A new law took effect in the city of Los Angeles on June 8 that prohibits developers, property owners, and their respective principals from making local political contributions while certain planning applications are pending with the City and for 12 months thereafter.

Who does the law apply to?

Any applicant or property owner associated with a “significant planning entitlement” filing in the city of Los Angeles qualifies as a “restricted developer” and is subject to the new restriction. “Significant planning entitlement” is defined broadly, capturing many discretionary applications filed with the Los Angeles Department of City Planning, including zoning issues and general plan amendments.

Continue Reading Los Angeles Bans Political Contributions by Developers and Property Owners

New York recently adopted regulations impacting charitable organizations that are registered and required to file annual financial reports (the CHAR 500) with the New York Attorney General’s Charities Bureau.[1] These regulations, which became effective March 16, 2022, clarify that the names and street addresses of donors to public charities are no longer required to be disclosed to the Charities Bureau with the CHAR 500.

The regulations were proposed in response to the U.S. Supreme Court’s 2021 decision in Americans for Prosperity Foundation v. Bonta, which found California’s donor disclosure law requiring charities to submit an unredacted copy of IRS Form 990 Schedule B to be unconstitutional under the First Amendment. Following the Court’s decision, California, New York, and New Jersey suspended collection of Schedule B donor information, which is typically filed on a confidential basis with the IRS as part of the otherwise public Form 990. Six months later, the New York Attorney General’s Office proposed regulations to eliminate the requirement that charitable organizations provide the state with the names and addresses of donors on Schedule B. The final regulations remain unchanged from those proposed by the AG’s Office.[2]

Continue Reading New York Adopts Regulations Amending Its Donor Disclosure Rules

U.S. companies are allowed to make contributions to super PACs, which is exactly what Wheatland Tube, LLC did in this case. However, the decision to contribute involved conversations with a foreign national, and that led to a $975,000 fine to settle charges that the contribution by a U.S. company violated the ban on contributions made by foreign nationals. The fine is the third-largest in the agency’s history and provides an important lesson about the limits of foreign national involvement in decisions by U.S. companies to be involved in the political process.

The complaint concerned contributions totaling $1.75 million to a federal super PAC by U.S. company Wheatland Tube, LLC. Wheatland Tube is wholly owned by a U.S. corporation, Zekelman Industries, Inc. Canadian citizen, Barry Zekelman, is the CEO (as well as an owner) of Zekelman Industries.

Mr. Zekelman acknowledged that he discussed the contributions with Wheatland Tube’s president, a U.S. citizen who also served as general counsel of Zekelman Industries. But Wheatland’s president said that he exercised independent judgment in making the decision to contribute. The FEC rejected this defense, concluding that even if a U.S. citizen has “final decision-making authority or final say” over the making of a contribution, a foreign national – an individual who is not a U.S. citizen or lawfully admitted for permanent residence – may not participate, directly or indirectly, in a decision-making process regarding U.S. election-related spending. The FEC made clear that none of the funds involved appeared to have come from non-U.S. sources; the only violation was Mr. Zekelman’s involvement in the decision to contribute. To that end, the settlement also involved Zekelman Industries, because, even though it is a U.S. company, its executives were involved in the decision to contribute, and they were acting at Mr. Zekelman’s direction.

Continue Reading FEC Imposes Record Fine for Foreign Individual’s Role in U.S. Company’s Otherwise Lawful Contribution to a Super PAC

The District of Columbia’s pay-to-play law will go into effect on November 9, 2022. The law was originally scheduled to take effect on November 4, 2020, but was postponed because of a lack of funding.

The law prohibits businesses seeking or holding contracts with the District government valued at $250,000 or more, and the business’s senior officers (e.g., president, executive director, chief executive officer, chief operating officer, or chief financial officer), from contributing to “covered officials.” Who is a covered official depends on who oversees the contract in question. For example, if a contractor is seeking or holding a contract overseen by a District agency that reports to the mayor, the prohibited recipients would be:

  • The mayor
  • Candidates for mayor
  • Political committees affiliated with the mayor and candidates
  • Constituent services fund of the mayor


Continue Reading DC Pay-to-Play Law Back on Track

The Federal Election Commission (FEC) recently announced a $16,000 civil penalty against a political campaign, to settle allegations that the campaign had inappropriately used FEC contributor data in an algorithm used to aid its fundraising. The settlement is the latest in a series of decisions this year cracking down on the practice of using the FEC’s public contribution data to facilitate fundraising operations.

Contributor Data Disclosure

Federal campaign finance laws require all federal political committees to disclose the name, address, occupation, employer, and contribution amounts from donors who have given more than $200 per cycle. When the law was first written in the mid-1970s, there was no internet, so access to the records was very limited. Moreover, $200 then was worth nearly $1,000 in current dollars (so in fact it was a much larger contribution than it may first appear). Today, the FEC makes these disclosures public in a searchable online database, a tempting trove in an age when data has become integral to improving the efficiency of organizations’ public outreach.

