Issuance of disqualification order by Attorney General
- hearing request
- legal effect
(1)The Attorney General may issue an order disqualifying a charitable organization from receiving contributions that are deductible as charitable donations for the purpose of Oregon income tax and corporate excise tax if the Attorney General finds that the organization has failed to expend at least 30 percent of the organization’s total annual functional expenses on program services when those expenses are averaged over the most recent three fiscal years for which the Attorney General has reports containing expense information. The calculation of program services expenses and total functional expenses shall be based on the amounts of program services expenses and total functional expenses identified by the organization in the organization’s Internal Revenue Service Form 990 return or other Internal Revenue Service return required to be filed as part of the organization’s report to the Attorney General.
(2)A charitable organization may request a contested case hearing within 60 days after notification from the Attorney General that the Attorney General proposes to issue a disqualification order under this section. Notwithstanding a finding that the charitable organization’s program services expenses fall below the minimum percentage specified in subsection (1) of this section, the Attorney General may decline to issue a disqualification order if the organization establishes:
(a)That the organization made payments to affiliates that should be considered in calculating the organization’s program services expenses;
(b)That the organization is accumulating revenue for a specific program purpose consistent with representations in solicitations; or
(c)Such other mitigating circumstances as may be identified by the Attorney General by rule.
(3)A disqualification order under this section remains in effect until such time as the charitable organization submits sufficient information to the Attorney General to demonstrate that the organization’s program services expenses meet the minimum percentage specified in subsection (1) of this section. A charitable organization may submit information under this subsection no earlier than one year after the disqualification order becomes final, and may not submit information under this subsection more than once each year after the initial submission is made. The information submitted under this subsection must include all Internal Revenue Service Form 990 returns, or equivalent Internal Revenue Service returns, filed by the organization after the disqualification order became final.
(4)A disqualification order under this section may not be issued to:
(a)A private foundation as defined in section 509 of the Internal Revenue Code, as in effect on October 7, 2013;
(b)A community trust or foundation operating as described in 26 C.F.R. 1.170A-9(f)(10) and (11), as in effect on October 7, 2013;
(c)A qualified charitable remainder trust described in section 664 of the Internal Revenue Code, as in effect on October 7, 2013;
(d)An organization that does not qualify to receive tax deductible contributions;
(e)An organization that is not required to file annual reports with the Attorney General;
(f)An organization that is not required to file an Internal Revenue Service Form 990 return or an equivalent Internal Revenue Service return;
(g)An organization that receives less than 50 percent of the organization’s total annual revenues from contributions or grants identified in accordance with Internal Revenue Service Form 990 or an equivalent form; and
(h)An organization that has been in existence for less than four years.
(5)When a disqualification order is issued under this section, the charitable organization that is the subject of the order does not qualify for and may not claim exemption from taxation under ORS 307.130 (Property of certain museums, volunteer fire departments and literary, benevolent, charitable and scientific institutions) for the tax year following the tax year in which the order went into effect and subsequent tax years in which the order remains in effect. [2013 c.260 §2]
Section 128.760 — Issuance of disqualification order by Attorney General; hearing request; legal effect,