Internet charities may face local rule

Designed mainly to curb cyber-scams, Pinellas' proposal to regulate a world of charity Web sites draws both criticism and incredulity.

By EDIE GROSS

© St. Petersburg Times, published June 9, 2000

For nearly two decades, volunteers at Romero House Soup Kitchen have fed, clothed and provided medical and legal aid to New Brunswick, home to Canada's poorest residents, with virtually no thought of Pinellas County.

That could change next month if the county approves an ordinance allowing it to regulate charities that solicit donations on the Internet.

Pinellas County's consumer protection department already forces charities and professional solicitors to register with the county. More than 700 charities and 20 professional soliciting organizations that seek money through the mail and telephone are registered under the program.

Now, the department has turned its sights to the Internet, where thousands of charities around the world, including Romero House, have created Web sites describing their causes. Any site that instructs a visitor on how to donate money is considered a solicitor under Pinellas County's proposed ordinance.

If a Pinellas resident can access the site, the site's owner would have to register, which costs $20 to $120 a year, said Sheryl Lord, director of consumer protection. Charities on the Internet could avoid the registration requirement by placing a line at the top of their Web site that says, "Pinellas County residents should not contribute."

"I think that's the most foolish idea I've heard in my life," said Evelyn McNulty, the bookkeeper at Romero House, which provides an address on its Web site where donations can be sent. "We're not doing it. I don't know how they'd enforce it."

Essentially, every charity in the universe that asks for donations on its Web site would be forced to register with Pinellas if the ordinance passes. Contacting each of those organizations and enforcing the rule would be difficult, Lord admits.

But residents have a right to know as much as they can about a charity before giving money, she said.

"I want to get it on the books so we're covered legally. Once it's on the books, we're going to go out in force," she said. "It's just another effort to try to protect consumers locally from the proliferation of the Internet. It's going to be tough, but we can't look the other way."

Lord's office is primarily concerned with Web site creators who tell visitors they are soliciting for specific charities and then never turn money over to those charities. The ordinance also would target organizations that send mass e-mails to residents requesting donations.

But the rule also would cover such groups as the Greater West Hollywood Food Coalition, which sells or auctions donated cars and uses the money to feed California's homeless.

"This particular organization has virtually no funds. It's pretty much run by volunteers. All we have is the Internet site," said volunteer Lyn Luzwick, who persuaded a friend to create the organization's Web site. "We're a very, very, very small deal. How does one county regulate the Internet? If you want to play God, get into the ministry."

Several charities said they felt the rule would infringe on their rights to free speech over the Internet. University of Florida law professor Joseph Little said the ordinance did raise some "free speech issues." But enforcing the rule would probably be the greatest challenge, he said.

"I don't think it'll work, I'll be candid with you," said Little, an expert in constitutional law. "I would doubt the Internet people are going to bother registering. From a proactive enforcement, it'd be virtually impossible. The practical difficulties are probably going to be as great as the constitutional difficulties."

Technically, the Florida Department of Agriculture and Consumer Services already requires charities that solicit in this state -- over the Internet, on the phone or through the mail -- to register.

"But we're not so naive to think that every one of these people are (registered)," said department spokesman Terence McElroy. "We know they're not. But they're required to be."

If caught violating state law, the organization faces fines of $1,000 or more. Sometimes the state lowers the fine if the charity simply did not know the law, McElroy said.

In Pinellas County, charities that solicit over the phone and through the mail are required to provide a long list of information: their street address, officers, telephone scripts, history and a breakdown of where the money goes. Some charities use professional solicitors, often phone banks, which also must register with the county.

If caught without proper registration, those charities can be banned from soliciting in Pinellas County, Lord said.

County commissioners will consider the new ordinance at a July 11 public hearing. Commissioners Karen Seel and Calvin Harris said the county will spend most of its time going after Internet sites that request donations but do not turn them over to charities.

"I think the enforcement is meant for the scams. What we're looking for is the bad apples," Seel said. "I think what we're trying to do is create some type of cutting-edge protection for our citizens. So if this is new ground, it's new ground."

Lee Cassidy, executive director of the National Federation of Nonprofits Inc. in Washington, said his organization is skeptical of Pinellas County's plan. Congress and state lawmakers should go after fraudulent fundraisers, not counties, he said.

As treasurer of the American Charities for Reasonable Fundraising Regulation, Cassidy is already involved in a lawsuit against Pinellas County's current registration requirements. Targeting charities around the world just because they are on the Internet does not seem fair, he said.

"The fact that a charity's Web site might be logged onto by somebody in Pinellas County is no different than the fact that a Web site might be logged onto by somebody in St. Petersburg, Russia, or London, England. There's no way in the world every charity in the world is going to register in Pinellas County," Cassidy said.

"If the corner soup kitchen has a Web site which is really intended for people in the local community, that Web site is accessible by everybody in the world. You think that little $200,000-a-year, corner soup kitchen is going to register in Pinellas County when it's in Tuscaloosa?" he said. "These people are not connected to reality."

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