end

Sec. 21.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 12. new text end

new text begin Commissioner's approval; rules. new text end

new text begin Courses, instructions, and procedures for
courses must be approved by the commissioner. The commissioner may adopt rules to
administer this section. The credit hours required by this section may be credited to a person
for distance education courses that meet the requirements of the Appraiser Qualifications
Board, as contained in the Real Property Appraiser Criteria.
new text end

Sec. 22.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 13. new text end

new text begin Student tracking manual. new text end

new text begin A student must record the education, experience,
and other requirements in an orderly manner and contemporaneously with completion, in
a student tracking manual. The tracking manual must be organized by required core
curriculum modules and subtopics.
new text end

Sec. 23.

Minnesota Statutes 2018, section 82B.095, is amended by adding a subdivision
to read:


new text begin Subd. 14. new text end

new text begin Appraiser prelicense education. new text end

new text begin (a) Credit toward the education requirements
of this section may be obtained through the completion of a degree in real estate from an
accredited degree-granting college or university whose curriculum has been reviewed and
approved by the Appraiser Qualifications Board.
new text end

new text begin (b) Notwithstanding section 45.22, a college or university course may be approved
retroactively by the commissioner for appraiser prelicense education credit if:
new text end

new text begin (1) the course was offered by a college or university located in Minnesota;
new text end

new text begin (2) the college or university was an approved education provider at the time the course
was offered; and
new text end

new text begin (3) the commissioner's approval is the same in terms of courses, hours, and time limits
as those specified by the Appraiser Qualifications Board.
new text end

Sec. 24.

Minnesota Statutes 2018, section 82B.105, is amended to read:


82B.105 RECIPROCITY.

The education, experience, and examination requirements of this chapter deleted text beginmaydeleted text endnew text begin mustnew text end be
waived by the commissioner deleted text beginfor individuals of other jurisdictionsdeleted text end ifdeleted text begin: (1)deleted text end the individual is
licensednew text begin and in good standingnew text end in another jurisdiction deleted text beginand is listed in good standing on the
National Registry maintained by the Appraisal Subcommittee, and (2) the licensing
requirements of that jurisdiction are substantially similar to the provisions of this chapter
deleted text end.

Sec. 25.

Minnesota Statutes 2018, section 82B.11, is amended by adding a subdivision to
read:


new text begin Subd. 2a. new text end

new text begin Trainee real property appraiser. new text end

new text begin The scope of practice for a trainee real
property appraiser is the appraisal of properties which a certified residential real property
appraiser or certified general real property appraiser acting as the supervisory appraiser is
permitted and competent to appraise.
new text end

Sec. 26.

Minnesota Statutes 2018, section 82B.11, subdivision 6, is amended to read:


Subd. 6.

Temporary practice.

(a) The commissioner shall issue a license for temporary
practice as a real estate appraiser under subdivision 3, 4, or 5 to a person certified or licensed
by another state if:

deleted text begin (1) the property to be appraised is part of a federally related transaction and the person
is licensed to appraise property limited to the same transaction value or complexity provided
in subdivision 3, 4, or 5;
deleted text end

deleted text begin (2)deleted text endnew text begin (1)new text end the appraiser's business is of a temporary nature; and

deleted text begin (3)deleted text endnew text begin (2)new text end the appraiser registers with the commissioner to obtain a temporary license before
conducting appraisals within the state.

(b) The term of a temporary practice license is the lesser of:

(1) the time required to complete the assignment; or

(2) 12 months.

If more than 12 months are necessary to complete the assignment, a new temporary
application and fee is required.

Sec. 27.

Minnesota Statutes 2018, section 82B.19, subdivision 1, is amended to read:


Subdivision 1.

License renewals.

