NY State Senate Bill 2021-S4458

Archive: Last Bill Status - In Senate Committee Elections Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to elections
Feb 04, 2021	referred to elections

co-Sponsors

2021-S4458 (ACTIVE) - Details

Current Committee:: Senate Elections
Law Section:: Election Law
Laws Affected:: Amd §§14-130 & 14-132, El L
Versions Introduced in Other Legislative Sessions:: 2013-2014: S5127
2015-2016: S2214
2017-2018: S4231
2019-2020: S2513
2023-2024: S1149

2021-S4458 (ACTIVE) - Summary

Relates to campaign funds for personal use.

2021-S4458 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S4458

SPONSOR: KRUEGER
 
TITLE OF BILL:  An act to amend the election law, in relation to
campaign funds for personal use

 
PURPOSE:

This legislation will more clearly delineate how candidates for elected
office can and cannot use their campaign funds, and establish rules for
the disposal of excess campaign funds upon the death of a candidate.

 
SUMMARY OF PROVISIONS:

Section 1 amends section 14-130 of the election law, defining the proper
uses of campaign funds and delineating the improper use of campaign
funds;

Section 2 adds a new section 14-132 to the election law, delineating
when and how political committees must dispose of unused campaign funds
upon the death of a candidate or elected official.

Section 3 sets forth the effective date.

 
JUSTIFICATION:

This bill addresses a number of concerns with how campaign funds are
expended. Currently, New York's election law, allowing candidates to
spend campaign funds for "any lawful purpose," is among the most lax in
the nation. While spending campaign funds for personal use is technical-
ly prohibited, the lack of any definition for what constitutes a
personal use renders the provision meaningless. This shortcoming in the
law is striking when compared to the detailed restrictions issued by the
Federal Election Commission. And when it is combined with the provision
that allows elected officials to retain campaign funds for any use
related to the holding of public office, it gives legislators virtual
carte blanche for expenditures that are, at best, tangentially related
to their campaigns and official duties.

Examples of successful, unsuccessful or former candidates using excess
campaign funds fox luxury vehicles, sky boxes, extravagant meals,
inter-national travel and home improvements have regularly appeared in
newspapers across the state. There is a growing and justifiable public
perception that campaign funds are being used to enhance the post
election lifestyles of candidates for public office. Such largesse turns
the ideal of representatives serving the public on its head.  Campaign
donors have a reasonable expectation that their contributions will be
used for the candidate's election efforts and the execution of his or
her duties. They do not expect their contributions to subsidize personal
spending. This legislation addresses these abuses while preserving
elected officials' ability to fund the legitimate work of their offices.

By adding a detailed list, both in generalities and specific examples,
to the current language, the line as to what can and cannot be done is
brightly drawn. In addition to the obvious need to spend campaign funds
on campaigns, the expanded definition makes it clear that expenditures
related to holding public office are restricted to those costs that
would not otherwise be incurred if an individual was a private citizen.

In addition, the bill sets limits on how long campaign committees can be
maintained after the death of a candidate. Reports of committees contin-
uing years after campaigns were ended are all too common. By setting
time limits and also specifying how excess funds can be disbursed, this
abuse will be eliminated.

 
LEGISLATIVE HISTORY:

2019-20: S.2513 Elections

2017-18: S.4231 Elections

2015-16: S.2214 Elections

2013-14: S.5127 Elections

 
LOCAL FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect on the 60th day after becoming law.

