Appraisal Practices Revisited

By Ted Reiff

Several years ago I wrote a newsletter article entitled, "An Owner's Guide to Donating Used Building Materials," which briefly discussed the importance of choosing the right donee, a trained deconstruction contractor, and an IRS-qualified appraiser.

I think it's time to once again address the critical issue of choosing the right appraiser–one who is IRS–qualified and follows the minimum appraisal requirements set forth in the Uniform Standards of Professional Appraisal Practice (USPAP). I have found that many appraisers quote IRS qualifications (see IRS Bulletin 561, pages 10 and 11), but really do not understand them.

In the aftermath of the S&L scandals of the 1980s, federal legislation was passed to create The Appraisal Foundation (TAF). This organization established USPAP as minimum requirements for both real-property and personal-property appraisers (see www.AppraisalFoundation.org).

Over the past several years I have seen dozens of appraisers enter the used building materials niche, and I am appalled at the lack of professionalism and ethical conduct evidenced by the appraisal reports that some of them submit.

Used building-material donations reap tremendous benefits. They:

  • Provide high-quality, low or no cost materials to budget-minded families
  • Help rejuvenate blighted neighborhoods
  • Create entry-level employment in the construction trades
  • Reduce the impact of construction waste on landfills
  • Save the embodied energy of salvaged materials, thus reducing the need for new energy expenditures
  • Help create a more healthful environment

These benefits would be lost if a spate of implausible appraisals motivated the IRS to rewrite donor regulations in such a way as to severely restrict the donation of used building materials. Remember what happened to automobile donations? In the beginning they were a virtual honor system; now they are quite narrowly defined.

In order to obtain better recognition and more business, some questionable appraisers have joined professional industry organizations that have no time, capability or interest in vetting dues-paying members. These appraisers gain a veneer of credibility, while marketing dubious practices.

TRP is one of the largest nonprofit deconstruction and building-materials salvage organizations in the country. In 2009 and 2010, we were thoroughly audited by the IRS and have worked with numerous appraisers since our founding in 1993. Because it's of vital concern to us, I have carefully studied the IRS regulations governing the donation of used building materials and have completed a USPAP and personal property appraisal class. While I am not an appraiser, I have prepared myself to judge the many practicing appraisers that TRP encounters on an ongoing basis. I've met appraisers who:

  • Are not licensed in the states listed on their resumes
  • Claim to belong to professional appraisal associations, but do not
  • Make extraordinary assumptions without giving reasons
  • Assign valuations twice as high as their peers
  • Advocate for the donor when they are required to be neutral
  • State that a donation has been made when it clearly has not
  • Claim specific college degrees that they, in fact, do not hold

Hiring an appraiser should be a lot like hiring an employee. Donors and donees should verify items that appraisers list on their resumes, such as education, memberships, training and employment.

Donors who "shop" appraisers to get the best deal are courting disaster, both for themselves and the larger donor community. Likewise, donees who turn a blind eye to the crazy values and irregular procedures of appraisers, as though their threat to our nascent industry were insignificant, are putting at risk the entire used building-materials industry.

I view these attitudes as unconscionable. It makes no sense to sacrifice long term sustainability for short term (and short-sighted) gains.

I recently asked, and gained, permission from the TRP board of directors to seek out and vet appraisers who are operating within the sphere of our reuse business. We have engaged certified USPAP instructors to conduct reviews of a sampling of used building-material appraisals. Our goal is to provide both donors and donees with a list of IRS-qualified and USPAP-reviewed appraisers.

In the meantime, if you would like more information, please do not hesitate to contact me at 510.383.1983.

Specials of the Month

At the Oakland warehouse we are featuring plumbing and appliances. Receive 25% off the price of any plumbing fixture or appliance in the warehouse through April 30.
The ReUse People Specials
The Los Angeles warehouse is featuring doors and plumbing fixtures. Purchase one door at the regular price and receive a second door of the same or lesser value, FREE. Plus, receive 25% off the price of any plumbing fixture the warehouse. Both specials through April 30.
The ReUse People Specials

New Inventory

The Oakland warehouse has a large supply of metal fencing. Stop by and take a look.

 

New inventory at the Los Angeles warehouse includes a stainless steel barbeque, a stainless steel mini refrigerator, and a porcelain pedestal sink with stainless steel legs. All in excellent condition!

The ReUse People Specials The ReUse People Specials

Location and Contact Information

TRP ReUse Warehouse - Oakland
9235 San Leandro Street
Oakland, CA  94603
(510) 383-1983; toll-free 888-588-9490
Hours: Mon-Sat 9:00-6:00 Closed Sunday

TRP ReUse Warehouse - Los Angeles
3015 Dolores Avenue, Los Angeles, CA 90065
818-244-5635
Hours: Mon-Fri 10:00-5:00; Sat 10:00-4:00

Please visit our partnering warehouses:

The ReUse Warehouse
1400 East Geer Street
Durham, NC 27704
(919) 219-4913
Hours: Mon-Fri, 2:00-6:00; Sat, 9:30-5:00

Second Chance Building Materials Center
1423 West Grove Street
Boise, ID 83702
(208) 331-2707
Hours: Mon-Sat, 9:00-6:00; Sun, 12:00-5:00

Roaring Fork Valley Habitat for Humanity
7025 Hwy 82
Glenwood Springs, CO 81601
(970) 945-7733
Hours: Mon-Fri, 10:00-5:30; Sat, 10:00-5:00; Sun, 11:00-4:00

Stardust Building Supply
3901 E. Thunderbird Road
Phoenix, AZ 85032
(602) 459-9803
Hours: Mon-Sat, 8:00-6:00; Sun, 10:00-4:00

Habitat for Humanity ReStore, Salt Lake Valley,
1276 South 500 West
Salt Lake City, UT 84101
(801) 263-0136
Hours: Mon-Sat 9:00am-6:00pm; closed Sunday

Habitat for Humanity ReStore, Summit & Wasatch Counties
6280 N. Silver Creek Drive, Silver Summit, UT
(435) 487-9015
Hours: Wed-Sat 10:00-6:00; closed Sunday

Recycle Utah
1951 Woodbine Way Park City, UT 84060
(435) 649-9698
Hours: Mon-Sat 8:00-5:30; Sun 10:00-4:00

Reuse Depot
50 West Madison
Maywood, IL 60153
(708) 223-0502
Hours: Wed-Mon 10:00-6:00p; Closed Tuesdays

New England Reuse
400 Sackett Point Rd
North Haven, CT 06473
(203) 230-2638
Hours: Mon-Fri 9:00-5:00p; Saturday 9:00-1:00p

::Login::   Website by The ReUse People.