Money in Politics in New York: September 14 Edition

September 14, 2012

Reposted with permission from The Brennan Center. Money in Politics is a series which regularly compiles the latest news concerning the corrosive nature of money in New York State politics — and the ongoing need for public financing and robust campaign finance reform.

Corporations Use Limited Liability Companies to Skirt Campaign Contribution Limits
Limited Liability Companies associated with luxury real estate mogul Leonard Litwin have channeled more than $900,000 into races for the New York State Senate this election cycle, largely to Republicans seeking to hold on to majority control. These LLCs have also contributed nearly $100,000 to at least 18 candidates for the State Assembly. Although the state caps political donations to $150,000 for individuals and $5,000 for corporations, an LLC is treated like an individual, allowing these entities to donate up to $150,000 annually. Furthermore, the process of forming an LLC is simple; any person or business can create an LLC by mailing a short form to the Department of State with a $200 fee. Companies can fashion numerous LLC’s in order to funnel donations above the legal limit for a single corporation. According to Adam Skaggs, senior counsel at the Brennan Center, “It’s a loophole that absolutely should be a high priority if you want to apply meaningful limits on how much you want to donate to candidates.” Employing LLCs to circumvent the law can also disguise the source of contributions since LLCs are only required to provide the name of a “registered agent”—an attorney or a firm that processes corporate registrations—rather than the actual parent company.
Super PACs Gear Up in Long Island Swing District
Super PACs are becoming increasingly involved in political contests in New York. Prosperity First is a new Super PAC in eastern Long Island that is backed by $500,000 from Robert Mercer, CEO of the hedge fund Renaissance Technologies. It has already run $294,000 worth of ads supporting Republican businessman Randy Altschuler in his bid for Congress against current incumbent Democrat Tim Bishop of the 1 Congressional District. Renaissance Technologies spent $1.05 million in 2011 and 2012 lobbying against the Dodd-Frank bill and proposals to increase the capital gains tax on Capitol Hill. The 2010 election contest between Altschuler and Bishop was extremely close with 600 votes out of 200,000 throwing the race to Bishop. Consequently Super PACs could have a significant impact on House races such as this. Similarly the Democrat-leaning House Majority Super PAC has been active in other districts in New York targeting Republican Representatives Chris Gibson, Michael Grimm, Nan Hayworth and Ann Marie Buerkle. House Majority PAC has raised $1 million for New York Congressional races thus far, and plans to spend $6 million in the state by Election Day.