[Federal Register Volume 86, Number 208 (Monday, November 1, 2021)]
[Notices]
[Pages 60239-60242]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-23657]


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FEDERAL HOUSING FINANCE AGENCY

[No. 2021-N-11]


Proposed Collection; Comment Request

AGENCY: Federal Housing Finance Agency.

ACTION: 30-Day notice of submission of information collection for 
approval from Office of Management and Budget.

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SUMMARY: In accordance with the requirements of the Paperwork Reduction 
Act of 1995 (PRA), the Federal Housing Finance Agency (FHFA or the 
Agency) is seeking public comments concerning an information collection 
known as ``Minimum Requirements for Appraisal Management Companies,'' 
which has been assigned control number 2590-0013 by the Office of 
Management and Budget (OMB). FHFA intends to submit the information 
collection to OMB for review and approval of a three-year extension of 
the control number, which is due to expire on October 31, 2021.

DATES: Interested persons may submit comments on or before December 1, 
2021.

ADDRESSES: Submit comments to FHFA, identified by ``Proposed 
Collection; Comment Request: `Minimum Requirements for Appraisal 
Management Companies, (No. 2021-N-11)' '' by any of the following 
methods:
     Agency Website: www.fhfa.gov/open-for-comment-or-input.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments. If you submit your 
comment to the Federal eRulemaking Portal, please also send it by email 
to FHFA at [email protected] to ensure timely receipt by the Agency.
     Mail/Hand Delivery: Federal Housing Finance Agency, Eighth 
Floor, 400 Seventh Street SW, Washington, DC 20219, ATTENTION: Proposed 
Collection; Comment Request: ``Minimum Requirements for Appraisal 
Management Companies, (No. 2021-N-11).''
    We will post all public comments we receive without change, 
including any personal information you provide, such as your name and 
address, email address, and telephone number, on the FHFA website at 
http://www.fhfa.gov. In addition, copies of all comments received will 
be available for examination by the public through the electronic 
comment docket for this PRA Notice also located on the FHFA website.
    Also send a copy of any comments that concern this information 
collection to www.reginfo.gov/public/do/PRAMain. Find this particular 
information collection request by selecting ``Federal Housing Finance 
Agency'' under ``Currently Under Review;'' then check ``Only Show ICR 
for Public Comment'' checkbox. Once you have found this information 
collection request, select ``Comment,'' and enter or upload your 
comment and information. Alternatively, you can mail your written 
comments to the Office of Information and Regulatory Affairs, OMB, Room 
3002, New Executive Office Building, Washington, DC 20503; Attention: 
Desk Officer for the Federal Housing Finance Agency.

FOR FURTHER INFORMATION CONTACT: Robert Witt. Senior Policy Analyst, 
Office of Housing and Regulatory Policy, by email at 
[email protected] or by telephone at (202) 649-3128; or Maura 
Dundon, Associate General Counsel, [email protected], (202) 853-
6734 (these are not toll-free numbers); Federal Housing Finance Agency, 
400 Seventh Street SW, Washington, DC 20219. For TTY/TRS users with 
hearing and speech disabilities, dial 711 and ask to be connected to 
any of the contact numbers above.

SUPPLEMENTARY INFORMATION: FHFA is seeking comments on its upcoming 
request to OMB to renew the PRA clearance for the following collection 
of information:
    Title: Minimum requirements for appraisal management companies.
    OMB Number: 2590-0013.
    Affected Public: Participating States and State-registered 
Appraisal Management Companies.

A. Need for and Use of the Information Collection

    In 2015, FHFA, the Federal Deposit Insurance Corporation (FDIC), 
the Office of the Comptroller of the Currency (OCC), and the Board of 
Governors of the Federal Reserve System (Board) (collectively, the 
Agencies) jointly issued regulations \1\ to implement minimum statutory 
requirements to be applied by states in the registration and 
supervision of appraisal management companies (AMCs).\2\ These minimum

