Sen. Patrick Gallivan has introduced a bill to increase transparency when corporations contribute through limited liability companies (LLCs).

Under the current law, corporations may contribute $5,000 per year to a candidate, while LLCs may give up to $60,800. As a result, many corporations set up LLCs in order to contribute in excess of contribution caps, and there is no limit on the number of LLCs a corporation may create.

Senate Bill 8035 would require corporations creating LLCs to identify themselves. Unlike other proposed legislation focused on the “LLC loophole,” this bill would not lower the amount an LLC may contribute.

The Brennan Center for Justice, on behalf of several New York lawmakers, filed suit against the New York State Board of Elections, challenging a 1996 board ruling that treats limited liability companies (LLCs) as individuals. The ruling has the result of creating a loophole allowing LLCs to circumvent stricter contribution limits imposed upon other business entities, namely partnerships and corporations.

The board had an opportunity to overturn its 1996 ruling at its April 2015 board meeting, but board members split along party lines to uphold the ruling, thus prompting the Brennan Center for Justice to file suit.

Plaintiffs allege the LLC loophole allows special interest groups to funnel tens of millions of dollars into political campaigns without transparency. Corporate contributions are limited to $5,000 per calendar year; partnerships are limited to $2,500 per calendar year at the partnership entity level. Under the 1996 board ruling, LLCs can contribute substantially more than other business entities because they are treated as individuals.

The lawsuit was filed in the Supreme Court of New York, County of Albany.