(a) The commissioner must determine that a licensed
real estate appraiser has met the continuing education requirements deleted text beginof this chapterdeleted text endnew text begin in the
most recent version of the Real Property Appraiser Qualification Criteria, published by the
Appraiser Qualifications Board of the Appraisal Foundation
new text end before the commissioner renews
a license. This determination must be based on, for a resident appraiser, course completion
records uploaded electronically in a manner prescribed by the commissioner and, for a
nonresident appraiser, course completion records presented by electronic transmission or
uploaded electronically in a manner prescribed by the commissioner.

deleted text begin The basic continuing education requirement for renewal of a license is the completion
by the applicant either as a student or as an instructor, during the immediately preceding
term of licensing, of at least 30 classroom hours of instruction in courses or seminars that
have received the approval of the commissioner. Classroom hour credit must not be accepted
for courses of less than two hours. As part of the continuing education requirements of this
section, the commissioner must require that all real estate appraisers successfully complete
the seven-hour national USPAP update course every two years. If the applicant's immediately
preceding term of licensing consisted of six or more months, but fewer than 24 months, the
applicant must provide evidence of completion of 15 hours of instruction during the license
period. The credit hours required under this section may be credited to a person for distance
education courses that meet Appraiser Qualifications Board criteria. An approved prelicense
education course may be taken for continuing education credit.
deleted text end

(b) The 15-hour USPAP course cannot be used to satisfy the requirement to complete
the seven-hour national USPAP update course every two years.

Sec. 28.

Minnesota Statutes 2018, section 82B.19, subdivision 2, is amended to read:


Subd. 2.

Rules.

deleted text begin (a) The commissioner may adopt rules to assure that persons renewing
their licenses as licensed real estate appraisers have current knowledge of real property
appraisal theories, practices, and techniques that will provide a high degree of service and
protection to those members of the public with whom they deal in a professional relationship
under authority of their license.
deleted text end

deleted text begin (b)deleted text end To the extent the commissioner considers it appropriate, courses or parts of courses
may be considered to satisfy both continuing education requirements under this section and
continuing real estate education requirements.

deleted text begin (c) As a prerequisite for course approval, education providers must submit proposed
monitoring methods, and systems for recording attendance sufficient to ensure that
participants receive course credit only for portions actually attended.
deleted text end

Sec. 29.

Minnesota Statutes 2018, section 82B.19, is amended by adding a subdivision to
read:


new text begin Subd. 5. new text end

new text begin Approval of appraiser continuing education. new text end

new text begin (a) Notwithstanding section
45.30, subdivision 6, paragraph (a), the commissioner must permit a licensee to submit for
approval a continuing education course that has not been preapproved. The commissioner
may charge a fee of up to $25 to review for approval a continuing education course that
was not preapproved.
new text end

new text begin (b) A continuing education course that has been approved in another jurisdiction must
be approved by the commissioner for continuing education in Minnesota, unless the subject
of the continuing education course is only relevant outside of Minnesota. This includes but
is not limited to updates on real estate market conditions outside of Minnesota, the laws
and regulations of another state, or any other subject that is not applicable to the appraisal
of real estate or real property in Minnesota.
new text end

new text begin (c) A provider in Minnesota or in another state that exclusively offers courses that can
only be used by a licensee to satisfy the continuing education requirements of this section
is not an education provider for purposes of chapter 45.
new text end

Sec. 30.

Minnesota Statutes 2018, section 82B.20, subdivision 1, is amended to read:


Subdivision 1.

Enforcement.

The license of a licensed real estate appraiser may be
denied, revoked, or suspended, or the person may be otherwise disciplined in accordance
with this chapternew text begin and section 45.027new text end, upon any of the grounds set forth in this section.

Sec. 31.

Minnesota Statutes 2018, section 82B.20, subdivision 2, is amended to read:


Subd. 2.

Conduct prohibited.

No person may:

(1) obtain or try to obtain a license under this chapter by knowingly making a false
statement, submitting false information, refusing to provide complete information in response
to a question in an application for license, or through any form of fraud or misrepresentation;

(2) fail to meet the minimum qualifications established by this chapter;

(3) be convicted, including a conviction based upon a plea of guilty or nolo contendere,
of a crime that is substantially related to the qualifications, functions, and duties of a person
developing real estate appraisals and communicating real estate appraisals to others;

(4) engage in an act or omission involving dishonesty, fraud, or misrepresentation with
the intent to substantially benefit the license holder or another person or with the intent to
substantially injure another person;

(5) engage in a violation of any of the standards for the development or communication
of real estate appraisals as provided in this chapter;

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

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

(8) willfully disregard or violate any of the provisions of this chapter or the rules of the
commissioner for the administration and enforcement of the provisions of this chapter;

