New York Has New Ethics Law

Holly Johnston, Esq.,
Research/Compliance Associate

On August 24, Gov. Andrew Cuomo signed Senate Bill 8160, an ethics reform package with a primary focus on transparency. The highlights of the new law include lower lobbyist and lobbyist employer reporting thresholds, greater disclosure from social welfare organizations and PACs, and increased personal responsibility for political consultants and lobbyists.

Beginning 30 days after Cuomo’s signature, lobbyist employer reporting is triggered when lobbying expenditures reach $15,000. For lobbyists, reporting and disclosure of funding sources will be required when expenditures reach $2,5000. Finally, contributions to a lobbying organization from any donor will have to be reported if the donation totals $2,500 or more.

The issue advocacy reform portion of the law requires any 501(c)(4) organization engaged in political activity to now publicly disclose all sources of funding if accepting in-kind or cash donations from 501(c)(3) organizations. Further, 501(c)(4) groups must disclose all sources of funding if engaging in issue advocacy. Under a Joint Commission on Public Ethics (JCOPE) rule passed in August, these disclosure requirements will be applied retroactively to cover donations beginning in July.

While the ethics plan mainly fosters greater disclosure, it also provides some welcome reliefs for lobbyists. Individuals working in public relations or grassroots lobbying are no longer required to register or report as lobbyists, thanks to a new exception excluding these communications in the statutory definition of lobbying. Meanwhile, remaining lobbyists will now enjoy greater due process rights if investigated by JCOPE, including the right to a hearing. 

The statutory changes will also afford political committees with some greater freedoms. Clarified definitions of independent expenditure committee and political action committee will determine registration and reporting requirements and the ability to coordinate funds.

Finally, to encourage personal responsibility, political consultants with potential conflicts of interest will now be required to register with the secretary of state and disclose government involvement. Anyone violating the state’s prohibition on contingency fee lobbying is now subject to a fine the greater of $10,000 or the contingency fee amount.

Summary of Changes UPDATE
Note Recent Changes to Compliance Regulations 

Michael Beckett, Esq., Research Manager

AUSTIN, TEXAS: A federal court ruled the city’s campaign contribution blackout period is unconstitutional. The blackout period only permitted officeholder and candidate committees to accept campaign contributions during the last 180 days before an election or recall election. In Zimmerman v. City of Austin, the United States District Court for the Western District of Texas, Austin Division, concluded the law was unconstitutional under the First Amendment. In addition, the court found an Austin City Charter provision designating a 90-day requirement for campaign account terminations to be unconstitutional. District Court Judge Lee Yeakel did uphold the city’s contribution limits for mayoral and City Council candidates, finding the limit a constitutional regulation of protected First Amendment activity. The ruling also found City Councilman Don Zimmerman, who originally brought the lawsuit last summer, did not have standing to challenge the aggregate limits of the total contributions a candidate can accept from sources other than natural persons eligible to vote in a postal zip code completely or partially within the Austin city limits.

CALIFORNIA: State Treasurer John Chiang announced municipal finance firms seeking state business will be required to certify they did not make contributions to bond election campaigns. Firms failing to provide the certification will be suspended from the state’s pool of acceptable underwriters. The new requirement aims to stop pay-to-play deals where municipal finance firms offer to fund or provide campaign services in exchange for contracts.

CALIFORNIA: The Fair Political Practices Commission (FPPC) approved an amendment to a regulation to further clarify the definition of lobbyist. Regulation 18239 creates a rebuttable presumption all compensation received in a calendar month from a person for services involving direct communication with a qualifying official for the purpose of influencing legislative or administrative action is for the purpose of direct communication. The regulation amendment is effective September 16, 2016.

FEDERAL: The Municipal Securities Rulemaking Board (MSRB) has filed an amendment with the Securities and Exchange Commission (SEC) clarifying the two-year look-back ban on contributions from municipal advisors in the upcoming amendments to MSRB Rule G-37. The amendments, effective August 17, 2016, apply regulatory policies to municipal advisors matching the regulatory policies applicable to dealers under the existing rules. Included in the rules is a two-year look-back provision prohibiting contributions in the two years prior to conducting regulated business. The MSRB states contributions by persons who become associated with a dealer and become municipal finance professionals of the dealer who are affected by new amendments to Rule G-37 are subject to the two-year look-back. Contributions made in the two years prior to the August 17 effective date may subject a dealer to a prohibition on municipal securities business.

