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General Assembly Substitute Bill No. 5222
February Session, 2022
AN ACT CONCERNING PAID SOLICITORS OF CHARITABLE FUNDS
AND CHARITABLE ORGANIZATION TRANSPARENCY.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 21a-190f of the general statutes is repealed and the 1
following is substituted in lieu thereof (Effective from passage): 2
(a) No person shall act as a paid solicitor unless such person has first 3
registered with the department. Registration shall be in a form 4
prescribed by the commissioner, shall be certified by the paid solicitor 5
as true and correct to the best of the solicitor's knowledge and shall be 6
accompanied by a fee in the amount of five hundred dollars. The 7
application shall contain such information as the department shall 8
require. Each registration shall be valid for one year and may be 9
renewed for additional one-year periods. 10
(b) An applicant for registration or for a renewal of registration as a 11
paid solicitor shall, at the time of making such application, file with and 12
have approved by the department a bond in a form prescribed by the 13
commissioner, in which the applicant shall be the principal obligor in 14
the sum of twenty thousand dollars, with one or more responsible 15
sureties whose liability in the aggregate as such sureties shall be no less 16
than such sum. The paid solicitor shall maintain the bond in effect as 17
long as the registration is in effect. The bond shall run to the state and 18 Substitute Bill No. 5222
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to any person who may have a cause of action against the principal 19
obligor of the bond for any liabilities resulting from the obligor's 20
conduct of any activities subject to sections 21a-190a to 21a-190l, 21
inclusive, as amended by this act, or arising out of a violation of said 22
sections or any regulation adopted pursuant to said sections. 23
(c) No less than [twenty days] one business day prior to the 24
commencement of each solicitation campaign, a paid solicitor shall file 25
with the department a copy of the contract described in subsection (d) 26
of this section and shall complete a solicitation notice in a form 27
prescribed by the commissioner. A solicitation notice shall be certified 28
by the paid solicitor as true and correct to the best of the solicitor's 29
knowledge and shall include a description of the solicitation event or 30
campaign, the location and telephone number from which the 31
solicitation is to be conducted, the names and residence addresses of all 32
employees, agents or other persons however styled who are to solicit 33
during such campaign and the account number and location of all bank 34
accounts where receipts from such campaign are to be deposited. 35
[Copies of campaign solicitation literature, including the text of any 36
solicitation to be made orally, shall be submitted to the department.] The 37
charitable organization on whose behalf the paid solicitor is acting shall 38
certify that the solicitation notice and accompanying material are true 39
and complete. [Prior to the commencement of such solicitation 40
campaign, the commissioner shall publicize such solicitation by posting 41
on the department's web site information describing the terms of the 42
contract between the paid solicitor and the charitable organization, the 43
dates of such solicitation campaign and the percentage of the raised 44
funds to be retained by the paid solicitor. The commissioner may 45
publicize such solicitation through any additional means the 46
commissioner deems appropriate.] 47
(d) A contract between a paid solicitor and a charitable organization 48
shall be in writing, shall clearly state the respective obligations of the 49
paid solicitor and the charitable organization and shall state the 50
minimum amount that the charitable organization shall receive as a 51 Substitute Bill No. 5222
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result of the solicitation campaign, which minimum amount shall be 52
stated as a percentage of the gross revenue. Such minimum amount 53
shall not include any amount that the charitable organization is to pay 54
as expenses of the solicitation campaign. 55
(e) A paid solicitor shall, prior to orally requesting a contribution, and 56
at the same time at which a written request for a contribution is made, 57
clearly and conspicuously disclose at the point of solicitation such 58
solicitor's name as on file with the department [,] and the fact that such 59
solicitor is a paid solicitor. [and the percentage of the gross revenue 60
which the charitable organization shall receive as identified in 61
subsection (d) of this section.] 62
(f) A paid solicitor shall, in the case of a solicitation campaign 63
conducted orally, whether by telephone or otherwise, send a written 64
confirmation to each person who has pledged to contribute, no more 65
than five days after such person has been solicited, which confirmation 66
shall include a clear and conspicuous disclosure of the information 67
required by subsection (e) of this section. 68
(g) A paid solicitor shall not represent that any part of the 69
