S T A T E O F N E W Y O R K
________________________________________________________________________
9535
I N A S S E M B L Y
March 11, 2016
___________
Introduced by M. of A. HEASTIE, MORELLE, PEOPLES-STOKES, LENTOL, CUSICK,
LAVINE, FARRELL, DINOWITZ, FAHY -- Multi-Sponsored by -- M. of A.
ABINANTI, ARROYO, BARRETT, BENEDETTO, BICHOTTE, BRAUNSTEIN, BRENNAN,
BRINDISI, BRONSON, BUCHWALD, CAHILL, CERETTO, COLTON, COOK, CRESPO,
CYMBROWITZ, DAVILA, DenDEKKER, ENGLEBRIGHT, GALEF, GANTT, GLICK, GOTT-
FRIED, GUNTHER, HARRIS, HEVESI, HIKIND, HOOPER, HUNTER, HYNDMAN,
JAFFEE, JEAN-PIERRE, JOYNER, KAVANAGH, KEARNS, KIM, LIFTON, LINARES,
LUPARDO, MAGEE, MAGNARELLI, MARKEY, MAYER, McDONALD, MILLER, MOSLEY,
MOYA, NOLAN, O'DONNELL, OTIS, PAULIN, PERRY, PICHARDO, RAMOS, RODRI-
GUEZ, ROSENTHAL, ROZIC, RUSSELL, RYAN, SCHIMEL, SEAWRIGHT, SEPULVEDA,
SIMANOWITZ, SIMON, SIMOTAS, SKARTADOS, SOLAGES, STECK, STIRPE, THIELE,
TITONE, TITUS, WALKER, WEINSTEIN, WOERNER, ZEBROWSKI -- read once and
referred to the Committee on Codes
AN ACT to amend the legislative law, in relation to limitations on
outside income for members; to amend the election law, in relation to
campaign contributions by limited liability companies; to amend the
legislative law, in relation to communications with professional jour-
nalists and newscasters; and in relation to reporting of certain fund-
ing by lobbyists; and to amend the election law, in relation to monies
received and expenditures made by a party committee or constituted
committee
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The legislative law is amended by adding a new section 5-b
to read as follows:
S 5-B. LIMIT ON OUTSIDE INCOME FOR MEMBERS. 1. A MEMBER OF THE LEGIS-
LATURE RECEIVING A SALARY FOR LEGISLATIVE WORK FROM THE STATE OF NEW
YORK SHALL NOT, IN A CALENDAR YEAR, EARN OUTSIDE INCOME FOR PERSONAL
SERVICES ACTUALLY RENDERED IN AN AMOUNT GREATER THAN FORTY PERCENT OF
THE ANNUAL SALARY, AS PROVIDED BY LAW, OF STATE JUSTICES OF THE SUPREME
COURT.
2. (A) FOR PURPOSES OF THIS SECTION, THE TERM "OUTSIDE INCOME" SHALL
INCLUDE WAGES, SALARIES, FEES, COMMISSIONS AND OTHER FORMS OF COMPEN-
SATION FOR SERVICES ACTUALLY RENDERED.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD14682-01-6
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(B) FOR THE PURPOSES OF THIS SECTION, THE TERM "OUTSIDE INCOME" SHALL
NOT INCLUDE:
(1) SALARY, BENEFITS, AND ALLOWANCES PAID BY THE STATE;