2021-S4458 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4458
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 4, 2021
                                ___________
 
 Introduced  by Sens. KRUEGER, ADDABBO, GOUNARDES, LIU, MAY -- read twice
   and ordered printed, and when printed to be committed to the Committee
   on Elections
 
 AN ACT to amend the election law, in  relation  to  campaign  funds  for
   personal use
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 14-130 of the election law, as amended by section 9
 of part CC of chapter 56 of the laws of 2015, paragraphs (ix) and (x) of
 subdivision 3 as amended and paragraph (xi) of subdivision 3 as added by
 chapter 136 of the laws of 2019, is amended to read as follows:
   § 14-130. Campaign funds for personal use. 1.  Contributions  received
 by  a  candidate  or a political committee may ONLY be expended for [any
 lawful purpose. Such funds shall not be converted by  any  person  to  a
 personal  use  which is unrelated to a political campaign or the holding
 of a public office or  party  position.]  BONA  FIDE  PURPOSES  DIRECTLY
 RELATED TO EITHER:
   [2. No contribution shall be used to pay interest or any other finance
 charges  upon  monies  loaned  to  the campaign by such candidate or the
 spouse of such candidate.
   3. For the purposes of this section, contributions "converted  by  any
 person  to a personal use" are expenditures that are exclusively for the
 personal benefit of the  candidate  or  any  other  individual,  not  in
 connection  with  a political campaign or the holding of a public office
 or party position. "Converted by any person to  a  personal  use",  when
 meeting  the  definition  in this subdivision, shall include, but not be
 limited to, expenses for the following:
   (i) any residential or  household  items,  supplies  or  expenditures,
 including  mortgage,  rent  or  utility  payments  for  any  part of any
 personal residence of a candidate or officeholder or  a  member  of  the
 candidate's  or  officeholder's family that are not incurred as a result

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD08382-01-1

 S. 4458                             2

 of, or to facilitate, the individual's campaign, or the execution of his
 or her duties of public office or party position. In the event that  any
 property  or  building  is used for both personal and campaign use or as
 part  of  the  execution  of his or her duties of public office or party
 position, personal use shall constitute expenses that  exceed  the  pro-
 rated amount for such expenses based on fair-market value.
   (ii) mortgage, rent, or utility payments to a candidate or officehold-
 er  for  any  part  of  any  non-residential property that is owned by a
 candidate or officeholder or a member of a candidate's or officeholder's
 family and used for campaign purposes, to the extent the payments exceed
 the fair market value of the property's usage for campaign activities;
   (iii) clothing, other than items that are used in the campaign  or  in
 the execution of the duties of public office or party position;
   (iv) tuition payments unrelated to a political campaign or the holding
 of a public office or party position;
   (v)  salary  payments or other compensation provided to any person for
 services where such services are not solely  for  campaign  purposes  or
 provided in connection with the execution of the duties of public office
 or party position;
   (vi)  salary  payments or other compensation provided to a member of a
 candidate's family, unless the family  member  is  providing  bona  fide
 services to the campaign. If a family member provides bona fide services
 to  a  campaign,  any salary payments or other compensation in excess of
 the fair market value of  the  services  provided  shall  be  considered
 payments for personal use;
   (vii)  admission  to a sporting event, concert, theater, or other form
 of entertainment, unless such event is part of, or in connection with, a
 campaign or is related to the holding of public office  or  party  posi-
 tion;
   (viii)  payment  of any fines or penalties assessed against the candi-
 date  pursuant  to  this  chapter  or  in  connection  with  a  criminal
 conviction  or  by  the  joint  commission for public ethics pursuant to
 section ninety-four of the executive law or  sections  seventy-three  or
 seventy-three-a  of  the  public  officers law or the legislative ethics
 commission pursuant to section eighty of the legislative law;
   (ix) dues, fees, or gratuities at a country club, health club,  recre-
 ational  facility  or other entities with a similar purpose, unless they
 are expenses connected with a specific  fundraising  event  or  activity
 associated  with a political campaign or the holding of public office or
 party position that takes place on the organization's premises;
   (x) travel expenses including automobile purchases or  leases,  unless
 used  for  campaign  purposes or in connection with the execution of the
 duties of public office or party position  and  usage  of  such  vehicle
 which  is  incidental  to such purposes or the execution of such duties;
 and
   (xi) childcare expenses, other than expenses incurred in the  campaign
 or in the execution of the duties of public office or party position.
   4.  Nothing in this section shall prohibit a candidate from purchasing
 equipment or property from his or her  personal  funds  and  leasing  or
 renting  such  equipment  or property to a committee working directly or
 indirectly with him to aid or participate in his or  her  nomination  or
 election,  including  an exploratory committee, provided that the candi-
 date and his or her campaign treasurer sign a written  lease  or  rental
 agreement. Such agreement shall include the lease or rental price, which
 shall  not  exceed  the fair lease or rental value of the equipment. The

