State of the Nonprofit Regulatory Environment in WEST VIRGINIA

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

WV Code § 29-19-1

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Yes - W.V.C. §§ 29-19-1 to 29-19-15b

Registration Office

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

WV Code § 29-19-1

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: West Virginia Secretary of State West Virginia Code §§ 29-19-1 to 29-19-6

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

A regulation is NOT defined in the state

REPORTS-MERGER-AG

REGULATORY BODY: Attorney General

NOTES: No

WV Code § 31E-11-1103

REGULATORY BODY: Other

STATUTE TEXT: (a) After a plan of merger is approved as required by section one thousand one hundred two of this article, the surviving corporation shall deliver to the Secretary of State for filing articles of merger setting forth: (1) The plan of merger; (2) a statement to the effect that the plan of merger was adopted by the board of directors of each corporation party to the merger; (3) if member approval was not required, a statement to that effect; and (4) if approval of members of one or more corporations party to the merger was required: (A) The designation of each class of members entitled to vote separately on the plan as to each corporation; and (B) the total number of votes cast for and against the plan by each class of members entitled to vote separately on the plan as to each corporation and a statement that the number cast for the plan by each class of members was sufficient for approval by that class.(b) A merger takes effect upon issuance by the Secretary of State of a certificate of merger to the survivor corporation. (c) The Secretary of State shall withhold the issuance of any certificate of merger in the case where the new or surviving corporation will be a foreign corporation which has not qualified to conduct affairs or do or transact business or hold property in this state until the receipt by the Secretary of State of a notice from the Tax Commissioner and Bureau of Employment Programs to the effect that all taxes due from said corporation under the provisions of chapter eleven of this code, including, but not limited to, taxes withheld under the provisions of section seventy-one, article twenty-one, chapter eleven of this code, all business and occupation taxes, motor carrier and transportation privilege taxes, gasoline taxes, consumer sales taxes and any and all license franchise or other excise taxes and corporate net income taxes, and employment security payments levied or assessed against the corporation seeking to dissolve have been paid or that the payment has been provided for, or until the Secretary of State received a notice from the Tax Commissioner or Bureau of Employment Programs stating that the corporation in question is not subject to payment of any taxes or to the making of any employment security payments or assessments.

NOTES: Sec. of State, W. Va. Code, § 31E-11-1103

Certificate of Amendments

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

REPORTS-AMMEND-AG

REGULATORY BODY: Attorney General

NOTES: No

WV Code § 31E-10-1005

REGULATORY BODY: Other

STATUTE TEXT: A corporation amending its articles of incorporation shall deliver to the Secretary of State for filing articles of amendment setting forth:(1) The name of the corporation;(2) The text of each amendment adopted;(3) The date of each amendment’s adoption;(4) A statement that the amendment was approved by the board of directors as required under section one thousand three of this article or, if approval of members was not required, a statement to that effect and a statement that the amendment was approved by a sufficient vote of either: (A) The incorporators, if the vote was before the corporation had directors; or (B) the board of directors, in either case in accordance with section one thousand two or one thousand four of this article; and(5) If approval by members was required: (A) The designation of each class of members entitled to vote separately on the amendment; and (B) the total number of votes cast for and against the amendment by each class of members entitled to vote separately on the amendment and a statement that the number cast for the amendment by each class was sufficient for approval by that class.

NOTES: Sec. of State, W. Va. Code, § 31E-10-1005

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

WV Code § 29-19-5

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Requires financial statement and 990. W. Va. Code § 29-19-5

3 Notice or Action for Dissolutions

Voluntary Dissolutions

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

DISSOLV-VOLUNT-AG

REGULATORY BODY: Attorney General

NOTES: No

WV Code § 31E-13-1303

REGULATORY BODY: Other

STATUTE TEXT: (a) At any time after dissolution is authorized, the corporation may dissolve by delivering to the Secretary of State for filing articles of dissolution setting forth:(1) The name of the corporation;(2) The date dissolution was authorized; and(3) If dissolution was approved by the members, a statement that the proposal to dissolve was duly approved by the members in the manner required by this chapter and by the articles of incorporation.(b) A corporation is dissolved upon the receipt by the corporation of a certificate of dissolution from the Secretary of State.(c) The Secretary of State shall issue a certificate of dissolution to the corporation delivering articles of dissolution upon receipt by the Secretary of State of a notice from the Tax Commissioner and Bureau of Employment Programs to the effect that all taxes due from the corporation under the provisions of chapter eleven of this code, including, but not limited to, taxes withheld under the provisions of section seventy-one, article twenty-one of said chapter eleven of this code, all business and occupation taxes, motor carrier and transportation privilege taxes, gasoline taxes, consumer sales taxes and any and all license franchise or other excise taxes and corporate net income taxes, and employment security payments levied or assessed against the corporation seeking to dissolve have been paid or that the payment has been provided for, or until the Secretary of State received a notice from the Tax Commissioner or Bureau of Employment Programs, as the case may be, stating that the corporation in question is not subject to payment of any taxes or to the making of any employment security payments or assessments.