(2) INCOME AND ALLOWANCES ATTRIBUTABLE TO SERVICE IN THE RESERVES OF
THE ARMED FORCES OF THE UNITED STATES, NATIONAL GUARD, OR OTHER ACTIVE
MILITARY SERVICE;
(3) CAPITAL GAINS OR PAYMENTS FROM A PENSION, DEFERRED COMPENSATION,
OR RETIREMENT PLAN;
(4) EARNINGS ACCRUED FROM PRIOR EMPLOYMENT OR ACTUAL SERVICE RENDERED
PRIOR TO THE MEMBER TAKING OFFICE, EVEN IF THE EARNINGS ARE NOT PAID OR
DO NOT BECOME DUE UNTIL AFTER THE PERSON BECOMES A MEMBER;
(5) INCOME DERIVED FROM INVESTMENT ACTIVITIES, INCLUDING INVESTMENT IN
REAL ESTATE, WHERE THE MEMBER'S SERVICES ARE NOT A MATERIAL FACTOR IN
THE PRODUCTION OF INCOME;
(6) INCOME DERIVED FROM THE PROFITS OF A BUSINESS, FIRM, CORPORATION,
LIMITED LIABILITY COMPANY, PARTNERSHIP, OR OTHER BUSINESS ENTITY, DUE TO
THE MEMBER'S OWNERSHIP INTEREST;
(7) PAYMENTS FROM WORKERS' COMPENSATION BENEFITS, SOCIAL SECURITY
BENEFITS, DEATH BENEFITS, OR OTHER GOVERNMENT OR PRIVATE INSURANCE
PAYMENTS;
(8) INCOME OR BENEFITS FROM AN INHERITANCE, TRUST, OR OTHER TRANSFER
PURSUANT TO A WILL OR SIMILAR INSTRUMENT OR BY OPERATION OF INTESTACY
LAWS;
(9) ONE-TIME DISTRIBUTIONS, SUCH AS LOTTERY WINNINGS OR COURT AWARDS
OR SETTLEMENTS, EVEN IF PAID IN INSTALLMENTS; OR
(10) ALIMONY, MAINTENANCE, OR CHILD SUPPORT.
(C) FOR PURPOSES OF DETERMINING WHETHER THE MEMBER'S YEARLY OUTSIDE
INCOME EXCEEDS THE LIMIT ESTABLISHED IN SUBDIVISION ONE OF THIS SECTION,
A MEMBER OF THE LEGISLATURE WHO EARNS INCOME, INCLUDING INCOME FROM
COMMISSIONS OR CONTINGENCY FEES, PAID AT ONE TIME BUT BASED ON WORK
PERFORMED ON A MATTER IN MORE THAN ONE YEAR MAY AT THE MEMBER'S ELECTION
APPORTION THAT INCOME OVER THE SAME NUMBER OF YEARS GOING FORWARD FROM
THE DATE THE INCOME WAS RECEIVED AS THE NUMBER OF YEARS IN WHICH THE
WORK WAS PERFORMED.
3. A MEMBER OF THE LEGISLATURE SHALL NOT RECEIVE A SALARY OR ANY OTHER
FORM OF PAYMENT OR COMPENSATION FROM A FIRM, CORPORATION, LIMITED
LIABILITY COMPANY, PARTNERSHIP, ASSOCIATION, OR OTHER ENTITY ("FIRM")
FOR USE OF HIS OR HER NAME IN THE NAME OF THE FIRM OR ON SUCH FIRM'S
LETTERHEAD, WEBSITE OR PROMOTIONAL MATERIALS UNLESS THE AMOUNT OF SUCH
PAYMENT OR COMPENSATION IS DIRECTLY RELATED TO WORK ACTUALLY PERFORMED
BY THE MEMBER AND THE AMOUNT IS REASONABLE WHEN COMPARED TO SIMILAR
PAYMENTS CUSTOMARILY CHARGED IN THE LOCALITY FOR SIMILAR SERVICES OR
SUCH PAYMENT OR COMPENSATION IS PROPORTIONALLY BASED ON AN OWNERSHIP
INTEREST IN THE FIRM HELD BY THE MEMBER.
