ENROLLED
H. B. 4413

(By Delegates Fleischauer, Compton,
C. White, Manuel, Fragale and Beach)


[Passed March 8, 2002; in effect ninety days from passage.]

AN ACT to amend and reenact sections five and six, article nineteen, chapter twenty-nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, all relating to charitable organizations generally, increasing contribution levels for certain charities eligible for exemption from being required to file annual registration statements; excluding certain charitable organizations that do not employ professional fund-raisers or receive public contributions from annual audit requirements; increasing the threshold before an independent audit is required; making technical changes relating to exemptions for charities that are an integral part of a church; and broadening types of charities eligible for certain exceptions.

Be it enacted by the Legislature of West Virginia:
That sections five and six, article nineteen, chapter twenty-nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted, all to read as follows:

§29-19-5. Registration of charitable organizations; fee.
(a) Every charitable organization, except as provided in section six of this article, which intends to solicit contributions within this state or to have funds solicited on its behalf shall, prior to any solicitation, file a registration statement with the secretary of state upon forms prescribed by him or her which shall be good for one full year and which shall be refiled in the next and each following year in which the charitable organization is engaged in solicitation activities. If an organization discontinues solicitation at any time after its last registration filing, then it shall file a registration statement reflecting its activities during its last fiscal year in which solicitation in West Virginia took place. It is the duty of the president, chairman or principal officer of the charitable organization to file the statements required under this article. The statements shall be sworn to and shall contain the following information:
(1) The name of the organization and the purpose for which it was organized;
(2) The principal address of the organization and the address of any offices in this state. If the organization does not maintain an office, the name and address of the person having custody of its financial records;
(3) The names and addresses of any chapters, branches or affiliates in this state;
(4) The place where and the date when the organization was legally established and the form of its organization;
(5) The names and addresses of the officers, directors, trustees and the principal salaried executive staff officer;
(6) A copy of a balance sheet and a statement or report of income and expenses for the organization's immediately preceding fiscal year or a financial statement reporting information showing the kind and amount of funds raised during the preceding fiscal year, the costs and expenses incidental to the fund raising and showing how the funds were disbursed or allocated for the same fiscal year: Provided, That for organizations raising more than one hundred thousand dollars per year in contributions excluding grants from governmental agencies or private foundations, the balance sheet and income and expense statement, or financial statement provided, shall be audited by an independent public accountant. Organizations are required to report the amount of money raised in the state and the amount spent in the state for charitable purposes;
(7) A copy of any determination of the organization's tax exempt status under the provisions of 26 U.S.C. §501(c)(3) and a copy of the last filed Internal Revenue Service form 990 and Schedule A for every charitable organization and any parent organization;
(8) Whether the organization intends to solicit contributions from the public directly or have other solicitation done on its behalf by others;
(9) Whether the organization is authorized by any other governmental authority to solicit contributions and whether it is or has ever been enjoined by any court from soliciting contributions;
(10) The general purpose or purposes for which the contributions to be solicited shall be used;
(11) The name or names under which it intends to solicit contributions;
(12) The names of the individuals or officers of the organization who will have final responsibility for the custody of the contributions;
(13) The names of the individuals or officers of the organization responsible for the final distribution of the contributions; and
(14) Copies of all contract documentation from professional fund-raising counsels and professional solicitors as provided for in subsection (d), section seven of this article.
(b) Each chapter, branch or affiliate, except an independent member agency of a federated fund-raising organization, may separately report the information required by this section or report the information to its parent organization which shall then furnish the information regarding its West Virginia affiliates, chapters and branches in a consolidated form to the secretary of state. An independent member agency of a federated fund-raising organization, as defined in section two of this article, shall comply with the provisions of this article independently. Each organization shall file a separate registration form for each name under which funds will be solicited.
(c) The registration forms and any other documents prescribed by the secretary of state shall be signed by an authorized officer or by an independent public accountant and by the chief fiscal officer of the charitable organization and shall be verified under oath.
(d) Every charitable organization collecting less than one million dollars during any year which submits an independent registration to the secretary of state shall pay an annual registration fee of fifteen dollars; every charitable organization collecting more than one million dollars during one year which submits an independent registration to the secretary of state shall pay an annual registration fee of fifty dollars; and a parent organization filing on behalf of one or more chapters, branches or affiliates or a single organization filing under different names shall pay a single annual registration fee of fifty dollars for itself and the chapters, branches or affiliates included in the registration statement. All fees and moneys collected by the secretary of state pursuant to the provisions of this article shall be deposited by the secretary of state as follows: One-half shall be deposited in the state general revenue fund and one-half shall be deposited in the services fees and collections account established by section two, article one, chapter fifty-nine of this code for the operation of the office of the secretary of state. The secretary of state shall dedicate sufficient resources from that fund or other funds to provide the services required in this article.
(e) For good cause shown, the secretary of state may extend the due date for the annual filing of a registration statement or report by a charitable organization or a professional fund-raiser for a period not to exceed ninety days. During that period, the previously filed registration statement or report of the charitable organization which has been granted the extension remains in effect.
(f) In addition to the registration fee required by this section, a charitable organization and/or professional fund-raiser, which fails to file a registration statement or report by the original or extended due date for filing as required by this section shall, for each month or part of the month thereafter in which the registration statement or report is not filed, pay an additional fee of twenty-five dollars: Provided, That the total amount of the additional fees for a registration statement or report required to be filed in any one year shall not exceed five hundred dollars. All fees and moneys collected by the secretary of state pursuant to the provisions of this article shall be deposited by the secretary of state as follows: One-half shall be deposited in the state general revenue fund and one-half shall be deposited in the service fees and collections account established by section two, article one, chapter fifty-nine of this code for the operation of the office of the secretary of state. Any balance remaining on the thirtieth day of June, two thousand one, in the existing special revenue account entitled "charitable organization fund" as established by chapter thirty-four, acts of the Legislature, regular session, one thousand nine hundred ninety-two, shall be transferred to the service fees and collections account established by section two, article one, chapter fifty-nine of this code for the operation of the secretary of state. The secretary of state shall dedicate sufficient resources from that fund or other funds to provide the services required in this article.

