STATE OF NEW YORK
________________________________________________________________________
4231
2017-2018 Regular Sessions
IN SENATE
February 6, 2017
___________
Introduced by Sens. KRUEGER, ADDABBO, AVELLA, SQUADRON -- 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:
1 Section 1. Section 14-130 of the election law, as amended by section 9
2 of part CC of chapter 56 of the laws of 2015, is amended to read as
3 follows:
4 § 14-130. Campaign funds for personal use. 1. Contributions received
5 by a candidate or a political committee may only be expended for [any
6 lawful purpose. Such funds shall not be converted by any person to a
7 personal use which is unrelated to a political campaign or the holding
8 of a public office or party position] bona fide purposes directly
9 related to either.
10 [2. No contribution shall be used to pay interest or any other finance
11 charges upon monies loaned to the campaign by such candidate or the
12 spouse of such candidate.
13 3. For the purposes of this section, contributions "converted by any
14 person to a personal use" are expenditures that are exclusively for the
15 personal benefit of the candidate or any other individual, not in
16 connection with a political campaign or the holding of a public office
17 or party position. "Converted by any person to a personal use", when
18 meeting the definition in this subdivision, shall include, but not be
19 limited to, expenses for the following:
20 (i) any residential or household items, supplies or expenditures,
21 including mortgage, rent or utility payments for any part of any
22 personal residence of a candidate or officeholder or a member of the
23 candidate's or officeholder's family that are not incurred as a result
24 of, or to facilitate, the individual's campaign, or the execution of his
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD05523-01-7
S. 4231 2
1 or her duties of public office or party position. In the event that any
2 property or building is used for both personal and campaign use or as
3 part of the execution of his or her duties of public office or party
4 position, personal use shall constitute expenses that exceed the pro-
5 rated amount for such expenses based on fair-market value.
6 (ii) mortgage, rent, or utility payments to a candidate or officehold-
7 er for any part of any non-residential property that is owned by a
8 candidate or officeholder or a member of a candidate's or officeholder's
9 family and used for campaign purposes, to the extent the payments exceed
10 the fair market value of the property's usage for campaign activities;
11 (iii) clothing, other than items that are used in the campaign or in
12 the execution of the duties of public office or party position;
13 (iv) tuition payments unrelated to a political campaign or the holding
14 of a public office or party position;
15 (v) salary payments or other compensation provided to any person for
16 services where such services are not solely for campaign purposes or
17 provided in connection with the execution of the duties of public office
18 or party position;
19 (vi) salary payments or other compensation provided to a member of a
20 candidate's family, unless the family member is providing bona fide
21 services to the campaign. If a family member provides bona fide services
22 to a campaign, any salary payments or other compensation in excess of
23 the fair market value of the services provided shall be considered
24 payments for personal use;
25 (vii) admission to a sporting event, concert, theater, or other form
26 of entertainment, unless such event is part of, or in connection with, a
27 campaign or is related to the holding of public office or party posi-
28 tion;
29 (viii) payment of any fines or penalties assessed against the candi-
30 date pursuant to this chapter or in connection with a criminal
31 conviction or by the joint commission for public ethics pursuant to
32 section ninety-four of the executive law or sections seventy-three or
33 seventy-three-a of the public officers law or the legislative ethics
34 commission pursuant to section eighty of the legislative law;
35 (ix) dues, fees, or gratuities at a country club, health club, recre-
36 ational facility or other entities with a similar purpose, unless they
37 are expenses connected with a specific fundraising event or activity
38 associated with a political campaign or the holding of public office or
39 party position that takes place on the organization's premises; and
40 (x) travel expenses including automobile purchases or leases, unless
41 used for campaign purposes or in connection with the execution of the
42 duties of public office or party position and usage of such vehicle
43 which is incidental to such purposes or the execution of such duties.
44 4. Nothing in this section shall prohibit a candidate from purchasing
45 equipment or property from his or her personal funds and leasing or
46 renting such equipment or property to a committee working directly or
47 indirectly with him to aid or participate in his or her nomination or
48 election, including an exploratory committee, provided that the candi-
49 date and his or her campaign treasurer sign a written lease or rental
50 agreement. Such agreement shall include the lease or rental price, which
51 shall not exceed the fair lease or rental value of the equipment. The
52 candidate shall not receive lease or rental payments which, in the
53 aggregate, exceed the cost of purchasing the equipment or property.
54 5. Nothing in this section shall prohibit an elected public office-
55 holder from using campaign contributions to facilitate, support, or
S. 4231 3
1 otherwise assist in the execution or performance of the duties of his or
2 her public office.
3 6. The state board of elections shall issue advisory opinions upon
4 request regarding expenditures that may or may not be considered
5 personal use of contributions. Any formal or informal advisory opinions
6 issued by a majority vote of the commissioners of the state board of
7 elections shall be binding on the board, the chief enforcement counsel
8 established by subdivision three-a of section 3-100 of this chapter, and
9 in any subsequent civil or criminal action or proceeding or administra-
10 tive proceeding.]
11 a. promoting the nomination or election of a candidate; or
12 b. performing duties of public office or party position which are not
13 paid for or eligible for reimbursement by the state or any political
14 subdivision or private party, and ordinary and necessary expenses relat-
15 ing to the holding of public office or party position.