4. FOR MEMBERS ENGAGED IN THE PRACTICE OF LAW IN THE STATE, THE
FOLLOWING SHALL APPLY:
(A) DIVISION OF FEES. A MEMBER WHO IS ENGAGED IN THE PRACTICE OF LAW
IN THE STATE SHALL NOT DIVIDE A FEE FOR LEGAL SERVICES WITH ANOTHER
LAWYER WHO IS NOT ASSOCIATED IN THE SAME LAW FIRM UNLESS SUCH LAWYER
PERFORMS LEGAL SERVICES AND THE DIVISION OF FEES IS IN PROPORTION TO THE
SERVICES PERFORMED BY EACH LAWYER; AND
(B) PAYMENT FOR REFERRALS. (1) A MEMBER WHO IS A LAWYER WHO IS ENGAGED
IN THE PRACTICE OF LAW IN THE STATE SHALL NOT COMPENSATE OR GIVE
ANYTHING OF VALUE TO A PERSON OR ORGANIZATION TO RECOMMEND OR OBTAIN
EMPLOYMENT BY A CLIENT, OR AS A REWARD FOR HAVING MADE A RECOMMENDATION
RESULTING IN EMPLOYMENT BY A CLIENT; (2) A MEMBER WHO IS A LAWYER
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ENGAGED IN THE PRACTICE OF LAW IN THE STATE MAY BE RECOMMENDED, EMPLOYED
OR PAID BY THE FOLLOWING OFFICES OR ORGANIZATIONS IF THERE IS NO INTER-
FERENCE WITH THE EXERCISE OF INDEPENDENT PROFESSIONAL JUDGMENT ON BEHALF
OF THE CLIENT: A LEGAL AID OR PUBLIC DEFENDER OFFICE; A MILITARY LEGAL
ASSISTANCE OFFICE; A LAWYER REFERRAL SERVICE OPERATED BY A BAR ASSOCI-
ATION OR AS AUTHORIZED BY LAW; AND ANY BONA FIDE ORGANIZATION THAT
RECOMMENDS OR PAYS FOR LEGAL SERVICES, IN ACCORDANCE WITH THE RULES OF
PROFESSIONAL CONDUCT PROMULGATED BY THE APPELLATE DIVISIONS OF THE
SUPREME COURT.
S 2. The legislative law is amended by adding a new section 5-c to
read as follows:
S 5-C. CONFLICTS RESTRICTIONS. 1. A MEMBER OF THE LEGISLATURE MAY NOT
RECEIVE INCOME FROM AN OWNERSHIP INTEREST IN ANY FIRM, CORPORATION,
LIMITED LIABILITY CORPORATION, OR PARTNERSHIP THAT ENGAGES IN LOBBYING,
AS DEFINED IN ARTICLE ONE-A OF THIS CHAPTER, THAT REPRESENTS CLIENTS IN
LITIGATION AGAINST THE STATE, THAT ENTERS INTO CONTRACTS WITH THE STATE,
OR THAT APPEARS IN MATTERS BEFORE THE STATE IF THE MEMBER OF THE LEGIS-
LATURE IS PROHIBITED BY SECTION SEVENTY-THREE OF THE PUBLIC OFFICERS LAW
FROM ENGAGING IN SUCH ACTIVITY, UNLESS THE MEMBER OF THE LEGISLATURE HAS
RECEIVED AN OPINION FROM THE LEGISLATIVE ETHICS COMMISSION, PURSUANT TO
ARTICLE FIVE OF THIS CHAPTER, THAT DIRECTS THE MEMBER OF THE LEGISLATURE
TO TAKE ACTIONS TO PREVENT INCOME FROM THE PROHIBITED ACTIVITIES BEING
PAID TO THE MEMBER OF THE LEGISLATURE AS PART OF THE INCOME FROM SUCH
OWNERSHIP INTEREST AND THE LEGISLATOR FULLY COMPLIES WITH THOSE
DIRECTIONS.
2. ANY MEMBER OF THE LEGISLATURE WHO RECEIVES INCOME FROM AN OWNERSHIP
INTEREST IN A FIRM, CORPORATION, LIMITED LIABILITY CORPORATION, OR PART-
NERSHIP SHALL, WITHIN THIRTY DAYS OF TAKING OFFICE OR WITHIN FIFTEEN
DAYS OF BECOME AWARE OF SUCH INCOME, WHICHEVER IS LATER, SUBMIT INFORMA-
TION TO THE LEGISLATIVE ETHICS COMMISSION THAT WOULD ALLOW THE COMMIS-
SION TO EVALUATE SUCH INCOME AND GIVE THE LEGISLATOR ADVICE TO ENSURE
COMPLIANCE WITH THE REQUIREMENTS OF SECTIONS SEVENTY-THREE,
SEVENTY-THREE-A, AND SEVENTY-FOUR OF THE PUBLIC OFFICERS LAW. THE
COMMISSION MAY REQUEST FURTHER INFORMATION BEFORE ISSUING ITS ADVICE.
