Relates to political contributions made by limited liability companies.
TITLE OF BILL: An act to amend the election law, in relation to contributions from limited liability companies
PURPOSE: To attribute campaign contributions of limited liability companies (LLCs) to the individual members of the LLC in the same manner that partnership contributions are attributed to individual partners in current law.
SUMMARY OF PROVISIONS: Section 1 of the bill would amend subdivision 2 of section 14-120 of the election law as added by chapter 79 of the laws of 1992 to treat political contributions from LLCs in the same manner as contributions from partnerships.
Section 2 of the bill specifies the effective date.
JUSTIFICATION: It is widely believed that our campaign finance laws need substantial changes to ensure the integrity of elections in our state. This bill does not address the broad range of issues that might be addressed in a comprehensive reform package. However, this bill would close one enormous loophole in the current system. Under current law, as interpreted by the judiciary, each LLC is considered a separate contributor and may make the maximum allowable contribution. Since a single individual or a small group of individuals often control multiple LLCs in some cases a very large number of such LLCs-the treatment of these LLCs as separate contributors effectively allows one or more individuals to make a virtually unlimited amount of campaign contributions.
This bill would correct this by simply attributing contributions from LLCs to the members of the LLC in the same way the law currently attributes contributions from partnerships to the individual partners.
PRIOR LEGISLATIVE HISTORY: 2009-10: S.5277 (Squadron) - Elections, A.7069 (Kavanagh) - Election Law
FISCAL IMPLICATIONS: None.
EFFECTIVE DATE: This act shall take effect immediately.
STATE OF NEW YORK ________________________________________________________________________ 38 2011-2012 Regular Sessions IN SENATE (PREFILED) January 5, 2011 ___________Introduced by Sens. SQUADRON, HASSELL-THOMPSON, KRUEGER, SERRANO -- read twice and ordered printed, and when printed to be committed to the Committee on Elections AN ACT to amend the election law, in relation to contributions from limited liability companies THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 2 of section 14-120 of the election law, as added by chapter 79 of the laws of 1992, is amended to read as follows: 2. Notwithstanding subdivision one of this section, a partnership, as defined in section ten of the partnership law, OR A LIMITED LIABILITY COMPANY, AS DEFINED IN SECTION ONE HUNDRED TWO OF THE LIMITED LIABILITY COMPANY LAW, may be considered a separate entity for the purposes of this section, and as such may make contributions in the name of said partnership OR LIMITED LIABILITY COMPANY without attributing such contributions to the individual members of the partnership OR LIMITED LIABILITY COMPANY provided that any such contribution made by a partner- ship OR LIMITED LIABILITY COMPANY to a candidate or to a political committee, shall not exceed
[,]twenty-five hundred dollars. In the event that such partnership OR LIMITED LIABILITY COMPANY contribution to any such candidate or political committee exceeds twenty-five hundred dollars, the aggregate amount of such contribution shall be attributed to each partner OR LIMITED LIABILITY COMPANY MEMBER whose share of the contribution exceeds ninety-nine dollars. S 2. This act shall take effect immediately.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD00058-01-1