S*284 Session 112 (1997-1998)
S*0284(Rat #0345, Act #0368 of 1998) General Bill, By Leventis, Anderson, Cork,
Courson, Elliott, Giese, Holland, Land, Moore, Reese, M.T. Rose, Short, Waldrep,
Washington and Wilson
A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION
1-5-40 SO AS TO DESIGNATE THE SECRETARY OF STATE TO MONITOR ALL ELECTED OR
APPOINTED STATE BOARDS AND COMMISSIONS IN ORDER TO ASCERTAIN WHEN VACANCIES
OCCUR AND PUBLICIZE THESE VACANCIES AND POSITIONS ON THESE BODIES WHOSE TERMS
EXPIRE; PROVIDE THAT THE DUTIES, FUNCTIONS, AND RESPONSIBILITIES OF THE PUBLIC
CHARITIES SECTION OF THE OFFICE OF THE ATTORNEY GENERAL'S OFFICE ARE DEVOLVED
UPON THE SECRETARY OF STATE'S OFFICE ON JULY 1, 1998; TO TRANSFER ALL
PERSONNEL ORIGINALLY TRANSFERRED FROM THE SECRETARY OF STATE'S OFFICE AND
STILL EMPLOYED BY THE ATTORNEY GENERAL IN THE PUBLIC CHARITIES SECTION,
APPROPRIATIONS, AND FULL-TIME EQUIVALENT POSITIONS OF THE PUBLIC CHARITIES
SECTION TO THE SECRETARY OF STATE'S OFFICE ON JULY 1, 1998; TO PROVIDE THAT
THE SECRETARY OF STATE SHALL ADMINISTER THE "SOUTH CAROLINA SOLICITATION OF
CHARITABLE FUNDS ACT" AND REQUIRE HIM TO NOTIFY EACH CHARITABLE ORGANIZATION
THAT HE IS THE ADMINISTRATOR OF THE ACT; TO AMEND SECTIONS 33-56-20, 33-56-30,
33-56-40, 33-56-50, 33-56-60, 33-56-70, 33-56-80, 33-56-90, 33-56-100,
33-56-110, 33-56-120, 33-56-130, 33-56-140, 33-56-150, 33-56-160, AND
33-56-190, ALL AS AMENDED, ALL RELATING TO THE SOLICITATION OF CHARITABLE
FUNDS, SO AS TO DELETE REFERENCES TO THE ATTORNEY GENERAL AND REFLECT THE
SECRETARY OF STATE AND HIS OFFICE AS THE OFFICIAL AGENCY TO ADMINISTER THE
PROVISIONS OF THE "SOUTH CAROLINA SOLICITATION CHARITABLE FUNDS ACT", AND TO
ALLOW THE SECRETARY OF STATE TO RETAIN A PORTION OF ADMINISTRATIVE FINES TO
OFFSET THE EXPENSES OF ENFORCEMENT.-AMENDED TITLE
01/30/97 Senate Introduced and read first time SJ-7
01/30/97 Senate Referred to Committee on Judiciary SJ-7
02/20/97 Senate Committee report: Favorable Judiciary SJ-17
03/05/97 Senate Read second time SJ-30
03/11/97 Senate Read third time and sent to House SJ-18
03/12/97 House Introduced and read first time HJ-9
03/12/97 House Referred to Committee on Judiciary HJ-9
04/16/98 House Committee report: Favorable with amendment
Judiciary HJ-3
04/21/98 House Requests for debate-Rep(s). Witherspoon, Kelley,
