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AN ACT
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relating to regulating the collection or solicitation of donated |
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goods subsequently sold by for-profit entities or individuals; |
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providing a civil penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 17, Business & Commerce Code, is amended |
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by adding Subchapter K to read as follows: |
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SUBCHAPTER K. REGULATING THE COLLECTION OR SOLICITATION BY |
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FOR-PROFIT ENTITIES OF CERTAIN PUBLIC DONATIONS |
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Sec. 17.921. DEFINITIONS. In this subchapter: |
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(1) "Charitable organization" means an organization |
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that is exempt from federal income tax under Section 501(a) of the |
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Internal Revenue Code of 1986 by being listed as an exempt |
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organization in Section 501(c) of that code. |
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(2) "For-profit entity" has the meaning assigned by |
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Section 1.002, Business Organizations Code. |
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(3) "Household goods" mean furniture, furnishings, or |
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personal effects used or for use in a dwelling. |
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(4) "Public donations receptacle" means a large |
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container or bin in a parking lot or public place that is intended |
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for use as a collection point for clothing or household goods |
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donated by the public. |
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Sec. 17.922. REQUIRED DISCLOSURE FOR COLLECTIONS THROUGH |
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PUBLIC RECEPTACLE. (a) A for-profit entity or individual may not |
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use a public donations receptacle to collect donated clothing or |
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household goods and subsequently sell the donated items unless the |
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for-profit entity or individual attaches to the receptacle a notice |
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that: |
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(1) is permanently and prominently displayed on the |
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front and at least one side of the receptacle; |
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(2) is in bold print, with letters at least two inches |
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in height and one inch in width; |
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(3) contains the business address, other than a post |
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office box number, and telephone number of the for-profit entity or |
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individual; and |
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(4) contains the appropriate disclosure prescribed by |
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this section in English and Spanish. |
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(b) If none of the proceeds from the sale of the donated |
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items will be given to a charitable organization, the disclosure |
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required by Subsection (a)(4) must state: |
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"DONATIONS ARE NOT FOR CHARITABLE ORGANIZATIONS AND WILL BE |
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SOLD FOR PROFIT." |
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(c) If any of the proceeds from the sale of the donated items |
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will be given to a charitable organization, the disclosure required |
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by Subsection (a)(4) must state: |
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"DONATIONS ARE TO (NAME OF FOR-PROFIT ENTITY OR INDIVIDUAL) |
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AND WILL BE SOLD FOR PROFIT. ____ PERCENT (INSERT PERCENTAGE) OF |
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ALL PROCEEDS WILL BE DONATED TO (NAME OF CHARITABLE ORGANIZATION)." |
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(d) If the for-profit entity or individual pays to a |
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charitable organization a flat fee that is not contingent on the |
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proceeds generated from the sale of the donated items and the |
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for-profit entity or individual retains a percentage of the |
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proceeds from the sale, the disclosure required by Subsection |
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(a)(4) must state: |
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"THIS DONATION RECEPTACLE IS OPERATED BY (NAME OF FOR-PROFIT |
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ENTITY OR INDIVIDUAL) ON BEHALF OF (NAME OF CHARITABLE |
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ORGANIZATION). Donations are sold for profit by (name of |
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for-profit entity or individual) and a flat fee of (insert amount) |
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is paid to (name of charitable organization)." |
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Sec. 17.923. REQUIRED DISCLOSURES FOR TELEPHONE OR |
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DOOR-TO-DOOR SOLICITATIONS. (a) A for-profit entity or |
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individual who makes, or directs another person to make, a |
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telephone or door-to-door solicitation requesting that the person |
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solicited donate clothing or household goods may not subsequently |
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sell the donated items unless the solicitor provides to each person |
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solicited, before accepting a donation from the person, the |
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appropriate disclaimer prescribed by this section. |
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(b) If none of the proceeds from the sale of the donated |
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items will be given to a charitable organization, the solicitor |
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must state: |
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"DONATIONS ARE NOT FOR CHARITABLE ORGANIZATIONS AND WILL BE |
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SOLD FOR PROFIT." |
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(c) If any of the proceeds from the sale of the donated items |
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will be given to a charitable organization, the solicitor must |
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state: |
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"DONATIONS TO (NAME OF FOR-PROFIT ENTITY OR INDIVIDUAL) WILL |
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BE SOLD FOR PROFIT AND ____ PERCENT (INSERT PERCENTAGE) OF ALL |
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PROCEEDS WILL BE DONATED TO (NAME OF CHARITABLE ORGANIZATION)." |
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(d) If the for-profit entity or individual pays to a |