THE MEMBER OF THE LEGISLATURE MAY ONLY RETAIN SUCH INTEREST IF THE
MEMBER FULLY COMPLIES WITH THE ADVICE OF THE COMMISSION.
S 3. Section 14-116 of the election law, subdivision 1 as redesignated
by chapter 9 of the laws of 1978 and subdivision 2 as amended by chapter
260 of the laws of 1981, is amended to read as follows:
S 14-116. Political contributions by certain organizations. 1. No
corporation [or], LIMITED LIABILITY COMPANY, joint-stock association OR
OTHER CORPORATE ENTITY doing business in this state, except a corpo-
ration or association organized or maintained for political purposes
only, shall directly or indirectly pay or use or offer, consent or agree
to pay or use any money or property for or in aid of any political
party, committee or organization, or for, or in aid of, any corporation,
LIMITED LIABILITY COMPANY, joint-stock [or], other association, OR OTHER
CORPORATE ENTITY organized or maintained for political purposes, or for,
or in aid of, any candidate for political office or for nomination for
such office, or for any political purpose whatever, or for the
reimbursement or indemnification of any person for moneys or property so
used. Any officer, director, stock-holder, MEMBER, OWNER, attorney or
agent of any corporation [or], LIMITED LIABILITY COMPANY, joint-stock
association OR OTHER CORPORATE ENTITY which violates any of the
provisions of this section, who participates in, aids, abets or advises
or consents to any such violations, and any person who solicits or know-
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ingly receives any money or property in violation of this section, shall
be guilty of a misdemeanor.
2. Notwithstanding the provisions of subdivision one of this section,
any corporation or an organization financially supported in whole or in
part, by such corporation, ANY LIMITED LIABILITY COMPANY OR OTHER CORPO-
RATE ENTITY may make expenditures, including contributions, not other-
wise prohibited by law, for political purposes, in an amount not to
exceed five thousand dollars in the aggregate in any calendar year;
provided that no public utility shall use revenues received from the
rendition of public service within the state for contributions for poli-
tical purposes unless such cost is charged to the shareholders of such a
public service corporation.
3. EACH LIMITED LIABILITY COMPANY THAT MAKES A CONTRIBUTION FOR POLI-
TICAL PURPOSES SHALL FILE WITH THE STATE BOARD OF ELECTIONS, BY DECEMBER
THIRTY-FIRST OF THE YEAR IN WHICH THE CONTRIBUTION IS MADE, ON THE FORM
PRESCRIBED BY THE STATE BOARD OF ELECTIONS, THE IDENTITY OF ALL DIRECT
AND INDIRECT OWNERS OF THE MEMBERSHIP INTERESTS IN THE LIMITED LIABILITY
COMPANY AND THE PROPORTION OF EACH DIRECT OR INDIRECT MEMBER'S OWNERSHIP
INTEREST IN THE LIMITED LIABILITY COMPANY. PROVIDED THAT, IF BY APPLICA-
TION OF THIS SUBDIVISION, ANY DIRECT OR INDIRECT OWNER OF ANY MEMBERSHIP
INTEREST IS A LIMITED LIABILITY COMPANY, ALL OWNERS AND THE PROPORTION
OF THEIR MEMBERSHIP INTERESTS IN ANY SUCH LIMITED LIABILITY COMPANY
SHALL BE FURTHER IDENTIFIED.