Barfield, Keegan, Edge, Walker, Leach &
Davenport HJ-56
04/22/98 House Amended HJ-32
04/22/98 House Read second time HJ-45
04/22/98 House Roll call Yeas-106 Nays-2 HJ-45
04/23/98 House Read third time and returned to Senate with
amendments HJ-26
04/28/98 Senate House amendment amended SJ-5
04/28/98 Senate Returned to House with amendments SJ-5
05/06/98 House Debate adjourned on Senate amendments until
Thursday, May 7, 1998 HJ-15
05/07/98 House Debate adjourned on Senate amendments until
Tuesday, May 12, 1998 HJ-19
05/12/98 House Concurred in Senate amendment and enrolled HJ-26
05/21/98 Ratified R 345
05/26/98 Signed By Governor
05/26/98 Effective date 07/01/98
06/25/98 Copies available
06/30/98 Act No. 368
(A368, R345, S284)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH
CAROLINA, 1976, BY ADDING SECTION 1-5-40 SO AS TO
DESIGNATE THE SECRETARY OF STATE TO MONITOR ALL
ELECTED OR APPOINTED STATE BOARDS AND COMMISSIONS
IN ORDER TO ASCERTAIN WHEN VACANCIES OCCUR AND
PUBLICIZE THESE VACANCIES AND POSITIONS ON THESE
BODIES WHOSE TERMS EXPIRE; PROVIDE THAT THE DUTIES,
FUNCTIONS, AND RESPONSIBILITIES OF THE PUBLIC
CHARITIES SECTION OF THE ATTORNEY GENERAL'S OFFICE
ARE DEVOLVED UPON THE SECRETARY OF STATE'S OFFICE
ON JULY 1, 1998; TO TRANSFER ALL PERSONNEL ORIGINALLY
TRANSFERRED FROM THE SECRETARY OF STATE'S OFFICE
AND STILL EMPLOYED BY THE ATTORNEY GENERAL IN THE
PUBLIC CHARITIES SECTION, APPROPRIATIONS, AND
FULL-TIME EQUIVALENT POSITIONS OF THE PUBLIC
CHARITIESSECTION TO THE SECRETARY OF STATE'S OFFICE
ON JULY 1, 1998; TO PROVIDE THAT THE SECRETARY OF
STATE SHALL ADMINISTER THE SOUTH CAROLINA
SOLICITATION OF CHARITABLE FUNDS ACT AND REQUIRE
HIM TO NOTIFY EACH CHARITABLE ORGANIZATION THAT HE
IS THE ADMINISTRATOR OF THE ACT; TO AMEND SECTIONS
33-56-20, 33-56-30, 33-56-40, 33-56-50, 33-56-60, 33-56-70, 33-56-80,
33-56-90, 33-56-100, 33-56-110, 33-56-120, 33-56-130, 33-56-140,
33-56-150, 33-56-160, AND 33-56-190, ALL AS AMENDED, ALL
RELATING TO THE SOLICITATION OF CHARITABLE FUNDS, SO
AS TO DELETE REFERENCES TO THE ATTORNEY GENERAL
AND REFLECT THE SECRETARY OF STATE AND HIS OFFICE AS
THE OFFICIAL AGENCY TO ADMINISTER THE PROVISIONS OF
THE "SOUTH CAROLINA SOLICITATION OF CHARITABLE
FUNDS ACT", AND TO ALLOW THE SECRETARY OF STATE TO
RETAIN A PORTION OF ADMINISTRATIVE FINES TO OFFSET
THE EXPENSES OF ENFORCEMENT.