§29-19-6. Certain persons and organizations exempt from registration.

The following charitable organizations shall not be required to file an annual registration statement with the secretary of state:
(1) Educational institutions, the curriculums of which, in whole or in part, are registered or approved by the state board of education, either directly or by acceptance of accreditation by an accrediting body recognized by the state board of education; and any auxiliary associations, foundations and support groups which are directly responsible to any such educational institutions;
(2) Persons requesting contributions for the relief of any individual specified by name at the time of the solicitation when all of the contributions collected without any deductions whatsoever are turned over to the named beneficiary for his or her use;
(3) Hospitals which are nonprofit and charitable;
(4) Organizations which solicit only within the membership of the organization by the members thereof: Provided, That the term "membership" shall not include those persons who are granted a membership upon making a contribution as the result of solicitation. For the purpose of this section, "member" means a person having membership in a nonprofit corporation, or other organization, in accordance with the provisions of its articles of incorporation, bylaws or other instruments creating its form and organization; and having bona fide rights and privileges in the organization, such as the right to vote, to elect officers, directors and issues, to hold office or otherwise as ordinarily conferred on members of such organizations;
(5) Churches, synagogues, associations or conventions of churches, religious orders or religious organizations that are an integral part of a church which qualifies as tax exempt under the provisions of 26 U.S.C. §501(c)(3) and which qualifies as being exempt from filing an annual return under the provisions of 26 U.S.C. §6033;
(6) Any person, firm, corporation or organization that sponsors a single fund-raising event for the benefit of a named charitable organization where all or part of the funds collected are donated to the named charitable organization: Provided, That the named charitable organization receiving the funds is registered pursuant to this article, reports each of these donations individually, and certifies that no funds were withheld by the organization that solicited the funds;
(7) Any charitable organization that does not employ a professional solicitor or fund-raiser and does not intend to solicit and receive and does not actually raise or receive contributions from the public in excess of twenty-five thousand dollars during a calendar year.
Charitable organizations which do not intend to solicit and receive in excess of twenty-five thousand dollars, but do receive in excess of that amount from the public, shall file the annual registration statement within thirty days after contributions are in excess of twenty-five