PURPOSE: This rule establishes the criteria for real estate appraising education providers to obtain approval of case study courses that can be offered for both education and experience credit towards licensure and/or certification.

PUBLISHER’S NOTE: The secretary of state has determined that the publication of the entire text of the material which is incorporated by reference as a portion of this rule would be unduly cumbersome or expensive. This material as incorporated by reference in this rule shall be maintained by the agency at its headquarters and shall be made available to the public for inspection and copying at no more than the actual cost of reproduction. This note applies only to the reference material. The entire text of the rule is printed here.

1. (1) General.

   1. (A) The case study course is an educational offering which shall be designed to investigate the intellectual development and practical application of constructing and reporting a real property appraisal. Any such course shall include both classroom and on-site instruction and experience, including the passage of a final examination for pre-licensure education credit, and the submission of one

2. (1) or more acceptable appraisal reports for experience credit.

   1. (B) Case study courses shall be at least thirty (30) hours of instruction. For each case study course, experience credit hours may not exceed three (3) times the education credit granted, and in no event shall the experience credit granted for a single course exceed ninety (90) hours. An applicant for licensure or certification may receive thirty (30) hours of pre-licensure education credit upon passage of an examination approved by the Appraiser Qualifications Board (AQB) course approval program or by an alternate method established by the AQB. A licensee may receive twenty-eight (28) hours of continuing education credit for a case study course as allowed pursuant to 20 CSR 2245-8.010. An applicant for licensure or certification will receive the experience credit upon completing one
3. (1) or more Uniform Standards of Professional Appraisal Practice (USPAP) compliant appraisal reports for the course. The USPAP, FINANCIAL INSTITUTIONS AND PROFESSIONAL REGISTRATION

2012 Edition, is incorporated herein by reference and can be obtained from The Appraisal Foundation, 1155 15th Street NW, Suite 1111, Washington, DC 20005, by calling (202) 347-7722, or at www.appraisalfoundation.org. This rule does not incorporate any subsequent amendments or additions to the USPAP. The amount of education and experience credit available from a case study course will be determined at the time it is approved by the AQB course approval program or by an alternate method established by the AQB.

1. (C) A course provider may offer case study courses in the following areas:

   1. 1. Residential, including but not limited

to, single family, modular, condominium, two (2) to four (4) family residential, manufactured, and other unique residences;

1. 2. Commercial, including but not limit-

ed to, the following uses: office, retail, shopping center, hotel or motel, convenience store, restaurant, apartments (five (5) or more units), subdivisions, or any combination thereof;

1. 3. Industrial, including but not limited

to, warehouses;

1. 4. Special uses, including but not limit-

ed to, houses of worship;

1. 5. Agricultural, including but not limit-

ed to, farms (row crop and/or pasture), and timberland;

1. 6. Review appraisals in any of the areas

listed above in this subsection;

1. 7. Appraisal consulting, including but

not limited to, feasibility studies or marketability studies in any of the areas listed above in this subsection;

1. 8. Appraisal management, including but

not limited to, 1) supervisory appraiser responsibilities, functions and liabilities, and 2) management of an appraisal office including but not limited to staff management and supervision, databank, and plant set-up;

1. 9. Miscellaneous, including but not lim-

ited to, condemnation appraisals in any of the areas listed above in this subsection; and

1. 10. Any other area approved by the

AQB.

