Ohio Attorney General Scales Down Proposed Charitable Transparency Rules
On July 28, 2006, the Ohio Attorney General issued revised proposed rules concerning the transparency of Ohio charities. The revision is a dramatically scaled-down version of the proposed rules issued on June 29, 2006. A copy of the revised proposed rules can be found at www.ag.state.oh.us/spotlight/cgrules.asp. On August 31, 2006, the Attorney General will submit final rules with Ohio’s Joint Committee on Agency Rule Review. The Attorney General has asked for public comment on the revised proposed rules by August 21, 2006.
The revised proposed rules eliminate the controversial Conflicts of Interest Policy, Executive Compensation and Reimbursement Policy, Billing Policy, and Annual Community Benefit Report. They continue to require registration for the first time by charitable hospitals and certain health related Section 501(c)(4) organizations.
Ohio charities with annual gross receipts of more than $25,000 are encouraged to file an annual form with the Attorney General that includes a number of questions concerning transparency. (Charities with annual gross receipts of between $5,001 and $25,000 must file this new form.) The questions on the new form cover:
- Loans made by the charity to executives, directors or employees;
- Whether the charity has developed a conflict of interest policy requiring the disclosure and documentation of conflicts;
- Whether the charity has adopted a compensation and expense reimbursement policy prohibiting excessive compensation;
- Whether the charity is certified by a state or national certification agency; and
- For charitable hospitals and nursing homes, whether they have adopted a fair billing policy and a fair debt collection policy.
The revised proposed rules also establish a Charitable Advisory Council. The Council consists of nine members appointed by the Attorney General. Council members represent grant making charities, large, mid-size and small charities, charitable hospitals, and charitable nursing homes, among others. The Council advises the Attorney General on a variety of matters impacting Ohio charities.
While the revised proposed rules still need work, they are a vast improvement over the initial proposal.
We will keep you updated on the proposed rules as they continue to be developed. Should you have any questions, please feel free to contact Doug Thomson at email@example.com or 513-651-6935.