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PRINTER'S NO. 4007
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
2398
Session of
2015
INTRODUCED BY ZIMMERMAN, BAKER, MILLARD, SAYLOR, GREINER,
CUTLER, RADER, WARD, MILNE, PETRI, B. MILLER AND D. COSTA,
OCTOBER 12, 2016
REFERRED TO COMMITTEE ON FINANCE, OCTOBER 12, 2016
AN ACT
Amending the act of December 19, 1990 (P.L.1200, No.202),
entitled "An act providing for the registration and
regulation of solicitations by charitable organizations,
professional fundraisers and other solicitors; imposing
additional powers on the Department of State and the Office
of Attorney General; prescribing civil and criminal
penalties; and making a repeal," in registration of
charitable organizations, further providing for the audit of
certain financial reports and for annual registration fees;
in exemptions from registration, further providing for
exemption of registration for certain charitable
organizations; and, in short form registration, further
providing for organizations required to file.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 5(f) and (p) of the act of December 19,
1990 (P.L.1200, No.202), known as the Solicitation of Funds for
Charitable Purposes Act, amended July 9, 1992 (P.L.436, No.92)
and October 27, 2006 (P.L.1180, No.121), are amended to read:
Section 5. Registration of charitable organizations; financial
reports; fees; failure to file.
* * *
(f) Audit of certain financial reports.--The financial
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report of every charitable organization which receives annual
contributions of $300,000 or more shall be audited by an
independent certified public accountant or public accountant.
Each charitable organization which receives annual contributions
of at least $200,000, but less than $300,000, shall be required
to have a review or audit of their statements performed by an
independent certified public accountant or public accountant.
Every charitable organization which receives annual
contributions of at least $100,000, but less than [$300,000]
$200,000, shall be required to have a compilation, review or
audit of their financial statements performed by an independent
certified public accountant or public accountant. Every
charitable organization which receives annual contributions of
at least $50,000, but less than $100,000, shall be required to
have [a] an internally prepared compilation, review or audit of
their financial statements performed by an independent certified
public accountant or public accountant. [A] An internally
prepared compilation, audit or review is optional for any
charitable organization which receives annual contributions of
less than $50,000. Audits shall be performed in accordance with
generally accepted auditing standards, including the Statements
on Auditing Standards of the American Institute of Certified
Public Accountants, whereas compilations and reviews shall be
performed in accordance with the Statements on Standards for
Accounting and Review Services of the American Institute of
Certified Public Accountants.
* * *
(p) Annual registration fees.--A charitable organization
which submits a short form registration statement pursuant to
section 7 or receives contributions of [$25,000] $50,000 or less
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during the immediately preceding fiscal year shall pay an annual
registration fee of $15. A charitable organization which
receives contributions in excess of [$25,000] $50,000 but less
than $100,000 during the immediately preceding fiscal year shall
pay an annual registration fee of $100. A charitable
organization which receives contributions in excess of $100,000
but not exceeding $500,000 during the immediately preceding
fiscal year shall pay an annual registration fee of $150. A
charitable organization which receives contributions in excess
of $500,000 during the immediately preceding fiscal year shall
pay an annual registration fee of $250. A parent organization
filing on behalf of one or more affiliates and a federated
fundraising organization filing on behalf of its member agencies
shall pay a single annual registration fee for itself and such
other affiliates or member agencies included in the registration
statement.
* * *
Section 2. Sections 6 and 7 of the act, amended July 9, 1992
(P.L.436, No.92), are amended to read:
Section 6. Exemptions from registration.
(a) General rule.--The following charitable organizations
shall be exempt from the registration requirements of this act:
(1) Educational institutions, the curricula of which in
whole or in part are registered with or approved by the
Department of Education, either directly or by acceptance of
accreditation by an accrediting body recognized by the
Department of Education, and any auxiliary associations,
foundations and support groups which are directly responsible
to educational institutions.
(2) Hospitals which are subject to regulation by the
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Department of Health or the Department of Public Welfare and
the hospital foundation, if any, which is an integral part
thereof.
(3) A local post, camp, chapter or similarly designated
element or a county unit of such elements of:
(i) any veterans' organization chartered under
Federal law and any service foundation recognized in the
bylaws of such organization;
(ii) a bona fide organization of volunteer firemen;
(iii) a bona fide ambulance association;
(iv) a bona fide rescue squad association; or
(v) a bona fide auxiliary or affiliate of any
organization or association under subparagraph (i), (ii),
(iii) or (iv);
[provided that all fundraising activities of an organization
or association under subparagraph (i), (ii), (iii), (iv) or
(v) are carried on by volunteers, members or an auxiliary or
affiliate thereof, and those volunteers, members or
affiliates receive no compensation directly or indirectly for
the fundraising activities.] provided that volunteers,
members or an auxiliary or affiliate of an organization or
association under subparagraph (i), (ii), (iii), (iv) or (v)
receive no compensation directly or indirectly for the
fundraising activities.