(9) accept an appraisal assignment when the employment itself is contingent upon the
appraiser reporting a predetermined estimate, analysis, or opinion, or where the fee to be
paid is contingent upon the opinion, conclusion, or valuation reached, or upon the
consequences resulting from the appraisal assignment;

(10) violate the confidential nature of governmental records to which the person gained
access through employment or engagement as an appraiser by a governmental agency;

(11) offer, pay, or give, and no person shall accept, any compensation or other thing of
value from a real estate appraiser by way of commission-splitting, rebate, finder's fee, or
otherwise in connection with a real estate appraisal. This prohibition does not apply to
transactions among persons licensed under this chapter if the transactions involve appraisals
for which the license is required;

(12) engage or authorize a person, except a person licensed under this chapter, to act as
a real estate appraiser on the appraiser's behalf;

(13) violate standards of professional practice;

deleted text begin (14) make an oral appraisal report without also making a written report within a
reasonable time after the oral report is made;
deleted text end

deleted text begin (15)deleted text endnew text begin (14)new text end represent a market analysis to be an appraisal report;

deleted text begin (16) give an appraisal in any circumstances where the appraiser has a conflict of interest,
as determined under rules adopted by the commissioner; or
deleted text end

deleted text begin (17)deleted text endnew text begin (15)new text end engage in other acts the commissioner by rule prohibits.

No person, including a mortgage originator, appraisal management company, real estate
broker or salesperson, appraiser, or other licensee, registrant, or certificate holder regulated
by the commissioner may improperly influence or attempt to improperly influence the
development, reporting, result, or review of a real estate appraisal. Prohibited acts include
blacklisting, boycotting, intimidation, coercion, and any other means that impairs or may
impair the independent judgment of the appraiser, including but not limited to the withholding
or threatened withholding of payment for an appraisal fee, or the conditioning of the payment
of any appraisal fee upon the opinion, conclusion, or valuation to be reached, or a request
that the appraiser report a predetermined opinion, conclusion, or valuation, or the desired
valuation of any person, or withholding or threatening to withhold future work in order to
obtain a desired value on a current or proposed appraisal assignment.

Sec. 32.

Minnesota Statutes 2018, section 82B.21, is amended to read:


82B.21 CLASSIFICATION OF SERVICES.

A client or employer may retain or employ a licensed real estate appraiser to act as a
disinterested third party in giving an unbiased estimate of value or analysis; to provide a
market analysis to facilitate the client's or employer's objectivesdeleted text begin; or to perform a limited
appraisal
deleted text end. The appraisal and the appraisal report must comply with the provisions of this
chapter and the uniform standards of professional appraisal practice.

Sec. 33.

Minnesota Statutes 2018, section 82B.22, is amended to read:


82B.22 CONTINGENT FEES.

deleted text begin A licensed real estate appraiser may not accept a commission for an appraisal assignment
that is contingent upon the appraiser reporting a predetermined estimate, analysis, or opinion,
or is contingent upon the opinion, conclusion, or valuation reached, or upon the consequences
resulting from the appraisal assignment.
deleted text end

A licensed real estate appraiser who enters into an agreement to perform a market analysis
may be paid a fixed fee or a fee that is contingent on the results achieved by the specialized
services.

If a licensed real estate appraiser enters into an agreement to perform a market analysis
for a contingent fee, this fact must be clearly stated in each written and oral report. In each
written report, this fact must be clearly stated in a prominent location in the report and also
in each letter of transmittal and in the licensing statement made by the appraiser in the report.

Sec. 34. new text beginREPEALER.
new text end

new text begin Minnesota Statutes 2018, sections 82B.021, subdivision 17; 82B.071, subdivision 2;
82B.095, subdivision 2; 82B.10, subdivisions 1, 2, 3, 4, 5, 6, 8, and 9; 82B.11, subdivision
2; 82B.12; 82B.13, subdivisions 1, 1a, 3, 4, 5, 6, 7, and 8; 82B.14; and 82B.195, subdivisions
2 and 3,
new text end new text begin are repealed.
new text end

Sec. 35. new text beginEFFECTIVE DATE.
new text end

new text begin Sections 1 to 34 are effective August 1, 2019.
new text end

APPENDIX

Repealed Minnesota Statutes: 19-4162

82B.021 DEFINITIONS.