[[Page 60240]]

requirements apply to states that have elected to establish an 
appraiser certifying and licensing agency with authority to register 
and supervise AMCs (participating states).\3\
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    \1\ The National Credit Union Administration and the Bureau of 
Consumer Financial Protection also participated in the joint 
rulemaking but, by agreement, the responsibility for clearance under 
the PRA of information collections contained in the joint 
regulations is shared only by the FDIC, OCC, the Board, and FHFA.
    \2\ See 12 U.S.C. 3353(a). An AMC is an entity that serves as an 
intermediary for, and provides certain services to, appraisers and 
lenders.
    \3\ 12 U.S.C. 3346.
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    The regulations also implement the statutory requirement that 
states report to the Appraisal Subcommittee (ASC) of the Federal 
Financial Institutions Examination Council (FFIEC) the information 
required by the ASC to administer the national registry of AMCs (AMC 
National Registry or Registry).\4\ The AMC National Registry includes 
AMCs that are either: (1) Subsidiaries owned or controlled by an 
insured depository institution (as defined in 12 U.S.C. 1813) and 
regulated by either the FDIC, OCC, or the Board (federally regulated 
AMCs); \5\ or (2) registered with, and subject to supervision of, a 
state appraiser certifying and licensing agency.
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    \4\ See 12 U.S.C. 3353(e).
    \5\ See 12 CFR 1222.21(k) defining a federally regulated AMC.
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    FHFA's AMC regulation, located at Subpart B of 12 CFR part 1222, is 
substantively identical to the AMC regulations of the FDIC, OCC, and 
the Board and contains the recordkeeping and reporting requirements 
described below.

1. State Reporting Requirements (Removed; Formerly IC #1)

    FHFA's 60-day notice included an information collection named 
``State Reporting Requirements'' regarding the regulatory requirement 
that each state electing to register AMCs for purposes of permitting 
AMCs to provide appraisal management services relating to covered 
transactions in the state submit to the ASC the information regarding 
such AMCs required to be submitted by ASC regulations or guidance 
concerning AMCs that operate in the state.\6\ However, FHFA will not 
request to renew the State Reporting Requirements IC. The FDIC recently 
removed the same IC request in its 30-day notice. The FDIC stated that 
it did not need to take the PRA reporting burden because the ASC had 
issued its own regulations or guidance implementing these requirements 
and submitted its own IC taking the PRA burden.\7\ FHFA concurs with 
the FDIC's analysis. Accordingly, FHFA will not request to renew the IC 
on State Reporting Requirements and that IC will be removed.
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    \6\ See 12 CFR 1222.26.
    \7\ See Federal Deposit Insurance Corporation, Agency 
Information Collection Activities: Proposed Collection Renewal; 
Comment Request, 86 FR at 58269, 58274 (Oct. 21, 2021).
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2. State Recordkeeping Requirements (Redesignated IC #1; Formerly IC 
#2)

    States seeking to register AMCs must have an AMC registration and 
supervision program. The regulation requires each participating state 
to establish and maintain within its appraiser certifying and licensing 
agency a registration and supervision program with the legal authority 
and mechanisms to: (i) Review and approve or deny an application for 
initial registration; (ii) periodically review and renew, or deny 
renewal of, an AMC's registration; (iii) examine an AMC's books and 
records and require the submission of reports, information, and 
documents; (iv) verify an AMC's panel members' certifications or 
licenses; (v) investigate and assess potential violations of laws, 
regulations, or orders; (vi) discipline, suspend, terminate, or deny 
registration renewals of, AMCs that violate laws, regulations, or 
orders; and (vii) report violations of appraisal-related laws, 
regulations, or orders, and disciplinary and enforcement actions to the 
ASC.\8\
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    \8\ See 12 CFR 1222.23(a).
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    The regulation requires each participating state to impose 
requirements on AMCs that are not federally regulated (non-federally 
regulated AMCs) to: (i) Register with and be subject to supervision by 
a state appraiser certifying and licensing agency in each state in 
which the AMC operates; (ii) use only state-certified or state-licensed 
appraisers for federally regulated transactions in conformity with any 
federally regulated transaction regulations; (iii) establish and comply 
with processes and controls reasonably designed to ensure that the AMC, 
in engaging an appraiser, selects an appraiser who is independent of 
the transaction and who has the requisite education, expertise, and 
experience necessary to competently complete the appraisal assignment 
for the particular market and property type; (iv) direct the appraiser 
to perform the assignment in accordance with the Uniform Standards of 
Professional Appraisal Practice; and (v) establish and comply with 
processes and controls reasonably designed to ensure that the AMC 
conducts its appraisal management services in accordance with sections 
129E(a) through (i) of the Truth-in-Lending Act.\9\
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    \9\ See 12 CFR 1222.23(b). Sections 129E(a) through (i) of the 
Truth-in-Lending Act are located at 15 U.S.C. 1639e(a)-(i).
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    FHFA is redesignating this IC from #2 to #3.

