Appraisal Institute Withdraws from Foundation

On September 7, 2010, the Appraisal Institute (AI) released a statement withdrawing their sponsorship of the Appraisal Foundation.  Calling the Foundation’s statement unjust and unwarranted, the statement said the “Foundation’s decision to sanction the Appraisal Institute for conduct said to have violated the Foundation’s Bylaws is simply wrong.”  A video message to members from AI President Leslie Sellers can be viewed here.  A copy of the letter from AI stating their immediate withdrawal from the Foundation is available for members of AI.

As of this posting, the Appraisal Foundation has not made any public statements about the withdrawal of AI.  Their most recent statement was issued on September 3, 2010.

  1. Mona Capaci

    I watched the AI Presidential address, however, it was NEVER stated what exactly the issues are or were. Please spell those out in detail.

  2. DJM

    Appraisal Institue is primarily an educational provider. The survive on their overpriced classes and overpriced designations. They have over charged appraisers for years. I dont doubt the benefits of the MIA and SRA but the cost is prohibitive to most of us. Now that we have State Certification and quality educational providers the Appraisal Institue continues its decline more every year. They are no longer the only game in town. I like what they do but get real $595 for a 30 hour course and $840 annual for MAI plus local fees. Keep in mind with an MAI and no State Certification you cant appraise anything and get a loan on it. I am glad AI got put in there place they need a new business plan

  3. CGA

    DJM is exactly correct. There are many experienced and knowledgeable residential and commercial appraisers without the SRA or MAI designations. Private or public entity clients requiring these particular private organization designations is a travesty of the highest order. That is, in large part, due to AI’s incessant political posturing within the public arena. As an educational provider, they are adequate at times and good at others. As a book seller, they are great. If the AI wants to be an advocate for the appraisal profession, by all means have at it. But, it appears they want to pressure industry participants to only engage MAI designees as the top of the appraiser food chain. Why not have certifications in different content areas, such as litigation support, conservation easements, green building valuation, historic housing, office buildings, multi-family housing, shopping centers, hotel valuation, etc. This could be offered by any state/federally approved educational provider, including the Foundation itself. Instead of a single catch all designation. That is what licensing/certification was meant for in the first place. Then the client could engage the particular appraiser on an assignment by assignment basis in regards to their particular knowledge base indicating competency. There are many MAI designated appraisers that are not competent in one or more of those specific areas. And, that goes for licensed/certified appraisers as well.

    My understanding is that the Foundation would like to offer a wide variety of appraisal courses and that the AI wants to stop it. Why? In order for the AI to continue to have a strangle hold on appraisal education? If not this reason, then exactly what is the problem? It cannot possibly be only that AI wants to offer USPAP materials to its members and others through its courses and the Foundation wants to change or modify the fee structure. That is silly. If anything, why not have the Foundation require that all courses pass the academic rigor offered through the ACE academic approval process so that everyone can get appropriate college credit for any coursework that they take, with the exception of CE credit. That should be the primary focus for appraisal classes. That would improve the “profession” in many ways.

  4. Jon

    I would l to know just what the specific amendment the Appraisal Institute proposed that would limit the Foundations future educational activities.

  5. Carlos Diez

    The specific issue is complicated and comes down to different interpretations of the bylaws. But the underlying issue is political, driven by animosity towards the AI (from some non AI members). Too involved to get into here, but…

    I feel I must comment on DJM’s statement. I hope (for the sake of the profession) that this person is not an appraiser. If he were, he would know that nobody can survive on selling overpriced anything. And people wouldn’t keep going through the trouble to get the designation if it didn’t pay off. The AI is NOT merely an education provider. The value is in the designation, a credential that says you’ve acquired a certain body of knowledge, met certain standards of quality. The value is in how the credential translates into better assignments and higher fees.

    It’s like telling a commercial broker that the CCIM Institute’s courses are too expensive and that they should be put in “there” place. They’d probably roll their eyes and say… that’s the point… if it were easy and cheap to get the designation, what would be the point of getting it? People who don’t get it, don’t get it because it’s too much work, not because they wouldn’t love to have it.