Subd. 17.

Foundation appraisal organization.

"Foundation appraisal organization" means a member private appraisal trade organization of the Appraisal Foundation including, but not limited to, the following: American Institute of Real Estate Appraisers, American Society of Appraisers, American Society of Farm Managers and Rural Appraisers, International Association of Assessing Officers, International Right of Way Association, National Association of Independent Fee Appraisers, National Society of Real Estate Appraisers, or Society of Real Estate Appraisers.

82B.071 RECORDS.

Subd. 2.

Retention.

Licensees shall keep a separate work file for each appraisal assignment, which is to include copies of all contracts engaging his or her services for the real estate appraisal, appraisal reports, and all data, information, and documentation assembled and formulated by the appraiser to support the appraiser's opinions and conclusions and to show compliance with USPAP, for a period of five years after preparation, or at least two years after final disposition of any judicial proceedings in which the appraiser provided testimony or was the subject of litigation related to the assignment, whichever period expires last. Appropriate work file access and retrieval arrangements must be made between any trainee and supervising appraiser if only one party maintains custody of the work file.

82B.095 APPRAISER QUALIFICATION COMPONENTS.

Subd. 2.

Conformance to Appraiser Qualifications Board criteria.

Qualifications for all levels of licensing must conform to the Real Property Qualification Criteria established by the Appraisal Qualifications Board for implementation effective January 1, 2015.

82B.10 EXAMINATIONS.

Subdivision 1.

Generally.

(a) An applicant for a license must pass an examination conducted by the commissioner. The examinations must be of sufficient scope to establish the competency of the applicant to act as a real estate appraiser and must conform with the current National Uniform Exam Content Outlines published by the Appraiser Qualifications Board.

(b) A passing grade for a real estate appraiser licensing examination must be the cut score defined by the Appraiser Qualifications Board criteria.

(c) To qualify for a license as a trainee real property appraiser, an applicant must pass a current trainee real property appraiser examination. The examination must test the applicant's knowledge of appraisal terms, principles, theories, and ethics as provided in this chapter.

(d) To qualify for a license as a licensed real property appraiser, an applicant must pass a current uniform licensed real property appraiser examination approved by the Appraiser Qualifications Board. The examination must test the applicant's knowledge of appraisal terms, principles, theories, and ethics as provided in this chapter.

(e) To qualify for a license as a certified residential real property appraiser, an applicant must pass a current uniform certified residential real property appraiser examination approved by the Appraiser Qualifications Board. The examination must test the applicant's knowledge of appraisal terms, principles, theories, and ethics as provided in this chapter.

(f) To qualify for a license as a certified general real property appraiser, an applicant must pass a current uniform certified general real property appraiser examination approved by the Appraiser Qualifications Board. The examination must test the applicant's knowledge of appraisal terms, principles, theories, and ethics as provided in this chapter.

(g) An applicant must complete the applicable education prerequisites in section 82B.13 and the experience requirements in section 82B.14 before the applicant takes the examination required under this section.

Subd. 2.

Reexaminations.

An examination must be required before renewal of a license that has been suspended, or before the issuance of a license to a person whose license has been ineffective for a period of two years. No reexamination is required of an individual who has failed to renew an existing license because of absence from the state while on active duty with the armed services of the United States of America.

Subd. 3.

Examination frequency.

The commissioner must hold examinations at times and places the commissioner determines.

Subd. 4.

Period for application.

An applicant who obtains an acceptable score on an examination must file an application and obtain the license within two years of the date of successful completion of the examination or a second examination must be taken to qualify for the license.

Subd. 5.

Renewal; examination.

Except as provided in subdivision 2, no examination is required for the renewal of a license. However, a licensee who has been licensed in the state of Minnesota and who fails to renew the license for a period of two years must be required by the commissioner to again take an examination.

Subd. 6.

Examination eligibility; revocation.

No applicant may take an examination if a license as a real estate appraiser has been revoked in this or another state within two years of the date of the application.

Subd. 8.

Fees.

The commissioner may assess an examination fee sufficient to recover the actual direct costs of holding the examination.