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charitable organization a flat fee that is not contingent on the |
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proceeds generated from the sale of the donated items and the |
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for-profit entity or individual retains a percentage of the |
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proceeds from the sale, the solicitor must state: |
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"SOLICITATIONS FOR DONATIONS ARE MADE BY (NAME OF FOR-PROFIT |
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ENTITY OR INDIVIDUAL) ON BEHALF OF (NAME OF CHARITABLE |
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ORGANIZATION). Donations will be sold for profit by (name of |
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for-profit entity or individual) and a flat fee of (insert amount) |
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is paid to (name of charitable organization)." |
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Sec. 17.924. REQUIRED DISCLOSURES FOR MAIL SOLICITATIONS. |
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(a) A for-profit entity or individual who mails, or directs |
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another person to mail, a solicitation requesting that the |
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recipient donate clothing or household goods may not subsequently |
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sell the donated items unless the solicitor includes with the |
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mailed solicitation the appropriate disclosure prescribed by this |
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section, prominently displayed in boldfaced type or capital letters |
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in English and Spanish. |
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(b) If none of the proceeds from the sale of the donated |
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items will be given to a charitable organization, the disclosure |
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required by Subsection (a) must state: |
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"DONATIONS ARE NOT FOR CHARITABLE ORGANIZATIONS AND WILL BE |
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SOLD FOR PROFIT." |
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(c) If any of the proceeds from the sale of the donated items |
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will be given to a charitable organization, the disclosure required |
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by Subsection (a) must state: |
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"DONATIONS TO (NAME OF FOR-PROFIT ENTITY OR INDIVIDUAL) WILL |
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BE SOLD FOR PROFIT AND _______ PERCENT (INSERT PERCENTAGE) OF ALL |
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PROCEEDS WILL BE DONATED TO (NAME OF CHARITABLE ORGANIZATION)." |
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(d) If the for-profit entity or individual pays to a |
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charitable organization a flat fee that is not contingent on the |
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proceeds generated from the sale of the donated items and the |
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for-profit entity or individual retains a percentage of the |
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proceeds from the sale, the disclosure required by Subsection (a) |
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must state: |
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"SOLICITATIONS FOR DONATIONS ARE MADE BY (NAME OF FOR-PROFIT |
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ENTITY OR INDIVIDUAL) ON BEHALF OF (NAME OF CHARITABLE |
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ORGANIZATION). Donations will be sold for profit by (name of |
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for-profit entity or individual) and a flat fee of (insert amount) |
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is paid to (name of charitable organization)." |
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Sec. 17.925. LOCAL ORDINANCE OR REGULATION. Nothing in |
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this subchapter shall be construed to limit the authority of a local |
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government to adopt an ordinance or regulation relating to the use |
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of public donations receptacles as a collection point for donated |
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clothing or household goods if the ordinance or regulation is |
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compatible with and equal to or more stringent than a requirement |
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prescribed by this subchapter. |
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Sec. 17.926. CIVIL PENALTY. (a) Except as provided by |
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Subsection (b), a person who violates this subchapter is liable to |
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this state for a civil penalty in an amount not to exceed $500 for |
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each violation. Each sale of a donated item is considered a |
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separate violation for purposes of this subsection. |
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(b) The total amount of penalties that may be imposed under |
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Subsection (a) may not exceed $2,000 for donated items sold during a |
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single transaction. |
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(c) In determining the amount of the civil penalty imposed |
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under this section, the court shall consider the amount necessary |
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to deter future violations. |
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(d) The attorney general or the prosecuting attorney in the |
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county in which the violation occurs may bring an action to recover |
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the civil penalty imposed under this section. In this subsection, |
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"prosecuting attorney" has the meaning assigned by Section 41.101, |
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Government Code. |
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SECTION 2. This Act takes effect September 1, 2009. |
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______________________________ |
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President of the Senate |
Speaker of the House |
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I hereby certify that S.B. No. 776 passed the Senate on |
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April 2, 2009, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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I hereby certify that S.B. No. 776 passed the House on |
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May 20, 2009, by the following vote: Yeas 138, Nays 0, one present |
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not voting. |
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______________________________ |
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Chief Clerk of the House |
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Approved: |
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______________________________ |
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Date |
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______________________________ |
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Governor |