Welcome to the Legislative Forum at MSCAPP! As current chairman of the MSCAPP Legislative Committee I will try to discuss issues, answer member questions, and provide useful information regarding the many topics which fall under the broader general heading of governmental affairs, including specific legislation which may impact appraisers.

Like any forum, any member can initiate threads on topics of concern, post replies to existing threads, or simply read the post to keep abreast of what is going on. MSCAPP also has a number of specific topic categories, such as an AMC discussion forum sub-category, already set up which may be more suitable for general discussions. The Legislative Forum, however, might be more appropriate when the topic of discussion for, say AMC issues, is regarding the existing law, changes being proposed to the laws, agency rules regarding AMC's, or similar subjects. But don't worry, if you post something here in this forum, it will still likely be addressed even if it is more germane to one of the other categories.

So feel free to post!! This is your association and your forum. Your participation is welcome and essential to having a vibrant, well informed appraisal community.

Also, if you subscribe to a given topic, notification will be sent to you when new posts are made, thus you can be sure not to miss anything.

This will be a very busy year with a number of critical issues likely to arise which could impact appraisers. So be sure you take a look at this forum on a regular basis. I will be posting a first update in the next few days on the issue of raising appraisal license fees which may be considered by the legislature this year. You will want to remain alert regarding this issue!

In bullet point form, here is a quick run down of actions taken this morning by the Mississippi Appraisal Board (MAB.)

1) Motion passed to pursue legislative amendments to the state statues to:

a) Raise the initial registration fee for AMC's from the current $500 to $2,500.

b) Raise the renewal fee for AMC's from the current $500 to $1,500.

c) Raise the statutory cap on appraiser license fees from $325 to $425.

2) Motion passed to review the proposed AMC regulation rules for possible adoption at the next monthly meeting.

MSCAPP's three person delegation was permitted to address the MAB on the twin subjects of raising AMC registration fees and/or raising appraiser license fees. I presented MSCAPP's position, as outlined in our legislative agenda adopted by the board and the general membership, to the MAB. The above first motion is consistent with most of the major objectives in the MSCAPP legislative agenda. MSCAPP would prefer a straight $2,500 per year minimum annual fee be charged all AMC's doing business in the state but the above proposal is a good workable compromise that is substantially better than the current, woefully low $500 annual AMC fee.

MSCAPP projects about 100 AMC companies will register in Mississippi once the law is implemented. If the fees are raised to the levels voted upon by the MAB today, this would generate $250,000 of new revenue for the MAB in the first year and $150.000 in the second year and thereafter. By comparision, in the past several years, the maximum dollars spent by the MAB in any one year has been about $371,000 (but usually less.) Thus, the potential exists for AMC fees alone, if raised to a national level, to cover about 50% of the costs of running the MAB on a two year cycle basis. Obviously, appraisers, who also pay license fees on a two year cycle basis, would cover the other 50% of the MAB's operating expenses. To MSCAPP, this represents a "fair sharing" of the costs of supporting the state regulatory agency by those who are being regulated.

The current MAB Board seems agreeable to the concept of giving "Plan A" time to develop before any efforts are made to implement an appraiser license fee increase. Plan A is to seek legislation amending the AMC bill passed last session. MSCAPP will continue with its efforts to draft a bill consistent with the MAB position and MSCAPP's position, get it introduced by the mid-February deadline, and work to get it passed. If we are successful, an appraiser license increase may not be necessary. No shortfall is likely to occur until FY 14, which does not begin until July 1, 2013. There should be ample income to cover MAB expenses for the next 18 months.

