Deadlock Results in No Action: NYS Board of Elections Fails to Close LLC Loophole

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  • Lauren George
Bad Public Policy and Bad for Democracy

New York, NY – Today is a bad day for democracy in New York, and our groups are disappointed by the State Board of Elections’ deadlock, which leaves in place its ill-advised and outdated 1996 advisory opinion that treats limited liability companies (LLCs) like individuals, rather than corporations. This gaping loophole has allowed millions of dollars to flood New York’s elections with cash, as individual large donors have used it to circumvent New York’s already high contribution limits. The Board’s 2-2 deadlock today not only denies New Yorkers wanted relief from this widely-decried abuse of our campaign finance system but also throws a revealing light on the dysfunction of our politically controlled election administration.

The Board’s inability to take action follows the failure of the Governor and State Legislature to reach an agreement to close the loophole during the state budget negotiations, though the Governor included in his 30-day amendments language to close the loophole through statute. It also ignores an outpouring of views from 11,000 New Yorkers who sent comments over the last few days to the Board urging a vote to close the LLC loophole.

New Yorkers should not have to wait any longer for our elected and appointed leaders to muster the political courage to reform our campaign finance system. The LLC loophole keeps voters in the dark about contributors who pour millions of dollars into New York campaigns. We call on the Governor and State Legislature to finally close the loophole before the end of the legislative session. The finger-pointing must end, as it is clear that it is now the responsibility of our elected leaders to act.