Subd. 9.

Cheating.

The commissioner must not accept the scores of a person who has cheated on an examination. Cheating on a real estate appraiser examination must be grounds for denying an application for an appraiser's license.

82B.11 CLASSES OF LICENSE.

Subd. 2.

Trainee real property appraiser.

When a net income capitalization analysis is not required by the uniform standards of professional appraisal practice, a trainee real property appraiser may appraise residential real property or agricultural property.

82B.12 EXAMINATION REQUIREMENT.

An original license as a licensed real estate appraiser must be issued to a person who has demonstrated through a written examination process that the appraiser has the following qualifications:

(1) appropriate knowledge of technical terms commonly used in or related to real estate appraising, appraisal report writing, and economic concepts applicable to real estate;

(2) understanding the principles of land economics, real estate appraisal processes, and problems likely to be encountered in gathering, interpreting, and processing of data in carrying out appraisal disciplines;

(3) understanding the standards for the development and communication of real estate appraisals as provided in this chapter;

(4) knowledge of theories of depreciation, cost estimating, methods of capitalization, and the mathematics of real estate appraisal that are appropriate for the classification of license for which the person is applying;

(5) knowledge of other principles and procedures appropriate for the classification of license for which the person is applying;

(6) basic understanding of real estate law; and

(7) understanding the types of misconduct and ethical considerations for which disciplinary proceedings may be started against a licensed real estate appraiser.

82B.13 EDUCATION PREREQUISITES.

Subdivision 1.

Trainee real property appraiser.

(a) As a prerequisite for licensing as a trainee real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has successfully completed:

(1) at least 75 hours of prelicense courses approved by the commissioner. Fifteen of the 75 hours must include successful completion of the 15-hour national USPAP course; and

(2) in addition to the required hours under clause (1), a six-hour course that is specifically oriented to the requirements and responsibilities of supervisory appraisers and trainee appraisers. A course approved by the commissioner for the purposes of this subdivision must be given the course title "Minnesota Supervisor/Trainee Appraiser Course." This course must not be counted toward qualifying education to upgrade to a higher level appraiser license.

(b) All qualifying education must be completed within the five-year period prior to the date of submission of a trainee real property appraiser license application.

Subd. 1a.

Licensed real property appraiser.

As a prerequisite for licensing as a licensed real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has successfully completed:

(1) at least 150 hours of prelicense courses approved by the commissioner. The courses must consist of 75 hours of general real estate appraisal principles and the 15-hour national USPAP course; and

(2) an associate degree or higher from an accredited college or university. In lieu of the required degree, the applicant may present satisfactory documentation of successful completion of 30 semester credit hours of instruction from an accredited college or university.

Subd. 3.

Commissioner's approval; rules.

The courses and instruction and procedures of courses must be approved by the commissioner. The commissioner may adopt rules to administer this section. These rules must, to the extent practicable, conform to the rules adopted for real estate and insurance education. The credit hours required under this section may be credited to a person for distance education courses that meet Appraiser Qualifications Board criteria.

Subd. 4.

Certified residential real property appraiser.

As a prerequisite for licensing as a certified residential real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has successfully completed:

(1) at least 200 hours of prelicense courses approved by the commissioner, with particular emphasis on the appraisal of one to four unit residential properties. Fifteen of the 200 hours must include successful completion of the 15-hour national USPAP course; and

(2) a bachelor's degree or higher from an accredited college or university.

Subd. 5.

Certified general real property appraiser.

As a prerequisite for licensing as a certified general real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has successfully completed:

(1) at least 300 hours of prelicense courses approved by the commissioner, with particular emphasis on the appraisal of nonresidential properties. Fifteen of the 300 hours must include successful completion of the 15-hour national USPAP course; and

(2) a bachelor's degree or higher from an accredited college or university.

Subd. 6.

All appraiser license levels.

