Why am I receiving notice about "possible impacts to eligibility"?
In January 2023, the state of California’s Assembly Bill 488 (AB-488) went into effect. This bill has several impacts on the nonprofit community within the state of California – one of those being that charities identified as “delinquent” by the California AG’s office are not eligible to solicit or fundraise.
What do these new requirements mean? How does this impact my ability to receive my donations through Bonterra?
As Bonterra customers, the “solicitation” that is performed is done on behalf of Network for Good’s Donor-Advised Fund (DAF), so we will continue to allow customers to donate funds to our DAF for future disbursement to your organization.
However, if the California Department of Justice is reporting your organization as delinquent, we will not be able to disburse those funds through the grants (disbursements) you typically receive.
Until we have received confirmation from the Attorney General’s office that your organization is no longer delinquent, we are unable to disburse donations to your organization through our donor-advised fund.
You can also independently confirm your status with the California’s Office of the Attorney General through their Registry of Charitable Trusts, to determine if your organization is missing any requirements.
Why are the requirements different for those nonprofits located in the state of California?
The state of California now requires that all nonprofits registered within the state with an annual revenue of under $50,000 fill out the Form CT-TR-1 in addition to the standard the IRS 990 (or 990-EZ) form and Form RRF-1.
This is a result of California signing Assembly Bill 488 (AB-488) into law on October 7th, 2021. AB-488 expanded both the governance and regulation of nonprofit organizations through additional oversight and reporting requirements, and goes into effect on January 1, 2023.
For more information on AB-488, please check out the complete text of the bill here.
Is this a requirement put into place by Bonterra?
No, this is a requirement that has been put into place by the California Attorney General’s Office. As a donor-advised fund, Network for Good must comply with this requirement – which means that we legally cannot disburse funds to any California-based nonprofit organization that has not submitted all necessary forms to the Attorney General’s Office.
You can find more information on how the state of California determines and reviews delinquent nonprofits here.
What will happen to the donations my nonprofit has already collected?
At the moment, Bonterra is able to hold donations and wait for you to get back in good standing, if your organization is considered "current - awaiting reporting" by California's Attorney General.
To determine what your organization's registration status is with the California AG's office, please check the Registry of Charitable Trusts and use the search tool to check your organization's most recent status.
For more information on the various statuses that may reflect on the AG's website, please click here for a more detailed explanation of each registration status.
Pending regulations may change our ability to do this, and we will inform you of any updates or changes to those regulations as we are made aware of them.
Will my nonprofit still be able to collect donations through Bonterra moving forward?
Until a nonprofit has resolved their delinquent status with the Attorney General, Bonterra will not be able to disburse funds to that nonprofit through the donor-advised fund.
However, nonprofits who have demonstrated that they are working to resolve this delinquency with the Attorney General’s office within sixty (60) days of receiving the delinquency notice can continue to solicit donations through their Bonterra fundraising tools.
Nonprofits who reach out during this time period must then submit documentation within six (6) months that this delinquency has been removed. Once a nonprofit has provided documentation that they are now in good standing, Bonterra will then release all donations that have been “held” on the nonprofit’s behalf.
What happens if my organization doesn’t reach out to Bonterra within the sixty-day timeframe?
If we do not hear from a nonprofit within sixty (60) days of receiving the delinquency notice, we will add a “block” to the account to prevent future donations from being collected on behalf of the nonprofit.
What other options does my nonprofit have?
Nonprofits can reach out during the sixty-day period and state that they’d like for a block to be placed pre-emptively, if they would prefer to not continue to solicit until their delinquent status has been addressed.
(NOTE: This option does NOT entitle a nonprofit to a refund of our services, so please be sure to consider this before choosing this option for your organization.)
Nonprofits may also independently seek out a “fiscal sponsor” who can collect and disburse donations on their behalf until the matter is addressed. If a nonprofit is interested in this option, they need to provide letters to Bonterra from both the organization and the fiscal sponsor, that include the following information:
Letters must come from an organizational representative authorized to make this decision (such as a director, CEO, CFO, etc.)
Letters must be written on each organization’s official letterhead, respectively
Each organization’s letter must state that the organization is agreeing to this partnership
Each organization’s letter must state the length of the fiscal sponsorship (e.g. six months, one year, until otherwise noted, etc.)
Each organization’s letter must include today’s date and the date that the partnership begins/began
What does my organization need to do to no longer be considered “delinquent?”
We strongly recommend that nonprofits who may be considered delinquent to contact the Delinquency Program directly, as the California Attorney General’s Office will have the most relevant and up-to-date information on your organization’s status and the next steps required to return to good standing with the state.
You can contact the Delinquency Program directly using the link here.
You can also review the additional literature and resources (including a FAQ section specifically on delinquency) available through the state here.
There are also helpful and accessible videos that the state has created on their YouTube channel that may be useful while navigating this process.
How long does it take to have this “delinquent” status lifted?
According to the Attorney General’s website, nonprofits can expect a processing time of 30-90 days for all forms and supporting documentation from the date received. They also note that they will reply, if necessary, to clarify or gather additional information.
The website also recommends that nonprofits continue to check the Registry of Charitable Trusts and use the search tool to check their status throughout this process.
However, nonprofits should communicate with Bonterra as soon as they are made aware of their delinquent status, to discuss their available options in continuing to solicit donations until the issue has been resolved.
Where can I learn more information on these requirements?
You can learn more about California’s requirements for nonprofit organizations through the Attorney General’s website. This website includes further information on delinquency, downloadable versions of required forms, information on annual registration renewal, and more resources specifically for California nonprofits.
How can I voice my opinion or discuss reform of these requirements?
We strongly recommend that any feedback you and your organization have in regards to these requirements be submitted to your local California assembly member’s office.