Contents

C H A P T E R T W E N T Y - F O U R2 4State Fundraising Regulation§ 24.1 State Regulationin General 627§ 24.2 Historical Perspective 628§ 24.3 States’ Police Power 630§ 24.4 Basic Definitions 630§ 24.5 RegistrationRequirements 631§ 24.6 Reporting Requirements 632§ 25.7 Exemptions fromRegulation 632§ 25.8 Fundraising CostLimitations 633§ 24.9 Prohibited Acts 634§ 24.10 ContractualRequirements 635§ 24.11 Disclosure Requirements 636The solicitation of charitable contributions in the United States involves practicesthat are recognized as being forms of free speech protected by federal andstate constitutional law. Thus, there are limitations on the extent to which fundraisingfor charitable, educational, scientific, religious, and like organizationscan be regulated by government. Nevertheless, nonprofit organizations in theUnited States face considerable regulatory requirements at the federal, state, andlocal levels when they solicit contributions for charitable purposes. The purposeof this chapter is to summarize this body of law. 1The process of raising funds for charitable purposes is heavily regulated bythe states. At this time, all but four states have some form of statutory structureby which the fundraising process is regulated. 2 Of these states, 39 have formalcharitable solicitation acts.§ 24.1 STATE REGULATION IN GENERALThe various state charitable solicitation acts generally contain certain features,including:• A process by which a charitable organization registers or otherwisesecures a permit to raise funds for charitable purposes in the state• Requirements for reporting information (usually annually) about an organization’sfundraising program1 This body of law is summarized in greater detail in Fundraising, particularly ch. 3.2 The states that have no statutory or other regulatory law in this regard are Alaska, Idaho, Montana, and Wyoming. 627