 S. 4458                             3

 candidate shall not receive lease  or  rental  payments  which,  in  the
 aggregate, exceed the cost of purchasing the equipment or property.
   5.  Nothing  in  this section shall prohibit an elected public office-
 holder from using campaign  contributions  to  facilitate,  support,  or
 otherwise assist in the execution or performance of the duties of his or
 her public office.
   6.  The  state  board  of elections shall issue advisory opinions upon
 request regarding  expenditures  that  may  or  may  not  be  considered
 personal  use of contributions. Any formal or informal advisory opinions
 issued by a majority vote of the commissioners of  the  state  board  of
 elections  shall  be binding on the board, the chief enforcement counsel
 established by subdivision three-a of section 3-100 of this chapter, and
 in any subsequent civil or criminal action or proceeding or  administra-
 tive proceeding.]
   A. PROMOTING THE NOMINATION OR ELECTION OF A CANDIDATE; OR
   B.  PERFORMING DUTIES OF PUBLIC OFFICE OR PARTY POSITION WHICH ARE NOT
 PAID FOR OR ELIGIBLE FOR REIMBURSEMENT BY THE  STATE  OR  ANY  POLITICAL
 SUBDIVISION OR PRIVATE PARTY, AND ORDINARY AND NECESSARY EXPENSES RELAT-
 ING TO THE HOLDING OF PUBLIC OFFICE OR PARTY POSITION.
   2.  CAMPAIGN FUNDS SHALL NOT BE CONVERTED TO PERSONAL USE, WHICH SHALL
 BE DEFINED AS EXPENDITURES THAT:
   A. ARE FOR THE PERSONAL BENEFIT OF OR TO DEFRAY NORMAL LIVING EXPENSES
 OF THE CANDIDATE, OFFICEHOLDER, IMMEDIATE FAMILY OR DOMESTIC PARTNER  OF
 EITHER OR ANY OTHER PERSON;
   B.  ARE  USED  TO  FULFILL ANY COMMITMENT, OBLIGATION, OR EXPENSE THAT
 WOULD EXIST IRRESPECTIVE OF THE CANDIDATE'S CAMPAIGN  OR  DUTIES  AS  AN
 OFFICEHOLDER; OR
   C. ARE PUT TO ANY USE FOR WHICH THE CANDIDATE OR OFFICEHOLDER WOULD BE
 REQUIRED  TO  TREAT  THE AMOUNT OF THE EXPENDITURE AS GROSS INCOME UNDER
 SECTION 61 OF THE INTERNAL REVENUE CODE.
   3. EXPENDITURES FOR PERSONAL USE  SHALL  ALSO  INCLUDE,  BUT  ARE  NOT
 LIMITED TO, EXPENDITURES FOR:
   A.  RESIDENTIAL  OR  HOUSEHOLD  ITEMS,  SUPPLIES, MAINTENANCE OR OTHER
 EXPENDITURES, INCLUDING MORTGAGE, RENT, UTILITIES, REPAIRS, OR  IMPROVE-
 MENTS  FOR  ANY PART OF ANY PERSONAL RESIDENCE OF A CANDIDATE OR OFFICE-
 HOLDER, HIS OR HER IMMEDIATE FAMILY OR DOMESTIC PARTNER;
   B. RENT OR UTILITY PAYMENTS THAT EXCEED FAIR MARKET VALUE FOR  USE  OF
 ANY  PART  OF  ANY  NON-RESIDENTIAL  PROPERTY OWNED BY A CANDIDATE, OR A
 MEMBER OF A CANDIDATE'S FAMILY OR DOMESTIC  PARTNER  USED  FOR  CAMPAIGN
 PURPOSES;
   C.  SALARY  AND  OTHER  FEES  FOR  BONA FIDE SERVICES TO A CAMPAIGN OR
 LEGISLATIVE OFFICE THAT EXCEED FAIR AND REASONABLE MARKET VALUE OF  SUCH
 SERVICES;
   D.  INTEREST  OR  ANY  OTHER  FINANCE CHARGES FOR MONIES LOANED TO THE
 CAMPAIGN BY THE CANDIDATE OR THE SPOUSE  OR  DOMESTIC  PARTNER  OF  SUCH
 CANDIDATE;
   E. TUITION PAYMENTS;
   F. DUES, FEES, OR GRATUITIES AT PRIVATE CLUBS, RECREATIONAL FACILITIES
 OR  OTHER  NONPOLITICAL  ORGANIZATIONS,  UNLESS  CONNECTED TO A SPECIFIC
 WIDELY ATTENDED FUNDRAISING EVENT THAT TAKES PLACE ON THE ORGANIZATION'S
 PREMISES;
   G. AUTOMOBILE PURCHASES OR LONG TERM LEASES; SHORT  TERM  CAR  RENTALS
 AND  CELLULAR  EQUIPMENT  AND SERVICES NOT USED EXCLUSIVELY FOR CAMPAIGN
 PURPOSES OR DUTIES AS AN OFFICEHOLDER;

