MD
Maryland House Bill HB72

Maryland 2023 Regular Session

Maryland House Bill HB72 Compare Versions

OldNewDifferences
1- WES MOORE, Governor Ch. 381
21
3-– 1 –
4-Chapter 381
5-(House Bill 72)
62
7-AN ACT concerning
3+EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4+ [Brackets] indicate matter deleted from existing law.
5+ Underlining indicates amendments to bill.
6+ Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7+amendment.
8+ Italics indicate opposite chamber/conference committee amendments.
9+ *hb0072*
810
9-Business Regulation – Charitable Contribution – Definition Organizations
11+HOUSE BILL 72
12+C2 (3lr0307)
13+ENROLLED BILL
14+— Economic Matters/Judicial Proceedings —
15+Introduced by Delegate Watson
1016
11-FOR the purpose of altering the definition of “charitable contribution” to exclude donations
12-of property made with a certain intent and an authorization for or a discount on the
13-use of certain services or materials, equipment, or facilities for purposes of provisions
14-of law regulating charitable organizations and charitable representatives;
15-authorizing the Maryland Secretary of State to accept certain documentation in place
16-of an audit or review in connection with a charitable organization’s registration
17-statement; and generally relating to charitable contributions organizations.
17+Read and Examined by Proofreaders:
1818
19-BY repealing and reenacting, without amendments,
20- Article – Business Regulation
21-Section 6–101(a)
22- Annotated Code of Maryland
23- (2015 Replacement Volume and 2022 Supplement)
19+_______________________________________________
20+Proofreader.
21+_______________________________________________
22+Proofreader.
2423
25-BY repealing and reenacting, with amendments,
26- Article – Business Regulation
27-Section 6–101(c) and 6–402
28- Annotated Code of Maryland
29- (2015 Replacement Volume and 2022 Supplement)
24+Sealed with the Great Seal and presented to the Governor, for his approval this
3025
31- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
32-That the Laws of Maryland read as follows:
26+_______ day of _______________ at _________________ _______ o’clock, ________M.
3327
34-Article – Business Regulation
28+______________________________________________
29+Speaker.
3530
36-6–101.
31+CHAPTER ______
3732
38- (a) In this title the following words have the meanings indicated.
33+AN ACT concerning 1
3934
40- (c) (1) “Charitable contribution” means a contribution made on a
41-representation that it will be used for a charitable purpose.
35+Business Regulation – Charitable Contribution – Definition Organizations 2
4236
43- (2) “Charitable contribution” includes the payment, transfer, or
44-enforceable pledge of financial help, including money, credit, property, or services.
37+FOR the purpose of altering the definition of “charitable contribution” to exclude donations 3
38+of property made with a certain intent and an authorization for or a discount on the 4
39+use of certain services or materials, equipment, or facilities for purposes of provisions 5
40+of law regulating charitable organizations and charitable representatives; 6
41+authorizing the Maryland Secretary of State to accept certain documentation in place 7
42+of an audit or review in connection with a charitable organization’s registration 8
43+statement; and generally relating to charitable contributions organizations. 9
4544
46- (3) “Charitable contribution” does not include:
45+BY repealing and reenacting, without amendments, 10
46+ Article – Business Regulation 11
47+Section 6–101(a) 12
48+ Annotated Code of Maryland 13
49+ (2015 Replacement Volume and 2022 Supplement) 14 2 HOUSE BILL 72
4750
48- (i) an unsolicited gift;
49- Ch. 381 2023 LAWS OF MARYLAND
5051
51-– 2 –
52- (ii) a government grant or government money;
5352
54- (iii) membership assessments, dues, or fines;
53+BY repealing and reenacting, with amendments, 1
54+ Article – Business Regulation 2
55+Section 6–101(c) and 6–402 3
56+ Annotated Code of Maryland 4
57+ (2015 Replacement Volume and 2022 Supplement) 5
5558
56- (iv) a payment for property sold or services rendered by a charitable
57-organization, unless the property is sold or the services are rendered in connection with a
58-charitable solicitation; [and]
59+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 6
60+That the Laws of Maryland read as follows: 7
5961
60- (v) a public safety contribution as defined in subsection (j) of this
61-section; AND
62+Article – Business Regulation 8
6263
63- (VI) A DONATION OF PROPER TY THAT IS INTENDED TO BE
64-REDISTRIBUTED WITHOU T CHARGE FOR A BENEV OLENT, EDUCATIONAL ,
65-ELEEMOSYNARY , HUMANE, PATRIOTIC, PHILANTHROPIC , OR RELIGIOUS PURPOSE ;
66-AND
64+6–101. 9
6765
68- (VII) AN AUTHORIZATION FOR OR A DISCOUNT ON THE USE OF
69-SERVICES OR MATERIAL S, EQUIPMENT, OR FACILITIES , INCLUDING THOSE
70-RELATING TO:
66+ (a) In this title the following words have the meanings indicated. 10
7167
72- 1. ADVERTISING; AND
68+ (c) (1) “Charitable contribution” means a contribution made on a 11
69+representation that it will be used for a charitable purpose. 12
7370
74- 2. BROADCAST AIRTIME , INCLUDING PUBLIC SER VICE
75-ANNOUNCEMENTS .
