California Assembly Bill AB2855 Amended / Bill

 BILL NUMBER: AB 2855AMENDED BILL TEXT AMENDED IN ASSEMBLY MARCH 17, 2016 INTRODUCED BY Assembly Member Frazier FEBRUARY 19, 2016 An act to  amend   add  Section  17510.3 of   17510.86 to  the Business and Professions Code, relating to charitable solicitations. LEGISLATIVE COUNSEL'S DIGEST AB 2855, as amended, Frazier. Charitable  solicitation   solicitations: financial  disclosures. Existing law requires  certain disclosures to be made   a solicitor or seller,  prior to any solicitation or sales solicitation for charitable  purposes.   purposes, to provide the prospective donor or purchaser with certain disclosures, including, among others, the name and address of the combined campaign, each organization   or fund on behalf of which money collected will be utilized, and the percentage of the total gift or purchase   price that may be deducted as a charitable contribution under both federal and state law. Under existing law, a violation of certain advertising restrictions, including charitable solicitation requirements, is a crime.  This bill would  make a nonsubstantive change to this provision.   require an Internet Web site produced by, or on behalf of, a charity to contain an Internet Web page that includes a disclosure of the charity's administrative overhead expenses and a copy of the charity's most recent Internal Revenue Service Form 990   filing   and would further require each Internet Web page on the Internet Web site to contain a direct link to that financial disclosures Internet   Web page, as specified. The bill would also require a document produced by, or on behalf of, a charity for solicitation for charitable purposes to include a disclosure statement indicating the percentage of the charity's funding spent on those administrative overhead expenses, as specified. As a violation of these requirements would be a crime, this bill would impose a state-mandated local program.   This bill would authorize the Attorney General to enforce these requirements by directing the Franchise Tax Board to suspend or revoke a violating charity's tax-exempt status, by suspending or revoking the registration of a violating charity, or by taking any other enforcement action pursuant to the Attorney General's existing powers and duties, as specified.   The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.   This bill would provide that no reimbursement is required by this act for a specified reason.  Vote: majority. Appropriation: no. Fiscal committee:  no   yes  . State-mandated local program:  no   yes  . THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   Section 17510.86 is added to the   Business and Professions Code   , to read:   17510.86. (a) An Internet Web site produced by, or on behalf of, a charity that operates, or engages in the solicitation for charitable purposes of funds or other property, in this state shall comply with both of the following: (1) The Internet Web site shall contain a financial disclosures Internet Web page, which shall include both of the following: (A) A disclosure of the sum total of the salaries, other compensation, and employee benefits of the charity's executive director and board of directors and all of the charity's other administrative overhead expenses, as reported on the charity's most recent Internal Revenue Service Form 990 filing. The disclosure shall be set forth in at least 14-point, bold, sans serif type font and shall be clear and conspicuous, as defined in Section 17601. (B) A complete copy of the charity's most recent Internal Revenue Service Form 990 filing. (2) Each Internet Web page on the Internet Web site shall include a direct link to the financial disclosures Internet Web page required pursuant to paragraph (1). The direct link shall contain the phrase "Click here to read a full disclosure of the finances, including the salaries and expenses, of this organization," shall be placed in the top right corner of each Internet Web page in at least 14-point, bold, sans serif type font, and shall be clear and conspicuous, as defined in Section 17601. (b) (1) A document produced by, or on behalf of, a charity for the solicitation for charitable purposes of funds or other property in this state shall include a disclosure statement indicating the percentage of the charity's funding that is spent on the sum total of the salaries, other compensation, and employee benefits of the charity's executive director and board of directors and all of the charity's other administrative overhead expenses, as reported on the charity's most recent Internal Revenue Service Form 990 filing. (2) The disclosure statement shall be printed on the first page of the document in at least 14-point, bold, sans serif type font and shall be clear and conspicuous, as defined in Section 17601. (c) The Attorney General may enforce this section by taking any of the following actions against a charity that provides false information or otherwise violates this section: (1) Directing the Franchise Tax Board to suspend or revoke the charity's exemption from the taxes imposed by the Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code). The suspension or revocation shall become effective immediately upon receipt by the Franchise Tax Board, and the Franchise Tax Board shall reinstate the exemption only upon subsequent notification by the Attorney General that the charity is in compliance with this section. (2) Refusing to register, or revoking or suspending the registration of, a charity pursuant to the Supervision of Trustees and Fundraisers for Charitable Purposes Act (Article 7 (commencing with Section 12580) of Chapter 6 of Part 2 of Division 3 of Title 2 of the Government Code). (3) Taking any other enforcement action pursuant to the Attorney General's existing powers and duties.   