Be it enacted by the General Assembly of the State of South Carolina:
Secretary of State to monitor positions
SECTION 1. The 1976 Code is amended by adding:
"Section 1-5-40. (A) The office of Secretary of State is designated as
the state office whose responsibility it is to monitor positions on the state
boards and commissions specified in this subsection and any elected or
appointed state boards and commissions established after the effective
date of this section. The dates of the term of office for appointments to
boards and commissions made with the advice and consent of the Senate
shall be the dates as certified to the Secretary of State by the Senate. The
dates of the terms of office for all other elected or appointed boards and
commissions shall be the date certified to the Secretary of State by the
Governor for his direct appointments and the dates for the terms of office
for members of boards and commissions elected by the General Assembly
shall be the dates as certified to the Secretary of State by the clerks of the
two houses. The specified boards and commissions referred to in this
subsection are:
(1) Accountancy, Board of
(2) Aging, Division on Advisory Council
(3) Agriculture Commission
(4) Architectural Examiners, State Board of
(5) Arts Commission
(6) Athletic Commission
(7) Auctioneer's Commission
(8) Barrier-Free Design, Board for
(9) Blind, Commission for the
(10) Builders Commission, Residential
(11) Building Code Council
(12) College of Charleston Board of Trustees
(13) Children's Trust Fund Board of Trustees
(14) Children, Foster Care Review Board
(15) Chiropractic Examiners, State Board of
(16) The Citadel Board of Visitors
(17) Clemson University Board of Trustees
(18) Coastal Carolina University Board of Trustees
(19) Consumer Affairs, Commission on
(20) Contractors' Licensing Board
(21) Cosmetology, State Board of
(22) Professional Counselors, Associate Counselors and Marital
and Family Therapists, State Board of Examiners
(23) Deaf and Blind, School for the
(24) Dentistry Board
(25) Disabilities and Special Needs Commission
(26) Education, State Board of
(27) Education Board, Southern Regional
(28) Education Council
(29) Educational Television Commission
(30) Election Commission
(31) Employment Security Commission
(32) Registration for Professional Engineers and Land Surveyors
(33) Environmental Certification Board
(34) Ethics Commission
(35) Financial Institutions, Board of
(36) Fisheries Commission, Atlantic States Marine
(37) Office of General Services, State Fleet Management
(38) Forestry Commission
(39) Francis Marion University Board of Trustees
(40) Funeral Service Board
(41) Geologists, Board of Registration for
(42) Governor's Mansion and Lace House Commission
(43) DHEC
(a) Board of Health and Environmental Control
(b) Office of Ocean and Coastal Resource Management
Board
(44) Higher Education Commission
(45) Holocaust, Council on the
(46) Housing, Finance and Development Authority
(47) Human Affairs Commission
(48) Indigent Defense, Commission on
(49) Intergovernmental Relations, Advisory Commission on
(50) Jobs and Economic Development Authority
(51) John de la Howe School
(52) Judicial Merit Selection Commission
(53) Juvenile Justice, Dept. of, Board of Juvenile Parole
(54) Lander University Board of Trustees
(55) Law Examiners Board
(56) Legislative Audit Council
(57) Library Board
(58) Liquefied Petroleum Gas Board
(59) Long Term Health Care Administrators, Board of
(60) Manufactured Housing Board
(61) Maternal, Infant and Child Health, Council on
(62) Medical Examiners, Board of
(63) Medical University of South Carolina Board of Trustees
(64) Mental Health, State Department of, Commission
(65) Migrant Farm Workers Commission
(66) Mining Council
(67) Minority Affairs, Commission for
(68) Museum Commission
(69) Natural Resources, Department of
(a) Natural Resources Board
(b) Heritage Trust Advisory Board
(70) Nuclear Advisory Council
(71) Nursing, Board of
(72) Occupational Health and Safety Review Board
(73) Occupational Therapy, Board of
(74) Old Exchange Building Commission
(75) Opportunity School, Wil Lou Gray Board of Trustees
(76) Opticianry, Board of Examiners in
(77) Optometry, Board of Examiners in
(78) Patriots Point Development Authority
(79) Pharmacy, Board of
(80) Physical Therapy Examiners, State Board of
(81) Podiatry Examiners, Board of
(82) Ports Authority Board
(83) Prisoner of War Commission
(84) Probation, Parole, and Pardon Services, Board of
(85) Prosecution Coordination, Commission on
(86) Psychology, Board of Examiners in
(87) Public Service Authority, Board of Directors
(88) Public Service Commission
(89) Pyrotechnic Safety, Board of
(90) Radiation Control Technical Advisory Council
(91) Real Estate Commission
(92) Real Estate Appraisers Board
(93) Reorganization Commission
(94) Salary, Executive and Performance Evaluation Commission
(95) Social Work Examiners, Board of
(96) South Carolina State University Board of Trustees
(97) Speech-Language Pathology and Audiology,
Board of Examiners
(98) Tax Board of Review
(99) Technical and Comprehensive Education, Board for
(100) Transportation Department Commission
(101) University of South Carolina Board of Trustees
(102) Veterinary Medical Examiners, Board of
(103) Vocational Rehabilitation, Board of
(104) Winthrop University Board of Trustees
(105) Women, Governor's Office, Commission on
(106) Workers' Compensation Commission
(B) The Secretary shall keep an up-to-date compilation of the
membership of the boards and commissions listed in subsection (A) so
that members of the General Assembly and interested citizens may be
informed of the current composition of these boards and commissions.
