Provides for state board of elections enforcement unit and counsel; relates to political communications, independent expenditure reporting and enforcement proceeding

Summary of specific provisions

The bill would codify in statute an enforcement unit within the State Board of Elections (SBOE). Moreover, at least 35 percent of the SBOE's annual budget would be dedicated to the unit to promote increased enforcement of campaign finance laws;

Expands the jurisdiction of the enforcement unit and promotes independence of the enforcement counsel by making the office a 4 year term, and the office of special counsel, the other legal unit at the SBOE, a 4 year term and codifies the requirement that the deputy in each unit be a member of the opposite political party than that of the counsel;

Changes the way that campaign finance enforcement matters are processed at the SBOE by requiring three of the four SBOE commissioners to vote to stop an investigation by the enforcement counsel, rather than requiring, as current law does, 3 votes to begin an investigation;

Mandates that all votes to stop an investigation, or to act on the recommendation of the enforcement counsel after an investigation, occur in public, as currently all discussion and all determinations made regarding campaign finance enforcement matters occur in executive session and not in public.

The bill also promotes compliance with campaign finance laws by:

Increasing the penalty for failure to file from $500 to $1,000;

Creating a substantial new penalty of up to $10,000 for the failure to file required statements three or more times in an election cycle; and creating a new penalty for accepting an excess contribution. In addition to returning the excess, a candidate or committee could be fined an amount equal to 2 times the excess plus face a civil penalty up to $10,000.

The bill would also require greater disclosure and transparency of campaign finance information. specifically, it would:

Define the term "independent expenditures" and require that such political communications that use such expenditures identify the source of such funds. violators would be penalized by a civil fine of up to $1,000 or the cost of the independent expenditure, whichever is greater;

Mandate that independent expenditures on communications opposing or supporting a candidate or ballot initiative in excess of $1,000 be subject to the same filing requirements currently in place for candidates and political committees;

Prohibit a person, campaign committee or political party from falsely identifying the source of a political communication;

Require itemization of candidate and political committee credit card payments and other like payments;

Require that for contributions over $500, the occupation and employer of the contributor be disclosed;

Prohibit candidates from authorizing more than one political campaign committee in anyone election cycle. Under current law candidates can have as many campaign committees as they so choose, making it hard to track donations and contributors. This section of the bill would not apply to exploratory committees;

Add Limited Liability Companies ("LLCS") to section 14-116 of the election law to provide that LLCs have the same $5,000 limit for making contributions to candidates, parties and political committees per year, as corporations currently do. Under current law LLCs are treated as natural persons for purposes of campaign contribution limits and as such, subject to a campaign contribution limit of $150,000;

Establish a comprehensive framework for the winding down of campaign committees. Current law does not require campaign committees to dispose of funds within a set timeframe. Hypothetically, a committee could continue transferring and making contributions for another twenty years after an elected official has died or left office. Under this section of the bill an authorized committee would have four years to fully dispose of campaign monies upon the later of: (a) the end of the individual's most recent term in office; (b) the date of

the election in which the individual last was a filed candidate; or (c) upon conviction of a felony;

Responds to the U.S. Supreme Court decision in citizens United vs. F.E.C. by requiring corporations via a meeting of shareholders on an annual basis or more to vote to authorize such corporation to make contributions or independent expenditures on behalf of itself.

Justification

The bill would promote compliance with campaign finance laws by increasing current penalties and creating new penalties for violations of campaign finance laws.

It would also promote transparency and accountability by requiring the disclosure of additional information regarding political committee activities and, for the first time, requiring the identification of the source of, and the filing of statements about, independent expenditures made in an election. The bill would require the SBOE to vote on campaign finance matters in public for the first time to allow the public to evaluate the effectiveness of campaign finance laws and increase the public's confidence in our electoral system.

Passage of the bill is needed to help strengthen our current ethics and campaign finance laws, and by so doing help to improve compliance with the standards of conduct, legal and ethical, to which all of New York's public servants should be held.

Prior legislative history

This is a new bill. Similar legislation (S.6457) which contained parts of this bill passed the Senate earlier this year and was subsequently vetoed by the Governor.

Fiscal implications

None.

Effective date

This act shall take effect January 1, 2011; provided however that sections sixteen through twenty-seven of this act shall take effect August 1, 2010.