SEC. 2.   No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.   SECTION 1.   Section 17510.3 of the Business and Professions Code is amended to read: 17510.3. (a) Prior to any solicitation or sales solicitation for charitable purposes, the solicitor or seller shall exhibit to the prospective donor or purchaser a card entitled "Solicitation or Sale for Charitable Purposes Card." The card shall be signed and dated under penalty of perjury by an individual who is a principal, staff member, or officer of the soliciting organization. The card shall give the name and address of the soliciting organization or the person who signed the card and the name and business address of the paid individual who is doing the actual soliciting. In lieu of exhibiting a card, the solicitor or seller may distribute during the course of the solicitation any printed material, such as a solicitation brochure, provided the material complies with the standards set forth below, and provided that the solicitor or seller informs the prospective donor or purchaser that the information as required below is contained in the printed material. Information on the card or printed material shall be presented in at least 10-point type and shall include the following: (1) The name and address of the combined campaign, each organization, or fund on behalf of which all or any part of the money collected will be utilized for charitable purposes. (2) If there is no organization or fund, the manner in which the money collected will be utilized for charitable purposes. (3) The non-tax-exempt status of the organization or fund, if the organization or fund for which the money or funds are being solicited does not have a charitable tax exemption under both federal and state law. (4) The percentage of the total gift or purchase price which may be deducted as a charitable contribution under both federal and state law. If no portion is so deductible the card shall state that "This contribution is not tax deductible." (5) If the organization making the solicitation represents any nongovernmental organization by any name which includes, but is not limited to, the term "officer," "peace officer," "police," "law enforcement," "reserve officer," "deputy," "California Highway Patrol," "Highway Patrol," "deputy sheriff," "firefighter," or "fire marshall," which would reasonably be understood to imply that the organization is composed of law enforcement or firefighting personnel, the solicitor shall give the total number of members in the organization and the number of members working or living within the county where the solicitation is being made, and if the solicitation is for advertising, the statewide circulation of the publication in which the solicited ad will appear. (6) If the organization making the solicitation represents any nongovernmental organization by any name which includes, but is not limited to, the term "veteran" or "veterans," which would reasonably be understood to imply that the organization is composed of veterans, the solicitor shall give the total number of members in the organization and the number of members working or living within the county where the solicitation is being made. This paragraph does not apply to federally chartered or state incorporated veterans' organizations with 200 or more dues paying members or to a thrift store operated or controlled by a federally chartered or state incorporated veterans' organization. This paragraph does not apply to any state incorporated community-based organization that provides direct services to veterans and their families and qualifies as a tax-exempt organization under Section 501(c)(3) or 501(c)(19) of the Internal Revenue Code and Section 23701d of the Revenue and Taxation Code. (b) Knowing and willful noncompliance by any individual volunteer who receives no compensation of any type from or in connection with a solicitation by any charitable organization shall subject the solicitor or seller to the penalties of the law. (c) When the solicitation is not a sales solicitation, any individual volunteer who receives no compensation of any type from, or in connection with, a solicitation by any charitable organization may comply with the disclosure provisions by providing the name and address of the charitable organization on behalf of which all or any part of the money collected will be utilized for charitable purposes, by stating the charitable purposes for which the solicitation is made, and by stating to the person solicited that information about revenues and expenses of the organization, including its administration and fundraising costs, may be obtained by contacting the organization's office at the address disclosed. The organization shall provide this information to the person solicited within seven days after receipt of the request. (d) A volunteer who receives no compensation of any type from, or in connection with, a solicitation or sales solicitation by a charitable organization that has qualified for a tax exemption under Section 501(c)(3) of the Internal Revenue Code, and who is 18 years of age or younger, is not required to make any disclosures pursuant to this section. (e) If any provision of this section or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of this section that can be given effect without the invalid provision or application, and to this end the provisions of this section are severable.