BILL NUMBER: S10663
SPONSOR: GOUNARDES
 
TITLE OF BILL:
An act to amend the election law and the New York city charter, in
relation to independent expenditures
 
PURPOSE OR GENERAL IDEA OF BILL:
To improve enforcement for New York State and New York City's independ-
ent expenditure (IE) donor disclosure rules and to close recently
exploited loopholes that allow IE committees to escape the intent of the
law
 
SUMMARY OF PROVISIONS:
Section one of this bill amends paragraph (a) of subdivision 1 of
Section 14-107 of Election Law (EL) to clarify that when an independent
expenditure (IE) made by a registered IE committee uses a candidate's
name, likeness, or other descriptor to refer to a candidate, or where
they use language or imagery substantially associated with a candidate
such that a reasonable viewer would understand the communication as
pertaining to the candidate and designed to influence the outcome of an
election, such communication or statement shall qualify as an independ-
ent expenditure even when it does not specifically name the candidate.
Section two of this bill amends subdivision 3 of Section 14-126 of the
EL to raise the penalties for an IE committee that fails to identify or
falsely identifies the political committee that has paid for a printed
or digital political communication pursuant to EL § 14-107(2) from
$1,000 to $1 million per day of noncompliance.
This section adds a second tier of noncompliance for $5 million per day
for knowing and willful violations.
This section also provides that the state Board of Elections (BOE) chief
enforcement counsel can pursue injunctive relief to halt an unlawful
communication, rather than a small de minimis penalty after the fact,
and creates a private right of action for punitive damages, attorneys
fees, and other remedies for individuals who have been injured by a
violation of EL § 14-126(3).
Section three of this bill creates three new definitions in subparagraph
(a) of paragraph 15 of subdivision a of Section 1052 of the New York
City Charter (NYCC).
Section four of this bill amends clauses (i), (ii), (iii), and (iv) of
subparagraph (c ) of paragraph 15 of subdivision a of Section 1052 of
the NYCC to close a loophole in NYC's landmark campaign finance disclo-
sure law which requires any individual or entity making an IE exceeding
$1,000 for a political communication in a campaign to disclose their top
three largest donors so long as the donors have contributed at least
$5,000 to the IE committee within the 12 months preceding the election
(see NYCC § 1052(a)(15)(c)). This section would clarify that if an IE
wants to list a political committee or a PAC as one of its top donors to
circumvent the spirit of the donor disclosure law, they would need to
then list the top three donors of the committee or PAC. If one of the
top three donors of the PAC is yet another PAC, the direct donor
requirement would continue, and so on and so forth until all direct
donors behind a political advertisement have been clearly disclosed.
This section first makes this amendment in clause (i) of subparagraph (c
) for printed or digital graphical ads before continuing on to close
this same loophole for spoken disclosures in paid television or Internet
video ads in clause (ii), spoken disclosures in paid ra dio, paid Inter-
net audio, or automated telephone calls in clause (iii), and spoken
disclosures for non-automated telephone calls in clause (iv).
Section five of this bill amends subparagraph (d) of paragraph 15 of
subdivision a of Section 1052 of the NYCC to raise the penalties for
unlawful IE spending disclosures in paragraph 15 from a $10,000 total
fine to a $1 million per day fine. This section also provides that the
NYC Campaign Finance Board can pursue injunctive relief to enjoin unlaw-
ful communications in real time rather than simply charging a de minimis
fine after the fact.
Section six sets the effective date.
 