This compilation must include:
(1) length of term for each office;
(2) the month and year in which terms have expired or will expire;
(3) terms which have expired;
(4) vacancies;
(5) the body or authority which elects or appoints, as appropriate;
and
(6) any qualifications including, but not limited to, residency
requirements or limitations required for a particular vacancy.
(C) The Secretary shall publicize vacancies, expired terms, and those
terms expiring within one year on a semiannual basis statewide."
Duties, functions, etc. transferred
SECTION 2. The duties, functions, and responsibilities of the Public
Charities Section of the office of the Attorney General are devolved upon
the Secretary of State's office on July 1, 1998. All personnel originally
transferred from the Secretary of State's office and still employed by the
Attorney General in the Public Charities Section, appropriations, and
full-time equivalent positions of the Public Charities Section also are
transferred to the Secretary of State's office on July 1, 1998.
Secretary of State to administer act
SECTION 3. The Secretary of State shall administer the "South
Carolina Solicitation of Charitable Funds Act" as contained in Chapter 56
of Title 33. No later than thirty days after the effective date of this act, the
Secretary of State must notify each charitable organization registered
pursuant to Chapter 56 of Title 33 that the Secretary of State is now the
administrator of the "South Carolina Solicitation of Charitable Funds Act"
and that required registrations are to be filed with the Secretary of State.
Definition
SECTION 4. Section 33-56-20 of the 1976 Code, as last amended by
Section 28C, Part II, Act 458 of 1996, is further amended by adding:
"(5) 'Secretary' means the Secretary of State."
Registration statement
SECTION 5. Section 33-56-30 of the 1976 Code, as last amended by
Section 28D, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-30. Except as otherwise provided in this chapter,
every charitable organization which intends to solicit contributions within
this State or have contributions solicited on its behalf shall file a
registration statement with the Secretary of State on forms prescribed by
the Secretary of State by July first of each year but in all cases prior to
solicitation. It is the duty of the chief executive officer or chief financial
officer of each charitable organization to file the statements required
under this chapter. The statements must be sworn to and contain:
(1) the name of the organization;
(2) the purpose for which it was organized;
(3) 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;
(4) the names and addresses of the chief executive officer and chief
financial officer;
(5) the names and addresses of any chapters, branches, or affiliates in
this State;
(6) the place and date the organization was legally established, the
form of its organization, and a reference to any determination of its tax
exempt status under the Internal Revenue Code;
(7) whether the organization intends to use professional solicitors or
hire individuals to solicit;
(8) whether it is certified as a tax exempt organization and is
authorized by any other governmental authority in this State to solicit
contributions;
(9) whether it is or has ever been enjoined by any court from soliciting
contributions; and
(10) the general purpose for which the contributions to be solicited
must be used.
The registration forms and other documents prescribed by the Secretary
of State must be signed by the chief executive officer and chief financial
officer of the charitable organization and certified as true. Every
charitable organization which submits a registration to the Secretary of
State must pay an annual registration fee of fifty dollars."
Children's Trust Fund
SECTION 6. Section 33-56-40 of the 1976 Code, as last amended by
Section 28E, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-40. The Children's Trust Fund of South Carolina as
established by Section 20-7-5010 is required to register with the Secretary
of State but is not required to pay the annual registration fee provided for
in Section 33-56-30."
