Effort to Close the SBOE ‘LLC Loophole’ Fails

At the State Board of Elections (SBOE) meeting on Tuesday, two Democratic Commissioners attempted to advance an advisory opinion that would closed the “LLC loophole,” but the effort fell short when neither Republican Commissioner voted in favor of the opinion.

For the purposes of state elections, limited liability companies (LLCs) are treated as individuals under a 1996 advisory opinion, rather than as corporations.  As a result, the owners of LLCs can contribute much more money to candidates.  If LLCs were treated as corporations, they would only be able to donate $5,000 per year to all candidates.

A similar effort by the SBOE’s two Democratic Commissioners failed last year, also along party lines.

A group of good government organizations has brought a lawsuit challenging the LLC loophole.  Last month, a trial court dismissed their lawsuit.  According to one of the plaintiffs in the case, that decision may be appealed.

Read news coverage from the Times Union and Politico NY.