contributions received will be given or donated to any charitable 70
organization unless such organization has consented in writing to the 71
use of its name, prior to the solicitation. Such written consent, if given, 72
shall be signed by two authorized officers, directors or trustees of the 73
charitable organization. 74
(h) No paid solicitor may represent that tickets to an event are to be 75
donated for use by another, unless the paid solicitor has first obtained a 76
commitment, in writing, from a charitable organization stating that it 77
will accept donated tickets and specifying the number of tickets which 78
it is willing to accept and provided no more contributions for donated 79
tickets shall be solicited than the number of ticket commitments 80
received from the charitable organization. 81
(i) A paid solicitor shall require any person such solicitor directly or 82 Substitute Bill No. 5222
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indirectly employs, procures or engages to solicit to comply with the 83
provisions of subsections (e) to (h), inclusive, of this section. 84
(j) A paid solicitor shall file a financial report for the campaign with 85
the department no more than ninety days after a solicitation campaign 86
has been completed, and on the anniversary of the commencement of 87
any solicitation campaign which lasts more than one year, in a form 88
prescribed by the commissioner. The financial report shall include gross 89
revenue and an itemization of all expenditures incurred. The report 90
shall be completed on a form prescribed by the department. An 91
authorized official of the paid solicitor and two authorized officials of 92
the charitable organization shall certify that such report is true and 93
complete to the best of their knowledge. The information contained in 94
such report shall be available to the public. 95
(k) A paid solicitor shall maintain during each solicitation campaign 96
and for not less than three years after the completion of each such 97
campaign the following records: [, which shall be available to the 98
department for inspection upon request:] (1) The name and address of 99
each contributor, if known to the paid solicitor, and the date and amount 100
of the contribution; [, provided the department shall not disclose this 101
information except to the extent necessary for investigative or law 102
enforcement purposes;] (2) the name and residence of each employee, 103
agent or other person involved in the solicitation; and (3) records of all 104
income received and expenses incurred in the course of the solicitation 105
campaign. The paid solicitor shall make the records required under 106
subdivisions (2) and (3) of this subsection, as well as records containing 107
the dates and amounts described in subdivision (1) of this subsection, 108
available to the department for inspection upon request. 109
(l) If a paid solicitor sells tickets to an event and represents that tickets 110
will be donated for use by another, the paid solicitor shall maintain, for 111
not less than three years after the completion of such event, the 112
following records, which shall be available to the department for 113
inspection upon request: (1) The name and address of contributors 114
donating tickets and the number of tickets donated by each contributor; 115 Substitute Bill No. 5222
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and (2) the name and address of all organizations receiving donated 116
tickets for use by others, including the number of tickets received by 117
each organization. 118
(m) All funds collected by the paid solicitor shall be deposited in a 119
bank account. The bank account shall be in the name of the charitable 120
organization with whom the paid solicitor has contracted and the 121
charitable organization shall have sole or joint control of the account. 122
(n) Any material change in any information filed with the department 123
pursuant to this section shall be reported in writing or electronically by 124
the paid solicitor to the department not more than seven days after such 125
change occurs. 126
(o) No person may act as a paid solicitor if such person, any officer or 127
director thereof, any person with a controlling interest therein, or any 128
person the paid solicitor employs, engages or procures to solicit for 129
compensation, has been convicted by a court of any state or the United 130
States of any felony, or of any misdemeanor involving dishonesty or 131
arising from the conduct of a solicitation for a charitable organization or 132
purpose. Any denial, suspension or revocation of the registration of a 133
paid solicitor based on a violation of this subsection shall be made in 134
accordance with the provisions of section 46a-80. 135
Sec. 2. Section 21a-190a of the general statutes is repealed and the 136
following is substituted in lieu thereof (Effective January 1, 2023): 137
As used in this section and sections [21a-190a] 21a-190b to 21a-190l, 138
inclusive, as amended by this act: 139
(1) "Charitable organization" means any person who is, or holds 140
[himself] oneself out to be, established for (A) any [benevolent, 141
educational, philanthropic, humane, scientific, patriotic, social welfare 142