(4) Public nonprofit library organizations which receive
financial aid from State and municipal governments and file
an annual fiscal report with the State Library System.
(5) Senior citizen centers and nursing homes which are
nonprofit and charitable and which have been granted tax-
exempt status under the Internal Revenue Code of 1986 (Public
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Law 99-514, 26 U.S.C. ยง 1 et seq.), provided that all
fundraising activities are carried on by volunteers, members
or officers of the Senior Citizen Center and those
volunteers, members or officers receive no compensation,
directly or indirectly, for the fundraising activities.
(6) Bona fide parent/teacher associations or
parent/teacher organizations as recognized in a notarized
letter from the school district in which they are located.
(7) Any corporation established by an act of Congress of
the United States that is required by Federal law to submit
annual reports of its activities to Congress containing
itemized accounts of all receipts and expenditures after
being fully audited by the Department of Defense.
(8) Any charitable organization which receives
contributions of [$25,000] $50,000 or less annually, provided
that such organization does not compensate any person who
conducts solicitations. Charitable organizations which
receive more than [$25,000] $50,000 in contributions shall
file the appropriate registration statement within [30] 90
days after the contributions are received.
(b) Effect of exemption.--Exemption from the registration
requirements of this act shall in no way limit the applicability
of other provisions of the act to a charitable organization or
any professional solicitor or professional fundraising counsel
acting on its behalf, except that written notice under sections
9(k) and 13(c) shall not apply.
Section 7. Short form registration.
(a) Organizations required to file.--The following
charitable organizations shall be required to file short form
annual registration statements with the department in lieu of
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the registration statement required by section 5:
(1) Persons or charitable organizations accepting
contributions for the relief of any individual specified by
name at the time of acceptance or solicitation when all of
the contributions collected without any deductions whatsoever
are turned over to the named beneficiary for his use;
provided that all contributions collected shall be held in
trust and shall be subject to the provisions of 20 Pa.C.S.
Ch. 71 (relating to trust estates). The secretary, the
Attorney General, any contributor or any person who provides
any goods or services for which funds are expressly or
implicitly solicited shall have the right to petition the
court of common pleas of the county in which the trust is
located for an accounting of all contributions. For purposes
of this paragraph, the trust shall be deemed to be located in
the county where the principal place of business of the
charitable organization is located. If a charitable
organization has its principal place of business outside this
Commonwealth, all of the following shall apply:
(i) If an affiliate is soliciting contributions
within this Commonwealth, the trust shall be deemed to be
located in the county where the principal place of
business of the affiliate is located.
(ii) If a person is soliciting contributions within
this Commonwealth, the trust shall be deemed to be
located in the county where the principal place of
business or the residence of the person is located.
(iii) If there is no place of business or residence
within this Commonwealth, the trust shall be deemed to be
located in the county of Dauphin.
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(2) Organizations which only solicit within the
membership of the organization by the members of the
organization; provided that the term "membership" shall not
include those persons who are granted a membership solely
upon making a contribution as the result of solicitation. For
the purpose of this paragraph, "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 and directors, to hold office or position as
ordinarily conferred on members of such organizations.
(3) Charitable organizations whose fundraising
activities are carried on by volunteers, members, officers or
permanent employees and which do not receive contributions in
excess of [$25,000] $50,000 during a fiscal year, if no part
of their assets or income inures to the benefit of or is paid
to any officer or member, professional fundraising counsel,
professional solicitor or commercial coventurer. Charitable
organizations which do not intend to solicit and receive in
excess of [$25,000] $50,000, but do receive contributions in
excess of that amount shall file the financial report
required in section 5 within [30] 90 days after contributions
are received in excess of that amount.
(4) Organizations described in section 6(a)(3) which do
not receive contributions in excess of $100,000 during a
fiscal year if no part of their assets or income inures to
the benefit of or is paid to a professional solicitor.
(b) Contents of statement.--The short form annual
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registration statements required to be filed under this section
shall include any information required by the regulations of the
department.
(c) Financial report.--Charitable organizations which file a
short form registration statement need not file the financial
report required under section 5.
(d) Updating of information.--Any material change in any
information filed with the department pursuant to this section
shall be reported in writing by the registrant to the department
not more than 30 days after such change occurs.
Section 3. This act shall take effect in 60 days.
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