Statements not required
SECTION 7. Section 33-56-50 of the 1976 Code, as last amended by
Section 28F, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-50. The following are not required to file registration
statements with the Secretary of State, provided none of its fund-raising
activities are carried on by professional solicitors:
(1) an educational institution which solicits contributions only from
its students and their families, alumni, faculty, friends and other
constituencies, trustees, corporations, foundations, and individuals who
are interested in and supportive of the programs of the institution;
(2) persons requesting contributions for the relief of an individual
specified by name at the time of the solicitation when all of the
contributions collected without any deductions of any kind are turned
over to the named beneficiary for his use, provided that a person soliciting
the contributions is not a named beneficiary;
(3) charitable organizations which (a) do not intend to solicit nor
receive contributions from the public in excess of twenty thousand dollars
during a calendar year or do not receive contributions from more than ten
persons during a calendar year and (b) have received letters of tax
exemption from the Internal Revenue Service, if all of their functions,
including fund-raising activities, are carried on by persons who are unpaid
for their services and if no part of their assets or income inures to the
benefit of or is paid to any officer or member. If the contributions raised
from the public, whether all of the contributions are or are not received by
a charitable organization during any calendar year, are in excess of twenty
thousand dollars or are received from more than ten people, within thirty
days after the date the contributions exceed twenty thousand dollars or the
number of contributors exceeds ten, it must register with and report to the
department as required by this chapter;
(4) organizations which solicit exclusively to their members, including
utility cooperatives;
(5) any veteran's organization which has a congressional charter; and
(6) the State, its political subdivisions, and any agencies or
departments of it which are subject to the disclosure provisions of the
Freedom of Information Act.
Any charitable organization claiming to be exempt from the registration
provisions of this chapter and which will or does solicit charitable
contributions shall submit annually to the Secretary of State on forms to
be prescribed by the Secretary of State, the name, address, and purpose of
the organization and a statement setting forth the reason for the claim for
exemption. If exempted, the Secretary of State or his appropriate division
shall issue a letter of exemption which may be exhibited to the public. No
filing fee is required of an exempt organization."
Organization to file
SECTION 8. Section 33-56-60 of the 1976 Code, as last amended by
Section 28G, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-60. (A) Each charitable organization soliciting funds
in this State and not exempt under Section 33-56-50, whether individually
or collectively with other organizations, shall file a report of its financial
activities, on forms prescribed by the Secretary of State, certified to be
true by the chief executive officer and the chief financial officer of it, in
the office of the Secretary of State. The report must cover the preceding
fiscal year and must be filed within four and one-half months of the close
of the organization's fiscal year unless a written extension has been
granted by the Secretary of State.
The report must include:
(1) specific and itemized support and revenue statements disclosing
direct public support from solicitation, indirect public support,
government grants, program service revenue, and any other revenue. The
report must disclose the amount of direct public support received from
direct mail solicitation, telephone solicitation, commercial co-venturers,
door-to-door solicitations, telethons, and all other itemized sources;
(2) specific and itemized expense statements disclosing program
services, public information expenditures, fund-raising costs, payments
to affiliates, management costs, and salaries paid; and
(3) balance sheet disclosures containing total assets and liabilities.
(B) However, if a charitable organization is required to file Internal
Revenue Service Form 990 with the Internal Revenue Service, the
organization may file the form with the Secretary of State in lieu of the
report required under subsection (A) of this section, provided that the
form may exclude the information which the Internal Revenue Service
would not release pursuant to a Freedom of Information request.
(C) An organization failing to file the report required by this section
may be enjoined from further solicitation of funds in this State in an
action brought by the Secretary of State. An organization failing to file
a timely report required by this section may be assessed by the Secretary
of State administrative fines not to exceed two thousand dollars."