or advocacy, public health, environmental conservation, civic or 143
eleemosynary] charitable purpose, or [for] (B) the benefit of firefighters, 144
law enforcement officers [, firefighters] or other persons who protect the 145
public safety. 146 Substitute Bill No. 5222
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(2) "Charitable purpose" means any benevolent, civic, educational, 147
eleemosynary, environmental conservation, humane, patriotic, 148
philanthropic, public health, scientific, social advocacy or social welfare 149
objective. 150
(3) "Charitable sales promotion" means an advertising or sales 151
campaign, conducted by a commercial coventurer, which represents 152
that the purchase or use of goods or services offered by the commercial 153
coventurer are to benefit a charitable organization or charitable purpose. 154
(4) "Commercial coventurer" means a person who (A) for profit, is 155
primarily and regularly engaged in trade or commerce in this state other 156
than in connection with the raising of funds for charitable organizations 157
or charitable purposes, and (B) conducts a charitable sales promotion. 158
(5) "Commissioner" means the Commissioner of Consumer 159
Protection. 160
(6) (A) "Contribution" means the grant, pledge or promise of credit, 161
financial assistance, money, property or other thing of any kind or value 162
in response to a solicitation. 163
(B) "Contribution" does not include bona fide assessments, dues or 164
fees paid by members, provided membership is not conferred solely as 165
consideration for making a contribution in response to a solicitation. 166
(7) "Department" means the Department of Consumer Protection. 167
(8) (A) "Fund-raising counsel" means a person who (i) is compensated 168
to advise, consult, manage or plan with respect to the solicitation in this 169
state of contributions by a charitable organization, (ii) does not solicit 170
contributions, and (iii) does not directly or indirectly engage, employ or 171
procure any person compensated to solicit contributions. 172
(B) "Fund-raising counsel" does not include a bona fide 173
nontemporary salaried employee or officer of a charitable organization. 174 Substitute Bill No. 5222
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(9) "Gross revenue" means income of any kind from all sources, 175
including all amounts received as the result of any solicitation by a paid 176
solicitor, without deduction of any costs or expenses. 177
(10) "Membership" means that which entitles a person to the honors, 178
privileges, professional standing or other direct benefit of the 179
organization and the rights to vote, elect officers and hold office in the 180
organization. 181
(11) (A) "Paid solicitor" means a person who, for any consideration 182
other than any nonmonetary gift of nominal value awarded to a 183
volunteer solicitor as an incentive or token of appreciation, performs for 184
a charitable organization any service in connection with which 185
contributions are solicited by such person or by any person he or she 186
directly or indirectly employs, engages or procures to solicit for such 187
contributions. 188
(B) "Paid solicitor" does not include a bona fide nontemporary 189
salaried employee or officer of a charitable organization. 190
(12) "Parent organization" means that part of a charitable 191
organization which exercises control over and supervises the 192
expenditure and solicitation activities of one or more affiliates, branches 193
or chapters. 194
[(2)] (13) "Person" means an individual, association, corporation, 195
limited liability company, [association] foundation, partnership, trust [, 196
foundation] or any other entity however styled. 197
[(3)] (14) "Solicit" and "solicitation" (A) mean any request directly or 198
indirectly for [money,] credit, financial assistance, money, property [, 199
financial assistance] or other thing of any kind or value on the plea or 200
representation that such [money,] credit, financial assistance, money, 201
property [, financial assistance] or other thing of any kind or value is to 202
be used for a charitable purpose or benefit a charitable organization, [. 203
"Solicit" and "solicitation" shall] and (B) include, but [shall] are not [be] 204
limited to, the following methods of requesting or securing such 205 Substitute Bill No. 5222
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[money,] credit, financial assistance, money, property [, financial 206
assistance] or other thing of value: [(A)] (i) Any oral or written request; 207
[(B)] (ii) any announcement to the press, over the radio or television or 208
by telephone or telegraph concerning an appeal or campaign by or for 209
any charitable organization or charitable purpose; [(C)] (iii) the 210
circulation, distribution, [circulation,] posting or publishing of any 211
handbill, written advertisement or other publication; [(D)] and (iv) the 212
offer or sale of, [offer] or attempt to sell, any advertisement, advertising 213
space, book, candy, card, [tag,] cookies, coupon, device, flower, 214
magazine, membership, merchandise, subscription, [flower,] tag, ticket 215
