Louisiana Administrative Code › Title 70 - TRANSPORTATION AND DEVELOPMENT › Part XVII - Real Estate › Chapter 5 - Appraisal Handbook for Fee Appraisers › Section XVII-537 - Role of the Cost Consultant (Formerly Section 533)

Current through Register Vol. 50, No. 6, June 20, 2024
A. Quite often it becomes necessary for the
				Appraisal Office to contract the services of individuals other than appraisal
				experts. More often than not those persons are cost consultants. These
				consultants are those who are trained and/or experienced in the construction
				industry with knowledge of and access to construction costs and related areas
				of expertise. The consultant may be asked to provide such items as reproduction
				and replacement costs, cost to cure items damaged by the required acquisition
				or costs for comparison purposes which would not be included within an
				appraisal report. The cost consultant is there to provide a service to the
				appraiser and LDOTD and should provide costs as requested and in conjunction
				with all other consultants that will utilize the estimate. The cost consultant
				is responsible to the project review appraiser as well as the appraiser(s) of
				record.
B. The cost consultant is
				to work hand in hand with the appraiser and review appraiser. Although he is
				the most qualified to judge construction costs, the appraiser is the person
				responsible for all values used within the appraisal report.
C. Just like the appraiser, the cost
				consultant is required to contact all property owners and allow them the
				opportunity to accompany the consultant during the property inspection. In the
				case of the cost consultant, it is absolutely necessary to inspect all
				improvements due to the nature of the assignment. Only in very rare situations
				would it be possible to complete a consultant assignment without, at least, a
				rudimentary inspection of improvements. This would only be acceptable when an
				owner refuses entrance upon the subject site or within the subject
				improvements.
D. As mentioned
				earlier, the responsibility for the use of a cost estimate, whether replacement
				cost, reproduction cost, cost to cure or other cost assignment belongs to the
				appraiser. Therefore, it is absolutely necessary that the appraiser and the
				cost consultant work together. The cost consultant is responsible for the
				estimated costs where reproduction and replacement is concerned.
E. However, he and the appraiser must agree
				on the factual data such as the size of the improvement, location upon the
				site, minor improvements, etc. When a cost to cure is required, the cost
				consultant must provide a method of cure that is agreeable to both the
				appraiser and review appraiser in order for the assignment to be considered as
				acceptable and payment made. Therefore, the cost consultant and the
				appraiser(s) should inspect the subject property together, if possible, and at
				the least confer and compare factual data and proposed cures prior to
				submission of the contracted estimate for review. The provided reports shall
				contain a breakdown of the components required in a reproduction, replacement
				or cost to cure estimate and will quote a source of justification for said
				costs. Utilization of Marshall and Swift only is not acceptable. Therefore,
				when the costs provided are utilized by the appraiser, it is required that the
				cost consultant's report be included within the appraisal report.
F. The appraiser, as the one ultimately
				responsible for the costs quoted within his/her report will contact the review
				appraiser should a provided cost estimate not be suitable for inclusion within
				an appraisal report. However, the review appraiser should have made a
				determination prior to receipt of said report by the appraiser. The review
				appraiser will then contact the consultant and discuss the situation and the
				appraiser's concerns. Should it be found that revision is warranted, the cost
				consultant will be responsible for that revision. Payment for services rendered
				will be withheld until such time as acceptable revisions or corrections are
				submitted.
AUTHORITY NOTE:
				  Promulgated in accordance with
				  R.S.
				  48:443.