S 701: Relates to campaign funds for personal use.

  
  STATE OF NEW YORK ________________________________________________________________________ 701 2025-2026 Regular Sessions  IN SENATE (Prefiled) January 8, 2025 ___________ Introduced by Sens. KRUEGER, ADDABBO, GOUNARDES, LIU, MAY -- read twice and ordered printed, and when printed to be committed to the Committee on Elections AN ACT to amend the election law, in relation to campaign funds for personal use The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 14-130 of the election law, as amended by section 9 2 of part CC of chapter 56 of the laws of 2015, paragraphs (ix) and (x) of 3 subdivision 3 as amended and paragraph (xi) of subdivision 3 as added by 4 chapter 136 of the laws of 2019, is amended to read as follows: 5 § 14-130. Campaign funds for personal use. 1. Contributions received 6 by a candidate or a political committee may only be expended for [any 7 lawful purpose. Such funds shall not be converted by any person to a 8 personal use which is unrelated to a political campaign or the holding 9 of a public office or party position.] bona fide purposes directly 10 related to either: 11 [2. No contribution shall be used to pay interest or any other finance 12 charges upon monies loaned to the campaign by such candidate or the 13 spouse of such candidate. 14 3. For the purposes of this section, contributions "converted by any 15 person to a personal use" are expenditures that are exclusively for the 16 personal benefit of the candidate or any other individual, not in 17 connection with a political campaign or the holding of a public office 18 or party position. "Converted by any person to a personal use", when 19 meeting the definition in this subdivision, shall include, but not be 20 limited to, expenses for the following: 21 (i) any residential or household items, supplies or expenditures, 22 including mortgage, rent or utility payments for any part of any 23 personal residence of a candidate or officeholder or a member of the EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD02517-01-5 
 S. 701 2 1 candidate's or officeholder's family that are not incurred as a result 2 of, or to facilitate, the individual's campaign, or the execution of his 3 or her duties of public office or party position. In the event that any 4 property or building is used for both personal and campaign use or as 5 part of the execution of his or her duties of public office or party 6 position, personal use shall constitute expenses that exceed the pro- 7 rated amount for such expenses based on fair-market value. 8 (ii) mortgage, rent, or utility payments to a candidate or officehold- 9 er for any part of any non-residential property that is owned by a 10 candidate or officeholder or a member of a candidate's or officeholder's 11 family and used for campaign purposes, to the extent the payments exceed 12 the fair market value of the property's usage for campaign activities; 13 (iii) clothing, other than items that are used in the campaign or in 14 the execution of the duties of public office or party position; 15 (iv) tuition payments unrelated to a political campaign or the holding 16 of a public office or party position; 17 (v) salary payments or other compensation provided to any person for 18 services where such services are not solely for campaign purposes or 19 provided in connection with the execution of the duties of public office 20 or party position; 21 (vi) salary payments or other compensation provided to a member of a 22 candidate's family, unless the family member is providing bona fide 23 services to the campaign. If a family member provides bona fide services 24 to a campaign, any salary payments or other compensation in excess of 25 the fair market value of the services provided shall be considered 26 payments for personal use; 27 (vii) admission to a sporting event, concert, theater, or other form 28 of entertainment, unless such event is part of, or in connection with, a 29 campaign or is related to the holding of public office or party posi- 30 tion; 31 (viii) payment of any fines or penalties assessed against the candi- 32 date pursuant to this chapter or in connection with a criminal 33 conviction or by the joint commission for public ethics pursuant to 34 section ninety-four of the executive law or sections seventy-three or 35 seventy-three-a of the public officers law or the legislative ethics 36 commission pursuant to section eighty of the legislative law; 37 (ix) dues, fees, or gratuities at a country club, health club, recre- 38 ational facility or other entities with a similar purpose, unless they 39 are expenses connected with a specific fundraising event or activity 40 associated with a political campaign or the holding of public office or 41 party position that takes place on the organization's premises; 42 (x) travel expenses including automobile purchases or leases, unless 43 used for campaign purposes or in connection with the execution of the 44 duties of public office or party position and usage of such vehicle 45 which is incidental to such purposes or the execution of such duties; 46 and 47 (xi) childcare expenses, other than expenses incurred in the campaign 48 or in the execution of the duties of public office or party position. 49 4. Nothing in this section shall prohibit a candidate from purchasing 50 equipment or property from his or her personal funds and leasing or 51 renting such equipment or property to a committee working directly or 52 indirectly with him to aid or participate in his or her nomination or 53 election, including an exploratory committee, provided that the candi- 54 date and his or her campaign treasurer sign a written lease or rental 55 agreement. Such agreement shall include the lease or rental price, which 56 shall not exceed the fair lease or rental value of the equipment. The 
