HB5383 94TH GENERAL ASSEMBLY

LRB094 18036 RAS 53341 b

94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB5383

Introduced 1/26/2006, by Rep. Randall M. Hultgren

SYNOPSIS AS INTRODUCED:

225 ILCS 460/1	from Ch. 23, par. 5101
225 ILCS 460/2.5 new
225 ILCS 460/7.3 new

Amends the Solicitation for Charity Act. Provides that charitable organization employees who are directly involved in the solicitation, receipt, or transportation of any motor vehicle for a charitable purpose must, prior to any solicitation, receipt, or transportation, register with the Attorney General in the form and manner prescribed by the Attorney General. Sets forth requirements for motor vehicle donations, including requirements for charitable organizations and third party contractors that pick up and dispose of vehicles. Effective July 1, 2006.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Solicitation for Charity Act is amended by changing Section 1 and by adding Sections 2.5 and 7.3 as follows:

(225 ILCS 460/1) (from Ch. 23, par. 5101)

Sec. 1. The following words and phrases as used in this Act shall have the following meanings unless a different meaning is required by the context.

(a) "Charitable organization" means any ." Any benevolent, philanthropic, patriotic, or eleemosynary person or one purporting to be such which solicits and collects funds for charitable purposes and includes each local, county, or area division within this State of such charitable organization, provided such local, county or area division has authority and discretion to disburse funds or property otherwise than by transfer to any parent organization.

(a-5) "Charitable organization employee" means an individual employed by a charitable organization.

(b) "Contribution" means the ." The promise or grant of any money or property of any kind or value, including the promise to pay, except payments by union members of an organization. Reference to the dollar amount of "contributions" in this Act means in the case of promises to pay, or payments for merchandise or rights of any other description, the value of the total amount promised to be paid or paid for such merchandise or rights and not merely that portion of the purchase price to be applied to a charitable purpose. Contribution shall not include the proceeds from the sale of admission tickets by any not-for-profit music or dramatic arts organization which establishes, by such proof as the Attorney General may require, that it has received an exemption under Section 501(c)(3) of the Internal Revenue Code and which is organized and operated for the presentation of live public performances of musical or theatrical works on a regular basis. For purposes of this subsection, union member dues and donated services shall not be deemed contributions.

(c) "Person" means any ." Any individual, organization, group, association, partnership, corporation, trust or any combination of them.

(d) "Professional fund raiser" means any ." Any person who for compensation or other consideration, conducts, manages, or carries on any solicitation drive or campaign in this State or from this State or on behalf of a charitable organization residing within this State for the purpose of soliciting contributions for or on behalf of any charitable organization or any other person, or who engages in the business of, or holds himself out to persons in this State as independently engaged in the business of soliciting contributions for such purposes. A bona fide director, officer, employee or unpaid volunteer of a charitable organization shall not be deemed a professional fund raiser unless the person is in a management position and the majority of the individual's salary or other compensation is computed on a percentage basis of funds to be raised, or actually raised.

(e) "Professional fund raising consultant" means any ." Any person who is retained by a charitable organization or trustee for a fixed fee or rate that is not computed on a percentage of funds to be raised, or actually raised, under a written agreement, to only plan, advise, consult, or prepare materials for a solicitation of contributions in this State, but who does not manage, conduct or carry on a fundraising campaign and who does not solicit contributions or employ, procure, or engage any compensated person to solicit contributions and who does not at any time have custody or control of contributions. A volunteer, employee or salaried officer of a charitable organization or trustee maintaining a permanent establishment or office in this State is not a professional fundraising consultant. An attorney, investment counselor, or banker who advises an individual, corporation or association to make a charitable contribution is not a professional fundraising consultant as a result of the advice.

(f) "Charitable purpose" means any ." Any charitable, benevolent, philanthropic, patriotic, or eleemosynary purpose.

(g) "Charitable Trust" means any relationship whereby property is held by a person for a charitable purpose.

(h) "Education Program Service" means any activity which provides information to the public of a nature that is not commonly known or facts which are not universally regarded as obvious or as established by common understanding and which informs the public of what it can or should do about a particular issue.

(i) "Primary Program Service" means the program service upon which an organization spends more than 50% of its program service funds or the program activity which represents the largest expenditure of funds in the fiscal period.

(j) "Professional solicitor" means any natural person who is employed or retained for compensation by a professional fund raiser to solicit contributions for charitable purposes from persons in this State or from this State or on behalf of a charitable organization residing within this State.

