Schneiderman adops new disclosure requirements for nonprofits that engage in electioneering
As part of a groundbreaking effort to bring transparency to the political process and protect donors to nonprofits, Attorney General Eric T. Schneiderman on Wednesday announced that he has adopted new regulations that will require nonprofit groups, including 501(c)(4) “social welfare” organizations, to make more robust disclosures of their political campaign activities.
Nonprofits that are registered with the state will now be required to report the percentage of their expenditures that go to federal, state and local electioneering. Groups that spend at least $10,000 to influence state and local elections in New York will be required to file itemized schedules of expenses and contributions. Those disclosures will be available to the public on the Attorney General’s NY Open Government website.
“There is only one reason to funnel political spending through a 501(c)(4), and that is to hide who has bankrolled the effort. 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,” Attorney General Schneiderman said.
Since the U.S. Supreme Court’s 2010 Citizens United decision, 501(c)(4) organizations, which are exempt from federal and state taxes because they purportedly engage in the “promotion of social welfare,” have become vehicles for political activity, including funding sham “issue ads” that attack candidates for public office, according to Schneiderman. In the last two election cycles, 501(c)(4)s and other nonprofits that do not publicly disclose sources of funds reported spending over half a billion dollars on political intervention.