To receive approval from the commissioner, an appraiser prelicense education course must be at least 15 hours long. The required course hours for all appraiser license levels include completion of the 15-hour national USPAP course and specific core curriculum courses and hours in accordance with the real property appraiser qualification criteria as defined by the Appraisal Qualifications Board:

Trainee
Basic appraisal principles 30 hours
Basic appraisal procedures 30 hours
The 15-hour national USPAP course or its equivalent 15 hours
Trainee level total education requirements 75 hours
Licensed
Basic appraisal principles 30 hours
Basic appraisal procedures 30 hours
The 15-hour national USPAP course or its equivalent 15 hours
Residential market analysis and highest and best use 15 hours
Residential appraiser site valuation and cost approach 15 hours
Residential sales comparison and income approaches 30 hours
Residential report writing and case studies 15 hours
Licensed level total education requirements 150 hours
Certified residential
Basic appraisal principles 30 hours
Basic appraisal procedures 30 hours
The 15-hour national USPAP course or its equivalent 15 hours
Residential market analysis and highest and best use 15 hours
Residential appraiser site valuation and cost approach 15 hours
Residential sales comparison and income approaches 30 hours
Residential report writing and case studies 15 hours
Statistics, modeling, and finance 15 hours
Advanced residential applications and case studies 15 hours
Appraisal subject matter electives 20 hours
(May include hours over minimum shown above in other modules)
Certified residential level total education requirements 200 hours
Certified general
Basic appraisal principles 30 hours
Basic appraisal procedures 30 hours
The 15-hour national USPAP course or its equivalent 15 hours
General appraiser market analysis and highest and best use 30 hours
Statistics, modeling, and finance 15 hours
General appraiser sales comparison approach 30 hours
General appraiser site valuation and cost approach 30 hours
General appraiser income approach 60 hours
General appraiser report writing and case studies 30 hours
Appraisal subject matter electives 30 hours
(May include hours over minimum shown above in other modules)
Certified general level total education requirements 300 hours

Subd. 7.

Student tracking manual.

It is the responsibility of students to record the qualifying education they have completed in a student tracking manual broken down by required core curriculum modules and subtopics, and to maintain an orderly record of education, experience, and other requirements.

Subd. 8.

Appraiser prelicense education.

(a) Credit toward the qualifying education requirements of this section may also be obtained via the completion of a degree in real estate from an accredited degree-granting college or university approved by the Association to Advance Collegiate Schools of Business, or a regional or national accreditation agency recognized by the United States Secretary of Education, provided that the college or university has had its curriculum reviewed and approved by the Appraiser Qualifications Board.

(b) Notwithstanding section 45.22, a college or university real estate course may be approved retroactively by the commissioner for appraiser prelicense education credit if:

(1) the course was offered by a college or university physically located in Minnesota;

(2) the college or university was an approved education provider at the time the course was offered; and

(3) the commissioner's approval is made to the same extent in terms of courses and hours and with the same time limits as those specified by the Appraiser Qualifications Board.

82B.14 EXPERIENCE REQUIREMENT.

(a) As a prerequisite for licensing as a licensed real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has obtained 2,000 hours of experience in real property appraisal obtained in no fewer than 12 months.

As a prerequisite for licensing as a certified residential real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has obtained 2,500 hours of experience in real property appraisal obtained in no fewer than 24 months.

As a prerequisite for licensing as a certified general real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has obtained 3,000 hours of experience in real property appraisal obtained in no fewer than 30 months. At least 50 percent, or 1,500 hours, must be in nonresidential appraisal work.

(b) Each applicant for license under section 82B.11, subdivision 3, 4, or 5, shall give under oath a detailed listing of the real estate appraisal reports or file memoranda for which experience is claimed by the applicant. Upon request, the applicant shall make available to the commissioner for examination, a sample of appraisal reports that the applicant has prepared in the course of appraisal practice.

(c) Applicants may not receive credit for experience accumulated while unlicensed, if the experience is based on activities which required a license under this section.

(d) Experience for all classifications must be obtained after January 30, 1989, and must be USPAP compliant.

82B.195 STANDARDS OF CONDUCT.

Subd. 2.

Disclosure requirements.

