Archive for Nonprofit Board Governance
Florida Charity Registration Legislation Adds New Requirments
Posted by: | CommentsThe Florida Department of Agriculture and Consumer Affairs have recently been giving charity registration and professional fundraisers a lot of attention. Florida has the dubious honor of being home to 11 of the top 50 WORST charities according to the Center for Investigative Reporting; http://cironline.org/.
The new legislation aims to “prevent the misuse of Floridians’ charitable contributions by deterring fraudulent and deceptive organizations from soliciting contributions in [the] state.”
How does this new legislation affect the charity registration process? According to the LFNP (The Law Firm for Non-profits at http://www.lfnp.com/) there are two key changes:
- Any charity that solicits contributions in or from Florida residents must adopt a conflict of interest policy, which must require annual certification of compliance with the policy by all directors, officers, and trustees of the charity. A copy of the annual certification must be submitted to the Department with its annual registration statement.
- A charity that has more than $1 million in total revenue and spends less than 25% of it on program service costs must complete an additional Department form, including the dollar amount and percentage of total revenue allocated to employees, fundraising, travel expenses, overhead, and charitable programs. The form must also detail any transactions with insiders (e.g., directors and officers).
What do you think about the increasing administrative requirements for charity registration?
Charity Registration VS Charity De-registration: Recipe for Success
Posted by: | CommentsRecently Clearly Compliant has had a string of clients and potential clients seeking assistance to “de-register” in specific states. It made me think of a saying I heard all too frequently from my Mom, “Sarah, your eyes are bigger than your stomach.” My Mom was an amazing cook who could turn mud into Mississippi Mud Pie, but let’s face it, with six kids to feed, it was never a good thing to see food wasted. I am NOT talking about greed. I AM talking about how easy it is to think we need more than we do! What is the recipe for success in state charity registration?
In my experience nonprofits that skip the assessment phase may end up registering in states where funds are not solicited. “Universal” registration is a term used in the industry and there are organizations that clearly need to register in every state where charity registration is required for fundraising. It sounds good. It sounds easy. However, for many small and medium size nonprofits a best practice is to complete a thorough assessment based on 3 – 5 years history from the donor database, mailing lists, member addresses, grant applications, website, social media, and all other fundraising activity. How much is the organization raising in each state? How many donors? What are the giving trends? Then, complete a cost/benefit analysis for each state that includes a comparison of funds raised to expenses for state registration. For example, if total cost to register in one state is $250 and donations are from two people totaling $50, consider stopping the solicitations. There are always exceptions….an organization may receive $0 from a state but know they will be applying for a grant or there is an opportunity for a future gift and the organization wants to be poised and ready to accept.
Like many great recipes, a charity registration assessment takes work. But thorough prep work may just leave more $$$ in your organization’s pot for mission accomplishment!