 S. 701 3 1 candidate shall not receive lease or rental payments which, in the 2 aggregate, exceed the cost of purchasing the equipment or property. 3 5. Nothing in this section shall prohibit an elected public office- 4 holder from using campaign contributions to facilitate, support, or 5 otherwise assist in the execution or performance of the duties of his or 6 her public office. 7 6. The state board of elections shall issue advisory opinions upon 8 request regarding expenditures that may or may not be considered 9 personal use of contributions. Any formal or informal advisory opinions 10 issued by a majority vote of the commissioners of the state board of 11 elections shall be binding on the board, the chief enforcement counsel 12 established by subdivision three-a of section 3-100 of this chapter, and 13 in any subsequent civil or criminal action or proceeding or administra- 14 tive proceeding.] 15 a. promoting the nomination or election of a candidate; or 16 b. performing duties of public office or party position which are not 17 paid for or eligible for reimbursement by the state or any political 18 subdivision or private party, and ordinary and necessary expenses relat- 19 ing to the holding of public office or party position. 20 2. Campaign funds shall not be converted to personal use, which shall 21 be defined as expenditures that: 22 a. are for the personal benefit of or to defray normal living expenses 23 of the candidate, officeholder, immediate family or domestic partner of 24 either or any other person; 25 b. are used to fulfill any commitment, obligation, or expense that 26 would exist irrespective of the candidate's campaign or duties as an 27 officeholder; or 28 c. are put to any use for which the candidate or officeholder would be 29 required to treat the amount of the expenditure as gross income under 30 section 61 of the Internal Revenue Code. 31 3. Expenditures for personal use shall also include, but are not 32 limited to, expenditures for: 33 a. residential or household items, supplies, maintenance or other 34 expenditures, including mortgage, rent, utilities, repairs, or improve- 35 ments for any part of any personal residence of a candidate or office- 36 holder, the candidate's or officeholder's immediate family or domestic 37 partner; 38 b. rent or utility payments that exceed fair market value for use of 39 any part of any non-residential property owned by a candidate, or a 40 member of a candidate's family or domestic partner used for campaign 41 purposes; 42 c. salary and other fees for bona fide services to a campaign or 43 legislative office that exceed fair and reasonable market value of such 44 services; 45 d. interest or any other finance charges for monies loaned to the 46 campaign by the candidate or the spouse or domestic partner of such 47 candidate; 48 e. tuition payments; 49 f. dues, fees, or gratuities at private clubs, recreational facilities 50 or other nonpolitical organizations, unless connected to a specific 51 widely attended fundraising event that takes place on the organization's 52 premises; 53 g. automobile purchases or long term leases; short term car rentals 54 and cellular equipment and services not used exclusively for campaign 55 purposes or duties as an officeholder; 
 S. 701 4 1 h. admission to sporting events, concerts, theaters, or other forms of 2 entertainment, unless part of a specific campaign or officeholder 3 related activity; and 4 i. payment of any fines, fees, or penalties assessed pursuant to this 5 chapter. 6 Nothing in this section shall prohibit a candidate from purchasing 7 office equipment with personal funds and leasing or renting such equip- 8 ment or property to a committee working with or for the candidate, 9 provided the candidate or the campaign treasurer signs a written lease 10 or rental agreement and files it with the appropriate required campaign 11 financial filing which shall include the lease or rental price which 12 shall not exceed the fair lease or rental value of the equipment or in 13 the aggregate exceed the cost of its purchase. 14 § 2. Section 14-132 of the election law, as added by section 2 of part 15 C of chapter 286 of the laws of 2016, is amended to read as follows: 16 § 14-132. Disposition of campaign funds. [1.] Upon the death of a 17 candidate, former candidate or holder of elective office, [where such 18 candidate or candidate's authorized committee] who received campaign 19 contributions, all [such funds] contributions shall be disposed of [by 20 any of the following means, or any combination thereof, within two years 21 of the death of such person: 22 (a) returning, pro rata, to each contributor the funds that have not 23 been spent or obligated; 24 (b) donating the funds to a charitable organization or organizations 25 that meet the qualifications of section 501(c)(3) of the Internal Reven- 26 ue Code; 27 (c) donating the funds to the state university of New York or the city 28 university of New York; 29 (d) donating the funds to the state's general fund; or 30 (e) contributing or transferring the funds to a candidate, party, 31 constituted or political committee in accordance with the applicable 32 limits, if any, set forth in this article. 33 2. No such candidate's authorized political committee shall dispose of 34 campaign funds by making expenditures for personal use as defined in 35 section 14-130 of this article. 36 3. If funds are not disposed of within the time required by this 37 section, such funds shall be recoverable by the chief enforcement coun- 38 sel of the state board of elections in a special proceeding in state 39 supreme court in the manner prescribed by section 16-116 of this chapter 40 and deposited into the state's general fund] within twelve months of the 41 death of the candidate pursuant to subdivision one of this section. 42 1. Any political committee required to dispose of funds pursuant to 43 this section shall, at the option of the representative of the estate of 44 the candidate, or the treasurer of a political committee formed solely 45 to promote the passage or defeat of a ballot proposal, dispose of such 46 funds by any of the following means, or any combination thereof: 47 a. returning, pro rata, to each contributor the funds that have not 48 been spent or obligated; 49 b. donating the funds to a charitable organization or organizations 50 that meet the qualifications of section 501(c) (3) of the Internal 51 Revenue Code; 52 c. donating the funds to the state university; 53 d. donating the funds to the state's general fund; 54 e. transferring the funds to a political party committee registered 55 with the state board of elections; or 
 S. 701 5 1 f. contributing the funds to a candidate or political committee such 2 that this does not exceed the limits set forth in section 14-114 of this 3 title. 4 2. No representative of the estate of a candidate or political commit- 5 tee shall dispose of campaign funds by making expenditures for personal 6 use as defined in section 14-130 of this title. 7 § 3. This act shall take effect on the sixtieth day after it shall 8 have become a law; provided, that the state board of elections shall 9 notify all registered campaign committees of the applicable provisions 10 of this act within thirty days after this act shall have become a law.