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committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

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F I S C A L I M P A C T R E P O R T

SPONSOR Park

DATE TYPED 3/07/05

HB 958/aHAFC

SHORT TITLE Require Registration of Fundraising Campaigns

SB

ANALYST Ford

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

$120.0 Recurring Charitibles Unit

Fund

$11.0 Non-Recurring Charitables Unit

Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

$120.0

Annual Fees

Recurring

Charitibles Unit

Fund

$11.0

One-time Fees

Non-Recurring Charitables Unit

Fund

(Parenthesis ( ) Indicate Revenue Decreases)

Duplicates SB 625

SOURCES OF INFORMATION

LFC Files

Responses Received From

Attorney General Office (AGO)

SUMMARY

Synopsis of HAFC Amendment

The House Appropriations and Finance Committee amendment removes the appropriations of

$300 thousand and clarifies that only fundraising campaigns conducted by a professional fund-

House Bill 958/aHAFC -- Page 2

raiser are subject to registration with the attorney general.

Synopsis of Original Bill

House Bill 958 appropriates $300 thousand from the general fund to the newly created charitable

units fund to defray the costs associated with the administration and enforcement of the Charita-

ble Solicitations Act. The bill creates the charitables unit fund, to be administered by the attorney

general. Money in the fund shall be derived from the fees created in this bill, appropriations

from the legislature, and other sources. The money in the fund is appropriated to the attorney

general to defray the costs associated with administration and enforcement of the Charitable So-

licitations Act.

The bill also requires charitable organizations that must to register with the attorney general to

pay an annual fee not to exceed $25. Professional fundraisers that contract with a charitable or-

ganization shall be required to pay an initial fee not to exceed $500 and a fee for each campaign,

not to exceed $250. The fees shall be deposited in the charitable unit fund.

House Bill 958 requires every professional fundraiser soliciting donations on behalf of a charita-

ble organization to file specified information for each fundraising campaign with the attorney

general.

Significant Issues

According to the AGO, the charitable solicitations unit lacks the resources to adequately enforce

the Charitable Solicitations Act, which includes public disclosure, investigation, and various en-

forcement requirements. This bill would create a revenue source for the attorney general. The

AGO writes that these fees are reasonable, based on a nationwide survey of similar fees.

FISCAL IMPLICATIONS

Although the AGO indicates that the intent of the appropriation is to fund one-time start up costs,

the appropriation of $300 thousand contained in this bill meets the LFC’s criteria as a recurring

expense to the general fund. Any unexpended or unencumbered balance remaining at the end of

FY 06 shall not revert. The appropriation of generated fee revenue is a recurring expense to the

charitables unit fund. Any unexpended or unencumbered balance remaining at the end of any

fiscal year shall not revert to any other fund.

According to the AGO’s Charitables Registrar, there are currently 4,025 charities registered that

would be subject to the annual registration fee of $25. There are currently 22 professional fund-

raises registered who would be subject to the one-time $500 fee. The AGO estimates small

growth in the number of fundraisers registered. The AGO estimates that there are approximately

66 fundraising campaigns each year that would be subject to the $250 fee.

Using these figures, the annual fee revenue generated by the bill is estimated at $120 thousand.

The one-time fee revenue would be approximately $11 thousand.

Continuing Appropriations

This bill creates a new fund and provides for continuing appropriations. The LFC objects to in-

House Bill 958/aHAFC -- Page 3

cluding continuing appropriation language in the statutory provisions for newly created funds.

Earmarking reduces the ability of the legislature to establish spending priorities.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

This bill is a duplicate of Senate Bill 625.

EF/lg:yr