New York Attorney General Issues Proposed Regulations to Require Nonprofits to Publicly Disclose Their Political Expenditures and Their Donors’ Identities

New York Attorney General Eric T. Schneiderman has issued proposed regulations that would require many nonprofit organizations to annually disclose certain information about their political spending and their donors’ identities. According to the Attorney General, the proposed regulations are in response to nonprofit organizations, in particular Section 501(c)(4) social welfare organizations, that have engaged in political campaign activity and do not disclose their sources of funding. While Section 527 organizations are required to publicly disclose certain information relating to their political expenditures and their donors’ identities, other nonprofit organizations are generally exempt from such reporting requirements.

The proposed disclosure requirements will apply to all nonprofit organizations that are registered with the New York Attorney General, except for Section 501(c)(3) organizations (such as public charities, which are strictly prohibited from participating in any political campaign activity).

Under the proposed regulations, a covered nonprofit organization will need to file an “Electioneering Disclosure Schedule” as part of its annual filing that includes the amount and percentage of total expenses that are election related expenditures.

The proposed regulations broadly define election related expenditures to include express advocacy for the election or defeat of a specific candidate, referendum or party, and “election targeted issue advocacy.” “Election targeted issue advocacy” means any communication within 180 days of an election that only references a candidate in that election; depicts the name, image, likeness or voice of a candidate; or refers to any political party or referendum; even if the reference does not call for the election or defeat of the candidate, referendum or party.

Nonprofit organizations that spend more than $10,000 on New York election related expenditures will be required to provide an itemized schedule detailing each New York election related expenditure, including the amount, date, recipient and purpose of the expenditure. Finally, nonprofit organizations that spend more than $10,000 on New York election related expenditures will also be required to disclose the name and address of each donor who donated at least $100 during the applicable reporting period on the “Electioneering Disclosure Schedule.”

The Attorney General will disclose each organization’s “Electioneering Disclosure Schedule” detailing the election related expenditures and donor identities to the public on the Attorney General’s website.

If an organization is concerned that the public disclosure of a donor’s identity “will cause undue harm, threats, harassment or reprisals to any person or organization,” it may apply for a waiver from the Attorney General.

The Attorney General’s proposal is subject to hearings and public comment through March 6, 2013. The Attorney General expects to adopt the regulations in 2013 to cover the local New York elections in 2013 and the New York State elections in 2014.

Topics:  Disclosure Requirements, Donor Lists, Election Related Expenditures, Electioneering, Political Contributions

Published In: Administrative Agency Updates, Elections & Politics Updates, Finance & Banking Updates, Nonprofits Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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