In addition to the requirements of the standards of professional appraisal practice as defined by section 82B.021, subdivision 31, an appraiser must, prior to performing any appraisal service which requires licensing pursuant to this chapter, disclose in writing to the person contracting for the appraisal service the information identified in clause (4). In addition, an appraiser must prepare a written disclosure providing the information identified in clauses (1) to (13). The written disclosure must be included as part of the final written appraisal report. As specified in this subdivision, an appraiser must:

(1) disclose who has employed the appraiser;

(2) disclose who the appraisal is rendered for, if not the person who employed the appraiser;

(3) disclose the purpose of the appraisal, including an explanation of the difference between the appraisal being given and an appraisal of fee simple market valuation;

(4) disclose any conflict of interest or situation which might reasonably be perceived to be a conflict of interest which must include, but not be limited to, the following situations:

(i) whether the appraiser has any ownership interest in the subject property or contiguous properties;

(ii) whether there is an ownership interest by a spouse, parent, or child of the appraiser in the property or contiguous properties; and

(iii) whether the appraiser has a continuing business relationship with one of the parties, for example, any part-time or full-time employment of the appraiser, spouse, children living at home, or dependent children.

Failure to promptly give notification of a conflict must be considered a violation of the standards of professional appraisal practice;

(5) disclose that the appraisal is a reevaluation and identify the areas of difference between the two appraisals and the justification for the changes;

(6) disclose any facts concerning the valuation needed for loan purposes or similar information that was provided to the appraiser before or during the appraisal;

(7) disclose that the appraiser has not performed appraisals of the type requested or for the type of property to be appraised as a regular part of the appraiser's business in the preceding five-year period, provided that if the appraiser asserts qualification by training or related experience to perform the appraisal, the appraiser must set forth the training or experience and how it is applicable to the appraisal;

(8) disclose the license classification of the appraiser and the types of appraisals that the appraiser is authorized to conduct under the licensure;

(9) disclose any lack of experience or training that would affect the ability of the appraiser to perform the appraisal or could cause rejection of the appraisal by the party requiring the appraisal;

(10) disclose any appraisal on the same property made by the appraiser in the last three years;

(11) disclose all pertinent assumptions upon which a valuation based upon income from the property is derived such as expected occupancy rates, rental rates, construction of future improvements, roads, or highways;

(12) prior to performing the appraisal, disclose whether the appraiser has previously been to the property; and

(13) disclose any other fact or circumstance that could bring the reliability of the appraisal or the impartiality of the appraiser into question.

Subd. 3.

Additional requirements.

In addition to the requirements of subdivisions 1 and 2, an appraiser must:

(1) not knowingly make any of the following unacceptable appraisal practices:

(i) include inaccurate or misleading factual data about the subject neighborhood, site, improvements, or comparable sales;

(ii) fail to comment on negative factors with respect to the subject neighborhood, subject property, or proximity of the subject property to adverse influences;

(iii) unless otherwise disclosed in the appraisal report, use comparables in the valuation process that the appraiser has not at least personally inspected from the exterior by driving by them;

(iv) select and use inappropriate comparable sales or fail to use comparables that are physically and by location the most similar to the subject property;

(v) use data, particularly comparable sales data, that was provided by parties who have a financial interest in the sale or financing of the subject property without the appraiser's verification of the information from a disinterested source. For example, it would be inappropriate for an appraiser to use comparable sales provided by the builder of the subject property or a real estate broker who is handling the sale of the subject property, unless the appraiser verifies the accuracy of the data provided through another source. If a signed HUD Settlement Statement is used for this verification, the appraiser must also verify the sale data with the buyer or county records. The appraiser must also make an independent investigation to determine that the comparable sales provided were the best ones available;

(vi) use adjustments to the comparable sales that do not reflect the market's reaction to the differences between the subject property and the comparables, or fail to make adjustments when they are clearly indicated;

(vii) develop a valuation conclusion that is based either partially or completely on factors identified in chapter 363A, including race, color, creed, religion, sex, marital status, status with regard to public assistance, disability, sexual orientation, familial status of the owner or occupants of nearby property, or national origin of either the prospective owners or occupants of the properties in the vicinity of the subject property; or

(viii) develop a valuation conclusion that is not supported by available market data;

(2) provide a resume, current within six months of the date it is provided, to anyone who employs the appraiser, indicating all professional degrees and licenses held by the appraiser; and

(3) reject any request by the person who has employed the appraiser that is in conflict with the requirements of Minnesota law or this chapter and withdraw from the appraisal assignment if the employing party persists in the request.