3. AMC Disclosure Requirements (State-Regulated AMCs) (Redesignated IC 
#2; Formerly IC #3)

    The regulation provides that an AMC may not be registered by a 
state or included on the AMC National Registry if the company is owned, 
directly or indirectly, by any person who has had an appraiser license 
or certificate refused, denied, cancelled, surrendered in lieu of 
revocation, or revoked in any state for a substantive cause.\10\ The 
regulation also provides that an AMC may not be registered by a state 
if any person that owns 10 percent or more of the AMC fails to submit 
to a background investigation carried out by the state appraiser 
certifying and licensing agency.\11\ Thus, each AMC registering with a 
state must provide information to the state on compliance with those 
ownership restrictions. Further, the regulation requires that a 
federally regulated AMC report to the state or states in which it 
operates the information required to be submitted by the state pursuant 
to the ASC's policies, including policies regarding the determination 
of the AMC National Registry fee, and information regarding compliance 
with the ownership restrictions described above.
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    \10\ See 12 CFR 1222.24(a), 1222.25(b).
    \11\ See 12 CFR 1222.24(b).
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    In FHFA's 60-day notice, we combined federally and non-federally 
regulated AMCs in former IC #3, entitled ``AMC Reporting 
Requirements.'' Subsequently, the FDIC issued its 30-day notice 
dividing the same information collected in FHFA's ``AMC Reporting 
Requirements'' IC into two different ICs: One for state-regulated AMCs, 
for which FHFA would take 10 percent of the burden (FDIC IC #3); and 
one for federally regulated AMCs, for which FHFA would take zero burden 
(FDIC IC #4).\12\ FHFA concurs with this approach and revises its 
submission by disaggregating the federally regulated and state-
regulated AMCs. In addition, FHFA is correcting the title of this IC to 
reflect that it is a disclosure requirement instead of a reporting 
requirement and redesignating it to IC #2. Thus, FHFA's redesignated IC 
#2 entitled ``AMC Disclosure Requirements (State-regulated AMCs)'' now 
only applies to state-regulated AMCs and corresponds to FDIC's IC #3.
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    \12\ See 86 FR at 58276, 58277. The FDIC's IC #3 and IC #4 are 
combined in FHFA's IC #3.

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[[Page 60241]]

4. AMC Disclosure Requirements (Written Notice of Appraiser Removal 
From Network or Panel) (Redesignated IC #3; Formerly IC #4)

    An entity meets the definition of an AMC that is subject to the 
requirements of the AMC regulation if, among other things, it oversees 
an appraiser panel of more than 15 state-certified or state-licensed 
appraisers in a state, or 25 or more state-certified or state-licensed 
appraisers in two or more states, within a given 12-month period.\13\ 
For purposes of determining whether a company qualifies as an AMC under 
that definition, the regulation provides that an appraiser in an AMC's 
network or panel is deemed to remain on the network or panel until: (i) 
The AMC sends a written notice to the appraiser removing the appraiser 
with an explanation; or (ii) receives a written notice from the 
appraiser asking to be removed or a notice of the death or incapacity 
of the appraiser.\14\ The AMC would retain these notices in its files. 
FHFA is correcting the title of this IC from ``AMC Recordkeeping 
Requirements'' to ``AMC Disclosure Requirements (Written Notice of 
Appraiser Removal From Network or Panel)'' to reflect that it is a 
disclosure requirement instead of a reporting requirement and 
redesignating it to IC #3 from IC #4.
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    \13\ See 12 CFR 1222.21(c)(1)(iii).
    \14\ See 12 CFR 1222.22(b).
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B. Burden Estimate