[, candy, cookies] or other tangible item in connection with an appeal 216
made for any charitable organization or charitable purpose, or where 217
the name of any charitable organization is used or referred to in any 218
such appeal as an inducement or reason for making any such sale [,] or 219
when or where in connection with any such sale, any statement is made 220
that the whole or any part of the proceeds from any such sale is to be 221
used for any charitable purpose or benefit any charitable organization. 222
A solicitation shall be deemed to have taken place whether or not the 223
person making the [same] solicitation receives any contribution. 224
[(4) "Charitable purpose" means any benevolent, educational, 225
philanthropic, humane, scientific, patriotic, social welfare or advocacy, 226
public health, environmental conservation, civic or eleemosynary 227
objective. 228
(5) "Contribution" means the grant, promise or pledge of money, 229
credit, property, financial assistance or other thing of any kind or value 230
in response to a solicitation. "Contribution" shall not include bona fide 231
fees, dues or assessments paid by members, provided membership is 232
not conferred solely as consideration for making a contribution in 233
response to a solicitation. 234
(6) "Fund-raising counsel" means a person who for compensation 235
plans, manages, advises or consults with respect to the solicitation in 236
this state of contributions by a charitable organization, but who does not 237
solicit contributions and who does not directly or indirectly employ, 238 Substitute Bill No. 5222
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procure or engage any person compensated to solicit contributions. A 239
bona fide nontemporary salaried officer or employee of a charitable 240
organization shall not be deemed to be a fund-raising counsel. 241
(7) "Paid solicitor" means a person who for any consideration, other 242
than any nonmonetary gift of nominal value awarded to a volunteer 243
solicitor as an incentive or token of appreciation, performs for a 244
charitable organization any service in connection with which 245
contributions are solicited by such person or by any person he directly 246
or indirectly employs, procures or engages to solicit for such 247
compensation. A bona fide nontemporary salaried officer or employee 248
of a charitable organization shall not be deemed to be a paid solicitor. 249
(8) "Commercial coventurer" means a person who for profit is 250
regularly and primarily engaged in trade or commerce in this state other 251
than in connection with the raising of funds for charitable organizations 252
or purposes and who conducts a charitable sales promotion. 253
(9) "Charitable sales promotion" means an advertising or sales 254
campaign, conducted by a commercial coventurer, which represents 255
that the purchase or use of goods or services offered by the commercial 256
coventurer are to benefit a charitable organization or purpose. 257
(10) "Department" means the Department of Consumer Protection. 258
(11) "Commissioner" means the Commissioner of Consumer 259
Protection. 260
(12) "Membership" means that which entitles a person to the 261
privileges, professional standing, honors or other direct benefit of the 262
organization and the rights to vote, elect officers and hold office in the 263
organization. 264
(13) "Parent organization" means that part of a charitable 265
organization which supervises and exercises control over the 266
solicitation and expenditure activities of one or more chapters, branches 267
or affiliates. 268 Substitute Bill No. 5222
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(14) "Gross revenue" means income of any kind from all sources, 269
without deduction of any costs or expenses, including all amounts 270
received as the result of any solicitation by a paid solicitor.] 271
Sec. 3. Section 21a-190b of the general statutes is repealed and the 272
following is substituted in lieu thereof (Effective January 1, 2023): 273
(a) Every charitable organization not exempted by section 21a-190d 274
shall annually register with the department prior to conducting any 275
solicitation or prior to having any solicitation conducted on [its] such 276
charitable organization's behalf by others. Application for registration 277
shall be in a form prescribed by the commissioner and shall include a 278
nonrefundable application fee of fifty dollars. Such application shall 279
include: (1) A registration statement, (2) an annual financial report for 280
such charitable organization for the preceding fiscal year that is 281
prepared in accordance with the provisions of subsection (a) of section 282
21a-190c, as amended by this act, and (3) an audited financial statement 283
as required by subsection (b) of section 21a-190c, as amended by this act. 284
An authorized officer of the charitable organization shall certify that the 285
statements therein are true and correct to the best of [their] such officer's 286
knowledge. [A chapter, branch or] An affiliate, branch or chapter in this 287
state of a registered parent organization shall not be required to register, 288
provided the parent organization files a consolidated annual 289
