Legal and Regulatory Framework Flashcards

According to the IAAO Standard on Ratio Studies, the recommended COD range for single-family residential property in newer or homogeneous areas is:

Answer: 5.0 to 10.0

IAAO recommends a COD of 5.0 to 10.0 for newer or fairly homogeneous single-family residential properties.

Under the IAAO Standard on Ratio Studies, the acceptable range for the overall level of assessment (median ratio) is:

Answer: 0.90 to 1.10

IAAO standards call for the median ratio to fall between 0.90 and 1.10.

Which IAAO-recommended statistic measures vertical equity, indicating whether high- and low-value properties are assessed at similar ratios?

Answer: Price-related differential (PRD)

The PRD compares the mean ratio to the weighted mean ratio, with 0.98 to 1.03 being acceptable.

A PRD of 1.08 most likely indicates that:

Answer: High-value properties are under-assessed relative to low-value properties

A PRD above 1.03 suggests assessment regressivity, where higher-value properties carry lower ratios.

Which standard-setting document governs ethics and appraisal practice for appraisers in the U.S. and is often referenced in assessment law?

Answer: USPAP

USPAP, issued by The Appraisal Foundation, sets ethical and performance standards, with Standard 6 addressing mass appraisal.

Which USPAP standard specifically addresses mass appraisal development and reporting?

Answer: Standard 6

USPAP Standard 6 covers mass appraisal, the core function of property tax assessment.

A state oversight agency performs a ratio study and finds one county assessing at 70% while others are at 100%. The state applies a factor to the county's values. This process is called:

Answer: Intercounty (direct) equalization

Equalization adjusts assessment levels between jurisdictions so that state-distributed aid and levies are fair.