March 2019

State Law

Arizona

On April 2, 700 non-profits statewide participated in “Arizona Gives Day,” a grassroots effort that invites Arizonians to support their favorite causes. Last year, Arizona Gives Day raised more than $3.2 Million for the participating organizations. Arizona Republic, April 2.

California

An announcement has been made that payroll deductions that were made to the United Way of Santa Rosa so far in 2019 will be returned to donors. The affiliate lost its standing as United Way, and there reportedly is a federal law enforcement probe of its finances. NonProfit Times, March 21

On March 15, CalNonprofits sent a letter to the sponsor of Assembly Bill 1539, which would regulate crowdfunding platforms. The California Association of Non-Profits is a statewide policy alliance of more than 10,000 organizations and acts as the voice of the state’s non-profit community. While the letter opposed a legislative proposal, it did not discourage the Assembly from seeking a more balanced and thorough look at the regulation of these emerging platform fundraising sites. March 15 letter from CalNonprofits.

Florida

The Attorney General has closed down a charity that has existed for 5 years with tax-exempt status as a charity. VetMade Industries of Tampa took in millions of dollars but performed no services for disabled or unemployed veterans. The investigation was sparked as a result of a series run on WFLA Television in Tampa.

The Federal Trade Commission and the Attorney General of Florida announced the settlement of charges that a veterans’ organization located in the State deceived donors with false claims that the organization helped military veterans. The settlement included a permanent ban from charitable solicitations or otherwise working for charities. Federal Trade Commission, March 28.

Missouri

A law enforcement charity has agreed to go out of business as a result of a settlement with the Federal Trade Commission and the Attorney General of Missouri. The settlement included a penalty as well as an agreement not to engage in any further fundraising activities. Federal Trade Commission, March 28.

New York

New York: The Governor of New York has signed Assembly Bill 2688 which amends Section 174-b of the Executive Law regarding point of solicitation disclosures. As of March 21, 2019, additional obligations exist to disclose telephone number and website address information for the Attorney General in all oral and written solicitations. Unfortunately, the law does not indicate which telephone number should be disclosed or the actual URL of the website that should be provided. We are working to identify both pieces of information.

Pennsylvania

The feel-good story from last year of the homeless man who loaned $20 to a woman at a gas station who wound up with a GoFundMe account that raised more than $400,000 has come to a sad end. The homeless man and the woman pled guilty in federal court to conspiracy charges. The third individual involved has not yet been resolved. In addition, there are charges pending in New Jersey. (As a result of this case that received so much notoriety, the individuals who were New Jersey residents sparked a new law in that state attempting to regulate fraud involving GoFundMe appeals.) Forbes, March 7.

New Mexico

Legislation has been introduced that would make the donors to public institutions in the State, such as colleges and universities, public information. The bill is sponsored by Attorney General Hector Balderas and comes after the University of New Mexico Foundation initially refused to release documents requested by an independent watchdog that sued under the Inspection of Public Records Act. NonProfit Times, March 12.

IRS

The Agency has announced a change of policy involving notices sent to organizations with a group tax exemption. The obligation to file an annual group exemption information update remains, but now the burden has shifted to the organization to proactively file a form with the IRS without first receiving a reminder. (https://www.irs.gov/charities-non-profits/group-exemption-rulings-and-group-returns)