71+ (2) “Charitable contribution” includes the payment, transfer, or 13
72+enforceable pledge of financial help, including money, credit, property, or services. 14
7673
77-6–402.
74+ (3) “Charitable contribution” does not include: 15
7875
79- (a) A registration statement shall be on the form that the Secretary of State
80-provides.
76+ (i) an unsolicited gift; 16
8177
82- (b) Except as provided in subsection (c) of this section, the registration statement
83-shall contain or be accompanied by:
78+ (ii) a government grant or government money; 17
8479
85- (1) the name and address of the charitable organization and of any affiliate,
86-branch, or chapter in the State;
80+ (iii) membership assessments, dues, or fines; 18
8781
88- (2) the name and address of:
82+ (iv) a payment for property sold or services rendered by a charitable 19
83+organization, unless the property is sold or the services are rendered in connection with a 20
84+charitable solicitation; [and] 21
8985
90- (i) each officer, including each principal salaried executive staff
91-officer, and each other person with final responsibility for the custody and final distribution
92-of the charitable contributions made to the charitable organization; or
86+ (v) a public safety contribution as defined in subsection (j) of this 22
87+section; AND 23
9388
94- (ii) each person who has custody of the financial records of the
95-charitable organization if the charitable organization does not have a local office in the
96-State; WES MOORE, Governor Ch. 381
89+ (VI) A DONATION OF PROPER TY THAT IS INTENDED TO BE 24
90+REDISTRIBUTED WITHOU T CHARGE FOR A BENEV OLENT, EDUCATIONAL , 25
91+ELEEMOSYNARY , HUMANE, PATRIOTIC, PHILANTHROPIC , OR RELIGIOUS PURPOSE ; 26
92+AND 27
9793
98-– 3 –
94+ (VII) AN AUTHORIZATION FOR OR A DISCOUNT ON THE USE OF 28
95+SERVICES OR MATERIAL S, EQUIPMENT, OR FACILITIES , INCLUDING THOSE 29
96+RELATING TO: 30
97+ HOUSE BILL 72 3
9998
100- (3) a statement of:
10199
102- (i) the purposes for which the cha ritable organization was
103-organized;
100+ 1. ADVERTISING; AND 1
104101
105- (ii) the purposes for which charitable contributions will be used; and
102+ 2. BROADCAST AIRTIME , INCLUDING PUBLIC SERVICE 2
103+ANNOUNCEMENTS . 3
106104
107- (iii) whether the charitable organization intends to solicit directly or
108-to have a professional solicitor or fund–raising counsel solicit charitable contributions on
109-its behalf;
105+6–402. 4
110106
111- (4) a copy of the articles of incorporation or other governing instrument of
112-the charitable organization;
107+ (a) A registration statement shall be on the form that the Secretary of State 5
108+provides. 6
113109
114- (5) a copy of a letter from the Internal Revenue Service, or other evidence,
115-showing the tax–exempt status of the charitable organization;
110+ (b) Except as provided in subsection (c) of this section, the registration statement 7
111+shall contain or be accompanied by: 8
116112
117- (6) (i) a copy of federal Form 990 that the charitable organization
118-submits to the Internal Revenue Service; or
113+ (1) the name and address of the charitable organization and of any affiliate, 9
114+branch, or chapter in the State; 10
119115
120- (ii) information that the charitable organization states on a form
121-that the Secretary of State provides;
116+ (2) the name and address of: 11
122117
