More Than Just a List of Services Rendered or an Act of Good Faith
Fundraising contracts are time sensitive and tied to state fundraising regulations. As outside counsel, Copilevitz, Lam & Raney can also advise you on Internal Revenue Service or state regulatory issues as they apply to charity operations and fundraising activities.
Annual renewals are required by most states and include substantial reporting requirements. Given the extensive nature of state regulation and the consequences of non-compliance, nonprofit organizations cannot afford to ignore registration and renewal requirements. For example, the State of New York once sued a charitable organization for raising funds prior to registration and actually obtained a judgment ordering the charity to return all of the funds that were collected regardless of actual expenses.
Approximately two-thirds of the states require some form of disclosure as part of fundraising appeals. Several states also require nonprofits to provide oral and/or written disclosures whether or not they receive professional assistance.
Many state registration laws mandate certain provisions in contracts between a charity and professional fundraiser. These may require the inclusion of terms such as clearly stating the fee arrangement, the scope of solicitation activities and responsibilities of all parties to the contract.