    For the information collections described above, the general 
methodology is to compute the industry-wide burden hours for 
participating states and AMCs and then assign a share of the burden 
hours to each of the Agencies for each information collection.
    As noted above, each of the Agencies' AMC regulations contains 
reporting and recordkeeping requirements applying to participating 
states and to both federally regulated and non-federally regulated 
AMCs.\15\ The Agencies have estimated that approximately 3,860 entities 
meet the regulatory definition of an ``appraisal management company.'' 
\16\ According to the AMC National Registry, 3,817 (rounded to 3,820) 
are state-regulated.\17\ Unlike the insured depository institutions 
regulated by the OCC, FDIC, and the Board, none of FHFA's regulated 
entities owns or controls an AMC or, by law, could ever own or control 
an AMC. Accordingly, the Agencies have agreed that responsibility for 
the burdens arising from reporting and recordkeeping requirements 
imposed upon federally regulated AMCs are to be split evenly among the 
OCC, FDIC, and the Board, and that FHFA will not include those burdens 
in its totals. The four Agencies have agreed to split the total burdens 
imposed upon participating states and upon non-federally regulated AMCs 
evenly between them.
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    \15\ In FHFA's regulations, the definition for AMC is set forth 
at 12 CFR 1222.21(c).
    \16\ Id. at 58276.
    \17\ Id.
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    Thus, for IC #1 ``State Recordkeeping Requirements,'' which relates 
to reporting and recordkeeping requirements imposed upon participating 
states, each agency is responsible for 25 percent of the total 
estimated burden. For IC #3``AMC Disclosure Requirements (Written 
Notice of Appraiser Removal From Network or Panel)'' which relates to 
disclosure requirements imposed upon both federally regulated AMCs and 
non-federally regulated AMCs, the OCC, FDIC, and the Board are each 
responsible for 30 percent of the total burden, while FHFA is 
responsible only for 10 percent of the burden imposed.\18\
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    \18\ FHFA's IC#2 ``AMC Disclosure Requirements (State-regulated 
AMCs) now collects information relating only to state-regulated 
AMCs, but FHFA will still be allocated only 10 percent of the 
burden. See 86 FR at 58277.
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    The Agencies estimate the total annualized hour burden placed on 
respondents by the information collection in the joint AMC regulations 
to be 8,208 hours. FHFA estimates its share of the hour burden to be 
837 hours. The calculations on which those estimations are based are 
described below.

1. State Recordkeeping Requirements (IC #1)

    The estimated burden hours on participating states for developing 
and maintaining an AMC licensing program is calculated by multiplying 
the number of states without a registration and licensing program by 
the hour burden to develop the system. The total burden hours are then 
equally divided among the FDIC, OCC, Board, and FHFA. According to the 
ASC there are four states (the territories of Guam, Mariana Islands, 
Puerto Rico, and the U.S. Virgin Islands) that have not developed a 
system to register and oversee AMCs.\19\ The burden estimate of 40 
hours per state without a registration system is unchanged from the 
estimate provided for the currently-approved ICR. Therefore, the total 
estimated burden attributable to all of the Agencies is: 4 states x 40 
hours/state = 160 hours. The estimated burden hours attributable to 
FHFA are 160 hours x 25 percent = 40 hours.
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    \19\ Appraisal Subcommittee ``States' Status on Implementation 
of AMC Programs,'' available at https://www.asc.gov/National-Registries/StatesStatus.aspx.
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2. AMC Disclosure Requirements (State-Regulated AMCs) (IC #2)

    The burden for AMC disclosure requirements for information needed 
to determine the AMC National Registry fee and information regarding 
compliance with the AMC ownership restrictions is calculated by 
multiplying the number of AMCs by the frequency of response and then by 
the burden per response. As described above, 30 percent of the burden 
hours are then assigned to each of the FDIC, OCC, and the Board, while 
10 percent are assigned to FHFA. There are 3,820 state-regulated AMCs.
    The frequency of response is estimated as the number of states that 
do not have an AMC registration program in which the average AMC 
operates.\20\ As discussed above, 4 states do not have AMC registration 
or oversight programs. According to the Consumer Financial Protection 
Bureau (CFPB), the average AMC operates in 19.56 states.\21\ Therefore, 
the average AMC operates in approximately 2 states that do not have AMC 
registration systems: (4 states/55 states) x 19.56 states = 1.422 
states, rounded to 2 states. The burden estimate of one hour per 
response is unchanged from the estimate provided for the currently-
approved ICR. Therefore, the total estimated hour burden is: 3,820 AMCs 
x 2 states x 1 hour = 7,640 hours. The estimated burden hours 
attributable to FHFA are 7,640 hours x 10 percent = 764 hours.
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    \20\ The number of states includes all U.S. states, territories, 
and districts to include: The Commonwealth of the Northern Mariana 
Islands; the District of Columbia; Guam; Puerto Rico; and the U.S. 
Virgin Islands.
    \21\ See OMB No. 3064-0195 and the accompanying Supporting 
Statement submitted by the FDIC in 2018, available at https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201804-3064-013. 
Additional details on the survey can be found in the text 
accompanying the final rule. See Minimum Requirements for Appraisal 
Management Companies, 80 FR 32,677 (June 9, 2015).
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3. AMC Disclosure Requirements (Written Notice of Appraiser Removal 
From Network or Panel) (IC #3)