1. (D) A case study course shall require completion of one (1) or more appraisal reports of the type of property to which the course pertains. The appraisal report(s) may value any real property interest, including, but not limited to, fee simple, leased-fee, leasehold, sub-leasehold, fractional interest, physical segment, or partial holding. Personal property and business valuation issues shall be addressed if related to the appraisal of real property, but shall not be the primary focus of the course.
2. (E) The provider shall assure that the course includes review of the appraisal process, including an in-depth review of the methods and techniques used in the three (3) approaches that pertain to the type of property appraised and the development and reporting requirements of the USPAP. The instruction regarding USPAP principles should include, at a minimum, discussion regarding the scope of work, the type of report used (self-contained, summary, restricted-use, or oral) and the other specific methods and techniques required in the report. Other appraisal report preparation issues that shall be discussed in the course include report format (narrative or form), grammar and syntax issues, quality control, and details relating to pertinent addendum for the type of property or report. The instructor or other approved USPAP reviewer shall be available to answer questions from and provide input to the students as to the deficiencies in the submitted appraisal report(s).
3. (F) A case study course shall include substantial time with the instructor in the field as well as in classroom instruction. The case study course shall include the following for each appraisal report completed, if applicable: inspect the subject property and neighborhood, view and photograph the comparable sales and rental properties used in the three (3) approaches, research and analyze data to apply the three (3) approaches to value, and reconcile the estimated values from each valuation approach to develop a final value opinion. The class may visit the courthouse, use data accessible via the Internet (multiple listing service (MLS), sales/listings, public information, demographic websites, etc.), and other sources, to collect the necessary data to perform the appraisal. To obtain experience credit from the course, an applicant for certification or licensure shall write a USPAP compliant appraisal report(s) reviewed and found acceptable by the course instructor or other approved USPAP reviewer. Before experience credit will be granted to an applicant for certification or licensure, the instructor or other approved USPAP reviewer shall certify to the commission that the appraisal report(s) required for the case study course is compliant with USPAP.
4. (G) A case study course regarding residential real property shall include completion of a written complete summary appraisal report of the subject property. A case study course regarding nonresidential real property shall include completion of a written complete self-contained appraisal report of the subject property. The appraisal report(s) shall be submitted to the course provider within thirty

1. (30) days after taking the course final examination. The course instructor or other approved USPAP reviewer will identify USPAP reporting deficiencies in the appraisal report. The provider will notify the student of any deficiencies noted in the appraisal report. The student shall correct all deficiencies to the satisfaction of the instructor or other approved USPAP reviewer.

   1. (H) All audio or visual teaching aids used in the course shall be used under the personal supervision of the instructor approved to conduct the course and may not exceed twenty percent (20%) of the total presentation. Guest speakers may not be used for more than ten percent (10%) of a course presentation and such guest speakers do not have to possess instructor credentials.
   2. (I) Upon submitting a statement from the provider of successful completion of a case study course, including passage of the course examination and completion of the required appraisal(s), an applicant for certification or licensure or a licensee shall receive the number of education and experience hours for which the case study course is approved, not to exceed thirty (30) hours of pre-licensure education credit, twenty-eight (28) hours of continuing education credit or ninety (90) hours of experience credit.

2. (2) Course Approval Application Process.

   1. (A) Any course provider desiring to provide a case study course to licensed and/or certified real estate appraisers and/or to applicants for licensure or certification as real estate appraisers shall obtain from the AQB, or by an alternate method established by the AQB, approval of each case study course, its instructor(s), and any other USPAP reviewer(s), if any, prior to enrolling any students in the case study course. A course provider shall submit verification to the commission that a case study course has been approved by the AQB.

3. (3) Course Administration Requirements.

   1. (A) Prior to enrolling a person for a particular case study course, the course provider shall require each prospective student to provide documentation of satisfactory completion of all course work required to obtain the license or certificate that is required under 20 CSR 2245-9.010(3) for an appraiser to perform the type of appraisal that is the subject of the case study course.

      1. 1. If a student is not licensed or certified

when enrolled in a case study course, the documentation shall include completion certificates for all pre-licensure courses required for licensure or certification.

1. 2. If a student is already licensed or cer-

tified when applying for a case study course, the documentation shall include a copy of the student’s state license or certificate and, if the course is for a type of appraisal which is outside of the scope of practice of the student’s current certification as defined by 20 CSR 2245-9.010, the documentation shall include completion certificates for any additional pre-licensure courses required for the different certification.