However, there must be a "Plan B" in place to cover the shortfall of revenue projected for the FY 2014 MAB budget in the event AMC fees are not raised. Realistically, the continued operation of the MAB is essential and funding must come from somewhere. Thus, in case the legislature does not pass a bill to raise AMC fees, authority to raise appraiser license fees by lifting the statutory cap must be in place as a "backup" plan. MSCAPP has recommended the cap be raised only by $100 which would provide ample room to raise license fees to cover any shortfall. Based on the best projections avaiable, the shortfall in revenue is most likely to be in the range of $50,000 to $75,000 for FY 14's budget and unlikely to exceed $100,000. Based on 1,300 licensed appraisers, to make up the most likely shortfall out of appraiser's pockets, a license fee increase of about $40 to $60 would be sufficient. In a worst case basis, an $80 increase in the appraiser license fee would cover the highest anticipated shortfall amount. Thus there is no reason to raise the statutory cap higher than the $425 recommended by MSCAPP and included in the MAB motion. Keeping the cap low means any future MAB Board will need to revisit this issue if and when any further shortfalls do occur but it would solve the current problem for now.

Keep in mind, raising appaiser license fees is "Plan B" not Plan A, both of MSCAPP and the MAB. The sources of funds for the MAB are almost entirely from either appraisers in the form of license fees or from AMC's in the form of registration fees. MSCAPP's official position is that appraisers are willing to pay an equitable "fair share" of the costs to run the MAB but given the extremely low fees in Mississippi for AMC's as compared to most other states, the plain facts are it is the AMC's who would not be paying a "fair share" unless their fees are raised. So the task now is to get Plan A enacted so as to avoid Plan B taking money from appraiser pockets. In a survey of other states conducted by MSCAPP, the mode of fees in about a dozen states was a $2,400 fee for AMC's. Therefore, the data clearly shows a $2,500 AMC fee is certainly not an unrealistic fee, as most AMC's are paying this fee or higher fees in many states where AMC laws are already in place.

Regarding the AMC proposed regulatory rules, MSCAPP several months ago sent an extensive set of recommendations to the MAB Administrator for consideration. A cursory review indicates many of our concerns probably have been addressed in the proposed rules. However, we will study the newest version of the rules to see if all our concerns were addressed and offer additional comment at the appropriate time when the rules are considered by the MAB. These rules will have impact on both appraisers and AMC's as they do set forth procedures to be followed when there are Appraiser vs. AMC complaints (or vice versa.)

We are in a new, previously non-existant era where there will be regulation of AMC's for the first time by a Mississippi regulatory agency. There will be unanticipated situations, for sure, but it behooves appraisers to do what can be done to insure we "get it right" with the adoption of laws and agency rules to regulate the often different interests of appraisers and AMC's. MSCAPP will continue to work hard to do just that.

In the above outline of the vote by the MAB, I failed to include one other important part of the motion that passed. The MAB voted to impose a $50,000 surety bond requirement for all AMC's registering in the state. This provision would, as with the other items, require legislative action to implement and is NOT effective merely because the MAB voted for the requirement.

Mississippi's weak AMC regulatory law was passed with very strong banking lobby support but without a surety bond provision (and with the extremely low AMC fee provision.) Be sure to thank your Mississsipi bankers and lenders (our appraisal clients) for their support of our profession! The banking industry lobby is a very powerful lobby that contributes a large amount of money to politicians. The banking industry also has its "fingers" in places of influence by having sympathetic people allied to their profession in place as directors on influential boards and commissions that oversee the various aspects of the real estate industry. In both the BPO and AMC battles last year, the strongest opposition we faced was from the banking industry lobby. In many instances, such as with the surety bond provision, "our side" simply could not prevail against the banking lobby influence.

But we will try again this year. The difference may be that the entire MAB has voted without opposition to impose the surety bond and other requirements on the AMC's. It is much harder for the banking industry (but certainly not impossible!) to fight successfully against the stated desires of a state regulatory agency, especially since the Chairperson of the MAB this year holds the seat customarily filled by an appraiser who is a staff employee of a bank. My hope is this combination of MSCAPP and other appraisers plus the appraisal board being "on the same page" together will carry weight when the legislation is considered.

