Request By:
Mr. L. Stanley Chauvin, Jr.
Carroll, Chauvin, Miller & Conliffe
2720 Citizens Plaza
Louisville, Kentucky 40202
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Ruth H. Baxter, Assistant Attorney General
Your letter of July 25, 1979, requested an advisory opinion interpreting KRS 367.550-.670, commonly known as the "Solicitation for Charitable and Civic Purposes Act. " Specifically, you have inquired whether (1) Grizzard Advertising, Inc., would be considered a "professional fund raiser" pursuant to KRS 367.650(6) if it provides to the Kentucky Sheriffs' Boys Ranch: a) form letters that solicit honorary/ associate members, b) systematic mailings and special appeal mailings, and c) bumper stickers, tags/envelopes, membership cards, and/or windshield declas; and (2) if the "honorary/ associate membership program" explained in the materials you forwarded to the Office constituted an exempted activity within the purview of the KRS 367.650(2) definition of "contribution." After reviewing these materials, it is our opinion that Grizzard Advertising is not a "professional fund raiser" within the purview of KRS 367.650(6). Thus, it is not necessary to answer the second question posed.
The "Solicitation for Charitable and Civic Purposes Act" declares unlawful ". . . the payment by a person or organization for which contributions are solicited to all professional fund raisers and solicitors of more than fifteen percent (15%) of gross contributions of money and property received and of net proceeds of social and spectator events and sales of goods and services, or the receipt by a professional fund raiser or solicitor, either directly or indirectly, of more than fifteen percent (15%) of gross contributions of money and property raised by him or through his efforts or more than fifteen percent (15%) of net proceeds of social and spectator events and sales of goods and services organized and conducted by him." KRS 367.655. Thus, in order to violate the statute, a determination must be made as to whether an individual is a "professional fund raiser" pursuant to the definitional portion of the Act.
A "professional fund raiser, " states KRS 367.650(6), means:
"[A] person who for compensation or other consideration plans, conducts, manages or carries on or advises concerning a drive or campaign of soliciting contributions to a person or organization for charitable or civic purposes, or employs or supervises solicitors in connection therewith. A bona fide officer or employe of the donee of such contributions is not a professional fund raiser unless his salary or other compensation is computed on the basis of funds raised or to be raised."
"(A) solicitor who is employed for compensation or other consideration by either a professional fund raiser or the prospective donee of the contributors" is a "professional solicitor" according to KRS 367.650(7).
According to the promotional materials furnished to our office by you, Grizzard Advertising, Inc. assists charitable organizations by providing promotional materials in a package described as an "honorary/ associate membership program." These materials consist of form letters, cards and "membership" information designed for the use of a state sheriffs' association or youth ranch and its solicitation of citizen members into an honorary/ associate membership program. Grizzard serves as printers of those form letters and mailers of this material to potential contributors. The corporation charges for its services on the basis of the number of form letters sent at a "per letter" rate, and the number of times a "mailing" is performed. No consultation or service charges are paid to Grizzard, nor are flat fees or monthly retainers involved. Furthermore, the company does not receive compensation, bonuses or similar financial remuneration based upon the amount of money contributed, or a percentage thereof, as a result of a solicitation "mailing. " Moreover, at no time does Grizzard solicit funds on behalf of its client or even receive money on behalf of its clients. The form letters provided by Grizzard would bear the Kentucky Sheriffs' Boys Ranch name and logo. Contributors would send their monies directly to this non-profit organization.
Therefore, it is our opinion that Grizzard Advertising, Inc., is neither a "professional fund raiser" nor a "professional solicitor" within the meaning of KRS 367.650(6) and (7). These statutory definitions on their face require direct participation in the solicitation drive or campaign to constitute a "professional fund raiser or solicitor." Grizzard's involvement in the proposed fund raising project amounts to little more than providing the "paperwork" incident to any solicitation campaign. Although Grizzard's materials indicate that the letters they provide have been used successfully by other state sheriffs' associations or youth ranch organizations, the corporation quickly points out that does not guarantee results from its mailings, and cannot and will not assure the soliciting organization that the results of a "mailing" will even be sufficient enough to pay the "mailing" expenses. Accordingly, for the reasons herein cited, we must conclude that the legislature did not intend the definition of "professional fund raiser" or "solicitor" to be stretched to reach disinterested third parties who provide a service incident to a solicitation program.
As a final note, however, we would caution the Kentucky Sheriffs' Boys Ranch that if the Grizzard solicitation program is adopted, the newly formed honorary/ associate membership association, if it is to be advertised as such, carries with it bona fide membership privileges so that the public is not misled or deceived, as declared unlawful by the Kentucky Consumer Protection Act, KRS 367.110-.300, into believing that they are actually joining an organization if, in truth and in fact, the public is simply making a one-time contribution for a specific sheriffs' project.