Agreement must be in writing
SECTION 9. Section 33-56-70 of the 1976 Code, as last amended by
Section 28H, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-70. Every contract or agreement between
professional fund-raising counsel or professional solicitor and a charitable
organization must be in writing and filed with the Secretary of State
within ten days after the contract is made. Every agreement or written
statement of the nature of the arrangement to prevail in the absence of a
contract between a professional fund-raising counsel or solicitor and a
charitable organization must be filed with the Secretary of State within ten
days after the contract or written agreement is made. Every contract filed
under this section must disclose the amount of compensation the
professional fund-raising counsel or solicitor will receive, or if there is no
flat fee, the percentage of collected revenues the professional fund-raising
counsel or solicitor will receive. Every contract or agreement filed under
this section must disclose the name and residence address of each person
directing or supervising the conduct of services. Every contract or
agreement filed under this section and involving telephone solicitation
must disclose the location and telephone numbers from which the
soliciting will be conducted.
Within ninety days after a solicitation campaign has been completed,
and on the anniversary of the commencement of a solicitation campaign
lasting more than one year, the professional solicitor or the charitable
organization must file with the Secretary of State a joint financial report
for the campaign, including gross revenue and an itemization of expenses.
The report must be completed on a form prescribed by the Secretary of
State and signed by an authorized official of the paid solicitor or an
authorized official from the charitable organization and certified to be
true.
A professional fund-raising counsel, professional solicitor, or charitable
organization failing to comply with this section is liable for an
administrative fine not to exceed ten dollars for each day of
noncompliance, with a maximum fine under each nonregistered
agreement of two thousand dollars."
Material open to public
SECTION 10. Section 33-56-80 of the 1976 Code, as last amended by
Section 28I, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-80. Registration statements and applications, reports,
professional fund-raising counsel contracts or professional solicitor
contracts, and all other documents and information required to be filed
under this chapter or by the Secretary of State are public records in the
office of the Secretary of State and are open to the general public for
inspection at such time and under such conditions as the Secretary of State
may prescribe. The Secretary of State shall publish and make available
to the public and to persons subject to this chapter explanatory
information concerning this chapter, the duties imposed by this chapter,
and the means for enforcing this chapter."
Certification must be displayed
SECTION 11. Section 33-56-90(4) of the 1976 Code, as last amended
by Section 28J, Part II, Act 458 of 1996, is further amended to read:
"(4) Upon request, a professional solicitor shall display or deliver to the
solicited party a copy of his registration certification from the Secretary
of State."
Records to be kept
SECTION 12. Section 33-56-100 of the 1976 Code, as last amended by
Section 28K, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-100. In accordance with the regulations promulgated
by the Secretary of State, every charitable organization and professional
fundraiser subject to the provisions of this chapter shall keep the true
fiscal records as to its activities in this State. The records must be retained
for at least three years after the end of the period of registration to which
they relate."
Person may not act as fund-raising counsel without being
registered
SECTION 13. Section 33-56-110 of the 1976 Code, as last amended by
Section 28L, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-110. No person shall act as a professional fund-raising
counsel or professional solicitor for a charitable organization subject to
the provisions of this chapter, unless he has first registered with the
Secretary of State. Applications for registration must be in writing under
oath or affirmation in the form prescribed by the Secretary of State and
contain that information as the Secretary of State may require. The
application for registration by professional fund-raising counsel or
professional solicitor must be accompanied by an annual fee of fifty
dollars.
At the time of making application, professional solicitors shall file with
and have approved by the Secretary of State a surety bond in which the
applicant or his employer must be the principal obligor in the sum of
fifteen thousand dollars with one or more sureties satisfactory to the
Secretary of State, whose liability in the aggregate as the sureties will at
least equal that sum and maintain the bond in effect so long as a
registration is in effect. However, a deposit of cash in the amount of
fifteen thousand dollars may be accepted in lieu of the bond. The bond
shall run to the State of South Carolina for the use of the Secretary of
State or his appropriate division and any person who may have a cause of
action against the obligor of the bonds for losses resulting from
malfeasance, nonfeasance, or misfeasance in the conduct of solicitation
activities. A partnership or corporation which is a professional solicitor
may file a consolidated bond on behalf of all its members, officers, and
employees.
Each registration is valid throughout the State for one year and may be
renewed for additional one-year periods upon written application under
oath in the form prescribed by the Secretary of State and the payment of
the fee prescribed in this chapter.