A surety bond protects the public from any AMC failing to follow the state laws. If an AMC violates the laws, the bonding company can be called upon to pay the costs of fines or other actions needed to comply with the law if the company cannot or does not agreeably pay. There have been, for example, instances of AMC's going bankrupt and leaving appraiser fees unpaid. Typically when a surety bond provision is written into an AMC regulatory law, part of the requirements are for the bond to insure against failure to pay appraisal fees in a timely manner. Since the AMC law aready requires timely payment of appraisal fees (within 60 days) the bonding process merely sets up a way to enforce that law in a "worst case" scenario where the AMC fails to pay. Every state MSCAPP surveyed has a surety bond provision in their law except Mississippi.

Please understand what we are asking for here is "good public policy" as it is part and parcel of the AMC laws everywhere else we have researched. The banking industry opposed this law with the full knowledge that it benefited them exclusively and when absent, leaves appraisers and the general public with no effective means of insuring an AMC follows the laws or pays the costs for not doing so. As legislative chairman, I have to point out that the banking lobby, by the act of resisting this type of provision last year, acted in its own special interest and not for the public good. We need to remedy this situation this year.

Things are moving very rapidly now, as we near the deadline for filing general bills in the Legislature on Monday (Feb. 20.) MSCAPP's bill has been drafted, circulated to my Legislative Committee members, to our Board of Directors, to the MS Appraisal Board members and staff, and to key legislators for everyone's review. The bill is now ready to be filed by the Monday deadline.

Your dues are a vital source of funds that we MUST have to fight for our legislative agenda, as we have a very good lobbyist to pay for his time and services. Without the talent we have in our lobbyist and his strong, effective work on our behalf, MSCAPP would not be able to do what we have already done with the BPO and AMC bills last year or what we still need to do with the License Fee Bill this year. As appraisers, we have to be proactive in fighting for the things we need. And it takes money, in addition to our volunteer time, to achieve our goals. If you have not renewed your dues, please do so now. And get another appraiser to join our group also. Help me, and your MSCAPP leadership, do what we can to improve the conditions for appraisers. It's the best $75 you can possibly spend to improve your future!

Ok, my Sunday sermon is over. Back to the update on our legislation. Representative Jeff Guice, from the Gulf Coast, has agreed to sponsor our bill in the House. He as well as MSCAPP are asking other legislators to join as co-sponsors. Similarly, in the Senate, our bill is being sponsored by Senator Gary Jackson. Please be sure to thank them for helping us! Other legislators are also likely to co-sponsor our bill with these two in the lead.

We need YOU, yes YOU, to contact your legislators or those you know to ask them to co-sponsor and support out bill. They can add their names to the bill and that will help us build the support we will need to get it passed. Please contact your legislators now. Even if they won't co-sponsor the bill, we still will need their vote for our bill. They need to hear how you feel about AMC's paying a fair and equitable fee and about why a surety bond by an AMC is needed to guarantee the AMC's who go bankrupt don't leave appraisers unpaid.

Both the MAB and MSCAPP are pushing for this bill. The MAB is on record with a formal vote and we have a written statement from the Administrator indicting they are 100% in favor of the proposed bill. We appreciate the work of our MAB and are very glad we can all be "on the same page" with this issue. Please know that your MAB Board representatives, who are all appraisers themselves, do understand our business and are as concerned as the rest of us about passage of this legislation. The MAB works for the measly low pay of $40 per day (and you thought AMC fees were low!) so please be sure to thank them for their service to our industry.

Should any member have any concerns, questions, or just need some talking points about our proposed bill, feel free to post to this forum or just get in touch with me. I will be happy to assist you in any way I can. It will take a united effort by all appraisers to get this bill passed. It's not something I can do myself nor can any single member. We must band together and work for what we need with our Appraisal Board and others if we want to get this bill through the legislature this session.

Thanks for any help you can give!

