State of the Nonprofit Regulatory Environment in WASHINGTON

Table of contents

• 1 Bifurcation of charitable regulatory body
• 2 Notice, Filing or Review of Transactions
• 3 Notice or Action for Dissolutions
• 4 Notice, Oversight or Filing of Hospital Conversions
• 5 Audits
• 6 Registration Law
• 7 Exemptions from Registering for Specific Organization Types
• 8 Defined remedies
• 9 Oversight of professional fundraisers

1 Bifurcation of charitable regulatory body

Bifurcated Regulatory Structure

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.020

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Yes - W. R. C. A. § 19.09.020 et seq.; W.A.C. §§ 434-120-100 to 434-120-175

WA Code § 434-120-100

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Yes - W. R. C. A. § 19.09.020 et seq.; W.A.C. §§ 434-120-100 to 434-120-175

Registration Office

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

BIFURCD-REGIOF-NS

REGULATORY BODY: Not Specific

NOTES: Washington Secretary of State https://www.sos.wa.gov/charities/Charitable-Organizations.aspx

2 Notice, Filing or Review of Transactions

Sale of Assets

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

REPORTS-ASSETS-AG

REGULATORY BODY: Attorney General

NOTES: No

REPORTS-ASSETS-OT

REGULATORY BODY: Other

NOTES: No

Mergers

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

REPORTS-MERGER-AG

REGULATORY BODY: Attorney General

NOTES: Yes

WA Code § 24.03.200

REGULATORY BODY: Other

STATUTE TEXT: RCW 24.03.200 Articles of merger or consolidation.(1) Upon such approval, articles of merger or articles of consolidation shall be executed by each corporation by an officer of each corporation, and shall set forth:(a) The plan of merger or the plan of consolidation;(b) Where the members of any merging or consolidating corporation have voting rights, then as to each such corporation (i) a statement setting forth the date of the meeting of members at which the plan was adopted, that a quorum was present at such meeting, and that such plan received at least two-thirds of the votes which members present at such meeting or represented by proxy were entitled to cast, or (ii) a statement that such amendment was adopted by a consent in the form of a record executed by all members entitled to vote with respect thereto;(c) Where any merging or consolidating corporation has no members, or no members having voting rights, then as to each such corporation a statement of such fact, the date of the meeting of the board of directors at which the plan was adopted and a statement of the fact that such plan received the vote of a majority of the directors in office.(2) The articles of merger or articles of consolidation shall be delivered to the secretary of state for filing in accordance with Article 2 of chapter 23.95 RCW.[ 2015 c 176 ss 3114; 2004 c 265 ss 20; 2002 c 74 ss 10; 1986 c 240 ss 33; 1982 c 35 ss 89; 1967 c 235 ss 41.]NOTES:Effective dateoContingent effective dateo2015 c 176: See note following RCW 23.95.100.Captions not lawo2002 c 74: See note following RCW 19.09.020.IntentoSeverabilityoEffective datesoApplicationo1982 c 35: See notes following RCW 43.07.160.

NOTES: West’s RCWA 24.03.200

Certificate of Amendments

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

REPORTS-AMMEND-AG

REGULATORY BODY: Attorney General

NOTES: No

WA Code § 24.03.175

REGULATORY BODY: Other

STATUTE TEXT: RCW 24.03.175 Filing of articles of amendment.The articles of amendment shall be delivered to the secretary of state for filing in accordance with Article 2 of chapter 23.95 RCW.[ 2015 c 176 ss 3111; 2002 c 74 ss 8; 1982 c 35 ss 86; 1967 c 235 ss 36.]NOTES:Effective dateoContingent effective dateo2015 c 176: See note following RCW 23.95.100.Captions not lawo2002 c 74: See note following RCW 19.09.020.IntentoSeverabilityoEffective datesoApplicationo1982 c 35: See notes following RCW 43.07.160.Fees: RCW 24.03.405.

NOTES: West’s RCWA 24.03.175

Does the state require annual financial reporting by charitable organizations in addition to filing a copy of the 990 with the regulator (if filing 990 is required)?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.075

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Does not require orgs to file 990s (as long as compliant with public inspection requirements), but does require orgs to file solicitation report (financial report of all solicitation of previous year) with each application/renewal. Wash. Rev. Code § 19.09.075; additional financial reporting may be required at request of the AG: Wash. Rev. Code § 19.09.210

WA Code § 19.09.210

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Does not require orgs to file 990s (as long as compliant with public inspection requirements), but does require orgs to file solicitation report (financial report of all solicitation of previous year) with each application/renewal. Wash. Rev. Code § 19.09.075; additional financial reporting may be required at request of the AG: Wash. Rev. Code § 19.09.210

