DEPARTMENT OF REGULATORY AGENCIES
DIVISION OF REAL ESTATE
BOARD OF REAL ESTATE APPRAISERS
4CCR 725-2

CHAPTER 1: DEFINITIONS

Pursuant to and in compliance with Title 12, Article 61 and Title 24, Article 4, C.R.S. as amended, notice of proposed rulemaking is hereby given, including notice to the Attorney General of the State of Colorado and to all persons who have requested to be advised of the intention of the Colorado Board of Real Estate Appraisers (the “Board”) to promulgate rules, or to amend, repeal or repeal and re-enact the present rules of the Board.

STATEMENT OF BASIS

The statutory basis for the rules titled Rules of the Board of Real Estate Appraisers is Chapter 7 of Title 12, Article 61, Colorado Revised Statutes, as amended.  The General Assembly passed Senate Bill 90-34, effective July 1, 1990, which created the Board and mandated the licensing of real estate appraisers under the statutory terms and conditions.  The General Assembly has variously amended the statutes by passing House Bill 92-1177, House Bill 96-1080, Senate Bill 97-90, House Bill 97-1056, House Bill 00-1137 and House Bill 02-1130.

STATEMENT OF PURPOSE

The purpose of this rule is to effectuate the legislative directive to promulgate necessary and appropriate rules in conformity with the statute and the provisions of the federal Financial Institutions Reform, Recovery and Enforcement Act of 1989.

SPECIFIC PURPOSE OF THIS RULEMAKING

The specific purpose of this rule is to amend or repeal existing rules with respect to definitions. 

Proposed New, Amended and Repealed Rules

[Deleted material shown struck through, new material shown ALL CAPS. Rules, or portions of rules, which are unaffected are reproduced.  Readers are advised to obtain a copy of the complete rules of the Board at www.dora.state.co.us/real-estate/rulemaking/BOREA/index.htm]

