charitable solicitations
DPA |
Committee on Energy, Utilities and Technology |
|
|
X |
Committee on Retirement and Government Operations |
|
|
|
Caucus and COW |
|
|
|
Third Read |
|
|
|
As Passed the House |
|
SB 1078 amends statute relating to charitable solicitations
A verbal amendment was added in the committee on Energy, Utilities and Technology to state that the attorney general may investigate and take appropriate action against unlawful acts or practices as prescribed by the Arizona Consumer Fraud Act.
Currently, every state in the country with the exception of
Vermont, Montana, Idaho, Wyoming, South Dakota, Delaware, Nevada, Colorado,
Texas, Hawaii, Iowa, and Indiana has laws in place requiring charities to
register before soliciting. This
compliance reporting is divided into two pieces: (1) registration, which provides an initial base of data and
information about an organization's finances and governance; and (2) annual financial reporting, which keeps
the state notified about an organization's operations with an emphasis on
fundraising results and practices. Typically, states require both registration (at least an initial
registration) and annual financial reporting.
Arizona requires a charity to register before soliciting its first contribution, whether through a contracted fundraiser, or otherwise, and to file a registration statement with the Secretary of State each September thereafter. A charitable organization that is required to file a registration statement is guilty of a class one misdemeanor (up to 6 months in jail and up to a 2,500.00 fine), if it fails register within thirty days of receiving notice from the Secretary of State. The following parties are exempt from the registration requirements of charitable solicitations:
· This state or any counties or municipalities of this state or their agencies.
· Political parties, candidates for federal, state or local office and campaign committees required to file financial information with federal, state or local election agencies.
·
Stipulates that an
organization exempt from federal income taxes at the time of initial
registration shall submit a copy of the IRS’s written determination of the
exemption to the Secretary of State (SOS).
·
Requires the
previous fiscal year return to be used when an organization files with the SOS.
·
Allows the SOS to
deny an application for any of the following reasons:
·
The name if the
organization is misleading to the public.
·
The name is
deceptively similar to an existing corporate name.
·
The name is the
same as or deceptively similar to a registered trade name, limited partnership
or foreign limited liability company.
·
Requires the
Secretary of State to deny an application for registration, and gives the
Secretary of State the discretion of revoking the registration, of a charitable
organization for any of the following reasons:
·
Material in the
application is misstated or omitted.
·
An employee,
member, officer, or director holding proprietary or beneficial interest in the
organization is a convicted felon, unless civil rights have been restored.
·
Engagement in
deceptive, fraudulent or unlawful business practices related to solicitation.
·
Violating
provisions relating to the solicitation of funds for charitable purposes.
·
Bouncing a check to
the Secretary.
·
Requires the
Secretary to notify and explain a denial within 10 days of receiving an
application.
·
Requires
independent solicitors when soliciting to do the following:
·
Identify themselves
as for-profit solicitors who are seeking contributions on behalf of an
organization or as a contracted fund raiser.
·
State the true
legal name of the organization or fund raiser.
·
Reveal the legal
name of the independent solicitor.
·
State that the
purpose for soliciting is to raise charitable funds.
·
Requires the
Attorney General to investigate unlawful solicitation acts.
·
Prescribes a Class
1 misdemeanor [6 months/$2,500] to an independent solicitor who fails to comply
with the disclosure requirements of the law or violates ARS 44-6561 (unlawful
acts or practices; violation; classification; penalty).
·
Makes technical and
conforming changes.
Amendments
·
A verbal amendment was added in the committee on Energy, Utilities and
Technology to state that the attorney general may investigate and take
appropriate action against unlawful acts or practices as prescribed by the
Arizona Consumer Fraud Act.
---------- DOCUMENT FOOTER ---------
45th Legislature
Second Regular Session 2 May
9, 2002
---------- DOCUMENT FOOTER ---------