Senate Bill No. 708
(By Senator Kessler)
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[Introduced February 19, 2007; referred to the Committee on the
Judiciary.]
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A BILL to amend and reenact §29-19-5 and §29-19-6 of the Code of
West Virginia, 1931, as amended, all relating to the
registration of certain charities; and exemptions from
registration.
Be it enacted by the Legislature of West Virginia:
That §29-19-5 and §29-19-6 of the Code of West Virginia, 1931,
as amended, be amended and reenacted, all to read as follows:
ARTICLE 19. SOLICITATION OF CHARITABLE FUNDS ACT.
§29-19-5. Registration of charitable organizations; fee.
(a) Every charitable organization, except as provided in
section six of this article, which intends to solicit
contributions,
donations or grants within this state or to have
funds solicited
or received on its behalf shall, prior to any
solicitation, file a registration statement with the Secretary of
State upon forms prescribed by him or her which shall be good for one full year and which shall be refiled in the next and each
following year in which the charitable organization is engaged in
solicitation activities. If an organization discontinues
solicitation at any time after its last registration filing, then
it shall file a registration statement reflecting its activities
during its last fiscal year in which solicitation in West Virginia
took place. It is the duty of the president, chairman or principal
officer of the charitable organization to file the statements
required under this article. The statements shall be sworn to and
shall contain the following information:
(1) The name of the organization and the purpose for which it
was organized;
(2) The principal address of the organization and the address
of any offices in this state. If the organization does not
maintain an office, the name and address of the person having
custody of its financial records;
(3) The names and addresses of any chapters, branches or
affiliates in this state;
(4) The place where and the date when the organization was
legally established and the form of its organization;
(5) The names and addresses of the officers, directors,
trustees and the principal salaried executive staff officer;
(6) A copy of a balance sheet and a statement or report of
income and expenses for the organization's immediately preceding fiscal year or a financial statement reporting information showing
the kind and amount of funds raised during the preceding fiscal
year, the costs and expenses incidental to the fundraising and
showing how the funds were disbursed or allocated for the same
fiscal year:
Provided, That for organizations raising more than
one hundred thousand dollars per year in contributions excluding
grants from governmental agencies or private foundations, the
balance sheet and income and expense statement, or financial
statement provided, shall be audited by an independent public
accountant. Organizations are required to report the amount of
money
raised received in the state and the amount spent in the
state for charitable purposes;
(7) A copy of any determination of the organization's tax
exempt status under the provisions of 26 U. S. C. §501(c)(3) and a
copy of the last filed Internal Revenue Service Form 990 and
Schedule A for every charitable organization and any parent
organization;
(8) Whether the organization intends to solicit contributions,
donations or grants from the public directly or have other
solicitation done on its behalf by others;
(9) Whether the organization is authorized by any other
governmental authority to solicit contributions,
donations or
grants and whether it is or has ever been enjoined by any court
from soliciting contributions;
(10) The general purpose or purposes for which the
contributions to be solicited shall be used;
(11) The name or names under which it intends to solicit
contributions;
(12) The names of the individuals or officers of the
organization who will have final responsibility for the custody of
the contributions;
(13) The names of the individuals or officers of the
organization responsible for the final distribution of the
contributions; and
(14) Copies of all contract documentation from professional
fund-raising counsels and professional solicitors as provided
for
in subsection (d), section seven of this article.
(b) Each chapter, branch or affiliate, except an independent
member agency of a federated fund-raising organization, may
separately report the information required by this section or
report the information to its parent organization which shall then
furnish the information regarding its West Virginia affiliates,
chapters and branches in a consolidated form to the Secretary of
State. An independent member agency of a federated fund-raising
organization, as defined in section two of this article, shall
comply with the provisions of this article independently. Each
organization shall file a separate registration form for each name
under which funds will be solicited.
(c) The registration forms and any other documents prescribed
by the Secretary of State shall be signed by an authorized officer
or by an independent public accountant and by the chief fiscal
officer of the charitable organization and shall be verified under
oath.
(d) Every charitable organization
collecting receiving less
than one million dollars during any year which submits an
independent registration to the Secretary of State shall pay an
annual registration fee of fifteen dollars; every charitable
organization collecting more than one million dollars during one
year which submits an independent registration to the Secretary of
State shall pay an annual registration fee of fifty dollars; and a
parent organization filing on behalf of one or more chapters,
branches or affiliates or a single organization filing under
different names shall pay a single annual registration fee of fifty
dollars for itself and the chapters, branches or affiliates
included in the registration statement. All fees and moneys
collected by the Secretary of State pursuant to the provisions of
this article shall be deposited by the Secretary of State as
follows: One-half shall be deposited in the state General Revenue
Fund and one-half shall be deposited in the services fees and
collections account established by section two, article one,
chapter fifty-nine of this code for the operation of the office of
the Secretary of State. The Secretary of State shall dedicate sufficient resources from that fund or other funds to provide the
services required in this article.