NOTES: File with Sec. of State W. Va. Code, § 31E-13-1303

Judicial Dissolutions

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 31E-13-1330

REGULATORY BODY: Attorney General

STATUTE TEXT: ss31E-13-1330. Grounds for judicial dissolution. The circuit court may dissolve a corporation:(1) In a proceeding by the Attorney General if it is established that:(A) The corporation obtained its articles of incorporation through fraud; or(B) The corporation has continued to exceed or abuse the authority conferred upon it by law;(2) In a proceeding by a member or director if it is established that:(A) The directors are deadlocked in the management of the corporate affairs, the members are unable to break the deadlock, and irreparable injury to the corporation is threatened or being suffered, or the activities and affairs of the corporation can no longer be conducted in accordance with the corporation’s purpose, because of the deadlock;(B) The directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal, oppressive, or fraudulent; or(C) The corporate assets are being misapplied or wasted;(3) In a proceeding by a creditor if it is established that:(A) The creditor’s claim has been reduced to judgment, the execution on the judgment returned unsatisfied, and the corporation is insolvent; or(B) The corporation has admitted in writing that the creditor’s claim is due and owing and the corporation is insolvent; or(4) In a proceeding by the corporation to have its voluntary dissolution continued under circuit court supervision.

NOTES: W. Va. Code, § 31E-13-1330

WV Code § 31E-13-1333

REGULATORY BODY: Other

STATUTE TEXT: (a) If after a hearing the circuit court determines that one or more grounds for judicial dissolution described in section one thousand three hundred thirty of this article exist, it may enter a decree dissolving the corporation and specifying the effective date of the dissolution, and the clerk of the circuit court shall deliver a certified copy of the decree to the Secretary of State, who shall file it.(b) After entering the decree of dissolution, the circuit court shall direct the winding up and liquidation of the corporation’s activities and affairs in accordance with section one thousand three hundred five of this article and the notification of claimants in accordance with sections one thousand three hundred six and one thousand three hundred seven of this article.

NOTES: W. Va. Code, § 31E-13-1333

Administrative Dissolutions

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

DISSOLV-ADMINI-AG

REGULATORY BODY: Attorney General

NOTES: No

WV Code § 31E-13-1320

REGULATORY BODY: Other

STATUTE TEXT: The Secretary of State may commence a proceeding under section one thousand three hundred twenty-one of this article to administratively dissolve a corporation if:(1) The corporation does not pay within sixty days after they are due any fees, franchise taxes or penalties imposed by this chapter or other law;(2) The corporation does not notify the Secretary of State within sixty days that its registered agent or registered office has been changed, that its registered agent has resigned or that its registered office has been discontinued;(3) The corporation’s period of duration stated in its articles of incorporation expires;(4) The professional license of one or more of the license holders is revoked by a professional licensing board and the license is or all the licenses are required for the continued operation of the nonprofit entity; or(5) The corporation is in default with the Bureau of Employment Programs as provided in section six, article two, chapter twenty-one-a of this code.

NOTES: W. Va. Code, § 31E-13-1320

4 Notice, Oversight or Filing of Hospital Conversions

Has Statute

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

HOSPCON-STATUT-NS

REGULATORY BODY: Not Specific

NOTES: No

Requires Notice or Oversight

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

HOSPCON-OVERSI-AG

REGULATORY BODY: Attorney General

HOSPCON-OVERSI-OT

REGULATORY BODY: Other

Requires Filing

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

HOSPCON-FILING-OT

REGULATORY BODY: Other

5 Audits

Requires Audit

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 29-19-5(a)(6)(A)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code § 29-19-5(a)(6)(A)

Audit Threshold

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

AUDITFI-THRESH-NS

REGULATORY BODY: Not Specific

NOTES: 500000

6 Registration Law

Registration Law

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WV Code § 29-19-5

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-5

7 Exemptions from Registering for Specific Organization Types

Religious Organizations

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WV Code § 29-19-6(5)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-6(5)