 S. 4458                             4
 
   H. ADMISSION TO SPORTING EVENTS, CONCERTS, THEATERS, OR OTHER FORMS OF
 ENTERTAINMENT, UNLESS  PART  OF  A  SPECIFIC  CAMPAIGN  OR  OFFICEHOLDER
 RELATED ACTIVITY; AND
   I.  PAYMENT OF ANY FINES, FEES, OR PENALTIES ASSESSED PURSUANT TO THIS
 CHAPTER.
   NOTHING IN THIS SECTION SHALL PROHIBIT  A  CANDIDATE  FROM  PURCHASING
 OFFICE  EQUIPMENT WITH PERSONAL FUNDS AND LEASING OR RENTING SUCH EQUIP-
 MENT OR PROPERTY TO A COMMITTEE  WORKING  WITH  OR  FOR  THE  CANDIDATE,
 PROVIDED  THE  CANDIDATE OR THE CAMPAIGN TREASURER SIGNS A WRITTEN LEASE
 OR RENTAL AGREEMENT AND FILES IT WITH THE APPROPRIATE REQUIRED  CAMPAIGN
 FINANCIAL  FILING  WHICH  SHALL  INCLUDE THE LEASE OR RENTAL PRICE WHICH
 SHALL NOT EXCEED THE FAIR LEASE OR RENTAL VALUE OF THE EQUIPMENT  OR  IN
 THE AGGREGATE EXCEED THE COST OF ITS PURCHASE.
   § 2. Section 14-132 of the election law, as added by section 2 of part
 C of chapter 286 of the laws of 2016, is amended to read as follows:
   §  14-132.  Disposition  of  campaign  funds. [1.] Upon the death of a
 candidate, former candidate or holder of elective  office,  [where  such
 candidate  or  candidate's  authorized  committee] WHO received campaign
 contributions, all [such funds] CONTRIBUTIONS shall be disposed  of  [by
 any of the following means, or any combination thereof, within two years
 of the death of such person:
   (a)  returning,  pro rata, to each contributor the funds that have not
 been spent or obligated;
   (b) donating the funds to a charitable organization  or  organizations
 that meet the qualifications of section 501(c)(3) of the Internal Reven-
 ue Code;
   (c) donating the funds to the state university of New York or the city
 university of New York;
   (d) donating the funds to the state's general fund; or
   (e)  contributing  or  transferring  the  funds to a candidate, party,
 constituted or political committee in  accordance  with  the  applicable
 limits, if any, set forth in this article.
   2. No such candidate's authorized political committee shall dispose of
 campaign  funds  by  making  expenditures for personal use as defined in
 section 14-130 of this article.
   3. If funds are not disposed of  within  the  time  required  by  this
 section,  such funds shall be recoverable by the chief enforcement coun-
 sel of the state board of elections in a  special  proceeding  in  state
 supreme court in the manner prescribed by section 16-116 of this chapter
 and deposited into the state's general fund] WITHIN TWELVE MONTHS OF THE
 DEATH OF THE CANDIDATE PURSUANT TO SUBDIVISION ONE OF THIS SECTION.
   1.  ANY  POLITICAL  COMMITTEE REQUIRED TO DISPOSE OF FUNDS PURSUANT TO
 THIS SECTION SHALL, AT THE OPTION OF THE REPRESENTATIVE OF THE ESTATE OF
 THE CANDIDATE, OR THE TREASURER OF A POLITICAL COMMITTEE  FORMED  SOLELY
 TO  PROMOTE  THE PASSAGE OR DEFEAT OF A BALLOT PROPOSAL, DISPOSE OF SUCH
 FUNDS BY ANY OF THE FOLLOWING MEANS, OR ANY COMBINATION THEREOF:
   A. RETURNING, PRO RATA, TO EACH CONTRIBUTOR THE FUNDS  THAT  HAVE  NOT
 BEEN SPENT OR OBLIGATED;
   B.  DONATING  THE  FUNDS TO A CHARITABLE ORGANIZATION OR ORGANIZATIONS
 THAT MEET THE QUALIFICATIONS OF  SECTION  501(C)  (3)  OF  THE  INTERNAL
 REVENUE CODE;
   C. DONATING THE FUNDS TO THE STATE UNIVERSITY;
   D. DONATING THE FUNDS TO THE STATE'S GENERAL FUND;
   E.  TRANSFERRING  THE  FUNDS TO A POLITICAL PARTY COMMITTEE REGISTERED
 WITH THE STATE BOARD OF ELECTIONS; OR

