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Nonprofit News Alert: AB 2855, a Bill that may be harmful to nonprofits

A recent CalNonprofits notification exposes significant burdens and requirements, as well as penalties for non-compliance, that could have a negative impact on nonprofits. Instructions are included for how to join the opposition to this initiative (CVNL has signed the opposition letter).

 

AB 2855 is a harmful bill for nonprofits and we need your help to stop it. Please sign on to our letter of opposition today!

Last week we told you about AB 2855 — a bill that would burden nonprofits with unfair and unnecessary requirements, and levy harsh penalties if you don’t comply. Now we’re asking you to help stop this harmful bill by signing a letter to the Assembly Privacy and Consumer Protection Committee where it will be heard.

To make sure the Committee hears us loud and clear, we’ve written a letter to the Committee Chair, Assemblymember Ed Chau, voicing our strong opposition to the bill. We’re asking you to add your organization’s name to the letter.

You can read the letter here.

As a reminder, here’s why the bill is so dangerous:

  • Nonprofits would have to put a link to financial disclosures in the upper right hand corner of EVERY page on their websites. The bill even states that the following wording — Click here to read a full disclosure of the finances, including the salaries and expenses, of this organization must be in 14 point bold non-serif font. As just one example, the website of the Humane Society of the United States has 12,000 pages, and every one of them would have to have this phrase and a link.
  • All nonprofits would also have to put on their financial disclosure pages, not only their Forms 990, but also the “percentage of the charity’s funding that is spent on the sum total of the salaries, other compensation and employee benefits of the charity’s executive director and board of directors and all of the charity’s other administrative overhead expenses, as reported on the charity’s most recent Internal Revenue Service Form 900 filing.”
  • Failure to comply with the many requirements in the bill would be subject not only to a fine or other sanction, but would be elevated to being a crime, and result in revocation of tax-exempt status.
  • By requiring these disclosures, such notification strongly implies that percentages of expenses are an accurate indicator of the effectiveness and value of the nonprofit. THIS IS NOT TRUE.

Do you share our concerns? To add your organization’s name to the letter, please contact Araceli Ramirez on our staff at aracelir@calnonprofits.org.

We need to know by this Thursday, April 7th at 5 pm Pacific time that you will be joining the growing number of California nonprofits that oppose this bill.

Let’s stop this harmful bill!

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