16 2. Campaign funds shall not be converted to personal use, which shall
17 be defined as expenditures that:
18 a. are for the personal benefit of or to defray normal living expenses
19 of the candidate, officeholder, immediate family or domestic partner of
20 either or any other person;
21 b. are used to fulfill any commitment, obligation, or expense that
22 would exist irrespective of the candidate's campaign or duties as an
23 officeholder; or
24 c. are put to any use for which the candidate or officeholder would be
25 required to treat the amount of the expenditure as gross income under
26 section 61 of the Internal Revenue Code.
27 3. Expenditures for personal use shall also include, but are not
28 limited to, expenditures for:
29 a. residential or household items, supplies, maintenance or other
30 expenditures, including mortgage, rent, utilities, repairs, or improve-
31 ments for any part of any personal residence of a candidate or office-
32 holder, his or her immediate family or domestic partner;
33 b. rent or utility payments that exceed fair market value for use of
34 any part of any non-residential property owned by a candidate, or a
35 member of a candidate's family or domestic partner used for campaign
36 purposes;
37 c. salary and other fees for bona fide services to a campaign or
38 legislative office that exceed fair and reasonable market value of such
39 services;
40 d. interest or any other finance charges for monies loaned to the
41 campaign by the candidate or the spouse or domestic partner of such
42 candidate;
43 e. tuition payments;
44 f. dues, fees, or gratuities at private clubs, recreational facilities
45 or other nonpolitical organizations, unless connected to a specific
46 widely attended fundraising event that takes place on the organization's
47 premises;
48 g. automobile purchases or long term leases; short term car rentals
49 and cellular equipment and services not used exclusively for campaign
50 purposes or duties as an officeholder;
51 h. admission to sporting events, concerts, theaters, or other forms of
52 entertainment, unless part of a specific campaign or officeholder
53 related activity; and
54 i. payment of any fines, fees, or penalties assessed pursuant to this
55 chapter.
S. 4231 4
1 Nothing in this section shall prohibit a candidate from purchasing
2 office equipment with personal funds and leasing or renting such equip-
3 ment or property to a committee working with or for the candidate,
4 provided the candidate or the campaign treasurer signs a written lease
5 or rental agreement and files it with the appropriate required campaign
6 financial filing which shall include the lease or rental price which
7 shall not exceed the fair lease or rental value of the equipment or in
8 the aggregate exceed the cost of its purchase.
9 § 2. Section 14-132 of the election law, as added by section 2 of part
10 C of chapter 286 of the laws of 2016, is amended to read as follows:
11 § 14-132. Disposition of campaign funds. [1.] Upon the death of a
12 candidate, former candidate or holder of elective office, [where such
13 candidate or candidate's authorized committee] who received campaign
14 contributions, all [such funds] contributions shall be disposed of [by
15 any of the following means, or any combination thereof, within two years
16 of the death of such person:
17 (a) returning, pro rata, to each contributor the funds that have not
18 been spent or obligated;
19 (b) donating the funds to a charitable organization or organizations
20 that meet the qualifications of section 501(c)(3) of the Internal Reven-
21 ue Code;
22 (c) donating the funds to the state university of New York or the city
23 university of New York;
24 (d) donating the funds to the state's general fund; or
25 (e) contributing or transferring the funds to a candidate, party,
26 constituted or political committee in accordance with the applicable
27 limits, if any, set forth in this article.
28 2. No such candidate's authorized political committee shall dispose of
29 campaign funds by making expenditures for personal use as defined in
30 section 14-130 of this article.
31 3. If funds are not disposed of within the time required by this
32 section, such funds shall be recoverable by the chief enforcement coun-
33 sel of the state board of elections in a special proceeding in state
34 supreme court in the manner prescribed by section 16-116 of this chapter
35 and deposited into the state's general fund] within twelve months of the
36 death of the candidate pursuant to subdivision one of this section.
37 1. Any political committee required to dispose of funds pursuant to
38 this section shall, at the option of the representative of the estate of
39 the candidate, or the treasurer of a political committee formed solely
40 to promote the passage or defeat of a ballot proposal, dispose of such
41 funds by any of the following means, or any combination thereof:
42 a. returning, pro rata, to each contributor the funds that have not
43 been spent or obligated;
44 b. donating the funds to a charitable organization or organizations
45 that meet the qualifications of section 501(c) (3) of the Internal
46 Revenue Code;
47 c. donating the funds to the state university;
48 d. donating the funds to the state's general fund;
49 e. transferring the funds to a political party committee registered
50 with the state board of elections; or
51 f. contributing the funds to a candidate or political committee such
52 that this does not exceed the limits set forth in section 14-114 of this
53 title.
54 2. No representative of the estate of a candidate or political commit-
55 tee shall dispose of campaign funds by making expenditures for personal
56 use as defined in section 14-130 of this title.
S. 4231 5
1 § 3. This act shall take effect on the sixtieth day after it shall
2 have become a law; provided, however, that if section 9 of part CC of
3 chapter 56 of the laws of 2015 shall not have taken effect on or before
4 such date then section two of this act shall take effect on the same
5 date and in the same manner as section 9 of part CC of chapter 56 of the
6 laws of 2015, takes effect; and provided, further, that the state board
7 of elections shall notify all registered campaign committees of the
8 applicable provisions of this act within thirty days after this act
9 shall have become a law.
