Daily Archives: July 12, 2016
Mid-Year President’s Message
July 12th, 2016
Mike Morris, ARA, MAI, 2016 ICAP President
Dear Members of ICAP:
It seems like only yesterday that I took over as President of ICAP. Thankfully, I followed several outstanding leaders that continue to guide and counsel me as we serve the appraisers of Illinois.
The year began with some immediate challenges including budget challenges and our push to get HB 3333 (passed 57-0 in the Senate) through the house and to the Governor’s desk.
- HB 3333 – We began work on this bill in early 2015 and made it a major focus of our 2015 Lobby Day in Springfield. It easily passed the Senate, but the House was unable to act on it during 2015. The bill establishes an Appraisal Management Company Recovery Fund, which is designed to provide restitution to “each state-certified general real estate appraiser or residential real estate appraiser who has suffered pecuniary loss, and to award to the Department of Financial and Professional Regulation expenses, fines or fees that have gone unpaid to the Department in certain circumstances.”
Currently, AMC’s are required to post a bond to the State that only provides protection to the State and not to appraisers who have unpaid fees. Our bill benefits both the AMC’s and the appraisal profession since once the recovery fund reaches a certain level, AMC’s will no longer be assessed fees until the fund falls below that level. For our profession, we now have a level of protection if an AMC client goes out of business. The final bill passed the Illinois Senate on May 31, 2016 and was sent to the Governor on June 27, 2016. The Governor has 60 calendars day to sign or veto the bill.
Moving into 2016 we hired a new lobbyist, had our 2nd annual Lobby Day, introduced two additional bills, planned three educational seminars, and provided response letters on pending national issues.
- ICAP’s bill – HB 5880 prohibits the deduction of any amount from the reasonable and customary fee paid to an appraiser for any costs, fees or other expenses incurred solely by the appraisal management company. The bill passed the House Business & Occupational Licenses Committee with a vote of 10-0 on April 5, 2016 and had a second reading on April 15, 2016 before being sent to the rules committee on April 22, 2016
- ICAP drafted HB 5881 to ensure that the fee paid to an appraiser is reported separately from the fee paid to the AMC. The purpose of this bill is to require the separation of appraisal and AMC fees on Illinois disclosures to alleviate consumer confusion and increase transparency. The last action on this bill was April 8, 2016 when it was returned to the Rules Committee.
- IDFPR Turnaround Town Hall Meeting – ICAP was invited, along with other professions, to send two representatives to this meeting. Prior to the meeting, we collected your feedback with a membership survey for discussion at the meeting. The issues of appraiser independence and customary and reasonable fees were clearly on the mind of our membership. Our formal questions to the Department were: “What steps has it taken (or is planning to take) to ensure that appraisal management companies comply with the appraisal independence standards?” and “What steps had the Department taken (or is it planning to take) to conduct a survey of fees for appraisal services?” We are continuing to work with the Department to ensure appraiser independence and to complete a fee study for appraisers in Illinois.
- 2016 Lobby Day – On May 4, 2016 a group of ICAP members and board members made the trek to Springfield for our 2nd annual Lobby Day. We kicked off the day with a legislative briefing and met with the new IDFPR Director, Kreg Allison, as well as Kari Selinger (IDFPR – Director’s Office), Brian Weaver and Mary Bates. After our meeting, we spent the afternoon on a Capitol tour and meetings with individual senators and representatives to promote our legislation.
- 1st Annual Golf Outing – On May 19th ICAP held our inaugural golf outing at the Gleneagles Country Club in Lemont. The outing drew over 50 golfers for an outstanding day of golf, food and fun.
- Appraisal Threshold Issue – We provided written comments to the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation stating, “there is no evidence that raising the appraisal threshold would increase the safety and soundness of real estate lending practices.” ICAP recommended that the Agencies “continue to operate with consumer protection as its prime directive and urged the agencies to resist any calls to increase the appraisal threshold.”
- Potential Changes to the Appraisal Qualifications Board (AQB) Criteria – ICAP surveyed our membership, developed a position paper and provided a formal written response to the AQB. Members can view our response to the AQB on the ICAP website.
- USPAP 2018-2019 1st Exposure Draft – As with the AQB criteria, we studied the proposed changes to the next version of USPAP and provided a formal written response.
- Changes to the FHA Handbook – During our June 9 ICAP board meeting, we met with Heidi Henning, Managing Director – Business Specialties, for the National Association of Realtors (NAR) to foster and promote our profession. NAR is reporting that recent changes to the FHA handbook on appraisals (requiring appraisers to take on home inspection-type duties) is leading some consumers to mistake the role of appraisers with that of home inspectors. ICAP completed a survey prior to the meeting, receiving over 1,000 responses on the topic. We reported our survey results and recommendations to Ms. Henning and will continue to work with NAR to ensure these issues are addressed and clarified.
- Seminars – As of this writing, we have completed one of the three, scheduled seminars. We had a record turnout for the Collinsville seminar on June 13 to hear an outstanding group of speakers. The Springfield and Lisle seminars are coming up, and we have an outstanding group of speakers lined up for those events.
So far 2016 has been a very busy year for ICAP, and I appreciate the support of our members, the feedback on the surveys and the outstanding board of directors. Working with incredible people who are not afraid of a challenge has made my job as president very rewarding.
Mike Morris, ARA, MAI
2016 ICAP President