3 Notice or Action for Dissolutions

Voluntary Dissolutions

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 24.03.220

REGULATORY BODY: Attorney General

STATUTE TEXT: RCW 24.03.220 Voluntary dissolution.A corporation may dissolve and wind up its affairs in the following manner:(1) Where there are members having voting rights with regard to the question, the board of directors shall adopt a resolution recommending that the corporation be dissolved, and directing that the question of such dissolution be submitted to a vote at a meeting of members having such voting rights, which may be either an annual or a special meeting. Notice in the form of a record stating that the purpose, or one of the purposes, of such meeting is to consider the advisability of dissolving the corporation, shall be given to each member entitled to vote at such meeting, within the time and in the manner provided in this chapter for the giving of notice of meetings of members. A resolution to dissolve the corporation shall be adopted upon receiving at least two-thirds of the votes which members present at such meeting or represented by proxy are entitled to cast.(2) Where there are no members, or no members having voting rights with regard to the question, the dissolution of the corporation shall be authorized at a meeting of the board of directors upon the adoption of a resolution to dissolve by the vote of a majority of the directors in office.Upon the adoption of such resolution by the members, or by the board of directors where there are no members or no members having voting rights, the corporation shall cease to conduct its affairs except in so far as may be necessary for the winding up thereof, shall immediately cause a notice of the proposed dissolution to be mailed to each known creditor of the corporation, to the attorney general with respect to assets subject to RCW 24.03.225(3), and to the department of revenue, and shall proceed to collect its assets and apply and distribute them as provided in this chapter.[ 2004 c 265 ss 23; 1986 c 240 ss 38; 1982 c 35 ss 92; 1967 c 235 ss 45.]NOTES:IntentoSeverabilityoEffective datesoApplicationo1982 c 35: See notes following RCW 43.07.160.

NOTES: West’s RCWA 24.03.220

WA Code § 24.03.245

REGULATORY BODY: Other

STATUTE TEXT: RCW 24.03.245 Filing of articles of dissolution.Articles of dissolution shall be delivered to the secretary of state for filing in accordance with Article 2 of chapter 23.95 RCW. Upon the filing of such articles of dissolution the existence of the corporation shall cease, except for the purpose of suits, other proceedings and appropriate corporate action by members, directors, and officers as provided in this chapter.[ 2015 c 176 ss 3117; 2002 c 74 ss 11; 1982 c 35 ss 94; 1967 c 235 ss 50.]NOTES:Effective dateoContingent effective dateo2015 c 176: See note following RCW 23.95.100.Captions not lawo2002 c 74: See note following RCW 19.09.020.IntentoSeverabilityoEffective datesoApplicationo1982 c 35: See notes following RCW 43.07.160.

NOTES: File with Sec. of State West’s RCWA 24.03.245

Judicial Dissolutions

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 24.03.250

REGULATORY BODY: Attorney General

STATUTE TEXT: RCW 24.03.250 Involuntary dissolution.A corporation may be dissolved involuntarily by a decree of the superior court in an action filed by the attorney general when it is established that:(1) The corporation procured its articles of incorporation through fraud; or(2) The corporation has continued to exceed or abuse the authority conferred upon it by law.[ 1969 ex.s. c 163 ss 2; 1967 c 235 ss 51.]

NOTES: West’s RCWA 24.03.250

WA Code § 24.03.295

REGULATORY BODY: Other

STATUTE TEXT: RCW 24.03.295 Filing of decree of dissolution.In case the court shall enter a decree dissolving a corporation, it shall be the duty of the clerk of such court to cause a certified copy of the decree to be filed with the secretary of state. No fee shall be charged by the clerk for issuance or by the secretary of state for the filing thereof.[ 1986 c 240 ss 40; 1967 c 235 ss 60.]

NOTES: West’s RCWA 24.03.295

Administrative Dissolutions

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

DISSOLV-ADMINI-AG

REGULATORY BODY: Attorney General

DISSOLV-ADMINI-OT

REGULATORY BODY: Other

4 Notice, Oversight or Filing of Hospital Conversions

Has Statute

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 70.45.010

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. §§ 70.45.010 - 70.45.900

Requires Notice or Oversight

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 70.45.060

REGULATORY BODY: Attorney General

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. § 70.45.060

WA Code § 70.45.060

REGULATORY BODY: Other

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. § 70.45.060

Requires Filing

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 70.45.060

REGULATORY BODY: Other

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. § 70.45.060

5 Audits

Requires Audit

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

AUDITFI-AUDITS-NS

REGULATORY BODY: Not Specific

NOTES: WAC 434-120-107: yes, but may be waived

Audit Threshold

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

AUDITFI-THRESH-NS

REGULATORY BODY: Not Specific

NOTES: $ 3 million over the last three years

6 Registration Law

Registration Law

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WA Code § 19.09.010

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: West’s RCWA 19.09.010 et seq.