SAN FRANCISCO, CALIFORNIA: The Ethics Commission voted unanimously to submit an initiative ordinance for the November 2016 ballot. The measure would restrict lobbyist gifts, campaign contributions, and bundled contributions. If passed by voters, the ordinance will become effective January 1, 2018.

Legislation We Are Tracking

At any given time, more than 1,000 legislative bills, which can affect how you do business as a government affairs professional, are being discussed in federal, state, and local jurisdictions. These bills are summarized in State and Federal Communications' digital encyclopedias for lobbying laws, political contributions, and procurement lobbying and can be found in the client portion of our website.

Summaries of major bills are also included in monthly email updates sent to all clients. The chart below shows the number of bills we are tracking in regard to lobbying laws, political contributions, and procurement lobbying.

Jurisdiction Added to our Website

The number of municipalities and regional governments our research associates track continues to grow. We now cover almost 300 municipalities and local governments. This is part of a continuous effort to better serve the needs of our clients.

In that effort, we have added abridged jurisdictions to our website. These entries, condensed due to the limited number of relevant local laws, provide the core information our clients need for their government relations work.

The new jurisdiction is:

W  E  B  S  I  T  E      T  I  P Now that the 2016 election cycle is in full swing, do not forget to check what ethics legislation will be on the ballot using the State and Federal Communications website. To access 2016 ballot measures, choose the state you are interested in from the pull-down menu and select the lobbying, political contributions, or procurement lobbying entry. The “Legislative Updates for 2016” page now provides ballot measures in addition to legislative bills by number and descriptive title. Clicking on the bill or measure number will bring up a brief summary and clicking again on the number from the summary screen will bring up the text of the entire bill or measure. Status updates are also included in the Summary of Changes sent out each month.

ASK THE EXPERTS

State and Federal Communications’ Experts Answer Your Questions

Here is your chance to “Ask the Experts” at State and Federal Communications, Inc. Send your questions to experts@stateandfed.com. (Of course, we have always been available to answer questions from clients that are specific to your needs, and we encourage you to continue to call or email us with questions about your particular company or organization. As always, we will confidentially and directly provide answers or information you need.) Our replies are not legal advice, just our analysis of laws, rules, and regulations.
 

State and Federal Communications, Inc.
Celebrates Employee Anniversaries

Each month at our staff meeting, Elizabeth acknowledges the employment anniversaries of the staff. In August we celebrate the following: Jim Sedor, Editor, 16 years; John Cozine, Esq., Compliance Manager, 11 years; Mark Sedmock, CPA, Comptroller, 3 years; and Jennifer Jaketic, Campaign Compliance Assistant, 1 year. These employees are essential members of the staff.  Congratulations to you.   State and Federal Communications, Inc. attended the 2016 National Conference of State Legislatures in Chicago, Illinois State and Federal Communications, Inc., providing the #1 Most Trusted Online Publications on Government Affairs Compliance was present for the 2016 NCSL Legislative Summit. They offered immediate, up-to-date knowledge to clients throughout the week. We are always available to answer your questions. Farewell to the Summer Interns The summer of 2016 brought eight interns to State and Federal Communications, Inc. all with different majors and talents.  They came from the University of Akron, Kent State University, and one on a University of Akron exchange program from the ESC Rennes School of Business in Paris, France.  They were trained in Marketing, Social Media, IT, Web Design and Production, Video Production, Graphic Design, Research, Community Service, and so much more.  We wish them well as they go on to finish college. [Top row:  Anthony Didion, KSU; Brittany Anderson, KSU; and Clemence Besnard, ESC Rennes School of Business/UA. Middle row: Christopher Jackson, UA; group intern photo; and Olivia Snyder, UA. Bottom row:  Rachel Anderson, KSU; Sophia Avouris, KSU; and Zack Koozer, KSU.]

Plan to say hello at future events where State and Federal Communications, Inc.
will be attending and/or speaking regarding compliance issues.