CHAPTER 1:	DEFINITIONS
1.1	The Appraisal Foundation (TAF):  TAF IS THE ORGANIZATION THAT IS THE SOURCE OF APPRAISAL STANDARDS, QUALIFICATIONS AND ETHICAL CONDUCT IN ALL VALUATION DISCIPLINES TO ASSURE PUBLIC TRUST IN THE VALUATION PROFESSION.  That appraisal foundation established November 30, 1987 as an Illinois not-for-profit corporation, and its boards, councils and groups.  
1.2	Appraisal Qualifications Board, or (AQB):  The Appraiser Qualifications Board of The Appraisal Foundation:  THE AQB ESTABLISHES THE MINIMUM EDUCATION, EXPERIENCE AND EXAMINATION REQUIREMENTS FOR REAL PROPERTY APPRAISERS TO OBTAIN STATE CERTIFICATIONS.  IN ADDITION, THE AQB PERFORMS A NUMBER OF ANCILLARY DUTIES RELATED TO REAL PROPERTY AND PERSONAL PROPERTY APPRAISER QUALIFICATIONS.
1.3	Appraiser Standards Board, or (ASB) :of The Appraisal Foundation:  THE ASB DEVELOPS, INTERPRETS AND AMENDS THE UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE (USPAP).
1.6	Board:  The Colorado Board of Real Estate Appraisers CREATED AND FURTHER DEFINED PURSUANT TO §12-61-703, C.R.S.
1.8	Initial License:  That THE FIRST license issued when GRANTED BY THE BOARD TO an applicant pursuant to §12-61-706, C.R.S. is first approved for a license by the Board.  AN APPLICANT MAY APPLY FOR AN INITIAL LICENSE AT ANY CREDENTIAL LEVEL AS LONG AS ALL REQUIREMENTS FOR SUCH CREDENTIAL LEVEL HAVE BEEN MET PURSUANT TO CHAPTER 3 OF THESE RULES.  An initial license is valid through December 31 of the year of issue.
1.10	Uniform Standards of Professional Appraisal Practice, or (USPAP):  Those Uniform Sstandards of Pprofessional Appraisal Ppractice promulgated by the Appraisal Standards Board of The Appraisal Foundation and adopted in Chapter 11 of these Rules through incorporation by reference. 
1.12	Registered (TRAINEE) Appraiser:  A REGISTERED APPRAISER IS A TRAINEE who has been granted a license pursuant to §12-61-706(1)(b)(IV), C.R.S. as a Registered Appraiser by the Board as a result of meeting the real estate appraisal education and real estate appraisal examination requirements established by Board Rule 2.1, THE AQB, OR AS A RESULT OF LICENSURE THROUGH ENDORSEMENT FROM ANOTHER STATE AS PROVIDED BY CHAPTER 9 OF THESE RULES., which license is in good standing.  The scope of practice for the Registered OR TRAINEE Appraiser shall be those properties that the supervising appraiser is permitted and competent to appraise, or as allowed by §12-61-706(5), C.R.S.
1.13	Licensed Appraiser:  A person who has been granted a license pursuant to §12-61-706(1)(b)(III), C.R.S. as a Licensed Appraiser by the Board as a result of meeting the real estate appraisal education, real estate appraisalexperience, and real estate appraisalexamination requirements established by Board Rule 2.2, THE AQB, or as a result of licensure through endorsement from another state as provided by Chapter 9 of these rules, which license is in good standing.  The usual scope of practice for the Licensed Appraiser shall be, if competent for the assignment, appraisal of non-complex one to four unit residential properties having a transaction value of less than $1,000,000 and complex one to four unit residential properties having a transaction value of less than $250,000, or as allowed by §12-61-706(5), C.R.S.
1.14	Certified Residential Appraiser:  A person who has been granted a license pursuant to §12-61-706(1)(b)(II), C.R.S. as a Certified Residential Appraiser by the Board as a result of meeting the real estate appraisal education, real estate appraisalexperience, and real estate appraisalexamination requirements established by Board Rule 2.3, THE AQB, or as a result of licensure through endorsement from another state as provided by Chapter 9 of these Rules, which license is in good standing.  The usual scope of practice for the Certified Residential Appraiser shall be, if competent for the assignment, appraisal of one to four unit residential properties without regard to transaction value or complexity, or as allowed by §12-61-706(5), C.R.S.  Such scope of practice includes VACANT OR UNIMPROVED land THAT IS TO BE USED FOR suitable for development to FOR A one to four UNIT residential PROPERTYunits, OR VACANT OR UNIMPROVED LAND FOR WHICH THE HIGHEST AND BEST USE IS A ONE TO FOUR UNIT RESIDENTIAL PROPERTY.  THE SCOPE OF PRACTICE FOR A CERTIFIED RESIDENTIAL APPRAISER but does not include VACANT OR UNIMPROVED land THAT HAS THE POTENTIAL FOR SUBDIVISION DEVELOPMENT for which a THE subdivision DEVELOPMENT analysis METHOD OF LAND VALUATION or /appraisal is necessary AND APPLICABLE.
1.15	Certified General Appraiser:  A person who has been granted a license pursuant to §12-61-706(1)(b)(I), C.R.S. as a Certified General Appraiser by the Board as a result of meeting the real estate appraisal education, real estate appraisalexperience, and real estate appraisalexamination requirements established by Board Rule 2.4, THE AQB, or as a result of licensure through endorsement from another state as provided by Chapter 9 of these Rules, which license is in good standing.  The scope of practice for the Certified General Appraiser shall be, if competent for the assignment, appraisal of all types of real property.  
1.20	Contingent Fee:  Compensation paid to a person who is licensed as a registered, licensed or certified appraiser, as a result of reporting a predetermined value or direction of value that favors the cause of the client, the amount of value estimateOPINION, the attainment of a stipulated result, or the occurrence of a subsequent event DIRECTLY RELATED TO THE APPRAISER’S OPINION AND SPECIFIC TO THE ASSIGNMENT’S PURPOSE.  A person licensed as a registered, licensed or certified appraiser employed by a business entity which is compensated by a contingent fee is considered to be compensated by a contingent fee.
