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NEW JERSEY REGISTER
VOLUME 39, ISSUE 3
ISSUE DATE: FEBRUARY 5, 2007
RULE ADOPTIONS
LAW AND PUBLIC SAFETY
Division of Consumer Affairs
State Board of Real Estate Appraisers

39 N.J.R. 494(a)

Adopted Amendments: N.J.A.C. 13:40A-1.2, 4.5, 4.6 and 4.7
Adopted New Rule: N.J.A.C. 13:40A-1.3

Definitions; Scope of Practice; Trainee Permits

Proposed: June 19, 2006 at 38 N.J.R. 2628(a).

Adopted: September 12, 2006 by the State Board of Real Estate Appraisers, John A. McCann, President.

Filed: December 22, 2006 as R.2007 d.30, with a technical change not requiring additional public notice and comment (see N.J.A.C. 1:30-6.3).

Authority: N.J.S.A. 45:14F-8.

Effective Date: February 5, 2007.

Expiration Date: June 7, 2007.

Federal Standards Statement

A Federal standards analysis is not required because the adopted amendments and new rule are not subject to any Federal standards or requirements imposed by law, although the rules contain standards and requirements which are the same as those Federal standards set forth in the Uniform Standards of Professional Appraisal Practice (USPAP) published by the Appraisal Standards Board of the Appraisal Foundation, as well as standards set forth by the Appraiser Qualification Board of the Appraisal Foundation.

Full text of the adoption follows (addition to proposal indicated in boldface with asterisks *thus*; deletion from proposal indicated in brackets with asterisks *[thus]*):

SUBCHAPTER 1. PURPOSE AND SCOPE; DEFINITIONS; SCOPE OF PRACTICE

13:40A-1.2 Definitions

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise:

"Trainee" means an individual in the process of acquiring the hours of appraisal experience and qualifying education required for certification or licensure under the direct supervision of a certified appraiser pursuant to this chapter.

13:40A-1.3 Scope of practice

(a) The scope of practice of appraisers with the licensed real estate appraiser qualification is the appraisal of non-complex one to four residential units having a transaction value less than $ 1,000,000 and complex one to four residential units having a transaction value less than $ 250,000.

(b) The scope of practice of appraisers with the certified residential real estate appraiser qualification is the appraisal of one to four residential units without regard to transaction value or complexity.

(c) The scope of practice of appraisers with the certified general real estate appraiser classification is the appraisal of all types of property.

(d) The scope of practice of appraiser trainees is the appraisal of those properties which the supervising appraiser is permitted to appraise.

SUBCHAPTER 4. TRAINEE PERMITS

13:40A-4.5 Responsibilities of trainee

(a) (No change.)

(b) The holder of a trainee permit issued by the Board shall have the following duties and responsibilities:

1.-3. (No change.)

4. In the event a supervising appraiser can no longer provide direct supervision to a trainee, the trainee shall return the permit within 30 days to the Board;

5. The Board shall reissue the permit to the trainee when the trainee has obtained a new supervising appraiser.

6. The trainee shall comply with the provisions of the Uniform Standards of Professional Appraisal Practice (USPAP).

(c) The holder of a trainee permit issued by the Board shall not solicit or maintain a direct relationship with a client, a party or parties who engage an appraiser by employment or contract in a specific assignment. The trainee shall not collect any fees from the client, except when acting as an agent of the supervising appraiser. The supervising appraiser shall ensure that any form of payment shall be directed to the supervising appraiser.

(d) The holder of a trainee permit issued by the Board shall not advertise. Any advertisement in the name of a supervising appraiser with whom the trainee is associated may include the name of the trainee by clearly indicating such person as a trainee. This shall not prohibit a trainee's use of standard business cards which clearly indicate such person as a trainee.

13:40A-4.6 Responsibilities of supervising appraiser

(a) Any individual designated as a "supervising appraiser" by the holder of a trainee permit shall acknowledge in writing to the Board that he or she agrees to perform all responsibilities set forth in (f) below.

