What's happening
This bill requires New York corporations to get shareholder approval before making political expenditures and mandates related disclosures.
Why it matters
Shifts power to shareholders. By requiring a majority shareholder vote before any corporate political spending, the bill gives investors direct say over how their money is used in the political sphere—potentially reducing the ability of corporate managers to make unilateral political donations.
Mandates transparency. Corporations must disclose political expenditures to shareholders within 48 hours and list them in annual reports, increasing public and investor knowledge of corporate political activity and enabling more informed investment decisions.
Enables shareholder dissent. Any shareholder who disagrees with a corporate political expenditure can request a pro rata rebate, giving individual investors a mechanism to avoid financially supporting political causes they oppose.
Restricts spending by widely held corporations. If a majority of a corporation’s shares are owned by entities that can’t take political positions (like pension funds or nonprofits), the bill prohibits that corporation from making political expenditures at all, potentially reducing corporate influence in politics.
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Who cares
- Likely concerns
Corporate shareholders
They would vote on annual political spending limits and permitted recipients or ballot questions, receive spending disclosures, and be entitled to request a proportional rebate for expenditures they oppose.
Corporations making political expenditures
They would need advance approval from a majority of all votes entitled to be cast, provide notices within 48 hours of spending, and list expenditures in annual reports.
Pension funds, mutual funds and other institutional shareholders
Corporations majority-owned by shareholders unable to take political positions, including the funds and institutions listed in the bill, would be barred from political spending.
Candidates, political parties, political committees and 501(c)(4) and (6) organizations
Corporate political spending directed to them would require advance shareholder authorization.
Headline styles
Let Shareholders OK Political Spending
Plain English, a few words. Used as the page title.
Sponsors
7 Co-sponsors
1 Multi-sponsor
History
- Referred to election law
- Referred to election law
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3363
2019-2020 Regular Sessions
IN ASSEMBLY
January 29, 2019
Introduced by M. of A. COLTON, MOSLEY, COOK, D'URSO, ARROYO, ENGLE- BRIGHT, BLAKE, WRIGHT -- Multi-Sponsored by -- M. of A. DE LA ROSA -read once and referred to the Committee on Election Law
AN ACT to amend the business corporation law, in relation to requiring shareholders to approve corporate political expenditures
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The business corporation law is amended by adding a new section 631 to read as follows: § 631. Shareholder approval of political expenditures.
(a) "Political expenditure" shall mean a contribution, gift, transfer, disbursement, or promise of money or a thing of value to promote or assist in the promotion of the success or defeat of a candidate, political party, or question in any state or federal election.
(b) A corporation may not use any money or other property of the corporation in connection with a political expenditure unless the shareholders of the corporation, by the affirmative vote of a majority of all votes entitled to be cast, have:
(1) Authorized in advance the total amount of money or property that may be used for all political expenditures during a specific fiscal year of the corporation; and
(2) Directed that the money or property can be used for:
A. A specified candidate or candidates;
B. Candidates of a specified political party or parties;
C. A specified political party or parties;
D. A specified political committee or committees;
E. A specified entity or entities exempt from taxation under section 501(c)(4) or (6) of the internal revenue code; or
F. A specified question or questions.
(c) Shareholder consideration of political expenditures shall occur at an annual or special meeting of the shareholders.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD04637-01-9
A. 3363 2
(d) Within forty-eight hours after making a political expenditure, the corporation shall:
(1) Give notice of the political expenditure by electronic transmission to each shareholder that has requested notice; and
(2) If the corporation maintains a website, post notice of the political expenditure on the website.
(3) When providing notice pursuant to subparagraphs one and two of this paragraph, the notice shall state the amount, recipient, date, and purpose of the political expenditure.
(e) The annual report of the corporation shall contain a list of all political expenditures made by the corporation during the reporting period, including the amount, recipient, date, and purpose of each political expenditure.
(f) If a shareholder disagrees with a political expenditure made under this section, he or she may receive from the corporation upon request a pro rata rebate in an amount of the percentage of the political expenditure equal to the percentage of ownership the shareholder has in the corporation.
(g) If a majority of a corporation's shares are owned by those who cannot take political positions, including but not limited to state and local pension funds, mutual funds, insurance companies, foundations, churches and universities, then the corporation shall not make political expenditures.
§ 2. This act shall take effect on the ninetieth day after it shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.