 S. 4458                             5
 
   F. CONTRIBUTING THE FUNDS TO A CANDIDATE OR POLITICAL  COMMITTEE  SUCH
 THAT THIS DOES NOT EXCEED THE LIMITS SET FORTH IN SECTION 14-114 OF THIS
 TITLE.
   2. NO REPRESENTATIVE OF THE ESTATE OF A CANDIDATE OR POLITICAL COMMIT-
 TEE  SHALL DISPOSE OF CAMPAIGN FUNDS BY MAKING EXPENDITURES FOR PERSONAL
 USE AS DEFINED IN SECTION 14-130 OF THIS TITLE.
   § 3. This act shall take effect on the sixtieth  day  after  it  shall
 have  become  a  law;  provided, that the state board of elections shall
 notify all registered campaign committees of the  applicable  provisions
 of this act within thirty days after this act shall have become a law.

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Senate Bill S4458

Sponsored By

Archive: Last Bill Status - In Senate Committee Elections Committee

co-Sponsors

2021-S4458 (ACTIVE) - Details

2021-S4458 (ACTIVE) - Summary

2021-S4458 (ACTIVE) - Sponsor Memo

2021-S4458 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S4458

Share this bill

Sponsored By

Liz Krueger

Archive: Last Bill Status - In Senate Committee Elections Committee

co-Sponsors

Joseph P. Addabbo Jr.

Andrew Gounardes

John C. Liu

Rachel May

2021-S4458 (ACTIVE) - Details

2021-S4458 (ACTIVE) - Summary

2021-S4458 (ACTIVE) - Sponsor Memo

2021-S4458 (ACTIVE) - Bill Text download pdf

Comments