House Bill 1286 (our MSCAPP bill) was filed by Representative Jeff Guice prior to the Monday deadline and is now on the legislative calendar for consideration. THANK YOU, JEFF!!
The short description of what our bill relates to, as per the legislature, is: "Appraisal management companies; revise law and fee."

The bill has been assigned to the Ways and Means Committee. Our bill must be "reported out" of this committee in order to proceed "up the ladder" for further consideration. There is a long path to get legislation passed and it is by no means certain. So we have a lot of work to do. And we must have the help of every MSCAPP member to do it.

If you know people who are on the House Ways and Means Committee, please contact them and explain we need their support of HB 1286 to get it out of committee. We need any legislator who will support our bill to "be there" on the day our bill is considered and to "vote for" passage of our bill as written. While the committee can and possibly may alter our bill in any way it sees fit, the ideal scenario would be to pass it intact. This committee, for those who are interested, has a 20-13 Republican majority. Here is the composition of this committee:

Ways and Means
Jeffrey C. Smith, Chairman; Ray Rogers, Vice-Chairman
Members: Brian Aldridge; Mark Baker; Richard Bennett; Edward Blackmon, Jr.; Chris Brown; Credell Calhoun; Gary Chism; Tyrone Ellis; James Evans; Mark Formby; Andy Gipson; Esther Harrison; D. Stephen Holland; Steven A. Horne; Sherra Hillman Lane; Bennett Malone; Rita Martinson; Brad Mayo; Kevin McGee; Bobby Moak; Alex Monsour; Thomas U. Reynolds; Omeria Scott; Ferr Smith; Gary V. Staples; Johnny W. Stringer; Jerry R. Turner; Jessica Upshaw; Tom Weathersby; Tommy L. Woods; Henry Zuber III

Finally, if you want to keep up with the progress of our bill, you may enjoy checking the MS Legislature website via this link to find its status:

billstatus.ls.state.ms.us/

Should you have questions, feel free to post them here or contact me. We do need your help!

Significant progress in achieving our MSCAP legislative goal to enact the MAB Fee Bill (SB 2903) has been made, despite various opposing actions to defeat out efforts. Here is what has transpired to date and where we stand, as of today.

First, we presented the MSCAP appraisal community’s desired legislative agenda to the MAB. We hoped to raise the AMC fees to $2,500 per year, impose a $25,000 surety bond requirement on the AMC’s, and limit appraiser fee increases to no more than $100. Upon review of our proposal, the MAB took a somewhat different approach and voted to lower the AMC fee increase we proposed to $2,500 for the initial registration and $1,500 for renewals thereafter but to raise the surety bond to $50,000. While MSCAP and appraisers in general likely would have preferred to see our $2,500 registration fee apply to AMC’s for all second year and later registrations instead of the MAB’s $1,500 fee, in order to get everyone “on the same page” in the appraisal community before presenting our bills to the legislature, MSCAP compromised and agreed to conform our legislation to the MAB vote.

Second, we sought and found legislative sponsors in both the House and the Senate to introduce identical bills in each chamber, with those bills being supported by both the MAB and MSCAP. Before the bills were considered, MAR’s legislative committee also voted to support our bills. Therefore, the Realtors joined in with us. The bills introduced in the legislature thus contained the MAB fee provisions as reflected in their official vote, not MSCAP’s original proposed version.

Third, our bill was amended in the Senate to lower the proposed AMC fee still further to a straight $1,500 fee for all years, including the first year. The surety bond provision was also lowered to $25,000 in the Senate amended version. Those two changes were compromised in order to eliminate serious opposition from the banking lobby so our bill would not be killed in the Senate committee. In exchange for those compromises, all provisions for any appraiser license fee increases were removed from the bill. With everyone in general agreement, the Senate amended version passed the committee and subsequently was passed by the Senate as a whole. It was then forwarded to the House for consideration.

Fourth, during this same time period, our original House version was assigned to the Ways and Means Committee where it was promptly killed. Our bill never made it out of that committee and was dead in the House for this session. Thus, our only chance for success was for the House to adopt and pass the amended Senate version. As fate would have it, the Senate version was assigned back to the Ways and Means Committee in the House where we once again feared it would be killed.

