Bill Text: CA AB2855 | 2015-2016 | Regular Session | Amended
Bill Title: Charitable solicitations: financial disclosures.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2016-11-30 - From committee without further action. [AB2855 Detail]
Download: California-2015-AB2855-Amended.html
BILL NUMBER: AB 2855 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 7, 2016
AMENDED IN ASSEMBLY MARCH 17, 2016
INTRODUCED BY Assembly Member Frazier
FEBRUARY 19, 2016
An act to add Section 17510.86 to the Business and Professions
Code, relating to charitable solicitations.
LEGISLATIVE COUNSEL'S DIGEST
AB 2855, as amended, Frazier. Charitable solicitations: financial
disclosures.
Existing law requires a solicitor or seller, prior to any
solicitation or sales solicitation for charitable purposes, to
provide the prospective donor or purchaser with certain disclosures,
including, among others, the name and address of the combined
campaign, each organization or fund on behalf of which money
collected will be utilized, and the percentage of the total gift or
purchase price that may be deducted as a charitable contribution
under both federal and state law. Under existing law, a violation of
certain advertising restrictions, including charitable solicitation
requirements, is a crime.
This bill would require an Internet Web site produced by, or on
behalf of, a charity Clarity, as specified,
to contain an Internet Web page that includes a
disclosure of the charity's administrative overhead expenses and a
copy of the charity's most recent Internal Revenue Service Form 990
filing and would further require each Internet Web page on the
Internet Web site to contain a direct link to that financial
disclosures Internet Web page, as specified. The bill would also
require a document produced by, or on behalf of, a charity for
solicitation for charitable purposes to include a disclosure
statement indicating the percentage of the charity's funding spent on
those administrative overhead expenses, as specified.
a prominent link to the Attorney General's Internet Web site which
contains information about consumer rights and protections and
charity research resources. The bill would also require any
solicitation document produced by a charity to also include the
address for the Attorney General's Internet Web site. As a
violation of these requirements would be a crime, this bill would
impose a state-mandated local program.
This bill would authorize the Attorney General to enforce these
requirements by directing the Franchise Tax Board to suspend or
revoke a violating charity's tax-exempt status, by suspending or
revoking the registration of a violating charity, or by taking any
other enforcement action pursuant to the Attorney General's existing
powers and duties, as specified.
The bill would, by July 1, 2017, require the Attorney General to
develop and publish specified information regarding consumer rights
and charities on the Attorney General's Internet Web site.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 17510.86 is added to the
Business and Professions Code , to read:
17510.86. (a) An Internet Web site produced by, or on behalf of,
a charity that operates or engages in the solicitation for charitable
purposes of funds or other property in this state shall include a
prominent link on the home page of the Internet Web site that
immediately directs all consumers to the Attorney General's Internet
Web site, which contains information about consumer rights and
protections and charity research resources.
(b) A document produced by, or on behalf of, a charity for the
solicitation for charitable purposes of funds or other property in
this state shall include the Internet Web site address of the
Attorney General's Internet Web site, which contains information
about consumer rights and protections and charity research resources.
(c) No later than July 1, 2017, the Attorney General shall develop
and publish on the Attorney General's Internet Web site, which
contains information about charities, informational materials
containing consumer rights and protections and charity research
resources to allow donors to become informed about a charity before
making a decision to give.
SECTION 1. Section 17510.86 is added to the
Business and Professions Code, to read:
17510.86. (a) An Internet Web site produced by, or on behalf of,
a charity that operates, or engages in the solicitation for
charitable purposes of funds or other property, in this state shall
comply with both of the following:
(1) The Internet Web site shall contain a financial disclosures
Internet Web page, which shall include both of the following:
(A) A disclosure of the sum total of the salaries, other
compensation, and employee benefits of the charity's executive
director and board of directors and all of the charity's other
administrative overhead expenses, as reported on the charity's most
recent Internal Revenue Service Form 990 filing. The disclosure shall
be set forth in at least 14-point, bold, sans serif type font and
shall be clear and conspicuous, as defined in Section 17601.
(B) A complete copy of the charity's most recent Internal Revenue
Service Form 990 filing.
(2) Each Internet Web page on the Internet Web site shall include
a direct link to the financial disclosures Internet Web page required
pursuant to paragraph (1). The direct link shall contain the phrase
"Click here to read a full disclosure of the finances, including the
salaries and expenses, of this organization," shall be placed in the
top right corner of each Internet Web page in at least 14-point,
bold, sans serif type font, and shall be clear and conspicuous, as
defined in Section 17601.
(b) (1) A document produced by, or on behalf of, a charity for the
solicitation for charitable purposes of funds or other property in
this state shall include a disclosure statement indicating the
percentage of the charity's funding that is spent on the sum total of
the salaries, other compensation, and employee benefits of the
charity's executive director and board of directors and all of the
charity's other administrative overhead expenses, as reported on the
charity's most recent Internal Revenue Service Form 990 filing.
(2) The disclosure statement shall be printed on the first page of
the document in at least 14-point, bold, sans serif type font and
shall be clear and conspicuous, as defined in Section 17601.
(c) The Attorney General may enforce this section by taking any of
the following actions against a charity that provides false
information or otherwise violates this section:
(1) Directing the Franchise Tax Board to suspend or revoke the
charity's exemption from the taxes imposed by the Corporation Tax Law
(Part 11 (commencing with Section 23001) of Division 2 of the
Revenue and Taxation Code). The suspension or revocation shall become
effective immediately upon receipt by the Franchise Tax Board, and
the Franchise Tax Board shall reinstate the exemption only upon
subsequent notification by the Attorney General that the charity is
in compliance with this section.
(2) Refusing to register, or revoking or suspending the
registration of, a charity pursuant to the Supervision of Trustees
and Fundraisers for Charitable Purposes Act (Article 7 (commencing
with Section 12580) of Chapter 6 of Part 2 of Division 3 of Title 2
of the Government Code).
(3) Taking any other enforcement action pursuant to the Attorney
General's existing powers and duties.
SEC. 2. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.