1. (B) All course providers shall maintain a list of case study curriculum classes offered with the following information on record and available for audit by the commission:

   1. 1. Course title;
   2. 2. The name, address, and business

phone number for each instructor and USPAP reviewer, if any;

1. 3. Class location, including facility

name and city;

1. 4. Class dates;
2. 5. Student roster, including student

name, address, phone number;

1. 6. Student registration, license or certi-

fication number, if any;

1. 7. Type of credit student earned (e.g.,

pre-licensure education, continuing education, and/or number of experience credits); and

1. 8. Documentation of AQB approval.
2. (C) Upon successful completion of each case study course, the course provider shall provide each student with a certificate specifying the type and number of education hours (pre-licensure or continuing education) and the number of experience hours he/she has earned.

1. (4) Course Objectives. Each case study course shall include the following objectives:

   1. (A) Cognitive. After completing an appraisal case study course, an individual should be able to:

      1. 1. Recall verbally or in writing the con-

trolling steps and sequences in the appraisal process;

1. 2. Demonstrate verbally or in writing

the elements of problem identification;

1. 3. Demonstrate verbally or in writing

the steps for proper scope of work decisions;

1. 4. Recall verbally or in writing relevant

USPAP and advisory references;

1. 5. Recall verbally or in writing the

appraiser’s ethical obligations;

1. 6. Demonstrate verbally or in writing

appraisal competency requirements;

1. 7. Demonstrate verbally or in writing

the binding requirements for appraisal development;

1. 8. Recall verbally or in writing the bind-

ing requirements for appraisal reporting; and

1. 9. Distinguish verbally or in writing

between the various classifications of appraisals and appraisal reports;

1. (B) Affective. After completing an appraisal case study course, an individual should develop an understanding of:

   1. 1. Competency as it relates to the scope

of work decision;

1. 2. The kind of information that shall be

identified and considered regarding the client’s intended use of an appraisal;

1. 3. Relevant characteristics;
2. 4. How to analyze the effect of assign-

ment conditions on the appraisal process;

1. 5. The relationship between intended

use and a credible solution;

1. 6. How the standard of value affects the

scope of work decision;

1. 7. Reasonable exposure time;
2. 8. How the appraiser’s workfile pre-

serves evidence of all applicable data that supports the appraiser’s opinions and conclusions; and

1. 9. The appraiser’s responsibility to

demonstrate proper judgment and execution; and

1. (C) Skills. After completing a real property appraisal case study course the student should be able to do the following:

   1. 1. Identify the appraisal problem;
   2. 2. Make a proper scope of work deci-

sion;

1. 3. Conduct a market analysis;
2. 4. Identify the subject property’s neigh-

borhood and conduct a neighborhood analysis;

1. 5. Identify relevant real property charac-

teristics;

1. 6. Discern assignment conditions;
2. 7. Describe site improvements;
3. 8. Describe real property improvements;
4. 9. Collect and analyze cost construction

data;

1. 10. Collect and analyze sales compari-

son data;

1. 11. Collect and analyze income

approach data;

1. 12. Reconcile data into final value opin-

ion; and

1. 13. Prepare a written real property

appraisal report in compliance with USPAP.

1. (5) Unit Titles. The following is a sample of possible unit titles and time allocations that might be used for a case study course curriculum.

   1. (A) Problem Identification and Scope of Work Decision (4 Hours)—

      1. 1. The appraisal process defined;
      2. 2. The eleven (11) basic controlling

steps and their sequence;

1. 3. Ethics and Competency;
2. 4. Prohibitions and Exhortations;
3. 5. Judgment and Execution;
4. 6. Intended Use and Intended Users

Interview; 20 CSR 2245-6

1. 7. Work Order;
2. 8. Problem Identification;
3. 9. Departure Possibilities;
4. 10. Scope of Work;
5. 11. Preliminary Survey and Appraisal

Plan; and

1. 12. Appraisal Contract.

2. (B) Data Collection and Analysis—General Data (5 Hours)—

   1. 1. Market Analysis;
   2. 2. Financial Analysis;
   3. 3. Economic Base;
   4. 4. Market Trends;
   5. 5. Forecasts;
   6. 6. Neighborhood Analysis; and
   7. 7. Measures of Central Tendency.

