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91_SB1540eng SB1540 Engrossed LRB9112929ACmg 1 AN ACT to amend the Solicitation for Charity Act. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The Solicitation for Charity Act is amended 5 by changing Sections 15 and 23 as follows: 6 (225 ILCS 460/15) (from Ch. 23, par. 5115) 7 Sec. 15. (a) Trustees of charitable trusts, 8 organizations and corporations have a duty to supervise fund 9 raising activities to ensure that contributions are 10 adequately protected and devoted to the proper purpose and 11 that statements or representations made during solicitations 12 to the public are true and correct. 13 (b) If any person, including a charitable organization, 14 a professional fund raiser, a trustee, a professional fund 15 raising consultant, or a professional solicitor, in 16 conducting a fund raising campaign for a charitable 17 organization or for charitable or ostensibly charitable 18 purposes: 19 (1) Represents that tickets for a show or goods or 20 services shall be made available to children, 21 disadvantaged persons or for a like charitable purpose, 22 and that such will be distributed by the persons 23 soliciting or the organization, the tickets shall be held 24 in trust for the use as a charitable trust and adequate 25 records and accounting for same maintained. 26 (2) Disseminates an educational message or 27 materials to the public with or in the course of fund 28 raising activities and allocates the costs between fund 29 raising and education programs, he shall prepare and 30 maintain written worksheets of how the allocation is made 31 and the reasoning behind the allocation. SB1540 Engrossed -2- LRB9112929ACmg 1 (3) Sells or offers for sale advertising space in a 2 publication or ad book or periodical, he shall maintain 3 adequate records for all ads sold and written document 4 receipts shall provide the name of the organization 5 involved, the publication's name, and its proposed date 6 of publication, as well as the number of copies proposed 7 to be printed or a reasonable estimate. 8 (4) Engages in the dissemination of education 9 program services as a part of or in physical conjunction 10 with its solicitation of charitable contributions, it 11 shall record and report all expenses incurred as fund 12 raising unless it allocates the expenses between fund 13 raising and other functions pursuant to professional 14 accounting standards and provisions as promulgated and 15 set forth by the American Institute of Certified Public 16 Accountants or the Financial Accounting Standards Board 17 from time to time in their official publications. For 18 purposes of making all such allocations, the factors and 19 considerations utilized must be reduced to writing. 20 (5) Engages in any public solicitation and therein 21 purports to relate the purpose or purposes for which the 22 funds are solicited, such shall then be fully and 23 accurately identified to the prospective donor. If a 24 charitable organization whose purposes include the 25 rendering of noneducational program services intends to 26 expend or budget more than 50% of its program service 27 expenditures for informing or educating the public and 28 the funds being solicited will be used for such purpose, 29 the donor at his or her request must be told that a 30 primary use of the program funds will be for public 31 education. 32 (6) Collects and takes control or possession of 33 contributions made for a charitable purpose or to a 34 charitable organization, they owe a fiduciary duty to the SB1540 Engrossed -3- LRB9112929ACmg 1 public to deal with the said contributions in an 2 appropriate fiduciary manner, to keep complete books and 3 records for at least 3 years, to keep records in a 4 comprehensive manner to permit accurate reporting and 5 auditing as required by law, and to not commingle funds 6 with noncharitable funds and to be able to account for 7 the funds, and will be subject to surcharge for any funds 8 not accounted for or wasted, in addition to other 9 remedies available at equity. A presumption shall exist 10 that expenditures not properly documented and disclosed 11 by records were not properly spent. 12 (7) Uses written materials to solicit or seek a 13 contribution from the public for a charitable 14 organization required to file an annual report under 15 Section 4 of this Act, those materials must state at the 16 bottom of the last page that "a copy of the charitable 17 organization's annual financial report is or will be on 18 file at the Office of the Attorney General of Illinois 19 and available for public inspection", in a typeface 20 consistent with the body of the document in which it is 21 inserted. However, this statement shall not be required 22 if fewer than 500 pieces of the material are used or 23 distributed within Illinois by the charitable 24 organization in a calendar year. 25 (8) Solicits or seeks a contribution from the 26 public through the use of a telephone for a charitable 27 organization required to file an annual report under 28 Section 4 of this Act, and said calls are made by callers 29 paid to be making said calls, the telephone call must 30 include a statement by the caller that "a copy of the 31 charitable organization's annual financial report is or 32 will be on file at the Office of the Attorney General of 33 Illinois and available for public inspection". 34 (b-5) A charitable organization, professional SB1540 Engrossed -4- LRB9112929ACmg 1 fundraiser, trustee, professional fund raising consultant, or 2 professional solicitor when making telephone solicitations 3 for a contribution to a charitable organization may not place 4 a block on its telephone numbers to keep the telephone 5 numbers from appearing on a recipient's caller ID. For the 6 purposes of this subsection, "caller ID" means the display to 7 the recipient of a call the caller's telephone number or 8 identity. 9 (c) Any person who violates this Section may be enjoined 10 from acting as orcontinuing to acton behalf of charitable 11 organizations or charitable causes within Illinoisthe12charityfor a period of up to 5 years at the discretion of a 13 court of chancery based upon the equities; and if the 14 violation is intentional or willful they shall not be 15 entitled to keep or receive fees, salaries, commissions or 16 any compensation as a result of or on account of the 17 solicitations or fund raising campaigns. At the request of 18 the Attorney General a court shall order that the fees, 19 salaries, commissions, or compensation shall be forfeited and 20 used for a charitable use as the court determines. 21 (d) In addition to any other penalty available in this 22 Act or at law, each charitable organization on behalf of 23 which a professional fundraiser, trustee, professional fund 24 raising consultant, or professional solicitor, or employee of 25 the charitable organization places in use or causes the use 26 of materials bearing the statement required by item (7) of 27 subsection (b) or fails to include the statement required by 28 item (8) of subsection (b) in a telephone call in seeking 29 contributions for a charitable organization, if that 30 charitable organization has not registered or maintained 31 registration as required by this Act during the period when 32 the materials carrying the statement are used or placed in 33 use or when the telephone call failing to include the 34 statement is made, is subject to a civil penalty of $5,000. SB1540 Engrossed -5- LRB9112929ACmg 1 (e) In imposing relief for violations of items (7) and 2 (8) of subsection (b) of this Section, the court shall take 3 into consideration the violator's knowledge of the 4 provisions, whether the violator is an unpaid volunteer, 5 prior notice, prior warnings, and the magnitude of the 6 violation; the court may fashion mandatory injunctive relief 7 to compel compliance in substitute or in furtherance of the 8 foregoing relief provided at law or by this Section, as the 9 equities may require. 10 (Source: P.A. 87-755.) 11 (225 ILCS 460/23) 12 Sec. 23. Charitable Advisory Council. As a part of 13 charitable trust enforcement and public disclosure, a task 14 force composed of citizens chosen by the Attorney General to 15 be known as the Attorney General's Charitable Advisory 16 Council shall be and is hereby formed and shall exist for as 17 long as the Attorney General deems that it is necessaryfor a183-year period. This Advisory Council shall study issues of 19 charitable giving, volunteerism, and fundraising in this 20 State. The Advisory Council members shall serve without 21 compensation, and the expenses of the Council may be paid for 22 out of the Illinois Charity Bureau Fund in an amount not to 23 exceed $10,000 per year and in the discretion of the Attorney 24 General. 25 (Source: P.A. 90-469, eff. 8-17-97; 91-444, eff. 8-6-99.)