(b) Supervising appraisers shall be in good standing with the Board and shall not have been subject to any disciplinary action, including revocation, suspension, or stayed suspension, by the Board, within the last three years from the beginning of the supervision.

(c) No appraiser shall serve as a supervising appraiser until he or she has been a licensee of the Board for at least two years.

(d) Beginning on January 1, 2008, licensed real estate appraisers shall no longer be approved to serve as supervising appraisers. Beginning on *[(the effective date of this amendment)]* *February 5, 2007*, the Board will no longer accept applications by trainees who seek approval of a licensed real estate appraiser as a supervising appraiser.

(e) Beginning on January 1, 2008, only those individuals who are certified by the Board as either a State certified general real estate appraiser or a State certified residential real estate appraiser shall be a supervising appraiser.

(f) A supervising appraiser shall have the following duties and responsibilities:

1. The supervising appraiser shall at all times be responsible for and provide direct supervision of the work performed by the trainee. For purposes of this section, "direct supervision" means:

i. To personally review the work product of the trainee;

ii. To approve, sign, and accept responsibility for each appraisal report including work product prepared by the trainee or in which the trainee has made a professional contribution and to sign all such reports and certify that all such reports have been independently and impartially prepared in compliance with the Uniform Standards of Professional Appraisal Practice, these rules and applicable statutory standards; and

iii. To indicate, within the certification section of the appraisal report, the name of the trainee providing significant real property appraisal assistance. For purposes of this subparagraph, "significant" means the exercise of appraisal knowledge and training and does not mean clerical or fact gathering tasks.

2.-4. (No change.)

5. A supervising appraiser shall not supervise more than three trainees at one time;

6. The supervising appraiser shall personally inspect, with the trainee, the interior and exterior of each appraised property until the supervising appraiser determines that the trainee is competent in accordance with the Competency Rule of the Uniform Standards of Professional Appraisal Practice. Upon making the determination of competency, the supervising appraiser shall request a competency certification form from the Board. The supervising appraiser shall submit, to the Board, within 30 days of receipt of the competency certification form, the certification that the trainee is competent to perform property inspections independently. Examples of competency include, but are not limited to, properly identifying the problem to be addressed, being familiar with a specific type of property, market, geographic area, or analytical method.

7. The supervising appraiser shall prepare and furnish a signed statement describing the nature and extent of the assistance rendered to each trainee who provided services on an appraisal assignment. This statement shall be placed in the workfile of the appraisal assignment.

8. Upon the termination of the supervising appraiser and the trainee relationship, the supervising appraiser shall request an evaluation certification form from the Board. The supervising appraiser shall submit, to the Board, within 30 days of receipt of the evaluation certification form, the certification evaluating the activities performed by his or her trainee.

9. Failure to comply with this section may be deemed professional misconduct.

13:40A-4.7 Real estate appraiser trainee log

(a)-(b) (No change.)

(c) The trainee shall:

1. Include in the appraisal log submitted to the Board only those appraisal report(s) which indicate(s) that the trainee provided significant assistance;

2. Verify that the trainee's contribution to the report has been indicated in the report before entering the report into the appraisal log; and

3. Notify the Board immediately, in writing, if the trainee has provided significant real property appraisal assistance to a supervising appraiser with an appraisal report, and the supervising appraiser has not indicated that the trainee provided significant real property appraisal assistance in the report, and the scope of the trainee's contribution. For purposes of this subsection, "significant" means the exercise of appraisal knowledge and training, and does not mean clerical or fact gathering tasks.

(d) Failure to comply with this section shall be grounds for:

1. Denial of renewal of the trainee permit;

2. Revocation of the trainee permit;

3. Denial of experience credit for the entire year in which the lack of compliance occurred; and/or

4. Denial of licensure or certification.



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