1.22	Distance education:  Educational methodologies and presentation techniques other than traditional classroom formats, including,AND without limitation, live teleconferencing, written OR ELECTRONIC correspondence courses, internet on-line learning, video and audio tapes, and others.
1.25	Supervisory appraiser:  any ACTIVE licensee who acts in a supervisory role in the preparation DEVELOPMENT AND REPORTING of appraisals, appraisal reports, and other appraisal work products.  Includes, without limitation, any licensee who signs a report in a manner indicating they exert control over the action of any assistant or associateTRAINEE OR LICENSEE, or who acts to guide or manage the work of any assistant or associateTRAINEE OR LICENSEE.  A supervisory appraiser is required to be in good standing with the Board, with no disciplinary actions taken against the supervising licensee’s license during the two THREE years preceding the period of supervision.
1.26	Qualifying education:  real estate appraisal education courses completed for credit toward the licensing requirements set forth in Chapter 2 of these Board Rules and meeting the requirements of Chapter 3 of these Board Rules.  Qualifying education courses must be at least 15 classroom hours in length and must include an examination.  Qualifying education courses may be used to satisfy the continuing education requirements set forth in Chapter 7 of these Board Rules.
1.27	Continuing education:  real estate and real estate appraisal related courses completed for credit toward meeting the continuing education requirements set forth in Chapter 7 of these Board Rules.  Continuing education courses meeting the requirements of Chapter 3of these Board Rules may be acceptable for credit toward meeting qualifying education requirements.
1.29	Appraisal (VALUATION) process:  the analysis of factors that bear upon value, including definition of the appraisal problem, gathering and analyzing data, applying appropriate valuation approaches and methods, arriving at an opinion of value and reporting the opinion of valueTHE ANALYSIS OF ECONOMIC FACTORS THAT CREATE VALUE TO DEVELOP AN OPINION OF VALUE.  STEPS IN THE ANALYTICAL PROCESS ARE:  DEFINING THE PROBLEM; DETERMINING AN APPROPRIATE SCOPE OF WORK; GATHERING AND ANALYZING GENERAL AND SPECIFIC DATA; APPLYING THE APPROPRIATE ANALYSES, PROCEDURES AND METHODOLOGY; THE APPLICATION OF RECONCILIATION CRITERIA TO REACH A FINAL DEFINED VALUE OPINION; AND CORRECTLY REPORTING THAT OPINION IN COMPLIANCE WITH THE UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE.
1.31	Real Property Appraiser Qualification Criteria:  Pursuant to Section 12-61-706(1) and (2), C.R.S. (as amended), the Board incorporates by reference in compliance with Section 24-4-103(12.5), C.R.S., the Real Property Appraiser Qualification Criteria adopted by the Appraiser Qualifications Board of The Appraisal Foundation through May 5, 2006, including the interpretations thereof.  Amendments to the Real Property Appraiser Qualification Criteria adopted subsequent to May 5, 2006 are not included in this rule.  A certified copy of the Real Property Appraiser Qualification Criteria is on file and available for public inspection with the Program Administrator at the offices of the Board of Real Estate Appraisers at 1560 Broadway, Suite 925, Denver, Colorado.  Copies of the Real Property Appraiser Qualification Criteria incorporated under this rule may be examined at any state publications depository library.  The Real Property Appraiser Qualification Criteria may be examined at the internet website of The Appraisal Foundation at www.appraisalfoundation.org, and copies may be ordered through that mechanism.  The Appraisal Foundation may also be contacted at 1155 15th Street, NW, Suite 1111, Washington, DC 20005, or by telephone at (202) 347-7722 or by telefax at (202) 347-7727.  The Real Property Appraiser Qualification Criteria shall remain in effect through December 31, 2007.  REPEALED.
1.33	Credential upgrade:  An existingA licensee, who has been granted a license pursuant to §12-61-706, C.R.S., may submit an application to the Board requesting an upgrade of the licensee’s credential if the licensee has completed the REAL ESTATE APPRAISAL education, examinationEXPERIENCE, and experienceEXAMINATION requirements as defined in Chapter 2 OF THESE RULES for the credential for which the licensee is applying.  If the Board grants the requested credential, the upgraded license will expire on the same date of the licensee’s current license cycle, prior to the upgrade.
1.36	GOOD STANDING:  NOT HAVING BEEN SUBJECT TO A STIPULATION AND FINAL AGENCY ORDER, OR A FINAL AGENCY ORDER FOR A PERIOD OF FIVE YEARS, OR HAD A LICENSE REVOKED OR PERMANENTLY SURRENDERED FOR ANY OF THE VIOLATIONS ENUMERATED UNDER §§12-61-710 OR 12-61-712, C.R.S. A LICENSE WILL BE CONSIDERED TO BE IN GOOD STANDING FIVE YEARS FOLLOWING THE EXECUTION OF THE STIPULATION AND FINAL ORDER, OR THE FINAL AGENCY ORDER, AND UPON SUCCESSFUL COMPLETION OF ALL TERMS.  IF A LICENSEE HAS AN EXECUTED STIPULATION FOR DIVERSION, THE LICENSE WILL NOT BE IN GOOD STANDING WITH THE BOARD UNTIL ALL TERMS OF THE STIPULATED AGREEMENT HAVE BEEN SUCCESSFULLY COMPLETED.