Real Estate Valuation Fairness and Improvement Act of 2021
Bill: H.R.2553 | Sponsor: Rep. Cleaver, Emanuel (D-MO)
Policy area: Finance and Financial Sector

Summary:
Real Estate Valuation Fairness and Improvement Act of 2021
This bill establishes the Interagency Task Force on Real Estate Valuation to harmonize among specified agencies and entities the underwriting standards that govern residential and commercial real estate valuations. The task force must also study racial disparities in the valuation and price of certain residential real estate.
The bill also establishes a grant program for states, nonprofit organizations, and institutions of higher education to promote diversity and inclusion in the appraisal profession.

To establish an interagency Task Force to analyze Federal collateral 
      underwriting standards and guidance, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Real Estate Valuation Fairness and 
Improvement Act of 2021''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) Two Federal agencies, the Federal Home Owners' Loan 
        Corporation and the Federal Housing Administration played a 
        major role in the development of the modern home mortgage 
        origination industry.
            (2) Both Federal agencies explicitly considered the racial 
        and ethnic make up of neighborhoods when underwriting loans and 
        valuing the real estate to be used as home loan collateral.
            (3) Both agencies devalued property or refused to make 
        loans secured by property in communities of color.
            (4) The harmful consequences of this discrimination remain 
        unresolved.

SEC. 3. REAL ESTATE VALUATION TASK FORCE.

    (a) Establishment.--The Appraisal Subcommittee of the Financial 
Institutions Examination Council shall facilitate the establishment and 
convening of an Interagency Task Force on Real Estate Valuation (in 
this section referred to as the ``Task Force'').
    (b) Members.--The Task Force shall consist of the following members 
or their designees:
            (1) The Director of the Federal Housing Finance Agency.
            (2) The Chair of the Board of Directors of the Federal 
        National Mortgage Association.
            (3) The Chair of the Board of Directors of the Federal Home 
        Loan Mortgage Corporation.
            (4) The President of the Government National Mortgage 
        Association.
            (5) The Chairperson of the Board of Directors of one of the 
        Federal home loan banks, selected by the Chairpersons of the 
        Boards of Directors of all of the Federal home loan banks.
            (6) The Assistant Secretary of the Department of Housing 
        and Urban Development who is the Federal Housing Commissioner.
            (7) The Undersecretary for Rural Development of the 
        Department of Agriculture.
            (8) The Secretary of Veterans Affairs.
            (9) The Director of the Bureau of Consumer Financial 
        Protection, who shall serve as the Chairperson of the Task 
        Force.
            (10) The Comptroller of the Currency.
            (11) The Chairperson of the Board of Directors of the 
        Federal Deposit Insurance Corporation.
            (12) The Chairman of the Board of Governors of the Federal 
        Reserve System.
            (13) The Chairman of the National Credit Union 
        Administration Board.
            (14) The Chairman of the State Liaison Committee.
    (c) Duties.--The Task Force shall--
            (1) harmonize to the greatest extent possible the various 
        collateral underwriting standards and guidance of the agencies 
        and entities represented on the Task Force governing 
        residential and commercial real estate valuations, including 
        standards and guidance with respect to appraisals, non-
        traditional and alternative methods of providing real estate 
        property evaluations such as automated valuation models, 
        processes and procedures for managing reconsiderations of value 
        by consumers, and standards and guidance with respect to common 
        collateral underwriting challenges, such as energy efficient 
        housing and limited or inactive markets;
            (2) to the extent that standards or guidance described 
        under paragraph (1) are not harmonized, the Task Force shall 
        issue a report to Congress explaining why harmonization cannot 
        or should not be implemented;
            (3) establish specific definitions for limited or inactive 
        housing markets in which comparable sales are limited or 
        unavailable over a certain period of time, and establish 
        greater flexibilities and guidance for appraisals and any 
        underwriting processes associated with appraisals conducted in 
        such markets, such as the ability to consider market evidence 
        for similar properties in other geographic areas or utilizing a 
        range of value;
            (4) aggregate data across Task Force members and conduct a 
        study to determine whether there are racial disparities at both 
        the borrower and community level in the valuation and price of 
        the residential real estate to be used as collateral for 
        mortgage applications processed by Task Force members;
            (5) identify specific causes of such racial disparities 
        and--
                    (A) adopt changes to address such causes; or
                    (B) if the Task Force determines that additional 
                statutory authority is needed to adopt such changes, 
                issue a report to Congress describing the needed 
                statutory authority; and
            (6) evaluate whether there are any barriers to entry that 
        are disproportionately preventing minorities from entering into 
        the appraisal profession, such as current minimum requirements 
        established by the Appraiser Qualifications Board, the cost and 
        availability of education, the content of the State appraiser 
        exam questions, or the time it takes to finish training.
    (d) Meetings.--The Task Force shall convene regularly, including 
with the advisory committee described under subsection (g), to carry 
out the duties under subsection (c) and submit the reports required 
under subsection (f).
    (e) Sharing of Information.--Each agency and entity represented on 
the Task Force shall share with the Task Force any data of the agency 
or entity necessary for the Task Force to carry out the duties of the 
Task Force under this Act.
    (f) Reports.--
            (1) Initial.--The Chairperson of the Task Force shall 
        submit a report to the Congress not later than the expiration 
        of the 24-month period beginning on the date of the enactment 
        of this Act detailing the findings and any actions taken to 
        further the duties of the Task Force as of such time and 
        describing any planned efforts and activities.
            (2) Ongoing.--Periodically after the submission of the 
        report pursuant to paragraph (1), the Chairperson shall submit 
        reports to the Congress setting forth updates of the findings 
        and actions taken to further the duties of the Task Force.
    (g) Advisory Committee.--The Task Force shall establish an advisory 
committee to provide advice with respect to the duties of the Task 
Force. The advisory committee shall consist of--
            (1) at least 2 civil rights advocates;
            (2) at least 2 consumer advocates;
            (3) at least 2 real estate appraisers (or representatives 
        of real estate appraiser trade groups);
            (4) at least 1 small lender (or representative of a trade 
        group for small lenders);
            (5) at least 1 representative of a trade group that 
        represents private investors;
            (6) at least 2 representatives of appraisal management 
        companies or trade groups for such companies;
            (7) at least 2 individuals who are industry experts on 
        alternative valuation models; and
            (8) at least 1 representative of the organization that 
        adopts the appraisal standards and appraiser qualification 
        criteria under title XI of the Financial Institutions Reform, 
        Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.).
    (h) Sunset.--The Task Force shall terminate upon the expiration of 
the 5-year period beginning on the date of the enactment of this Act.