Fifth, in the interim, opposing forces began to work harder against passage of our bill. A prominent lobbyist began to make key legislative contacts trying to kill the bill in the house. Emails were sent to appraisers around the state asking them to work against MSCAP and the MAB to defeat the bill in the dubious hope that AMC’s would generously give all the money they saved to appraisers by paying them higher fees. (Who actually thinks that would happen?)

Sixth, a subcommittee of the House Ways and Means Committee today took up the Senate version of our bill and, apparently in response to the opposing forces pressure, further amended the bill to lower the AMC fees. The House subcommittee lowered the AMC fee to only $600 per year and cut the surety bond down to just $20,000 plus inserted a repealer clause. That is the way politics and the legislative process works. Forces struggle to achieve what they want and seek to influence the eventual outcome of proposed legislation in their favor. That is precisely what we are doing at MSCAP…seeking to achieve benefits that support appraisers. This process of compromise and amendment happened when the MAB considered our proposal, it happened when the Senate considered our proposal, and it has now happened in the House. There is NOTHING unexpected about events working out this way. In fact, few would believe two bills that raise fees would readily pass both chambers without any changes. Again, who would actually think that would happen?

However at the end of the day, where do we stand now? We are FORTUNATE the Ways and Means Committee PASSED the bill, even though it is amended. Had it been killed a second time by the Ways and Means Committee today, as just a few days ago we feared it might, our legislation would be dead for this year. Getting the bill out of the committee and on the House calendar for a vote by the full House is a major victory even if the dollar amounts in the House version are lower than the dollar amounts in the Senate version already passed. There are ways to work out the differences in the dollar amounts to some agreeable figures.

The House will need to vote upon the bill at some point before the deadline in about two more weeks. They can vote on it at any time they choose to take the measure up for debate. MSCAP has not stopped working to get this bill passed with language closer to the Senate version. We support the Senate version and will continue to do so. The House bill can still be amended when it comes up for a House vote and an effort to strike the fee cuts imposed by the committee will most certainly be made. It is even theoretically possible the bill can be amended back to the full provisions MSCAP originally proposed and we are lining up support to possible make such an amendment if we feel the support is there for passing it. Our bill is very much still alive and headed for a floor vote in the House. Despite trying hard, our opponents have not killed our bills yet. Our bills have survived five (5) crucial votes so far and “our bill has legs” with forward momentum in its favor. We are asking all MSCAP members to continue educating your representatives on the appraiser’s position regarding this matter.

It is critical for the House to pass the bill in some form, even if it is necessary to pass it with the low fees put in by the Ways and Means committee. If it passes the House with fees different from the Senate version, then the difference must be worked out either by Senate concurrence or by a conference committee. Eventually, in order to be sent on to the Governor for his consideration and possible signature, the bill must pass both chambers with the exact same language. Depending on how the events work out, we are only three or four steps away from our bill becoming law. In the words of the late Johnny Cash, we need to “Press On!”

If the bill goes to conference, then anything can be changed in the bill and further amendments or compromise may occur in order to achieve consensus. This is to be expected. As I have stated repeatedly, it is important for every MSCAP appraiser member to understand the path to getting legislation passed is a long, twisted, arduous, and costly path which often requires considerable compromise with the very opponents who don’t like our proposal and who work to kill it. Again, that is how the process works.

Please strengthen your efforts to contact your legislators. There is no need to bash our opponents or to be angered over political tactics used in the legislative process. That is very counter productive, as the next occasion we may need the support of some of these same legislators. Be courteous and speak of the positive talking points for our proposal. Let the legislators know that YOU are a voter in their district but that the out of state AMC’s are neither citizens of this state nor voters here.

And if you have questions, post to the MSCAP forum or contact me or other MSCAP officers at any time.