123- (7) (i) an audit by an independent certified public accountant if the
124-gross income from charitable contributions in the most recently completed fiscal year is at
125-least $750,000; or
118+ (i) each officer, including each principal salaried executive staff 12
119+officer, and each other person with final responsibility for the custody and final distribution 13
120+of the charitable contributions made to the charitable organization; or 14
126121
127- (ii) a review by an independent certified public accountant if the
128-gross income from charitable contributions in the most recently completed fiscal year is at
129-least $300,000 but less than $750,000;
122+ (ii) each person who has custody of the financial records of the 15
123+charitable organization if the charitable organization does not have a local office in the 16
124+State; 17
130125
131- (8) an affidavit signed by the chairman, president, or other principal officer
132-attesting to the truth of the registration statement and each supporting document;
126+ (3) a statement of: 18
133127
134- (9) (i) a certification that all taxes due from the applicant to the State
135-or to Baltimore City or a county of the State for the preceding fiscal year have been paid,
136-and all taxes the applicant was required to collect and pay over to the State or to Baltimore
137-City or a county of the State for the preceding fiscal year have been collected and paid over;
138-or
128+ (i) the purposes for which the charitable organization was 19
129+organized; 20
139130
140- (ii) a certification that the taxes due from the applicant to the State
141-or to Baltimore City or a county are under dispute and the dispute has not been finally
142-resolved; and
143- Ch. 381 2023 LAWS OF MARYLAND
131+ (ii) the purposes for which charitable contributions will be used; and 21
144132
145-– 4 –
146- (10) any other information that the Secretary of State requires by
147-regulation.
133+ (iii) whether the charitable organization intends to solicit directly or 22
134+to have a professional solicitor or fund–raising counsel solicit charitable contributions on 23
135+its behalf; 24
148136
149- (c) The Secretary of State may accept other documentation in place of any item
150-required under subsection (b) of this section, INCLUDING, IN PLACE OF THE AUDI T OR
151-REVIEW REQUIRED BY S UBSECTION (B)(7) OF THIS SECTION , SUPPORTING
152-DOCUMENTS INDICATING , AND AN AFFIDAVIT ATT ESTING, THAT:
137+ (4) a copy of the articles of incorporation or other governing instrument of 25
138+the charitable organization; 26
153139
154- (1) THE CHARITABLE ORGAN IZATION:
140+ (5) a copy of a letter from the Internal Revenue Service, or other evidence, 27
141+showing the tax–exempt status of the charitable organization; 28
155142
156- (I) PRIMARILY SOLICITS I N–KIND CONTRIBUTIONS ;
143+ (6) (i) a copy of federal Form 990 that the charitable organization 29
144+submits to the Internal Revenue Service; or 30
145+ 4 HOUSE BILL 72
157146
158- (I) (II) RECEIVES DONATIONS O F PROPERTY , INCLUDING
159-HOUSEHOLD GOODS , FURNITURE, APPLIANCES, AND CLOTHING , THAT ARE
160-INTENDED TO BE REDIS TRIBUTED TO INDIVIDU ALS RESIDING IN THE STATE
161-WITHOUT CHARGE ;
162147
163- (II) (III) DOES NOT EMPLOY A PR OFESSIONAL SOLICITOR OR
164-FUND–RAISING COUNSEL ;
148+ (ii) information that the charitable organization states on a form 1