SEC. 4. PROMOTING DIVERSITY AND INCLUSION IN THE APPRAISAL PROFESSION.

    The Financial Institutions Reform, Recovery, and Enforcement Act of 
1989 is amended--
            (1) in section 1103(a) (12 U.S.C. 3332(a))--
                    (A) in paragraph (3), by striking ``and'' at the 
                end;
                    (B) in paragraph (4), by striking the period at the 
                end and inserting a semicolon;
                    (C) in paragraph (5), by striking the period at the 
                end and inserting a semicolon;
                    (D) in paragraph (6), by striking the period at the 
                end and inserting ``a semicolon; and''; and
                    (E) by adding at the end the following new 
                paragraph:
            ``(7) administer the grant program under section 
        1122(j).'';
            (2) in section 1106 (12 U.S.C. 3335)--
                    (A) by inserting ``(a) In General.--'' before ``The 
                Appraisal Subcommittee'';
                    (B) by striking the comma after ``comment'';
                    (C) by inserting before ``Any regulations'' the 
                following:
    ``(b) Regulations.--''; and
                    (D) in subsection (a) (as so designated by 
                subparagraph (A) of this paragraph), by adding at the 
                end the following: ``The Appraisal Subcommittee may 
                coordinate, and enter into agreements, with private 
                industry stakeholders (including appraisal management 
                companies and industry associations) to facilitate 
                activities and practices that ensure diversity among 
                individuals newly hired as appraisers in their first 
                employment positions in the appraisal industry.''; and
            (3) in section 1122 (12 U.S.C. 3351), by adding at the end 
        the following new subsection:
    ``(j) Grant Program To Promote Diversity and Inclusion in the 
Appraisal Profession.--
            ``(1) In general.--The Appraisal Subcommittee shall carry 
        out a program under this subsection to makes grants to State 
        agencies, nonprofit organizations, and institutions of higher 
        education to promote diversity and inclusion in the appraisal 
        profession.
            ``(2) Eligible activities.--Activities carried out with 
        amounts from a grant under this Act shall be designed to 
        promote diversity and inclusion in the appraisal profession, 
        and may include--
                    ``(A) funding scholarships;
                    ``(B) providing training and education;
                    ``(C) providing implicit bias training for 
                appraisers; and
                    ``(D) other activities as determined appropriate to 
                further the purposes of this grant program by the 
                Appraisal Subcommittee.
            ``(3) Allocation of funds.--In making grants under this 
        subsection, the Appraisal Subcommittee shall--
                    ``(A) allocate 50 percent of the funds made 
                available to Historically Black Colleges and 
                Universities or universities with degree programs 
                approved by the Appraiser Qualifications Board or a 
                relevant State regulatory agency for--
                            ``(i) scholarships for students of color 
                        who want to pursue a career in real estate 
                        appraisal; and
                            ``(ii) subsidizing living expenses for 
                        those students while in training; and
                    ``(B) allocate 20 percent of the funds to cover the 
                cost of fulfilling the experience requirements or other 
                applicable requirements that the students described 
                under subparagraph (A) will need to complete in order 
                to become appraisers.
            ``(4) Administrative costs.--The Appraisal Subcommittee may 
        use 1 percent of amounts appropriated pursuant to paragraph (6) 
        to cover the administrative costs of carrying out this 
        subsection.
            ``(5) Reports.--For each fiscal year during which grants 
        are made under the program under this subsection, the Appraisal 
        Subcommittee shall submit a report to the Congress regarding 
        implementation of the program and describing the grants made, 
        activities conducted using grant amounts, and the number of 
        individuals served by such grants, disaggregated by race, 
        ethnicity, age, and gender.
            ``(6) Authorization of appropriations.--There is authorized 
        to be appropriated to the Appraisal Subcommittee for grants 
        under this subsection $50,000,000 for each of fiscal years 2022 
        through 2026.''.
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