7 Exemptions from Registering for Specific Organization Types

Religious Organizations

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WA Code § 19.09.020(2)RCWA

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: RCWA 19.09.020(2)RCWA 19.09.020(2) Religious -Yes Churches - No

Small organizations

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WA Code § 19.09.081(1)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: RCWA 19.09.081(1) ($50k)

Educational Institutions

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-EDUCAT-NS

REGULATORY BODY: Not Specific

NOTES: NO

Governmental Organizations

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-GOVMNT-NS

REGULATORY BODY: Not Specific

NOTES: NO

Hospitals

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-HOSPIT-NS

REGULATORY BODY: Not Specific

NOTES: NO

Veterans organizations

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-VETERA-NS

REGULATORY BODY: Not Specific

NOTES: NO

Foundations

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-FNDYES-NS

REGULATORY BODY: Not Specific

NOTES: NO

Foundations that don’t solicit contributions

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

ORGTYPE-FNDNOS-NS

REGULATORY BODY: Not Specific

NOTES: Yes

Charitable Trusts

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-CTRUST-NS

REGULATORY BODY: Not Specific

NOTES: RCW 11.110

Parent-Teacher Organizations

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-PTOEDU-NS

REGULATORY BODY: Not Specific

NOTES: NO

Reports to congress

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-CONGRE-NS

REGULATORY BODY: Not Specific

NOTES: NO

Non-soliciting

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WA Code § 19.09.020(2)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: West’s RCWA 19.09.020(2) (def. includes orgs that solicit or accept contributions)

Fraternal/ Membership

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-MEMFRA-NS

REGULATORY BODY: Not Specific

NOTES: NO

Political Orgs

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-POLITI-NS

REGULATORY BODY: Not Specific

NOTES: NO

Other

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WA Code § 19.09.081(2)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: RCWA 19.09.081(2): Fundraising for a specific individual

8 Defined remedies

Dissolution

Regulatory Action: REMEDY

YES: A regulation is defined in the state

WA Code § 24.03.250

REGULATORY BODY: Not Specific

STATUTE TEXT: RCW 24.03.250 Involuntary dissolution.A corporation may be dissolved involuntarily by a decree of the superior court in an action filed by the attorney general when it is established that:(1) The corporation procured its articles of incorporation through fraud; or(2) The corporation has continued to exceed or abuse the authority conferred upon it by law.[ 1969 ex.s. c 163 ss 2; 1967 c 235 ss 51.]

NOTES: West’s RCWA 24.03.250

Removal of Board Members

Regulatory Action: REMEDY

YES: A regulation is defined in the state

WA Code § 11.96A.030

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. § 11.96A.030; Wash. Rev. Code Ann. § 11.110.120

WA Code § 11.110.120

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code Ann. § 11.96A.030; Wash. Rev. Code Ann. § 11.110.120

9 Oversight of professional fundraisers

Does the state require registration by commercial fundraisers?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.068

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.068; Wash. Rev. Code § 19.09.079

WA Code § 19.09.079

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.068; Wash. Rev. Code § 19.09.079

Does the state require registration by fundraising counsel?

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

FNDRAZE-COUNSL-NS

REGULATORY BODY: Not Specific

Does the state oversee commercial-coventuring (e.g. by requiring that the co-venture be registered or by requiring that the charitable organization files the co-venture contract)?

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

FNDRAZE-VENTUR-NS

REGULATORY BODY: Not Specific

Does the state require the fundraisers to provide notice to the regulator before any solicitation campaign (in addition to annual registration and/or filing the contract)?

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

WA Code § 19.09.097

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Must file contract before start of solicitation campaign (form includes dates of solicitation): http://www.sos.wa.gov/_assets/charities/FSC.pdf; Wash. Rev. Code § 19.09.097

Does the state require specified disclosures to donors?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.100

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.100

Does the state require a copy of any contract between a charitable organization and a commercial fundraiser or fundraising counsel be filed with the regulator?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.097

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.097

Does the state require annual financial reporting by commercial fundraisers?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.079

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.079; additional financial reporting may be required at request of the AG: Wash. Rev. Code § 19.09.210

WA Code § 19.09.210

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Wash. Rev. Code § 19.09.079; additional financial reporting may be required at request of the AG: Wash. Rev. Code § 19.09.210

Does the state require bonding of professional fundraisers?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WA Code § 19.09.191

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Every commercial fund-raiser must execute a surety bond if it: (a) Directly or indirectly receives contributions from the public on behalf of any charitable organization; (b) Is compensated based upon funds raised or to be raised, number of solicitations made or to be made, or any other similar method; (c) Incurs or is authorized to incur expenses on behalf of the charitable organization; or (d) Has not been registered with the secretary as a commercial fund-raiser for the preceding accounting year. Wash. Rev. Code § 19.09.191

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