149+that the Secretary of State provides; 2
165150
166- (III) (IV) USED GENERALLY ACCEPTED ACCOUNTING
167-PRINCIPLES TO DETERMI NE THE VALUE OF PROP ERTY RECEIVED AS CHA RITABLE
168-CONTRIBUTIONS DURING THE IMMEDIATELY PREC EDING FISCAL YEAR ;
151+ (7) (i) an audit by an independent certified public accountant if the 3
152+gross income from charitable contributions in the most recently completed fiscal year is at 4
153+least $750,000; or 5
169154
170- (IV) (V) HAS CASH RECEIPTS FR OM CHARITABLE
171-CONTRIBUTIONS NOT EXCEEDING $300,000 AND AMOUNTING TO 20% OR LESS OF
172-THE CHARITABLE ORGAN IZATION’S GROSS INCOME DURIN G THE IMMEDIATELY
173-PRECEDING FISCAL YEA R THAT ARE USED FOR PROGRAM SERVICES OR
174-MANAGEMENT AND GENER AL EXPENSES OF THE C HARITABLE ORGANIZATION , AS
175-SET FORTH UNDER COMAR 01.02.04.04.A AND C;
155+ (ii) a review by an independent certified public accountant if the 6
156+gross income from charitable contributions in the most recently completed fiscal year is at 7
157+least $300,000 but less than $750,000; 8
176158
177- (V) (VI) IS CURRENT AND UP TO DATE IN ALL REGISTRA TION
178-AND REPORTING REQUIR EMENTS UNDER THIS TI TLE;
159+ (8) an affidavit signed by the chairman, president, or other principal officer 9
160+attesting to the truth of the registration statement and each supporting document; 10
179161
180- (VI) (VII) IS IN GOOD STANDING WITH THE STATE DEPARTMENT
181-OF ASSESSMENTS AND TAXATION, IF APPLICABLE; AND
162+ (9) (i) a certification that all taxes due from the applicant to the State 11
163+or to Baltimore City or a county of the State for the preceding fiscal year have been paid, 12
164+and all taxes the applicant was required to collect and pay over to the State or to Baltimore 13
165+City or a county of the State for the preceding fiscal year have been collected and paid over; 14
166+or 15
182167
183- (VII) (VIII) HAS TAX–EXEMPT STATUS UNDER § 501(C)(3) OF THE
184-INTERNAL REVENUE CODE;
168+ (ii) a certification that the taxes due from the applicant to the State 16
169+or to Baltimore City or a county are under dispute and the dispute has not been finally 17
170+resolved; and 18
185171
186- (2) THE CHARITABLE CONTR IBUTIONS OF PROPERTY ARE:
172+ (10) any other information that the Secretary of State requires by 19
173+regulation. 20
187174
188- (I) DIRECTLY RELATED TO THE PURPOSES FOR WHI CH THE
189-CHARITABLE ORGANIZAT ION WAS ORGANIZED ; AND WES MOORE, Governor Ch. 381
175+ (c) The Secretary of State may accept other documentation in place of any item 21
176+required under subsection (b) of this section, INCLUDING, IN PLACE OF THE AUDI T OR 22
177+REVIEW REQUIRED BY S UBSECTION (B)(7) OF THIS SECTION , SUPPORTING 23
178+DOCUMENTS INDICATING , AND AN AFFIDAVIT ATT ESTING, THAT: 24
190179
191-– 5 –
180+ (1) THE CHARITABLE ORGAN IZATION: 25
192181
193- (II) WILL BE USED IN COND UCTING THE CHARITABL E
194-ORGANIZATION ’S PROGRAMS; AND
182+ (I) PRIMARILY SOLICITS I N–KIND CONTRIBUTIONS ; 26
195183
196- (3) THE GOVERNING BODY O F THE CHARITABLE ORG ANIZATION:
184+ (I) (II) RECEIVES DONATIONS O F PROPERTY , INCLUDING 27
185+HOUSEHOLD GOODS , FURNITURE, APPLIANCES, AND CLOTHING , THAT ARE 28
186+INTENDED TO BE REDIS TRIBUTED TO INDIVIDUALS RESIDING IN THE STATE 29
187+WITHOUT CHARGE ; 30
197188
198- (I) IS COMPOSED OF AT LE AST THREE INDEPENDEN T AND
199-UNRELATED DIRECTORS ; AND
