Charities and Fundraisers FAQs
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Contract Elements Required by Law
- Q1. What must be in a contract between a paid solicitor or professional fundraising consultant and a charitable organization?
- A1. The following summarizes the provisions of the Colorado Charitable Solicitations Act that apply to contracts and the proper handling of contributions. 
professional fundraising consultant who will at any time have custody or
control of contributions from a solicitation conducted on behalf of a charity
in Colorado must register with the Secretary of State in Colorado before
performing any material services in connection with that solicitation.
- Every contract must be in writing.
- Every contract must be signed by an authorized official of the charitable organization or
sponsor. The authorized official must be a member of the organization’s governing body.
For paid solicitors, the contract
must also be signed by the authorized contracting officer for the paid
solicitor, or by the individual paid solicitor if he or she is not part of an organization.
- A copy of the contract must be given to the charitable organization before any material services are performed under the contract.
- Upon request, a copy of the contract must be given to the Secretary of State.
- If a paid solicitor or professional fundraising
consultant will have custody of any contributions, each contribution must
be deposited within two business days of receipt into an account in the
name of the charity. The charity must have sole control over all
withdrawals from the account.
- All contracts must include:
- A statement of the charitable purpose for which
the solicitation campaign is being conducted.
- A statement of the respective obligations of each party.
- The beginning and ending dates of the
- Professional fundraising
consultants must include the following:
- Whether the professional fundraising consultant will have custody or control of contributions at any time.
- A clear statement of the fees that will be paid to the professional fundraising consultant. If the fees are based on a percentage of contributions or other formula, a clear statement of the percentage or formula used must be included.
- Paid solicitors must include a statement of the specified minimum percentage, if any, of the
gross receipts from contributions that
will be remitted to the charitable organization. If the solicitation involves
the sale of goods, services, or tickets to a fundraising event, the specified
minimum percentage, if any, of the purchase price that will be remitted to the
charitable organization must also be included.
stated percentage cannot include any fundraising costs payable by the
- Paid solicitors must include a statement of the specified percentage, if any, of gross revenue
that constitutes the paid solicitor’s compensation.
paid solicitor’s compensation is not contingent upon the number of
contributions or the amount received, the paid solicitor’s compensation shall
be expressed as a reasonable estimate of the percentage of gross revenue. The contract shall clearly disclose the
assumptions upon which such reasonable estimate is made. The stated assumptions must be based upon all the
relevant facts known to the paid solicitor regarding the solicitation to be
Compensation means all salaries, commissions, fees, and other expenses
paid by the charitable organization or sponsor to the paid solicitor. It is assumed that paid solicitors will pay
all necessary business expenses from their total compensation.
The purpose of these questions is to disclose or estimate in advance the amount of the gross
revenue from the solicitation campaign that will constitute the paid
solicitor's compensation. The amount
shall be expressed either as a fixed percentage of the gross revenue or as a reasonable estimate.
 See 6-16-104.3(2) and 6-16-104.6(2), C.R.S.