New York AG Eric Schneiderman to nonprofits: Show us your campaign money

By Teri Weaver, The Post-Standard 

Syracuse, N.Y. -- Attorney General Eric Schneiderman has proposed regulations that would make certain nonprofit groups report their political spending, a change that could reveal the source of millions of dollars in campaign money currently hidden from public view.

The proposal could make most nonprofits -- including 501(c)(4)s -- registered with New York report the breakdown of spending that goes toward federal, state and local elections. If that spending topped $10,000, the group would be required to disclose money donated to the group and spending toward political candidates or issue advocacy in state and local races.

Schneiderman, the state's top law enforcement officer, has the authority to regulate nonprofits. He must hold public hearings on the proposal, but he ultimately has the ability to impose the new rules, The New York Times reported.

The changes are a way around the hidden campaign spending that has flourished since
U.S. Supreme Court’s 2010 Citizens United decision -- especially in 501(c)(4) groups.

Those organizations "have become vehicles for political activity, including funding sham 'issue ads' that attack candidates for public office," according to a news release from Schneiderman. The "501(c)(4)s have become attractive conduits for this sort of activity because they can raise and spend unlimited funds, conceal their funding sources, and avoid paying corporate taxes on donations. In the last two election cycles, election spending through 501(c)(4)s exceeded spending through traditional political action committees."

Under the new rules, nonprofits that spend $10,000 or more a year that way would have to list each expenditure and each contribution of $100 or more, including the contributor’s name, address and employer.

The information would be public, with an exception for donors who specify that their funds can’t be used for electioneering.

As the Times points out, the change could affect lawmaking in New York involving such high-profile issues as hydrofracking, gaming and redistricting.

"The rules would also affect any tax-exempt groups that join expected battles over a proposed constitutional amendment that would expand casino gambling, a top priority of Gov. Andrew M. Cuomo; another constitutional amendment that would alter the state’s redistricting process; and any local ballot measures regarding hydraulic fracturing," Nicholas Confessore wrote in the Times story.

The new rules would not apply to 501(c)(3) organizations, which are already strictly prohibited from intervention in political campaigns, according to Schneiderman.

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