    The burden for disclosure by AMCs of written notices of appraiser 
removal from a network or panel is estimated to be equal to the number 
of appraisers who leave the profession per year multiplied by the 
estimated percentage of appraisers who work for AMCs, then

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multiplied by burden hours per notice. As described above, 30 percent 
of the burden hours are then assigned to each of the FDIC, OCC, and the 
Board, while 10 percent are assigned to FHFA.
    The number of appraisers who leave an AMC annually, either by 
resigning, being laid off, or having their licenses revoked or 
surrendered, is estimated to be 4,130. The burden estimate of 0.08 
hours per notice is unchanged from the estimate provided for the 
currently-approved ICR. Therefore, the estimated total hour burden is: 
4,130 notices x 0.08 hours = 330 hours (rounded to the nearest whole 
number). The estimated burden hours attributable to FHFA are 330 hours 
x 10 percent = 33 hours.

C. Response to Comments Received

    In accordance with the requirements of 5 CFR 1320.8(d), FHFA 
published an initial notice and request for comments regarding the 
renewal of the PRA clearance for this information collection in the 
Federal Register on August 23, 2021 (60-day notice).\22\ The 60-day 
comment period closed on October 22, 2021.
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    \22\ See 86 FR 47107 (Aug. 23, 2021).
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    FHFA received one comment. The commenter questioned FHFA's estimate 
that 3,860 entities meet the regulatory definitions of an AMC. The 
commenter stated that ``[b]ased on the federal definition of an AMC and 
our understanding of the number of state licensed AMCs, this estimate 
of approximately 3,860 entities meeting the definition of an AMC seems 
exceedingly high. We believe there are approximately 300 licensed 
entities doing business as AMCs.'' The commenter does not provide any 
detail to explain how they arrived at their much lower estimate of 300 
compared to FHFA and FDIC's 3,860. Their comment gives no basis to 
ascertain the source of the discrepancy, either as to the underlying 
data or the analysis of the regulatory definition of AMCs.
    FHFA has reviewed the comment and continues have confidence in the 
3,860 estimate of AMCs. ASC's 2020 Annual Report states that ``[a]s of 
December 31, 2020, the Registry contained 3,417 AMCs.'' The FDIC's 
review determined that there are 3,854 total active AMCs in the 
Registry (both federally and non-federally regulated) as of June 2021, 
which we rounded to 3,860 in our 60-day notice. FHFA concurs with the 
FDIC's review of the ASC Registry in June 2021. Both the FDIC analysis 
and the ASC Annual Report substantiate FHFA's estimate and confirms our 
concurrence with the FDIC's review. FHFA remains confident that the 
number is accurate. Accordingly, FHFA will not change the number of 
AMCs in the 30-day notice.

D. Comments Request

    In accordance with the requirements of 5 CFR 1320.10(a), FHFA is 
publishing this second notice to request comments regarding the 
following: (1) Whether the collection of information is necessary for 
the proper performance of FHFA functions, including whether the 
information has practical utility; (2) the accuracy of FHFA's estimates 
of the burdens of the collection of information; (3) ways to enhance 
the quality, utility, and clarity of the information collected; and (4) 
ways to minimize the burden of the collection of information on 
respondents, including through the use of automated collection 
techniques or other forms of information technology.

Kevin Smith,
Chief Information Officer, Federal Housing Finance Agency.
[FR Doc. 2021-23657 Filed 10-29-21; 8:45 am]
BILLING CODE 8070-01-P