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State Charitable Solicitation Laws

States impose charitable solicitation laws to guide fundraising activities.  Charitable solicitation laws are designed to enhance public accountability and to aid potential donors by making the registration material and financial reports available to the public.  At the same time, state law enforcement agencies may use the material to detect and prosecute illegal conduct.

Practice 5A of Land Trust Standards and Practices requires land trusts to comply with all charitable solicitation laws.  While provisions vary, state laws typically include requirements for registration and reporting.  These laws generally require organizations to register one time or annually with a state agency, usually the Office of the Attorney General, Secretary of State or consumer protection agency.  Forty states and many counties have nonprofit registration requirements.  If a land trust operates in more than one state, or actively solicits funds from more than one state, it may need to register in each of those states.

The test for the level of activity required for registration varies from state to state, and many states exempt registration requirements if contributions are under a certain threshold.  Soliciting a few out-of-state donors each year may not trigger additional registration requirements, but  to be certain, your land trust needs to check with local counsel to determine if registering in that state is necessary.

Soliciting funds through the Internet offers a particular challenge for state registration requirements.  Groups with interactive contribution forms on their websites may be responsible for registration in states where they specifically target contributors or receive contributions on a repeated, ongoing or substantial basis.  Land trusts should be aware of the source of their contributions and the requirements of the states where these contributions are made to ensure their compliance with respective state laws.

Contact the appropriate state agency or your attorney to obtain details about fundraising requirements specific to the states in which you raise funds.  Find a listing of all state charities agencies here.

 

Unified Registration Statement

Thirty-seven of the forty states requiring registration accept the Unified Registration Statement (URS), which makes registering in multiple states much easier.  The URS is an effort to consolidate the information and data requirements of all states that require registration of nonprofit organizations performing charitable solicitations within their jurisdictions.  The effort is organized by the National Association of State Charity Officials and the National Association of State Attorneys General and is one part of the Standardized Reporting Project, whose aim is to standardize, simplify and economize compliance under the states’ solicitation laws.

 

Additional Resources

  • See information from GuideStar about fundraising in all 50 states via the Internet and mailed solicitations. Learn about solicitation permits in each state, current laws regarding this type of fundraising and more.
  • See Nonprofit Fundraising Registration: The 50 State Guide by Stephen Fishman (Nolo Press, October 2010). This book, written by an attorney, is a guide to the complex and varied registration requirements you’ll need to meet while fundraising for your land trust.
  • For information about the URS and the requirements of individual states, the Multi-State Filer Project is the go-to resource. Another helpful website is LawForChange, which provides specific fundraising guidance on a state-by-state basis.
  • Barb Welch of Barb Welch Consulting in Maine also prepared this helpful spreadsheet summarizing the requirements of each state for registration and reporting by charities.
  • Rob Levin, Esq. of Land Conservation Legal Services prepared this memo [PDF 44KB] for a land trust in Maine seeking guidance on registration requirements with respect to states other than Maine.
  • There are also commercial entities that can assist land trusts in determining in which states they need to register and with the registration process (the Alliance currently uses Labyrinth).
  • A number of states require additional disclosures, mandating that prospective donors be provided with information on how they may obtain a copy of the financial filings your organizations made to state officials. View the list compiled by Labyrinth, Inc.-West.

* The above information is intended for educational purposes only. You are encouraged to seek the advice of your legal advisor, or other authoritative sources, regarding the application of these general principles to your individual circumstances.  Any discussion of the matters contained herein is not intended or written to be used, and cannot be used, for the purpose of avoiding any penalties that may be imposed under state or federal law.

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