Policy For Collecting Donations

I am interested in developing a policy to outline who/how the library may collect donations on behalf of other organizations. We have always had a Lion's Club eyeglass donation box in the library. I inherited this procedure but I cannot find any policy that specifies the parameters of such an agreement. Does the organization we would collect for have to be a 501C3? I can't find guidance on what is acceptable, appropriate and most of all legal. Does the organization have to be one that reports finances to the state? We are a special legislative district library. I found some information from the state (below) but my legalese isn't what I'd like it to be. Thanks for any information you can provide. (PS this is prompted by someone telling a local group that we would let them collect old sneakers for their cause...Eeeewww!)

SECTION 174-B
Solicitation
Executive (EXC) CHAPTER 18, ARTICLE 7-A