N.Y. AG adopts new regulations on electioneering nonprofits

By Bryan Cohen | Jun 5, 2013

NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced new regulations Wednesday that will bring more transparency to the political process and protect the donors of nonprofits.

Schneiderman's new regulations will require nonprofit groups, including 501(c)(4) social welfare organizations, to make more robust disclosures of their activities related to political campaigns.

"There is only one reason to funnel political spending through a 501(c)(4), and that is to hide who has bankrolled the effort," Schneiderman said. "By shining a light on this dark corner of our political system, New York will serve as a model for other states, and for the federal government, in protecting the integrity of nonprofits and our democracy. By requiring nonprofits to disclose the extent and nature of their electioneering activities, we are protecting prospective donors from misleading solicitations, and giving voters more information about who is behind many of the ads they will see in this year's elections, and elections to come."

Nonprofits registered with the state will now have to report the percentage of their expenditures that go to local, state and federal electioneering. The groups that spend at least $10,000 on local and state elections in New York will need to file itemized schedules of contributions and expenses. The disclosures will be available publicly on Schneiderman's website.

"When people spend money to try to influence our elections, the public needs to know the source of that money, and how it is being spent," Schneiderman said. "The regulations going into effect today will ensure that New York nonprofits are not used to subvert that basic principle. Simply put, transparency reduces the likelihood of corruption."

Since the U.S. Supreme Court's 2010 Citizens United decision, 501(c)(4) organizations became vehicles for political activity, reportedly spending more than $500 million on political intervention in the last two election cycles.

Schneiderman's office says the regulations could help to prevent conflicts of interest and corruption. The regulations became effective Wednesday upon their publication in the state register.

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