Continue Reading FEC Cracks Down on Use of Contributor Data

A federal government contractor has agreed to pay a civil penalty of $125,000 for making prohibited contributions to super PACs. The penalty is the largest the Federal Election Commission has obtained for violating the ban on federal contractor contributions.

According to settlement documents made public earlier this month, a Florida-based disaster response firm made contributions

On July 1, the U.S. Supreme Court decided the consolidated case Americans for Prosperity Foundation v. Bonta in favor of the nonprofit organizations that brought the suits, holding California’s donor disclosure law to be unconstitutional because it violates the First Amendment protection of freedom of association. The immediate effect of the Court’s ruling is that the Court invalidated California’s rule requiring charities registered to fundraise in the state to file with the state Attorney General an unredacted copy of IRS Form 990 Schedule B, which discloses the names and addresses of their major donors.

As we previously wrote when the Court decided to hear the case and later heard oral arguments, the case focused on two main issues: (1) the standard of review that must be applied to laws involving compelled disclosure that are challenged on First Amendment grounds, and (2) whether the law should be held unconstitutional only as applied to the two nonprofits that brought the cases, or if the law should be struck down on its face.

Continue Reading U.S. Supreme Court Finds California Donor Disclosure Law Unconstitutional

On April 26, 2021, the Supreme Court heard oral arguments in the consolidated case Americans for Prosperity Foundation v. Bonta,1 which argues that California’s donor disclosure law is unconstitutional under the First Amendment because it will discourage donors from contributing due to the fear that their names and addresses will be publicly disclosed. As we previously wrote, California requires nonprofit organizations registered to fundraise in the state to annually disclose to the California Attorney General’s Office their Schedule B donor information, which is typically filed on a confidential basis with the IRS as part of the otherwise public Form 990.

This is one of the rare cases where the Supreme Court has reviewed a case about charitable speech or charitable association. In the cases of Buckley v. Valeo and Doe v. Reed, the Supreme Court found that the standard of exacting scrutiny applies when assessing compelled disclosure in the electoral context. The Court’s questions to the parties during oral arguments probed whether California’s disclosure law would be properly reviewed under exacting scrutiny, how the standard of review should be applied, and whether the law can withstand such scrutiny facially (that is, as applied to everyone) or at least as applied to the two nonprofits that brought the cases. The case is considered by many to be vitally important, not only as it relates to disclosure of charitable donors, but as a potential “back door” into challenging rules requiring disclosure of donors under campaign finance laws.

Continue Reading U.S. Supreme Court Hears Oral Arguments on California Donor Disclosure Cases

Every two years, the FEC indexes certain contribution limits to inflation. New contribution limits for the 2021-2022 election cycle were announced on Tuesday.

Individuals may now give $2,900 per candidate, per election (with the primary and general elections considered separate elections), up from the previous limit of $2,800. Between primary and general election giving, an individual may now give a total of $5,800 per candidate, per election cycle. The new limits are in effect for the two-year election cycle beginning the day after the most recent general election and ending on the date of the next general election (November 4, 2020 to November 8, 2022).

The FEC also raised the limits on individual contributions to national party committees. Individuals may now give up to $36,500 per recipient, per year to the main account of the national party committees, up from the previous limit of $35,500. Individuals may also give up to $109,500 per account, per year, to each of the additional national party committee accounts maintained for presidential nominating conventions; election recounts, contests, and other legal proceedings; and national party headquarters buildings (up from the previous limit of $106,500). These new limits are in effect for the two-calendar-year period beginning January 1, 2021 and ending December 31, 2022.

Continue Reading Federal Election Commission Announces New Contribution Limits for 2021-2022 Cycle

As states across the country finalize and certify the results of the 2020 general election, President-elect Joseph R. Biden and Vice President-elect Kamala D. Harris have begun preparing to assume control of the executive branch on January 20. The Biden-Harris Transition Team has already assembled and dispatched agency review teams to survey and report on the current organization and priorities of the various executive branch agencies. And while it remains unclear how traditional Inauguration Day festivities will be affected by the ongoing Covid-19 pandemic, President-elect Biden’s yet-to-be-organized Inaugural Committee will be responsible for planning and funding any official Inauguration Day parades or galas or any other official events.

As this new chapter of American government unfolds, many individuals, companies, and nonprofits are no doubt interested in reaching out to the Biden-Harris Transition Team and the Biden Inaugural Committee. This short alert sets out high-level guidelines regarding interactions with both the Transition Team and the Inaugural Committee. If you have any questions about these topics, please contact a member of our Political Law Group.

Continue Reading Interacting with the Biden-Harris Transition Team and Inaugural Committee