SHEDDING LIGHT ON USPAP
by Jesse Lochman, State Certified Appraisal Trainee
Appraisers are regulated and licensed by a state board in each state. Each state, however, is required to adopt certain standards from The Appraisal Foundation (TAF). Each state is required to adopt the Uniform Standards of Professional Appraisal Practice, referred to as USPAP by most appraisers. USPAP defines what an appraisal is, ethical and competency standards, and a whole host of other rules. The purpose of USPAP is to promote public trust in the appraisal profession through the regulations, and for the most part, USPAP has done a good job of that.
Every 2 years, the Appraisal Standards Board (ASB, an arm of The Appraisal Foundation) reviews USPAP and decides if changes need to be made by soliciting comments from appraisers, users of appraisal services, and the general public. Currently, the ASB is taking comments for the next revision, which won’t take effect until January 1st, 2020. While I plan to write them a letter, my complaint does not regard the content of USPAP, but its availability. I would like to draw your attention to a problem I have seen with the way TAF provides access to USPAP, so that you also can write them. The following paragraphs are excerpts from my letter, and you are welcome to use them if you agree.
I’ve had quite a few interactions with clients or interested parties who are unfamiliar with USPAP, but it wasn’t until recently that a client asked me why my fee couldn’t be contingent upon my opinion of Highest and Best Use of the property. I told him that USPAP prohibits basing a fee on a specific assignment result. He was critical of my explanation and asked where he might read the exact words in the USPAP publication. I referred him to The Appraisal Foundation’s webstore, and he just about blew a gasket when he realized that he would have to pay $75 just to be able to search through a PDF file. He did raise a very good point: we have adopted USPAP to increase public trust in our profession, yet if a member of the public wants to know more about USPAP, they must pay $75 to TAF to be able to read the standards to which we are held! This removes the transparency USPAP was designed to provide. I understand that TAF provides USPAP on their website for free, but that is a wacky, dysfunctional E-book design, which is not user friendly, not searchable, and requires the user to know exactly where to find what they want to find. The problem is that most of my clients are not USPAP experts. In fact, they would be hard-pressed to come up with the full, non-acronymic name. It is imperative that we provide easy, free, downloadable access to a PDF of the most current version of USPAP to the public, or else I fear that many of the benefits of USPAP will erode quickly.
While we are at it, let’s take a minute to examine how USPAP is made available to appraisers as well. Missouri, my home state, formerly provided a copy of USPAP for each appraiser to download free of charge. However, they have stopped doing that. How ridiculous is it that I, an appraiser, must pay a $75 fee to TAF to know the rules that I am required by state law to follow? And this is in addition to the portion of licensure fees collected by each state agency that are then passed along to TAF already. There are no other professionals known to me who must pay a fee to understand how they are regulated. I think that there is a very simple solution to this problem: make USPAP available as a free downloadable PDF to whomever wants to read it, thereby removing some of the cloud of mystery that surrounds USPAP for non-appraisers. Transparency is a great way to build public trust.
Rest assured that, whatever difficulties are presented by USPAP, Spurgeon Appraisals has done the necessary homework for providing appraisal reports fully in compliance with all state and federal regulations. Feel free to call us with any questions about USPAP. If you would like to write your own letter to ASB, use this email address: ASBComments@appraisalfoundation.org
Spurgeon Appraisals regularly appraises a variety of property types. We have experience appraising farms, residences, and commercial properties. We pride ourselves on providing excellent customer service and quality appraisals. Contact our team to see how we can meet your appraisal needs and exceed your service expectations.