Nonprofits that play politics in New York state must now disclose the percentage of their expenditures that go toward that electioneering.
The regulations, which originated in the state attorney general’s office, require so-called social welfare organizations – 501(c)(4)s – to make “more robust” disclosures. Those that spend more than $10,000 on election-related activities must now file itemized schedules of expenses and contributions.
The regulations became law June 5. They follow six months of procedure, during which public hearings were held across the state and 6,000 comments were fielded. The final resolution was submitted to the New York Department of State in April.
It was immediately pilloried by a conservative Washington, D.C.-based institute, the State Government Leadership Foundation. Its executive director, Chris Jankowski, said, “Attorney General Eric Schneiderman is silencing the voices of the people he does not agree with and illegally targeting organizations that are engaging in constitutionally protected conduct as determined by our nation’s highest court. This is yet another example of nonprofits being targeted by some of our government’s most powerful arms. These actions by the attorney general stifle the First Amendment rights of those who dare to disagree with him.”
Schneiderman said he is empowered by the state to act on the issue.
The regulations come in time to effect disclosure of information concerning local elections that will take place in the second half of 2013, including the New York City mayoral election, and will apply to all of New York state’s 2014 elections.
“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,” he said.
“As the state law enforcement official with primary responsibility for overseeing nonprofit organizations, Attorney General Schneiderman is empowered by New York law to determine the form and manner in which organizations make required annual financial reports to his office, and to enact rules and regulations to administer the financial reporting system,” the attorney general’s office reported.
So-called good government advocates have coined the term “dark money” to describe anonymous election spending through 501(c)(4)s. Several applauded Schneiderman’s move, including Michael Waldman, president of the Brennan Center for Justice at NYU School of Law, who said, “As secret money has overwhelmed our elections, federal regulators have failed in their most basic task. Attorney General Schneiderman has shown decisive leadership to bring political spending out of the dark. His disclosure rule provides a national model. He is doing his part. Other officials in Albany must do theirs. That starts with swift enactment of comprehensive campaign finance reform.”
Susan Lerner, executive director of Manhattan-based Common Cause New York, said: “The scourge of dark money in our politics must be stopped. Donors and the public have a right to know who is funding nonprofits that intervene in our elections. I commend Attorney General Schneiderman for his innovative efforts to promote transparency and encourage other policymakers to do the same.”