S 4. Section 14-120 of the election law is amended by adding a new
subdivision 3 to read as follows:
3. (A) NOTWITHSTANDING ANY LAW TO THE CONTRARY, ALL CONTRIBUTIONS MADE
TO A CAMPAIGN OR POLITICAL COMMITTEE BY A LIMITED LIABILITY COMPANY
SHALL BE ATTRIBUTED TO EACH MEMBER OF THE LIMITED LIABILITY COMPANY IN
PROPORTION TO THE MEMBER'S OWNERSHIP INTEREST IN THE LIMITED LIABILITY
COMPANY. PROVIDED THAT, IF, BY APPLICATION OF THIS PARAGRAPH, A CAMPAIGN
CONTRIBUTION IS ATTRIBUTED TO ANY LIMITED LIABILITY COMPANY, THE
CONTRIBUTIONS SHALL BE FURTHER ATTRIBUTED PROPORTIONALLY TO EACH DIRECT
OR INDIRECT OWNER OF THE MEMBERSHIP INTERESTS OF SUCH LIMITED LIABILITY
COMPANY.
(B) THE STATE BOARD OF ELECTIONS SHALL ENACT REGULATIONS THAT PREVENT
THE AVOIDANCE OF THE RULES SET FORTH IN THIS SUBDIVISION.
S 5. The second undesignated paragraph of subdivision (c) of section
1-c of the legislative law is amended by adding a new subparagraph (R)
to read as follows:
(R) COMMUNICATIONS WITH A PROFESSIONAL JOURNALIST OR NEWSCASTER RELAT-
ING TO NEWS, AS THESE TERMS ARE DEFINED IN SECTION SEVENTY-NINE-H OF THE
CIVIL RIGHTS LAW, AND COMMUNICATIONS RELATING TO CONFIDENTIAL AND
NON-CONFIDENTIAL NEWS AS DESCRIBED IN SUBDIVISIONS (B) AND (C) OF
SECTION SEVENTY-NINE-H OF THE CIVIL RIGHTS LAW RESPECTIVELY.
S 6. Paragraph 4 of subdivision (c) of section 1-h of the legislative
law, as added by section 1 of part B of chapter 399 of the laws of 2011,
is amended to read as follows:
(4) Any lobbyist registered pursuant to section one-e of this article
whose lobbying activity is performed on its own behalf and not pursuant
to retention by a client[:
(i)] that has spent over [fifty] FIVE thousand dollars for reportable
compensation and expenses for lobbying either during the calendar year,
or during the twelve-month period, prior to the date of this bi-monthly
report[, and
(ii) at least three percent of whose total expenditures during the
same period were devoted to lobbying in New York]
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shall report to the commission the names of each source of funding over
[five] ONE thousand dollars from a single source that were used to fund
the lobbying activities reported and the amounts received from each
identified source of funding.
This disclosure shall not require disclosure of the sources of funding
whose disclosure, in the determination of the commission based upon a
review of the relevant facts presented by the reporting lobbyist, may
cause harm, threats, harassment, or reprisals to the source or to indi-
viduals or property affiliated with the source. The reporting lobbyist
may appeal the commission's determination and such appeal shall be heard
by a judicial hearing officer who is independent and not affiliated with
or employed by the commission, pursuant to regulations promulgated by
the commission. The reporting lobbyist shall not be required to disclose
the sources of funding that are the subject of such appeal pending final
judgment on appeal.
The disclosure shall not apply to:
(i) any corporation registered pursuant to article seven-A of the
executive law that is qualified as an exempt organization by the United
States Department of the Treasury under I.R.C. S 501(c)(3);
(ii) any corporation registered pursuant to article seven-A of the
executive law that is qualified as an exempt organization by the United
States Department of the Treasury under I.R.C. S 501(c)(4) and whose
primary activities concern any area of public concern determined by the
commission to create a substantial likelihood that application of this
disclosure requirement would lead to harm, threats, harassment, or
reprisals to a source of funding or to individuals or property affil-
iated with such source, including but not limited to the area of civil
rights and civil liberties and any other area of public concern deter-
mined pursuant to regulations promulgated by the commission to form a
proper basis for exemption on this basis from this disclosure require-
ment; or
(iii) any governmental entity.
