STAND. COM. REP. NO. 257

Honolulu, Hawaii

RE:    S.B. No. 894

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii

Sir:

     Your Committee on Commerce, Consumer Protection, and Health, to which was referred S.B. No. 894 entitled:

"A BILL FOR AN ACT RELATING TO CHARITABLE ORGANIZATIONS,"

begs leave to report as follows:

     The purpose and intent of this measure is to update the regulation of charitable organizations and activities in the State by:

     (1)  Specifying disclosure requirements for collection boxes;

     (2)  Adding a definition of "property", as the term relates to the protection of charitable assets;

     (3)  Clarifying registration and deactivation procedures for charitable organizations;

     (4)  Clarifying requirements for the financial reports that must be filed by professional solicitors;

     (5)  Permitting charitable organizations that file an IRS Form 990-PF to file annual reports on the same schedule as charitable organizations that file IRS Form 990 or 990-EZ; and

     (6)  Making housekeeping amendments.

     Your Committee received testimony in support of this measure from the Department of the Attorney General, Hawai‘i Alliance of Nonprofit Organizations, and one individual.

     Your Committee finds that this measure makes several amendments to the State's law governing charitable organizations and activities, including:  requiring disclosure statements on collection boxes, which will alert and inform the public about whether a nonprofit or a for-profit entity owns the collection box; permitting the use of electronic signatures by professional solicitors; specifying procedures for deactivations of registration; and clarifying requirements for the filing of financial and annual reports.  This measure also assists the Department of the Attorney General in its oversight of charitable organizations and fundraising activities, clarifies regulatory procedures for the nonprofit sector, and ensures consumers are able to make informed choices when donating personal property.

     Your Committee has amended this measure by:

     (1)  Inserting an effective date of July 1, 2017; and

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Health that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 894, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 894, S.D. 1, and be referred to your Committee on Judiciary and Labor.

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Health,

________________________________

ROSALYN H. BAKER, Chair