3. (C) Data Collection and Analysis—Specific Data (7 Hours)—

   1. 1. Property Rights;
   2. 2. Physical Characteristics of the Site

and Improvements;

1. 3. Environmental Issues;
2. 4. Conformity;
3. 5. Cost and Depreciation Data;
4. 6. Comparative Properties;
5. 7. Elements of Comparison;
6. 8. Units of Comparison; and
7. 9. Income Analysis.

8. (D) Appraisal Development (9 Hours)—

   1. 1. Identify the Client and Other Intend-

ed Users;

1. 2. Identify the Intended Use of the

Appraiser’s Opinions and Conclusions;

1. 3. Identify the Purpose of the Assign-

ment—Standard of Value;

1. 4. Identify the Effective Date of the

Appraiser’s Opinions and Conclusions;

1. 5. Identify the Characteristics of the

Property that are Relevant to the Purpose and Intended Use of the Appraisal;

1. 6. Identify the Scope of Work Necessary

to Complete the Assignment;

1. 7. Identify any Extraordinary Assump-

tions Necessary in the Assignment;

1. 8. Identify any Hypothetical Conditions

Necessary in the Assignment;

1. 9. When Applicable, Develop an Opin-

ion of Highest and Best Use;

1. 10. Analyze and Collate Site Data;
2. 11. Analyze and Collate Cost Construc-

tion Data;

1. 12. Analyze and Collate Sales Compar-

ison Data;

1. 13. Analyze and Collate Income Data;
2. 14. Analyze all Agreements of Sale,

Options, or Listings of the Subject Property that are Current as of the Effective Date of the Appraisal;

1. 15. Analyze all Sales of the Subject

Property that Occurred Within the Three (3) Years Prior to the Effective Date of the Appraisal; FINANCIAL INSTITUTIONS AND PROFESSIONAL REGISTRATION Division 2245—Real Estate Appraisers

*Original authority: 339.509, RSMo 1990, amended

1. 16. Reconcile the Quality and Quantity 1998.

of Data Available and Analyzed Within the Approaches Used; and

1. 17. Reconcile the Applicability or Suit-

ability of the Approaches Used to Arrive at the Value Conclusion.

1. (E) Appraisal Reporting (5 Hours)—

   1. 1. Review Competency Requirements

for Reporting;

1. 2. Review Reporting Formats;
2. 3. Report the Identity of the Client and

any Intended User by Name or by Type;

1. 4. Report the Intended Use of the

Appraisal;

1. 5. Describe Information Sufficient to

Identify the Real Estate Involved;

1. 6. Report the Real Property Interest

Appraised;

1. 7. Report the Purpose of the Appraisal,

Including the Type and Definition of Value and its Source;

1. 8. State the Effective Date of the

Appraisal and Date of the Report;

1. 9. Report Sufficient Information to Dis-

close the Scope of Work;

1. 10. State all Assumptions, Hypothetical

Conditions, and Limiting Conditions;

1. 11. Report the Information Analyzed,

the Appraisal Procedures Followed, and the Reasoning that Supports the Analyses, Opinions, and Conclusions;

1. 12. Address the Use of the Property that

is the Subject of the Appraisal;

1. 13. Report and Explain any Permitted

Departures;

1. 14. Include a Signed Certification; and
2. 15. Discuss Work File Requirements.

3. (F) Appraisal Practicum—

   1. 1. All case study students will demon-

strate appraisal development and reporting skills by submitting an acceptable appraisal on an assigned property. The appraisal will be a culminating activity performed in partial fulfillment of the requirements for the “Case Study Course” related to appraisal licensure or certification; and

1. 2. Appraisal reports may be submitted in

sections for instructor review and approval. When all sections are completed satisfactorily, the entire report accompanied by the appraisal work file shall be presented to the instructor or other approved USPAP reviewer.

AUTHORITY: section 339.509(3) and (4), RSMo 2000.* Original rule filed Nov. 21, 2006, effective July 30, 2007. Amended: Filed March 31, 2008, effective Sept. 30, 2008. Amended: Filed Aug. 27, 2009, effective Feb. 28, 2010. Amended: Filed June 15, 2011, effective Dec. 30, 2011.