Activities undertaken by a non-profit corporation in order to raise funds to finance its operations may be subject to regulation under one or more state statutes. Prior to the commencement of a fund-raising plan, you and your attorney should examine Chapter 131F of the North Carolina General Statutes to determine whether they apply to your activities.
The primary purpose of the Charitable Solicitations Act is to protect the general public and public charity from unlawful solicitation and to provide for the establishment of basic standards for the solicitation and use of charitable funds in North Carolina. Under North Carolina law, any corporation or entity that solicits charitable contributions must apply for and obtain a license from the N.C. Department of the Secretary of State Solicitation Licensing Section on an annual basis. The licensure requirement also applies to professional fundraising counsel and professional solicitors. The specific exemptions from this licensure requirement listed in N.C.G.S. § 131F are:
- Any person who solicits for a religious institution;
- Solicitation of charitable contributions by the federal, state, or local government or any agency thereof;
- Any person who receives less than $25,000 in contributions in any calendar year and does not provide compensation to any officer, trustee, organizer, incorporator, fundraiser, or professional solicitor;
- Any educational institution, the curriculum of which, in whole or in part, is registered, approved, or accredited by the Southern Association of Colleges and Schools or an equivalent accrediting body;
- Any educational institution in compliance with Article 39 of Chapter 115C of the North Carolina General Statutes (Nonpublic Schools);
- Any foundation or department having an established identity with any of the educational institutions in subparagraphs 4 and 5 above:
- Any hospital licensed pursuant to Article 5 Chapter 131E or Article 2 of Chapter 122C of the North Carolina General Statutes, and any foundation or department having an established identity with such hospital, provided that the governing board of the hospital authorizes the solicitation and receives an accounting of funds collected and expended.
- Any noncommercial radio or television station;
- A qualified community trust as provided in 1.170A9(e)(10) through (e)(14) of Title 26 of the Code of Federal Regulations;
- A bona fide volunteer or bona fide employee or salaried officer of a charitable organization or sponsor;
- An attorney, investment counselor, or banker who advises a person to make a charitable contribution;
- A volunteer fire department, rescue squad, or emergency medical service;
- A Young Men's Christian Association or a Young Women's Christian Association; and
- A nonprofit continuing care facility licensed under Artile 64 of Chapter 58 of the North Carolina General Statutes.
The fees required to make an application are set forth in Article 2 of Chapter 131F of the North Carolina General Statutes and have a statutory limit of $200 or $400 for a parent organization filing on behalf of its chapters. There are other application and bond requirements and procedures as well as other provisions, requirements, prohibitions and powers listed in the act. These are beyond the scope of this publication and any specific inquiries concerning the act should be directed to the NC Department of the Secretary of State, Solicitation Licensing Section, PO Box 29622, Raleigh NC 27626-0622.