Appraisal Subcommittee Schedules Special Meeting to Address State Audit Report

On October 29, 2026, the Appraisal Subcommittee (ASC) of the Federal Financial Institutions Examination Council will convene a special virtual meeting to address a preliminary State audit report. This session, mandated by Section 1104(b) of Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), underscores the ASC's critical role in maintaining standards within the real estate appraisal industry. The meeting structure includes an initial closed session for discussion, followed by an open session where the Subcommittee will formally discuss and act on the audit findings.

The Appraisal Subcommittee's Mandate

The ASC operates under Title XI of FIRREA, a landmark piece of legislation enacted in the wake of the savings and loan crisis. Title XI established a federal framework for the oversight of real estate appraisals performed in federally related transactions. The ASC's primary responsibilities include monitoring the requirements established by states for the certification and licensing of real estate appraisers, and ensuring that appraisers are competent and that appraisal practice is consistent with uniform standards. A key aspect of this oversight involves auditing state appraiser regulatory programs to ensure compliance with federal requirements. These audits assess whether states are effectively enforcing appraiser qualifications, supervising appraisal activities, and adhering to the Uniform Standards of Professional Appraisal Practice (USPAP).

Structure of the Special Meeting

The October 29 meeting will begin at 1:00 p.m. ET with a closed session, expected to last until 1:45 p.m. ET. This initial closed portion, conducted via Microsoft Teams, is designated for the Subcommittee to discuss the preliminary State audit report. Federal law often permits closed sessions for deliberative processes that might involve sensitive or preliminary information not yet ready for public disclosure. Following the closed session, the ASC will transition to an open session, accessible to the public via Zoom, starting immediately after the conclusion of the closed segment. During this open session, the Subcommittee will publicly discuss the audit report and proceed to take formal action. This dual-session structure allows for candid internal discussion while maintaining transparency in the final decision-making process.

Significance of State Audit Reports

State audit reports are integral to the ASC's oversight function. These reports identify areas where state appraiser regulatory programs may be deficient or non-compliant with federal standards. Findings can range from administrative issues to more substantive concerns regarding appraiser qualifications, disciplinary actions, or enforcement mechanisms. The ASC's review and action on these reports can lead to directives for states to remedy identified shortcomings. In extreme cases of non-compliance, the ASC has the authority to issue orders that could prevent federally regulated financial institutions from using appraisers licensed or certified by a non-compliant state, although such actions are rare and typically preceded by extensive corrective action plans. The decision taken by the ASC on this preliminary report will signal its assessment of the state's program and potential next steps for compliance.

Public Access and Engagement

While the initial discussion on the preliminary report is closed, the subsequent open session ensures public transparency regarding the ASC's ultimate decisions. Interested parties, including appraisers, financial institutions, state regulators, and the public, can observe the proceedings. The ASC has provided clear instructions for virtual attendance: individuals must register in advance through a link on the agency's homepage, www.asc.gov, located in the News and Events section. This mechanism allows for broad access, reflecting a commitment to openness in federal regulatory processes, even for virtual meetings. It is notable that recording devices are prohibited, maintaining the controlled environment of such official proceedings.