    You can knock the AI for a lot of things, but at least their goal is to set a high standard, in a profession that badly needs them. Something to applaud, not throw tomatoes at, seems to me…

  6. CGA

    Carlos said,

    “The specific issue is complicated and comes down to different interpretations of the bylaws. But the underlying issue is political, driven by animosity towards the AI (from some non AI members). Too involved to get into here, but…”

    I think that most of us can understand complicated issues. We do analyze data for a living, do we not? It certainly is not too involved for the initiated to unravel.

    As for the standards set by the AI for MAI members, I would love to see some real coursework for their designated members to retain the MAI. I personally know a good number that could not put together a 10-20 year dcf or support a cap/discount rate if their lives depended on it. And, a good number could not explain a partial taking and the best methodology to utilize under any circumstances. I am sure that there are many CRE, CCIM, IFAC, MRICS, ASA, ASFMRA, SR/WA, and IAAO members that are far more qualified than many MAI members. The point here is that not every MAI is hands down the best, most qualified appraiser in the room. The profession would benefit from more standardization by educational requirements being separate from the designation process. That way “professionalism” would be determined outside of the subjective nature of any individual’s involvement with any private organization and the political nature of it’s leadership. Why not support a BBA degree with residential or commercial licensing as a part of the requirements in a similar way that accountants and actuaries complete their education? And, how about an MBA with advanced certifications part of that process? Then, if you wish to become involved with any private organization as a member for additional benefits that would be acceptable. Having to become a member of one specific organization in order to get work assignments regardless of an individual’s educational background or knowledge base is what is wrong with the industry.

    What do you think Carlos? I would also like to see what Jerome’s thoughts are on the subject.

  7. John

    AI’s political involvement and lobbying in support of the deregulation of our industry that occurred under the Clinton administration in the 90’s (which caused USPAP to change every 6 months, and required new courses be taught!) directly contributed to appraiser confusion, a weakening of USPAP, and ultimately the current housing crisis – they new better. AI has attempted to portray itself as a pinnacle of knowledge and achievement, and has certainly taken your money and built upon itself. AI has shown thanks by abandoning appraisers, the Foundation, and valid educational offerings. What a disappoinment!

  8. DJM

    Carlos I am an appraiser. AI membership is 1/5 what it was when I started this profession in 1986. That means that nobody is paying for their overpriced classes. AI will continue to decline if they dont change their ways. Only time will tell which one of us is right.

  9. Bradley W. Burdette, GAA

    The specific issue does not seem overly complicated nor is the interpretation of the Foundation bylaws. What is abundantly clear is that the AI wishes to be the voice of the appraisal profession. Unfortunately for them they surrendered that opportunity many years ago. I wish we had an organization which represents all appraisers; we don’t. I would argue that the behavior of the AI in this case seems in conflict with their goal of setting a high standard for the profession. It is not the first time.

  10. C. Brett Spaulding

    While I agree that AI courses are overpriced and very few are located in my area, they are the best courses. I think a large part of the problem is the arrogance of AI. There are, in fact, many residential and commercial appraisers without the designation that are excellent in the field. Its time for AI to regroup and come up with a new, more inclusive, game plan for membership. This does not mean lowering standards or paths to membership, however.

  11. Jack

    I held the SRA designation for 12 years, and gave it up. None of my clients required it, or even knew what it was. I got tired of trying to sell it. At one time, prior to certification, it opened doors. Now it does zippo. With the sanction imposed on the AI, it’s a liability in court work. Show me a copy of the appraisal work. I can tell in 2 minutes if it was done competently- letters after the name mean nothing to me.

  12. It takes guts to stand up to the Government no matter the issue. I am particularly proud to be a member of the Appraisal Institute for taking the stand they did. We need more courage like that demonstrated by the Appraisal Institute if the USA as a free-thinking and freedom-loving country is going to continue to be a free country. Keep on thinking free.

  13. Appraiser101

    As a well established appraiser and former member of AI, I would totally agree with DJM. At one point a designation was necessary to obtain most work but with state licensing, everything changed EXCEPT AI. They continued to demand higher prices for con ed classes and yearly membership fees, while appraisal fees decreased. All the time, AI was stating they were working with the appraiser, um huh, sure. Meanwhile, AI started a database in order to sell to third parties (remember originally they said it would ONLY be for members). AI is a thing of the past. I have reviewed reports by AI members that violate just as bad as non-members. In the real word of today, a designation from AI means little and they are struggling to stay alive.

  14. The appraisal institute is bought and sold, they are not doing appraisers any type of service or advocacy on appraisers’ behalf.