(k) "Program Service Activity" means the actual charitable program activities of a charitable organization for which it expends its resources.

(l) "Program Service Expense" means the expenses of charitable program activity and not management expenses or fund raising expenses. In determining Program Service Expense, management and fund raising expenses may not be included.

(m) "Public Safety Personnel Organization" means any person who uses any of the words "officer", "police", "policeman", "policemen", "troopers", "sheriff", "law enforcement", "fireman", "firemen", "paramedic", or similar words in its name or in conjunction with solicitations, or in the title or name of a magazine, newspaper, periodical, advertisement book, or any other medium of electronic or print publication, and is not a governmental entity. No organization may be a Public Safety Personnel Organization unless 80% or more of its voting members or trustees are active, retired, or disabled police officers, peace officers, firemen, fire fighters, emergency medical technicians - ambulance, emergency medical technicians - intermediate, emergency medical technicians - paramedic, ambulance drivers, or other medical assistance or first aid personnel.

(m-5) "Public Safety Personnel" includes police officers, peace officers, firemen, fire fighters, emergency medical technicians - ambulance, emergency medical technicians - intermediate, emergency medical technicians - paramedic, ambulance drivers, and other medical assistance or first aid personnel.

(n) "Trustee" means any person, individual, group of individuals, association, corporation, not for profit corporation, or other legal entity holding property for or solicited for any charitable purpose; or any officer, director, executive director or other controlling persons of a corporation soliciting or holding property for a charitable purpose.

(Source: P.A. 91-301, eff. 7-29-99.)

(225 ILCS 460/2.5 new)

Sec. 2.5. Charitable organization employee registration. Any charitable organization employee who is directly involved in the solicitation, receipt, or transportation of any motor vehicle, including without limitation automobiles, motorcycles, and boats, for a charitable purpose must, prior to any solicitation, receipt, or transportation, register with the Attorney General in the form and manner prescribed by the Attorney General. The Attorney General may adopt any rules and procedures necessary for the administration of this Section.

(225 ILCS 460/7.3 new)

Sec. 7.3. Motor vehicle donations.

(a) To receive funds derived from the sale of a motor vehicle donated to it, including without limitation automobiles, motorcycles, and boats, a charitable organization registered under this Act must:

(1) be designated as a 501(c)(3) corporation under the Internal Revenue Code and operating in Illinois;

(2) be in good standing with the Illinois Secretary of State;

(3) keep all mandatory 990 tax returns up to date and filed with the Attorney General's Charitable Trust Division;

(4) comply with Internal Revenue Service (IRS) regulations governing vehicle donations; and

(5) be listed on IRS Publication 78 as an organization qualified to receive deductible donations.

(b) If a charitable organization uses a third party contractor to pick up and dispose of donated motor vehicles, then the third party contractor shall do all of the following:

(1) Be licensed or registered under the Illinois Vehicle Code as a used vehicle dealer, tower, or vehicle auctioneer.

(2) Be registered as a business within the municipality of operation.

(3) Develop a written contract specifying the services to be provided to the charitable organization and the costs of those services. The contract must include provisions for:

(A) procedures for the pick up, physical assessment, and disposal of the vehicle;

(B) procedures for the monthly reporting to the charitable organization of the year, make, model, and method of disposal of each donated motor vehicle and an assessment of the condition and range of value of each donated motor vehicle; and

(C) vehicle disposition reports that list the sale, salvage, or auction price of donated vehicles, minus the costs for services, such as towing, commissions, and handling, as well as a picture of the vehicle taken before disposition.

(c) A charitable organization must provide the following documentation to the donor of a motor vehicle:

(1) proof of compliance with IRS rules governing vehicle donation charitable deductions;

(2) within 30 days after the donation is received by the charitable organization, a letter specifying the date the donated motor vehicle was picked up and the year, make, and model of the donated motor vehicle; and

(3) after disposition of the vehicle, a letter specifying the final amount of the donation exclusive of all fees, such as towing fees, commission payments, or title transfer fees.

(d) A charitable organization receiving funds or vehicles pursuant to this Section must file with the IRS all information required by law.

(e) A charitable organization, or its designee, receiving funds derived from the sale of a motor vehicle donated to the organization must complete the State of Illinois Sales Tax Transaction Return (ST-556).

(f) A charitable organization to which a motor vehicle is donated, or its designee, must complete a State of Illinois Application for Vehicle Title and Registration form to insure that once the donor relinquishes the donated vehicle the vehicle's ownership and registration are transferred.

Section 99. Effective date. This Act takes effect July 1, 2006.