189+ (II) (III) DOES NOT EMPLOY A PR OFESSIONAL SOLICITOR OR 31
190+FUND–RAISING COUNSEL ; 32
191+ HOUSE BILL 72 5
200192
201- (II) COMPLETED AN ONBOARD ING AND TRAINING PROGRAM
202-DURING THE IMMEDIATE LY PRECEDING FISCAL YEAR, PROVIDED INTERNALLY OR
203-EXTERNALLY , THAT COVERED :
204193
205- 1. THE CHARITABLE ORGAN IZATION’S MISSION;
194+ (III) (IV) USED GENERALLY ACCEPTED ACCOUNTING 1
195+PRINCIPLES TO DETERMI NE THE VALUE OF PROP ERTY RECEIVED AS CHA RITABLE 2
196+CONTRIBUTIONS DURING THE IMMEDIATELY PRECEDIN G FISCAL YEAR; 3
206197
207- 2. THE POLICIES, PROCEDURES , AND OPERATIONS OF
208-THE CHARITABLE ORGAN IZATION; AND
198+ (IV) (V) HAS CASH RECEIPTS FR OM CHARITABLE 4
199+CONTRIBUTIONS NOT EXCEEDING $300,000 AND AMOUNTING TO 20% OR LESS OF 5
200+THE CHARITABLE ORGAN IZATION’S GROSS INCOME DURIN G THE IMMEDIATELY 6
201+PRECEDING FISCAL YEAR THAT ARE USED F OR PROGRAM SERVICES OR 7
202+MANAGEMENT AND GENER AL EXPENSES OF THE C HARITABLE ORGANIZATI ON, AS 8
203+SET FORTH UNDER COMAR 01.02.04.04.A AND C; 9
209204
210- 3. THE DUTIES AND RESPONSIB ILITIES OF DIRECTORS
211-AND OFFICERS AS FIDU CIARIES OF THE CHARI TABLE CONTRIBUTIONS THAT THE
212-CHARITABLE ORGANIZAT ION COLLECTS AND SPE NDS.
205+ (V) (VI) IS CURRENT AND UP TO DATE IN ALL REGISTRA TION 10
206+AND REPORTING REQUIR EMENTS UNDER THIS TI TLE; 11
213207
214- (d) The Secretary of State may require an audit or review if the amount of gross
215-income is less than $750,000.
208+ (VI) (VII) IS IN GOOD STANDING WITH THE STATE DEPARTMENT 12
209+OF ASSESSMENTS AND TAXATION, IF APPLICABLE; AND 13
216210
217- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect
218-October 1, 2023.
211+ (VII) (VIII) HAS TAX–EXEMPT STATUS UNDER § 501(C)(3) OF THE 14
212+INTERNAL REVENUE CODE; 15
219213
220-Approved by the Governor, May 3, 2023.
214+ (2) THE CHARITABLE CONTR IBUTIONS OF PROPERTY ARE: 16
215+
216+ (I) DIRECTLY RELATED TO THE PURPOSES FOR WHI CH THE 17
217+CHARITABLE ORGANIZAT ION WAS ORGANIZED ; AND 18
218+
219+ (II) WILL BE USED IN COND UCTING THE CHARITABL E 19
220+ORGANIZATION ’S PROGRAMS; AND 20
221+
222+ (3) THE GOVERNING BODY O F THE CHARITABLE ORG ANIZATION: 21
223+
224+ (I) IS COMPOSED OF A T LEAST THREE INDEPE NDENT AND 22
225+UNRELATED DIRECTORS ; AND 23
226+
227+ (II) COMPLETED AN ONBOARD ING AND TRAINING PRO GRAM 24
228+DURING THE IMMEDIATE LY PRECEDING FISCAL YEAR, PROVIDED INTERNALLY OR 25
229+EXTERNALLY , THAT COVERED : 26
230+
231+ 1. THE CHARITABLE ORGAN IZATION’S MISSION; 27
232+
233+ 2. THE POLICIES, PROCEDURES , AND OPERATIONS OF 28
234+THE CHARITABLE ORGAN IZATION; AND 29
235+ 6 HOUSE BILL 72
236+
237+
238+ 3. THE DUTIES AND RESPO NSIBILITIES OF DIREC TORS 1
239+AND OFFICERS AS FIDU CIARIES OF THE CHARI TABLE CONTRIBUTIONS THAT THE 2
240+CHARITABLE ORGANIZAT ION COLLECTS AND SPE NDS. 3
241+
242+ (d) The Secretary of State may require an audit or review if the amount of gross 4
243+income is less than $750,000. 5
244+
245+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 6
246+October 1, 2023. 7
247+
248+
249+
250+
251+Approved:
252+________________________________________________________________________________
253+ Governor.
254+________________________________________________________________________________
255+ Speaker of the House of Delegates.
256+________________________________________________________________________________
257+ President of the Senate.