Dear PGResources.com Guestbook Subscriber:
You signed up on the *www.PGResources.com* Guestbook To receive FREE periodic updates by e-mail when changes to that site and the State Regulations of Charitable Gift Annuities are involved... This list is used ONLY to send you updates by e-mail as noted above... You will probably see ... perhaps one e-mail every 45-90 days. We requested your phone and fax number
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Our goal is to help you stay on top of the state regulations of charitable gift annuities... I believe we may have a closing *window of opportunity* of from 12-18 months before virtually all of the states’ legislatures have "revisited" the issue of the state regulation of charitable gift annuities (CGAs), as was suggested by the NAIC (National Association of Insurance Commissioners) in January, 1999. The drafts of the Permit and Exclusion laws that they sent to all 50 state legislatures in January, 1999 are found at.... www.pgresources.com/code.html
You will want to print out at least the first two drafts at the bottom of that page, so you know where the regulation of charitable gift annuities by the states is headed. Note the possibility of fines mentioned.
After this "window of opportunity" closes, it is my *personal view* that the NAIC MAY begin to take the position that any charity issuing gift annuities MUST know by now, that it is a state regulated industry. While only a few charities have actually been fined in the last few years for non-compliance with a state gift annuity regulatory law (but the numbers are growing), you will want to be aware that ALL the gift annuity laws passed since January, 1999, in the last 5 years, (16 states), have ALL contained the wording (found in the suggested *Exclusion* Model Act (see the NAIC button) that … each state reserves the right to fine any non-complying charity up to $1,000 per agreement that is NOT in compliance with their state law at the time the agreement was written. Keep in mind that CGA agreements as written, remain in effect until the demise of the last annuitant in each agreement.
Here is a Guestbook update on the latest changes to the *State Regulations* area of the 185 plus page *PGResources.com* web site. We hope this is helpful to you.
Jim Potter
Here are 14 NEW (or updated) items on Gift Annuities and Planned Giving and some other items of interest as well, with the date (MM/YY) each was added to the PGR web site. Be sure to click on and print out the page for EACH state listed. Links for each listing at … www.pgresources.com/newinfo.html
1) The LINKS for ALL changes mentioned in this report are found at the “New Information” button found at the top of all major pages on the site.
2) NEW- State Regulations (2/04): Three of the 5 pages, whose links are at the TOP of the State Regulations page, were updated in February. You will want to print out all three pages … www.pgresources.com/regs/html
3) NEW- Other Links - Books (2/04): Information about the new Third Edition of Debra Ashton's book The Complete Guide to Planned Giving will be available for direct purchase from her web site in April, 2004. See the details about this new edition that should be in every Planned Giving library, and how to get a pre-publication offer by signing up on her Guestbook. The most complete "How To Do It" book on planned giving, 3 years in the writing.
4) ALABAMA (2/04): New regulations info, filing forms and revised contact info, made to AL State Regulations page. Filing required with AL Securities Dept. This is different than the permits issued by Insurance Depts. of various states.
5) AZ, HI and NY (2/04) Three new bills filed in state legislatures in January, that will impact the regulations of CGAs in these three states. See details on the State page in each instance. AZ: New list of disclosures by charities is required before CGA gift can be accepted from AZ resident or by AZ charity. HI: Removal of requirement of $5 million in assets in HI but addition of other requirements for charity to accept CGAs from HI residents. NY: Acceptance of Real Estate for a CGA gift to charity holding a NY State Permit.
6) NEW YORK (2/04): New Annual Report Forms and line by line instructions posted to NY State Insurance Dept. web site for use with 12-31-03 Fund Activity Reports which are due March 1, 2004. That still holds, even though the Forms Were NOT posted to web site until very late in 01/2004. NY expects EVERY charity who must report their CGA Fund activity for the year 2003, will CALL to obtain a one month extension of filing date to 4-1-04. If report is late, fines of $250 a DAY are threatened. If you are one of the 176 NY Permit holding charities required to file, you should phone the NY Insurance Dept. for a 30-day extension. See links for info, forms and instructions on PGR's NY State Regulations page.
7) NEW JERSEY (1/04): NJ Governor signed new CGA law on 1-9-04, making the Prudent Investor Act of NJ the guideline for investing a charity's CGA Reserve Fund, if charity has, or files for, a NJ Permit. This makes all Northeast Permit States (MD, NJ & NY) all adopting the SAME liberal investment guidelines for a CGA Fund if charity holds permit in those states. Other than CA (which requires charity to have a separate account holding CA CGAs), all other permit states take the position that the most stringent rules of any permit state take over the entire Fund of the charity. (Presently that means that if you hold a NY Permit, you may NOT accept real estate into your CGA Fund, no matter where charity is located, the donor lives or the real property is located.) See item #5 above.
8) CALIFORNIA (1/04): New Fee structure (an automatic annual 10% increase) is posted for CA permits, annual reports, etc. effective 1-1-04. The Permit Filing Fee alone is now $3,599 after 1-1-04.
9) OREGON (10/03): Four changes (additions) made to OR Regulations page.
10) FLORIDA (5/03): New liberalizing of investment restrictions for CGA Reserve Funds (increased from 10% to 50% equities or equity mutual funds), which is still MORE restrictive than some Permit/Certificate issuing states, even though Florida is only an *annual notification* state, and NO longer, since 1990) a Permit issuing state.
11) NEW - ACGA Suggested Maximum CGA rates (5/03): New LOWER CGA rates suggested by American Council on Gift Annuities (ACGA) effective 7-1-03. Note: IF you did NOT lower your rates to equal the ACGA rates by 7-1-03, you MAY be required by some regulating (Permit or Notice States) to employ an actuary to *prove* to the regulating state that your CGA rates are still in compliance with the state's CGA regs. You should be careful to follow each state law, IF you elect to offer rates HIGHER than the ACGA suggested maximum rates.
10) Be sure to see the new, (9-5-03) 12 page *State Regulations Summary Report* at www.pgresources.com/sumreg.html
11) Ten (10) states issue Permits/Certificates of Authority, authorizing charity to issue CGA agreements in the state or to its residents.
12) Seventeen (17) states now require charity to *notify* the state's insurance or Securities Department that it is issuing CGA agreements in the state or to its residents. AL, FL and MT are ANNUAL notices. All the rest are one-time notifications only.
13) Twenty-nine (29) states now require state mandated and state unique *disclosure wording* to be added to each CGA agreement issued in the state or to a resident of the state, or risk possibility of a fine of up to $1,000 for each non-complying CGA agreement issued after adoption of their revised CGA law. For a list of states and dates, print out the five (5) reports at the top of the *state regulations* page on the www.pgresources.com web site.
14) For 21 links to important areas of the 185 plus page www.pgresources.com web site, click on and print out the page *First Time Visitor* (the link) at the top left of every major page on the web site.
I hope you find the information above to be useful. Tell your nonprofit and related professional colleagues about this site and this FREE "Guestbook" information service. Over 800 people now receive these periodic (3-4 times a year) notices. One can "subscribe", by going to the website and clicking on the "Guestbook". As a Guestbook subscriber, you will see it here first...
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Jim
James B. Potter
Planned Giving Consultant
Planned Giving Resources, Inc.
P.O. Box 665, Baker, LA 70704-0665
(225) 774-6700
(225) 775-6910 (fax)
E-mail..: jimbpotter@aol.com
Web site: www.pgresources.com
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