Federal agencies are considering raising the threshold for commercial real estate transactions requiring an appraisal from the current level of $250,000 to $400,000. The agencies including the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency have stated that they believe raising the floor will greatly reduce the number of transactions that require an appraisal and save costs and expenses in these transactions. The proposal requires that commercial real estate transactions at or below the threshold receive an “evaluation” which are less detailed than appraisals and do not require completion by a state licensed or certified appraiser.
New Jersey has adopted a “property taxpayer bill of rights” seeking to assist property owners with the real estate assessment process. New Jersey has one of the nation’s highest property taxes. Bill A-4007 requires the state division of taxation director to list taxpayers’ real property rights “in simple and nontechnical terms” and post it on the website of the various county tax boards and municipalities in the state. It also provides taxpayers with the “right to understand the calculation of the assessment on their real property, the right to detailed information about how to appeal an assessment of real property and the right to view the real property assessment of any other parcel of real property in the municipality in which the taxpayer’s property is located.”
The Utah legislature is considering policy changes regarding the acquisition of land for new charter schools and further expansions of existing schools. Specifically, there currently is uncertainty as to the eminent domain powers of charter schools in that state.
The Utah Administrative Rules Review Committee questioned what authority charter schools have to call on the state to seize property through eminent domain laws. Kristen Elinowski, a spokeswoman for the State Charter School Board, said because Utah’s eminent domain statute predates Utah’s charter schools policies, there is need for specific clarification of whether it is the state board of education, the charter school board or the charter school that should be the entity involved in approving the use of eminent domain.
The Georgia Supreme Court is considering an important case involving the state’s 2006 Landowner’s Bill of Rights statute. At issue is whether certain provisions of that statute are mandatory or merely advisory. The GA appeals court ruled that the City of Marietta violated that statute by not providing the property owner with details of the city’s appraisal of his property. The Landowner’s Bill of Rights says that the condemning authority should give the property owner an opportunity to accompany the appraiser during inspection, and provide the owner with “a written statement of, and summary of the basis for,” the offered amount. Marietta argues that these are not mandatory requirements. Oral argument was done last month.
Oregon has enacted legislation establishing a specific statute of limitations on civil actions against appraisers and appraisal firms for real estate appraisal activity. The law takes applies only to appraisals performed after January 1. It requires that any civil action against an appraiser or an appraisal firm commence within six years after the date of the “act or omission giving rise to the action.” The limitations will not apply to actions that allege fraud or misrepresentation.
Property owners whose land will be taken for the Sabal Trail Transmission LLC’s natural gas pipeline should be compensated under Florida law rather than federal rules, a Florida federal judge ruled.
In Sabal Trail Transmission LLC v. Real Estate et al, U.S. District Judge Mark Walker denied the pipeline’s request that eminent domain compensation be determined pursuant to the federal “just compensation” standard. The primary difference is that Florida’s just compensation includes attorneys’ fees and other expenses. Federal procedure does not provide for those expenses.
The New Jersey Appellate Division has held that the government can condemn easements for beach projects. In that case, the DEP sought voluntary easements from the landowners as part of a dune-and-berm system spanning the entire 18-mile length of Long Beach Island and 14 miles along Ocean County. The Court rejected the challenges of Ocean County property owners. The Court stated that the question was whether the specific eminent domain law at issue, N.J.S.A. 12:3-64, restricts the DEP to acquiring only a “fee simple” and not an easment. The appeals judges’ decision was based on the plain language of the statute and rejected the landowners’ arguments that the Legislature must have intended to limit the DEP’s authority to acquire only a fee simple.
Tennessee has enacted a law establishing a new statute of limitations regarding civil lawsuits and disciplinary actions against real estate appraisers. Under HB 376, any action to recover damages against a real estate appraiser must be brought within one year from the discovery of the act of omission giving rise to the action. However, in no event can an action be brought more than five years after the date the appraisal was performed.
Additionally, the Tennessee Real Estate Appraiser Commission cannot consider a complaint for a disciplinary acting that relates to an appraisal that was completed more than three years before the complaint was submitted.
The new law will take effect July 1, and will apply to appraisals performed after that date.
Florida has enacted a bill changing its appraiser licensing law. HB 927 includes changes advocated by the Appraisal Institute.
The law defines an “evaluation” as a “valuation permitted by any federal financial institutions regulatory agency for transactions that do not require an appraisal” and clarifies that a state-licensed appraiser may perform an evaluation. According to AI, appraisers in Florida were prevented from providing evaluations that are not in full compliance with the Uniform Standards of Professional Appraisal Practice even though federal requirements only call for compliance with the Interagency Appraisal and Evaluation Guidelines. State-licensed appraisers will now be able to perform services in compliance with federal requirements.
In addition, the law clarifies that the Florida Real Estate Appraiser Board has the authority to adopt rules allowing for the use of standards of professional practice other than USPAP for “nonfederally related transactions.” Such transactions include appraisal assignments for portfolio monitoring, financial reporting, litigation, tax and consulting, among other areas. The law requires appraisers using development and reporting standards other than those contained in USPAP to comply with USPAP Ethics and Competency Rules and other requirements adopted by the Board by rule. The law clarifies that any valuation work performed per standards other than USPAP cannot be used to satisfy the experience requirements for any Florida appraiser credential.
Tennessee has enacted a law that will prohibit the use of eminent domain to condemn land for industrial parks. It deletes the “industrial parks” exception for takings under 29-17-102 (E), . It also provides that any property taken must fall under the strict definition of “public use” as defined by T.C.A. 29-17-102, which references the Fifth Amendment of the U.S. Constitution and the Tennessee Constitution. In addition, it requires the condemning government body to compensate land owners for engineering fees, appraisal costs, and, in certain circumstances, legal fees that may be the result of a condemnation action. Roads, transportation projects, and utilities are exempt from these costs.