NY Requires Public Disclosure of 501(C)(4) Political Expenses and Donors

The New York Attorney General recently adopted regulations that require certain nonprofit organizations that are required to register with the New York Office of the Attorney General to disclose their electioneering expenses and information about contributors.   

The new rules principally affect section 501(c)(4) organizations that solicit contributions in New York, are incorporated in New York, or conduct business or hold property in New York, but may apply to other types of nonprofit organizations that are organized and/or operated for charitable or social welfare purposes. The rules do not apply to section 501(c) (3) organizations.

All Covered Organizations

A covered organization must file an Electioneering Disclosure Schedule (EDS) with the annual financial report it files with the New York Attorney General. The organization must report on its EDS the amount and percentage of total expenses that the organization spent during its fiscal year on election related expenditures.   

“Election related expenditures” include expenditures made for express election advocacy, expenditures for election targeted issue advocacy, or funds donated to another entity for the purpose of supporting express election advocacy or targeted issue advocacy.

NY Election Related Expenditures Exceeding $10,000

A covered organization that makes New York election related expenditures in excess of $10,000 during its fiscal year must include an itemized schedule disclosing information relating to each New York election related expenditure that exceeds $50.    A “New York election” means general, special, or primary elections conducted by a New York state or local government entity for New York state or local office, or any election at which any New York state or local constitutional amendment, proposition, referendum, or other question is submitted to voters. 

A covered organization that meets the $10,000 threshold must also provide an itemized schedule disclosing information relating to each donation it received during the reporting period, including:

  • the name and address of each donor who made donations in an aggregate amount of $1,000 or more during the organization’s fiscal year;
  • the employer of each such individual donor, if known to the organization; and
  • the date and amount of each donation.   

If a donor’s contribution is deposited to a separate bank account, the funds of which are not used by the organization for making New York election related expenditures, then information relating to that donor will not need to be reported. If the organization keeps one or more segregated bank accounts containing funds used solely for New York election related expenditures, and makes all of its New York election related expenditures from such accounts, then the annual financial report need only include information about the donors who made donations that were deposited in the segregated New York election related expenditure accounts. An organization that does not keep segregated accounts and makes New York election related expenditures in excess of $10,000 during its fiscal year must report the information above for all of its donations, whether or not used for New York election related expenditures.

The organization is not required to provide these itemized schedules if it is otherwise required by law to disclose the information on the itemized schedules to any other government agency that makes the information available to the public, and if the organization is in compliance with the requirements of such laws.

Public Disclosure

Information contained on each organization’s EDS will be made available to the public by the New York Attorney General on its website, except for information relating to donations received prior to June 5, 2013. 

The Attorney General may also determine upon application to keep private information relating to donations to an organization whose primary activities involve areas of public concern that create a reasonable probability that disclosure will cause undue harm, threats, harassment, or reprisals to any person or organization.

Filing Deadline

A covered organization must file its EDS by the fifteenth day of the fifth month after its fiscal year.

For more information, see Guidance to the Annual Disclosure of Electioneering Activities by Non-501(c)(3) Registrants.

The New York Attorney General recently adopted regulations that require certain nonprofit organizations that are required to register with the New York Office of the Attorney General to disclose their electioneering expenses and information about contributors.   

The new rules principally affect section 501(c)(4) organizations that solicit contributions in New York, are incorporated in New York, or conduct business or hold property in New York, but may apply to other types of nonprofit organizations that are organized and/or operated for charitable or social welfare purposes. The rules do not apply to section 501(c) (3) organizations.

All Covered Organizations

A covered organization must file an Electioneering Disclosure Schedule (EDS) with the annual financial report it files with the New York Attorney General. The organization must report on its EDS the amount and percentage of total expenses that the organization spent during its fiscal year on election related expenditures.   

“Election related expenditures” include expenditures made for express election advocacy, expenditures for election targeted issue advocacy, or funds donated to another entity for the purpose of supporting express election advocacy or targeted issue advocacy.

NY Election Related Expenditures Exceeding $10,000

A covered organization that makes New York election related expenditures in excess of $10,000 during its fiscal year must include an itemized schedule disclosing information relating to each New York election related expenditure that exceeds $50.    A “New York election” means general, special, or primary elections conducted by a New York state or local government entity for New York state or local office, or any election at which any New York state or local constitutional amendment, proposition, referendum, or other question is submitted to voters. 

A covered organization that meets the $10,000 threshold must also provide an itemized schedule disclosing information relating to each donation it received during the reporting period, including:

  • the name and address of each donor who made donations in an aggregate amount of $1,000 or more during the organization’s fiscal year;
  • the employer of each such individual donor, if known to the organization; and
  • the date and amount of each donation.   

If a donor’s contribution is deposited to a separate bank account, the funds of which are not used by the organization for making New York election related expenditures, then information relating to that donor will not need to be reported. If the organization keeps one or more segregated bank accounts containing funds used solely for New York election related expenditures, and makes all of its New York election related expenditures from such accounts, then the annual financial report need only include information about the donors who made donations that were deposited in the segregated New York election related expenditure accounts. An organization that does not keep segregated accounts and makes New York election related expenditures in excess of $10,000 during its fiscal year must report the information above for all of its donations, whether or not used for New York election related expenditures.

The organization is not required to provide these itemized schedules if it is otherwise required by law to disclose the information on the itemized schedules to any other government agency that makes the information available to the public, and if the organization is in compliance with the requirements of such laws.

Public Disclosure

Information contained on each organization’s EDS will be made available to the public by the New York Attorney General on its website, except for information relating to donations received prior to June 5, 2013. 

The Attorney General may also determine upon application to keep private information relating to donations to an organization whose primary activities involve areas of public concern that create a reasonable probability that disclosure will cause undue harm, threats, harassment, or reprisals to any person or organization.

Filing Deadline

A covered organization must file its EDS by the fifteenth day of the fifth month after its fiscal year.

For more information, see Guidance to the Annual Disclosure of Electioneering Activities by Non-501(c)(3) Registrants  

- See more at: http://www.pattonboggs.com/Viewpoint/NY-Requires-Public-Disclosure-of-501-C-4-Political-Expenses-and-Donors#sthash.RG3KoC56.dpuf
NY Requires Public Disclosure of 501(C)(4) Political Expenses and Donors - See more at: http://www.pattonboggs.com/Viewpoint/NY-Requires-Public-Disclosure-of-501-C-4-Political-Expenses-and-Donors#sthash.RG3KoC56.dpuf

Topics:  Election Related Expenditures, Electioneering, Filing Deadlines, Non-Profits, Public Disclosure

Published In: 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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