Many states have taken steps to protect the public from fraudulent fundraising solicitations, and today most states have legislation to regulate charitable solicitations by tax-exempt organizations. Many state statutes have been expanded and/or tightened. Associations and other nonprofit organizations, particularly Section 501(c)(3) organizations, such as the University of Georgia Foundation, that make legitimate solicitations for charitable contributions must be aware of these laws and recent enforcement activities.
Each state has its own definition of what constitutes a solicitation. For simplicity sake, UGAF will use the most defined and conservative definitions which are found in Pennsylvania law:
"Solicitation" - Any direct or indirect request for a contribution and the representation that such contribution will be used in whole or in part for a charitable purpose, including, but not limited to, any of the following:
Thirty-nine states and the District of Columbia require charities to register before soliciting their residents. Registration typically involves paying a fee and providing general information (e.g. name, address, corporate status, purpose, proposed registration activities, tax status, information about officers and directors, etc.). Many states also impose reporting and disclosure requirements such as filing an annual report or other financial information annually with their state regulatory agency.
States may impose additional requirements on an organization. The UGAF Compliance Officer should be made aware of any proposed contract with a Professional Fundraising Consultant, Professional Solicitor, or Commercial Co-Venturer before bids are submitted through the UGA Procurement Office. Definitions and expectations for each group are below:
Many states also require that professional fundraising consultants and solicitors register before they are permitted to conduct their services. Often states require paid solicitors to register or post bond with the state, whereas they often only impose registration requirements on fundraising advisers. In addition, some states require certain contractual provisions in all paid solicitors' contracts with charities, and mandate that paid solicitors provide the states with copies of their contracts.