ALBANY, N.Y. (AP) - The New York Assembly voted Tuesday to close a campaign finance loophole for limited liability companies, which a Senate committee chairman has refused to consider.
The bill would stop treating LLCs like individuals who can give up to $150,000 annually while masking the identities of actual donors. Instead, it would treat them like corporations subject to a $5,000 limit.
The 120-8 vote followed questions by several Republicans about treating LLCs instead like partnerships or urging broader legislation that would also set an aggregate limit on unions.
“The LLC loophole is perhaps the most egregious weakness in our laws regulating money in politics,” said Assemblyman Brian Kavanagh, the Manhattan Democrat who sponsored it. “It has been the mechanism of choice for certain people to attempt to buy influence wholesale, by giving virtually unlimited amounts of money to politicians’ campaign committees.”
Millions of dollars in contributions by New York City real estate interests, mainly funneled through LLCs, have been cited in federal corruption cases filed this year against Assembly Speaker Sheldon Silver and Senate Majority Leader Dean Skelos. Both lost their leadership positions but have kept their legislative seats and said they’ll be exonerated.
Shortly after the Assembly vote Tuesday, Senate Corporations, Authorities and Commissions Chairman Michael Ranzenhofer, an Erie County Republican, said the sponsor of a similar Senate bill failed to file the proper motion and he refused to consider it.
Sen. Daniel Squadron, a Manhattan Democrat, had filed a motion intended to compel consideration of the legislation in the Republican-controlled Senate. The Elections Committee advanced it two weeks ago without comment to Ranzenhofer’s committee.
Ranzenhofer said he hadn’t actually seen Squadron’s request until Tuesday, and his counsel disagreed with Squadron that the procedural rules required his committee to consider it. He said he would consider it for a future meeting, though none was scheduled in the month remaining in this year’s legislative session.
Ranzenhofer told The Associated Press that he doesn’t have an opinion on the bill to close the LLC loophole because he hasn’t read it yet. “I just got it on my desk today. … We have very, very many important bills, not only in this committee but in the House, and I’m just not an expert in all of them.”
Asked whether his receipt of $94,000 in campaign donations from LLCs affiliated with Glenwood Management, as reported by the New York Daily News, had any effect on his position, he said no.
Glenwood has been identified as the New York City company that gave large campaign donations to Skelos using LLCs, allegedly in return for helping continue tax breaks now worth about $1 billion annually to the city’s residential developers. Those tax breaks are up for renewal this year.
New Majority Leader John Flanagan, whom Republicans chose to replace Skelos on Monday, declined to state his position Tuesday on the legislation, saying he’d have to consult with the other senators in the Republican conference.
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