registration for itself and its [chapter, branch or] affiliate, branch or 290
chapter. Each charitable organization shall annually renew [its] such 291
charitable organization's registration not later than eleven months after 292
the end of such charitable organization's fiscal year. 293
(b) In the event the department determines that the application for 294
registration does not contain the documents required in subsection (a) 295
of this section or is not in accordance with the regulations adopted by 296
the commissioner pursuant to this chapter, the department shall notify 297
the charitable organization of such noncompliance not later than ten 298
days after the department's receipt of such application for registration. 299
Any such charitable organization may request a hearing on its 300
noncompliant status in accordance with the provisions of chapter 54. 301 Substitute Bill No. 5222
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(c) In addition to the application fee required pursuant to subsection 302
(a) of this section, a charitable organization shall pay a late fee of twenty-303
five dollars for each month, or part thereof, that such application for 304
registration is late. The commissioner may, upon written request and for 305
good cause shown, waive or reduce any late fee under this section. 306
(d) In the event that a charitable organization fails to register in 307
accordance with the provisions of this section, [such] the charitable 308
organization shall include in [its] such charitable organization's 309
application for registration an annual financial report for each of the 310
previous years in which such charitable organization was required to 311
file an application for registration or an annual financial report. 312
(e) Any charitable organization registered in accordance with this 313
section on September 30, 2005, shall be deemed to be registered 314
pursuant to this section until the last day of the fifth month after the 315
close of the fiscal year in effect on September 30, 2005. 316
(f) A charitable organization registered in accordance with this 317
section shall (1) when engaging in solicitation, or upon request from any 318
person, disclose the charitable organization's registration number, and 319
(2) display the charitable organization's registration number in a 320
conspicuous manner on (A) such charitable organization's Internet web 321
site, and (B) any (i) printed advertisement, or (ii) advertisement on any 322
Internet web site. 323
Sec. 4. Section 21a-71 of the general statutes is repealed and the 324
following is substituted in lieu thereof (Effective January 1, 2023): 325
No person shall sell any food, drug or cosmetic, as defined by section 326
21a-92, at an auction, unless such person has notified the Commissioner 327
of Consumer Protection, in writing, of such sale; provided this section 328
shall not apply to the sale of food by any church, parent teacher 329
association, charitable organization as defined [by subdivision (1) of] in 330
section 21a-190a, as amended by this act, or any organization of any 331
political party. Such notice shall be given at least seven days prior to 332 Substitute Bill No. 5222
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such sale and said commissioner may inspect such food, drug or 333
cosmetic and prohibit the sale of the same if it is found to be unfit for 334
human use. This section shall apply to the sale of unclaimed freight. 335
Sec. 5. Subsection (b) of section 21a-190c of the general statutes is 336
repealed and the following is substituted in lieu thereof (Effective from 337
passage): 338
(b) A charitable organization with gross revenue in [excess of] an 339
amount that is (1) greater than five hundred thousand dollars but less 340
than one million dollars in the year covered by the report shall include 341
with [its] the charitable organization's financial statement an audit 342
report or review report of a certified public accountant, or (2) at least 343
one million dollars in the year covered by the report shall include with 344
the charitable organization's financial statement an audit report of a 345
certified public accountant. For purposes of this section, gross revenue 346
shall not include grants or fees from government agencies or the 347
revenue derived from funds held in trust for the benefit of the charitable 348
organization. The commissioner may, upon written request and for 349
good cause shown, waive the audit report or review report requirement 350
[under] established in this subsection. 351
This act shall take effect as follows and shall amend the following
sections:
Section 1 from passage 21a-190f
Sec. 2 January 1, 2023 21a-190a
Sec. 3 January 1, 2023 21a-190b
Sec. 4 January 1, 2023 21a-71
Sec. 5 from passage 21a-190c(b)
Statement of Legislative Commissioners:
In Section 2(a)(1), "such person" was changed to "oneself", for clarity;
and, in Section 5(b), "audit, or review, report" was changed to "audit
report or review report", and "audit or review report" was changed to
"audit report or review report", for clarity.
Substitute Bill No. 5222
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GL Joint Favorable Subst.