Professional fundraisers or professional fund-raising counsel who fail
to comply with the provisions of this section are liable for an
administrative fine not to exceed ten dollars for each day of
noncompliance, with a maximum fine under this paragraph of two
thousand dollars."
Registration may not be exploited
SECTION 14. Section 33-56-120(2) of the 1976 Code, as last amended
by Section 28M, Part II, Act 458 of 1996, is further amended to read:
"(2) No charitable organization, professional fund-raising counsel, or
professional solicitor shall use or exploit the fact of registration so as to
lead the public to believe that the registration in any way constitutes an
endorsement or approval by the State. However, the use of the following
statement is not considered a prohibited exploitation: 'Registered with the
Secretary of State as required by law'. Registration does not imply
endorsement of a public solicitation for contributions."
Entities subject to chapter
SECTION 15. Section 33-56-130 of the 1976 Code, as last amended by
Section 28N, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-130. If any charitable organization, professional
fund-raising counsel, or professional solicitor soliciting contributions
from people in this State and having a principal place of business outside
the State, or organized under and by virtue of the laws of a foreign state,
is subject to the provisions of this chapter and does not otherwise appoint
a registered agent for service of process, then that charitable organization,
professional fund-raising counsel, or professional solicitor is considered
to have irrevocably appointed the Secretary of State as an agent upon
whom may be served summons, subpoena, subpoena duces tecum, or
other process directed to the charitable organization, professional
fund-raising counsel, or professional solicitor or any partner, principal
officer, or director of it in any action or proceeding brought under the
provisions of this chapter. Service of process upon the Secretary of State
must be made by delivering to and leaving with him personally a copy of
it at the office of the Secretary of State and the service is sufficient
service, provided, that notice of the service and a copy of the process are
sent by the Secretary of State to the charitable organization, professional
fund-raising counsel, or professional solicitor, by registered or certified
mail with return receipt requested, at the address set forth in the
registration form required to be filed with the Secretary of State pursuant
to this chapter or, in default of the filing of the form, at the last address
known to the Secretary of State. Service of the process is complete ten
days after the receipt by the Secretary of State of a return receipt
purporting to be signed by the addressee or a person qualified to receive
the registered or certified mail, in accordance with the accepted practices
of the United States Postal Service, or, if acceptance was refused by the
addressee, ten days after the return to the Secretary of State of the original
envelope bearing a notation by the postal authorities that receipt of it was
refused."
Secretary may investigate
SECTION 16. Section 33-56-140 of the 1976 Code, as last amended by
Section 28O, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-140. (1) Upon his own motion or upon complaint of
any person, the Secretary of State may investigate any charitable
organization, professional fund-raising counsel, or professional solicitor
to determine whether the charitable organization, professional
fund-raising counsel, or professional solicitor has violated the provisions
of this chapter or has filed an application or other information required
under this chapter which contains false or misleading statements. The
Secretary of State may subpoena persons and require the production of
books, papers, and other documents to aid in the investigation of alleged
violations of this chapter.
(2) If any charitable organization, professional fund-raising counsel,
or professional solicitor fails to file a registration application, statement,
report, or other information required to be filed with the Secretary of State
under this chapter, or violates the provisions of this chapter, the Secretary
of State shall notify the delinquent charitable organization, professional
fund-raising counsel, or professional solicitor of this fact by mailing a
notice by registered or certified mail, with return receipt requested, to its
last known address. If the required registration application, statement,
annual report, assurance of voluntary compliance, or other information is
not filed or if the existing violation is not discontinued within fifteen days
after the formal notification or receipt of the notice, the Secretary of State
may assess an administrative fine not to exceed two thousand dollars
against the delinquent organization.
