PRINTER'S NO. 2496
No. 1938 Session of 1989
INTRODUCED BY TRELLO, DISTLER, COHEN, HAYDEN, NOYE, ROBINSON,
PESCI, MORRIS, E. Z. TAYLOR, CAWLEY, KASUNIC, MRKONIC,
ADOLPH, VAN HORNE, HERMAN, GEIST AND NAHILL, OCTOBER 3, 1989
REFERRED TO COMMITTEE ON FINANCE, OCTOBER 3, 1989
AN ACT
1 Amending the act of April 30, 1986 (P.L.107, No.36), entitled
2 "An act relating to charitable organizations; requiring the
3 registration of such organizations; and regulating the
4 solicitation of money and property by, or on behalf of,
5 charitable organizations," further providing for fundraising
6 spending; and requiring timely approval or rejection of
7 applications, counsels and solicitors.
8 The General Assembly of the Commonwealth of Pennsylvania
9 hereby enacts as follows:
10 Section 1. Section 6(b) and (g) of the act of April 30, 1986
11 (P.L.107, No.36), known as the Charitable Organization Reform
12 Act, are amended to read:
13 Section 6. Registration of charitable organizations.
14 * * *
15 (b) Approval of registration.--The department shall examine
16 each initial application of charitable organizations for the
17 right to solicit funds and each renewal application of
18 charitable organizations for the right to solicit funds, and, if
19 found to be in conformity with the requirements of this act and
20 all relevant rules and regulations, it shall be approved for
1 registration. Any applicant who is denied approved registration
2 may, within 15 days from the date of notification of such
3 denial, request, in writing, a hearing before the Secretary of
4 the Commonwealth, or his designee, which hearing shall be held
5 within 15 days from the date of the request. Approval or denial
6 shall be made by the department within 30 days of receipt of the
7 application.
8 * * *
9 (g) Investigations.--The department may make or cause to be
10 made such investigation of any applicant as it shall deem
11 necessary. As a result of its investigation and action, the
12 department shall certify its approval or disapproval of the
13 application. No applicant shall be approved if one or more of
14 the following facts is found to exist:
15 (1) That one or more of the statements in the
16 application are not true.
17 (2) That the applicant is or has engaged in a fraudulent
18 transaction or enterprise.
19 (3) That a solicitation would be a fraud upon the
20 public.
21 [(4) That solicitation and fundraising expenses
22 (including not only payments to professional solicitors, but
23 also payments to professional fundraisers, and internal
24 fundraising and solicitation salaries and expenses) during
25 any of the three years immediately preceding the date of
26 application have exceeded 35% of the actual contributions
27 received. As used in this subsection the term "internal
28 fundraising and expenses" shall include, but not be limited
29 to, such portions of the charitable organization's salary and
30 overhead expenses as were fairly allocable (on a time or
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1 other appropriate basis) to its solicitation and/or
2 fundraising expense. In the event special facts or
3 circumstances are presented showing that expenses higher than
4 35% were not unreasonable, the Secretary of the Commonwealth,
5 or his designee, has the discretion to allow such higher
6 expense.
7 (5) That the expected cost of solicitation and
8 fundraising expenses for the specific year in which the
9 application is submitted (including not only payments to
10 professional solicitors, but also payments to professional
11 fundraisers, and internal fundraising and solicitation
12 salaries and expenses) will exceed 35% of the actual
13 contributions received. As used in this subsection the term
14 "internal fundraising and expenses" shall include, but not be
15 limited to, such portions of the charitable organization's
16 salary and overhead expenses as will be fairly allocable (on
17 a time or other appropriate basis) to its solicitation and/or
18 fundraising expense. In the event special facts or
19 circumstances are presented, showing that expenses higher
20 than 35% will not be unreasonable, the Secretary of the
21 Commonwealth, or his designee, has the discretion to allow
22 such higher expense.]
23 (6) That such activities to be financed will be
24 incompatible with the health, safety or welfare of the
25 citizens of the Commonwealth of Pennsylvania.
26 Section 2. Section 8 of the act is repealed.
27 Section 3. The act is amended by adding a section to read:
28 Section 8.1. Filing contracts.
29 Every contract or written agreement between professional
30 fundraising counsel and a charitable organization shall be filed
19890H1938B2496 - 3 -
1 with the Secretary of the Commonwealth within ten days after
2 such contract or written agreement is concluded.
3 Section 4. Section 10(d) of the act is amended to read:
4 Section 10. Registration of professional fundraising counsel
5 and professional solicitor; bonds; records;
6 books.
7 * * *
8 (d) Approval of application.--The Secretary of the
9 Commonwealth, or his designee, shall examine each application,
10 and, if he finds it to be in conformity with the requirements of
11 this act and all relevant rules and regulations and the
12 registrant has complied with the requirements of this act and
13 all relevant rules and regulations, he shall approve the
14 registration. Any applicant who is denied approved registration
15 may, within 15 days from the date of notification of such
16 denial, request, in writing, a hearing before the Secretary of
17 the Commonwealth, or his designee, which hearing shall be held
18 within 15 days from the date of the request. Approval or denial
19 shall be made by the department within 30 days of receipt of the
20 application.
21 Section 5. This act shall take effect in 60 days.
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