(e) For good cause shown, the Secretary of State may extend
the due date for the annual filing of a registration statement or
report by a charitable organization or a professional fundraiser
for a period not to exceed ninety days. During that period, the
previously filed registration statement or report of the charitable
organization which has been granted the extension remains in
effect.
(f) In addition to the registration fee required by this
section, a charitable organization
and or professional fundraiser,
or both, which fails to file a registration statement or report by
the original or extended due date for filing as required by this
section shall, for each month or part of the month thereafter in
which the registration statement or report is not filed, pay an
additional fee of twenty-five dollars:
Provided, That the total
amount of the additional fees for a registration statement or
report required to be filed in any one year shall not exceed five
hundred dollars. All fees and moneys collected by the Secretary of
State pursuant to the provisions of this article shall be deposited
by the Secretary of State as follows: One-half shall be deposited
in the State General Revenue Fund and one-half shall be deposited
in the service fees and collections account established by section
two, article one, chapter fifty-nine of this code for the operation of the Office of the Secretary of State.
Any balance remaining on
the thirtieth day of June, two thousand one, in the existing
special revenue account entitled "charitable organization fund" as
established by chapter thirty-four, acts of the Legislature,
regular session, one thousand nine hundred ninety-two, shall be
transferred to the service fees and collections account established
by section two, article one, chapter fifty-nine of this code for
the operation of the Secretary of State. The Secretary of State
shall dedicate sufficient resources from that fund or other funds
to provide the services required in this article.
§29-19-6. Certain persons and organizations exempt from
registration.
The following charitable organizations
shall are not
be
required to file an annual registration statement with the
Secretary of State:
(1) Educational institutions, the curriculums of which, in
whole or in part, are registered or approved by the State Board of
Education, either directly or by acceptance of accreditation by an
accrediting body recognized by the State Board of Education; and
any auxiliary associations, foundations and support groups which
are directly responsible to any such educational institutions;
(2) Persons requesting contributions for the relief of any
individual specified by name at the time of the solicitation when
all of the contributions collected without any deductions whatsoever are turned over to the named beneficiary for his or her
use;
(3) Hospitals and licensed nursing homes which are nonprofit
and charitable;
(4) Organizations which solicit only within the membership of
the organization by the members thereof:
Provided, That the term
"membership"
shall does not include those persons who are granted
a membership upon making a contribution as the result of
solicitation. For the purpose of this section, "member" means a
person having membership in a nonprofit corporation, or other
organization, in accordance with the provisions of its articles of
incorporation, bylaws or other instruments creating its form and
organization; and having bona fide rights and privileges in the
organization, such as the right to vote, to elect officers,
directors and issues, to hold office or otherwise as ordinarily
conferred on members of such organizations;
(5) Churches, synagogues, associations or conventions of
churches, religious orders or religious organizations that are an
integral part of a church which qualifies as tax exempt under the
provisions of 26 U. S. C. §501(c)(3) and which qualifies as being
exempt from filing an annual return under the provisions of 26 U.
S. C. §6033;
(6) Any person, firm, corporation or organization that
sponsors a single fund-raising event for the benefit of a named charitable organization where all or part of the funds collected
are donated to the named charitable organization:
Provided, That
the named charitable organization receiving the funds is registered
pursuant to this article, reports each of these donations
individually and certifies that no funds were withheld by the
organization that solicited the funds;
(7) Any charitable organization that does not employ a
professional solicitor or fundraiser and does not intend to solicit
and receive and does not actually raise or receive contributions,
donations or grants from the public in excess of twenty-five
thousand dollars during a calendar year.
Charitable organizations which do not intend to solicit and
receive
contributions, donations or grants in excess of twenty-five
thousand dollars, but do receive in excess of that amount from the
public, shall file the annual registration statement within thirty
days after contributions are in excess of twenty-five thousand
dollars.
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(NOTE: The purpose of this bill is to adjust registration
requirements of charities and to clarify that solicitation or
receipt of donations and grants is considered the same as
solicitation of contributions.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.)
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