Still, it’s a reality that nonprofits have to deal with to stay out of state regulators’ crosshairs. For a new charitable organization, the task of determining whether and where charitable solicitation registration is required can be daunting, and the price for failing to register where required is high. Over thirty states as well as the District of Columbia have some sort of registration and reporting requirement for charitable organizations. Many states also require professional fundraisers to register.
Although many states and the District of Columbia will accept the Unified Registration Statement (“URS”), the URS still needs to be filed with the Attorney General or Secretary of State of each state requiring registration. Further, many of these states require supplemental information to be filed along with the URS, which does nothing to reduce the administrative burden on the filing organizations.
Recognizing the complicated labyrinth that is the multi-state charitable solicitation registration process, a new organization called the Multistate Registration and Filing Portal, Inc. has been formed as a Delaware nonprofit corporation (“MRFP”). The MRFP is working with the National Association of States Charities Officials and the National Association of Attorneys General to develop an online system that will permit nonprofits and professional fundraisers to comply with all states’ registration and annual filing requirements through a single portal. This single portal initiative, if successful, would be a welcome alternative for nonprofits that have been forced to risk imperfect compliance or spend substantial resources attempting to comply with registration requirements across the states where they solicit.
According to MRFP’s website, they are working on a pilot of 12 states including: Alaska, California, Colorado, Connecticut, Hawaii, Illinois, Massachusetts, Michigan, Mississippi, Missouri, New Hampshire and Tennessee. The MRFP ultimately plans to facilitate filing with all states’ registration and annual filing requirements through the single online portal.
If successful, the single portal system should reduce administrative costs and redundancies in complying with states’ registration requirements by enabling users to import data from the electronically filed Forms 990. Organizations will be able to submit one payment online for all states where registration is required; the filing fees will be collected through the single portal and distributed to the states. Although the single portal does not streamline registration guidelines across the states, it should, if successful, significantly reduce compliance costs for organizations fundraising in multiple states.