(3) In addition to all other actions authorized by law, the Secretary of
State, if he has reason to believe that one or more of the following acts or
violations listed below has occurred, may bring an action to enjoin the
charitable organization, professional fund-raising counsel, professional
solicitor, or other person from continuing the act or violation, doing any
other acts in furtherance of it, and for such other relief as the court
considers appropriate:
(a) a person is knowingly and wilfully operating in violation of the
provisions of this chapter;
(b) a person has knowingly and wilfully made any false statement
in any registration application, statement, report, or other information
required to be filed by this chapter;
(c) a person has failed to file a registration statement or financial
report required by this chapter;
(d) a person is employed or is about to be employed in any
solicitation or collection of contributions any device, scheme, or artifice
to defraud or to obtain money or property by means of false pretense,
representation, or promise;
(e) the officers or representatives of a charitable organization,
professional fund-raising counsel, or professional solicitor have refused
or failed after notice to produce any records of the organization; or
(f) whenever the funds raised by solicitation activities are not
devoted or will not be devoted to the charitable purposes of the charitable
organization.
(4) In addition to the provisions of subsection (3), any person who
knowingly and wilfully violates the provisions of this chapter or who
knowingly and wilfully gives false or incorrect information to the
Secretary of State in filing statements or reports required by this chapter,
is guilty of a misdemeanor and, upon conviction, for a first offense must
be fined not more than one thousand dollars or be imprisoned for not
more than thirty days, and for a second or any subsequent offense must be
fined not more than five thousand dollars or be imprisoned for not more
than one year, or both.
(5) Any registration application, statement, report, or other
information required to be filed with the Secretary of State under this
chapter by a charitable organization, professional fund-raising counsel, or
professional solicitor which contains false or misleading statements may
be rejected by the Secretary of State and returned to the submitting party
without being filed.
(6) If a person is assessed an administrative fine under this chapter,
the person has thirty days to pay the fine. After thirty days, the Secretary
of State shall give the delinquent person thirty days' notice that he will
seek to enjoin the activities of the person. Before the Secretary of State
seeks an injunction, the person may pay the fines or request a hearing
before the Secretary of State. A person who fails to remit fines after the
required notice is given may be enjoined from engaging in further
charitable solicitation activities until the fine is paid. A person assessed
a fine may request an evidentiary hearing before the Secretary of State.
A person may appeal an adverse ruling by the Secretary of State to the
circuit court. An appeal to the circuit court is governed by the standard
of review provided in the Administrative Procedures Act and the case law
interpreting that provision.
(7) The Secretary of State may exercise the authority granted in this
section against a person who operates under the guise or pretense of being
an organization exempted by the provisions of Section 33-56-40 or
33-56-50 and is not in fact an organization entitled to the exemption."
Division created
SECTION 17. Section 33-56-150 of the 1976 Code, as last amended by
Section 28P, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-150. There is created in the office of the Secretary of
State a Division of Public Charities which, under the direction and control
of the Secretary of State, shall perform the duties imposed upon it by the
provisions of this chapter. The executive and administrative head of the
division shall be the Director of Public Charities designated by the
Secretary of State."
Portion of fines may be retained
SECTION 18. Section 33-56-160 of the 1976 Code, as last amended by
Section 28Q, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-160. The first two hundred thousand dollars in
administrative fine revenue received pursuant to this chapter in a fiscal
year may be retained by the Secretary of State to offset the expenses of
enforcing this chapter. All administrative fines collected pursuant to this
chapter in excess of two hundred thousand dollars in a fiscal year must be
transmitted to the State Treasurer and deposited in the state general fund.
All fees collected under this chapter must be transmitted to the State
Treasurer and deposited in a fund separate and distinct from the state
general fund and used by the Secretary of State for the purpose of
administering the provisions of this chapter."
Secretary may enter into agreements
SECTION 19. Section 33-56-190 of the 1976 Code, as last amended by
Section 28R, Part II, Act 458 of 1996, is further amended to read:
"Section 33-56-190. The Secretary of State may enter into agreements
with the appropriate authority of any other state for the purpose of
exchanging information with respect to charitable organizations,
professional fund-raising counsel, and professional solicitors."
Time effective
SECTION 20. This act takes effect July 1, 1998.
Approved the 26th day of May, 1998. |