Small organizations

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WV Code § 29-19-6(7)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-6(7) ($25k)

Educational Institutions

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WV Code § 29-19-6(1)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-6(1)

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

YES: A regulation is defined in the state

WV Code § 29-19-6(3)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Nonprofit and charitable hospitals: W. Va. Code, § 29-19-6(3)

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

A regulation is NOT defined in the state

ORGTYPE-FNDNOS-NS

REGULATORY BODY: Not Specific

NOTES: NO

Charitable Trusts

Regulatory Action: EXEMPTION

A regulation is NOT defined in the state

ORGTYPE-CTRUST-NS

REGULATORY BODY: Not Specific

NOTES: NO

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

WV Code § 29-19-5(a)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-5(a)

Fraternal/ Membership

Regulatory Action: EXEMPTION

YES: A regulation is defined in the state

WV Code § 29-19-6(4)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-6(4)

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

WV Code § 29-19-6(2)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Specified beneficiary, W. Va. Code, § 29-19-6(2); organization with single event to raise money for a named charitable org, W. Va. Code, § 29-19-6(6)

WV Code § 29-19-6(6)

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: Specified beneficiary, W. Va. Code, § 29-19-6(2); organization with single event to raise money for a named charitable org, W. Va. Code, § 29-19-6(6)

8 Defined remedies

Dissolution

Regulatory Action: REMEDY

YES: A regulation is defined in the state

WV Code § 31E-13-1330

REGULATORY BODY: Not Specific

STATUTE TEXT: ss31E-13-1330. Grounds for judicial dissolution. The circuit court may dissolve a corporation:(1) In a proceeding by the Attorney General if it is established that:(A) The corporation obtained its articles of incorporation through fraud; or(B) The corporation has continued to exceed or abuse the authority conferred upon it by law;(2) In a proceeding by a member or director if it is established that:(A) The directors are deadlocked in the management of the corporate affairs, the members are unable to break the deadlock, and irreparable injury to the corporation is threatened or being suffered, or the activities and affairs of the corporation can no longer be conducted in accordance with the corporation’s purpose, because of the deadlock;(B) The directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal, oppressive, or fraudulent; or(C) The corporate assets are being misapplied or wasted;(3) In a proceeding by a creditor if it is established that:(A) The creditor’s claim has been reduced to judgment, the execution on the judgment returned unsatisfied, and the corporation is insolvent; or(B) The corporation has admitted in writing that the creditor’s claim is due and owing and the corporation is insolvent; or(4) In a proceeding by the corporation to have its voluntary dissolution continued under circuit court supervision.

NOTES: W. Va. Code, § 31E-13-1330

Removal of Board Members

Regulatory Action: REMEDY

YES: A regulation is defined in the state

WV Code § 44D-7-706

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: AG may petition to remove a trustee: W. Va. Code Ann. § 44D-7-706

9 Oversight of professional fundraisers

Does the state require registration by commercial fundraisers?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 29-19-9

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code § 29-19-9

Does the state require registration by fundraising counsel?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 29-19-9

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code § 29-19-9

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

FNDRAZE-NOTICE-NS

REGULATORY BODY: Not Specific

Does the state require specified disclosures to donors?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 29-19-8

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code § 29-19-8

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

WV Code § 29-19-5

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-5: W. Va. Code § 29-19-7: contract must be filed with Secretary of State within 10 days after entered

WV Code § 29-19-7

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: W. Va. Code, § 29-19-5: W. Va. Code § 29-19-7: contract must be filed with Secretary of State within 10 days after entered

Does the state require annual financial reporting by commercial fundraisers?

Regulatory Action: REQUIREMENT

A regulation is NOT defined in the state

WV Code § 29-19-7

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: No, but: “Each charitable organization, as part of its registration as required in section five of this article, shall file with the secretary of state copies of all documents reflecting the final settlement amounts for a solicitation contract or, in the case of multiple year contracts, documents reflecting the total amount of money, funds or other property raised and expenses incurred by the professional fund-raising counsel or professional solicitor in a fiscal year.” W. Va. Code Ann. § 29-19-7 (West)

Does the state require bonding of professional fundraisers?

Regulatory Action: REQUIREMENT

YES: A regulation is defined in the state

WV Code § 29-19-9

REGULATORY BODY: Not Specific

STATUTE TEXT:

NOTES: The applicant shall, at the time of the making of an application, file with and have approved by the secretary of state a bond in the sum of ten thousand dollars ($10,000.00) and which shall have one or more sureties satisfactory to the secretary of state. W. Va. Code § 29-19-9

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