The joint commission on public ethics shall promulgate regulations to
implement these requirements.
S 7. Paragraph 4 of subdivision (c) of section 1-j of the legislative
law, as added by section 2 of part B of chapter 399 of the laws of 2011,
is amended to read as follows:
(4) Any client of a lobbyist that is required to file a semi-annual
report and[:
(i) that] has spent over [fifty] FIVE thousand dollars for reportable
compensation and expenses for lobbying either during the calendar year,
or during the twelve-month period, prior to the date of this semi-annual
report[, and
(ii) at least three percent of whose total expenditures during the
same period were devoted to lobbying in New York]
shall report to the commission the names of each source of funding over
[five] ONE thousand dollars from a single source that were used to fund
the lobbying activities reported and the amounts received from each
identified source of funding.
This disclosure shall not require disclosure of the sources of funding
whose disclosure, in the determination of the commission based upon a
review of the relevant facts presented by the reporting client or lobby-
ist, may cause harm, threats, harassment, or reprisals to the source or
to individuals or property affiliated with the source. The reporting
lobbyist may appeal the commission's determination and such appeal shall
be heard by a judicial hearing officer who is independent and not affil-
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iated with or employed by the commission, pursuant to regulations
promulgated by the commission. The reporting lobbyist shall not be
required to disclose the sources of funding that are the subject of such
appeal pending final judgment on appeal.
The disclosure shall not apply to:
(i) any corporation registered pursuant to article seven-A of the
executive law that is qualified as an exempt organization by the United
States Department of the Treasury under I.R.C. S 501(c)(3);
(ii) any corporation registered pursuant to article seven-A of the
executive law that is qualified as an exempt organization by the United
States Department of the Treasury under I.R.C. S 501(c)(4) and whose
primary activities concern any area of public concern determined by the
commission to create a substantial likelihood that application of this
disclosure requirement would lead to harm, threats, harassment, or
reprisals to a source of funding or to individuals or property affil-
iated with such source, including but not limited to the area of civil
rights and civil liberties and any other area of public concern deter-
mined pursuant to regulations promulgated by the commission to form a
proper basis for exemption on this basis from this disclosure require-
ment; or
(iii) any governmental entity.
The joint commission on public ethics shall promulgate regulations to
implement these requirements.
S 8. Subdivision 3 of section 14-124 of the election law, as amended
by chapter 71 of the laws of 1988, is amended to read as follows:
3. The contribution and receipt limits of this article shall not apply
to monies received and expenditures made by a party committee or consti-
tuted committee to maintain a permanent headquarters and staff and carry
on ordinary activities which are not for the express purpose of promot-
ing OR OPPOSING the candidacy of specific candidates. PROVIDED THAT
SUCH MONIES DESCRIBED IN THIS SUBDIVISION SHALL BE KEPT IN A SEGREGATED
ACCOUNT AND SHALL NOT BE CONTRIBUTED, UNLESS SUCH CONTRIBUTION IS TO THE
SEGREGATED ACCOUNT OF ANOTHER PARTY COMMITTEE OR CONSTITUTED COMMITTEE
TO BE USED ONLY FOR NON-CANDIDATE EXPENDITURES. PROVIDED, FURTHER, THAT
SUCH MONIES MAY NOT BE USED TO PAY FOR ANY POLITICAL COMMUNICATION THAT
INCLUDES OR REFERENCES THE NAME, LIKENESS OR VOICE OF ANY CLEARLY IDEN-
TIFIED CANDIDATE OR ELECTED OFFICIAL.
S 9. This act shall take effect immediately; provided that sections
one and two of this act shall take effect January 1, 2017; provided,
further, that any income or other compensation earned prior to the
effective date of sections one and two of this act shall not be subject
to the provisions of sections one and two of this act, and provided,
further, any services actually rendered prior to the effective date of
sections one and two of this act for which payment is made after the
effective date of sections one and two of this act shall not be subject
to the provisions of sections one and two of this act.