JUSTIFICATION:
This bill closes several loopholes in New York State and City's laws
governing campaign ad disclosure rules for independent expenditures
(lEs) while strengthening enforcement for unlawful communications that
are unduly influencing an election in real time.
In recent decades, NYS has passed sweeping campaign finance reform laws,
creating new definitions for "independent expenditure" in EL §
14-107(1)(a) and "independent expenditure committee" in EL § 14-100(15),
clarifying when IE activities are considered coordinated with a campaign
and thus subject to campaign contribution limits, and placing a series
of stringent disclosure requirements on lEs.(1) Any individual wishing
to form a committee for the purposes of making an independent expendi-
ture, generally defined as any public-facing audio, video, or written
advertisement or other statement advocating for or against a specific
candidate or ballot proposal that is being circulated on or after Janu-
ary 1st of the election year, or, if referencing a specific candidate,
within 60 days of a general or special election or 30 days of a primary,
must register their IE committee with the NYS Board of Elections (BOE),
electronically disclose all contributions or loans of at least $1,000
and expenditures of over $5,000 to BOE within 24 hours.(2)
An IE advertisement cannot be made at the behest of or in cooperation
with a candidate or party committee, and, because IEs are not coordi-
nated with a campaign, they are not subject to any of the contribution
or spending limits that other forms of political spending must adhere
to. This definition of IEs in state Election Law, therefore, is broadly
intended to capture campaign expenditures which are clearly designed to
influence the electorate despite the fact that they are being made inde-
pendently of a candidate's campaign.
Paid IE advertisements must contain an attribution at the bottom of the
ad that clearly states the name of the person that paid for or otherwise
published the ad as well as a statement that the communication was not
expressly authorized or requested by a candidate or a candidate's
committee (NYCRR § 6200.10(f)). The state BOE is also required to make a
record of an IE committee's contributions, donors, expenditures, and a
listing of all of their ads available online in a machine readable
format pursuant to EL § 14-107(5-a).
Statutory gaps and weak enforcement hamper the effectiveness of the
Election Law's IE disclosure rules, however. Firstly, special interests
form IE committees to run ads that are meant to influence the electorate
but do not contain the magic words "vote," "oppose," "support," "elect,"
"defeat," or reject" prescribed in EL § 14-107(1)(a)(i), stop just short
of referring to the candidate by name, and thus fall outside the bounds
of the definition of "independent expenditure" in EL § 14-107(1)(a). The
breadth of § 14-107's definition was recently put to the test in the
2025 NYC mayoral election, when an out-of-state conservative nonprofit
tried to run an ad highlighting the dangers of socialism in advance of
the NYC mayoral election. While this ad was clearly a reference to Mayor
Zohran Mamdani, the eventual winner of that election, the nonprofit
attempted to claim that they were engaging in general issue advocacy and
so should not be subject to the state and city's donor disclosure and
registration rules as prescribed in state Election Law and the New York
City Charter. This bill closes this issue advocacy loophole by clarify-
ing that when an IE's ad clearly and unambiguously references a candi-
date by using their name, likeness, or other descriptor, or where the ad
uses language or imagery substantially associated with the candidate
such that a reasonable viewer would understand the communication as
pertaining to the candidate and designed to influence the election, the
communication must disclose its donors like any other IE.(3)
Secondly, this bill dramatically improves enforcement against unlawful
IE communications at both the state level, where they are subject to
basic registration and listing disclosures in EL § 14-107, and under
NYC's more robust local donor disclosure law, which requires IEs to
clearly and conspicuously list their top three donors in any public-fac-
ing ad being circulated before an election pursuant to New York City
Charter § 1052(a)(15). Currently, unlawful IE communications are subject
to only a $1,000 penalty or the cost of communications, whichever is
higher, under EL § 14-126(3), and only if the campaign "knowingly" fails
to disclose its donors. Furthermore, this menial fine can only be recov-
ered in a special proceeding brought by the Chief Enforcement Counsel of
the State BOE.
A $1,000 civil penalty in the modern era, however, is no longer an
effective deterrent considering the total spend of six- and seven-figure
IE campaigns over the course of an election. Furthermore, the fact that
this relatively small civil remedy is only recoverable after the commu-
nication will already have circulated means that it cannot be enjoined
in a timely manner, despite the fact that the unlawful communication may
be influencing an election and undermining its integrity in real time.
Finally, the fact that the violation must have been "knowingly" commit-
ted is a difficult bar for the chief enforcement counsel to clear in a
court case, and leaves virtually no penalty for simple noncompliance
with this provision of Election Law.
This bill improves enforcement in four meaningful ways: firstly, it
raises the penalty from a $1,000 fine to $1 million per day, better
reflecting the actual cost of modern ad spends and 1E finances while
creating an incentive to fix the error in real time before further
damage can be done. Secondly, it creates a second tier of a $5 million
per day penalty for willful violations where an IE intentionally fails
to disclose or intentionally incorrectly discloses its PAC in a "Paid
for by" listing pursuant to EL § 14-106(2). Thirdly, it allows the BOE
chief enforcement counsel to seek a preliminary injunction to halt the
communication in real time. Fourthly, it creates a civil right of
action for an individual injured by the unlawful disclosure or lack of
disclosure.
This bill makes similar improvements to NYC's local law for IEs, in NYC
Charter § 1052(a)(15), while also closing a gaping loophole that bad
actors have recently used to evade NYC's top three donor disclosure law
that requires ads to clearly list or audibly disclose the top three
individuals or entities that have contributed to the IE within the prior
twelve months preceding the election. While the intent of NYCC §
1052(a)(15) is clearly to better inform the electorate as to who may be
behind the special interest IEs flooding their inboxes, radio waves, and
feeds, some IEs have recently begun forming pass-through PACs to play a
middleman role of collecting contributions from individuals and contrib-
utions to then funnel them into the IE that is forced to list its top
three donors on an ad. Rather than revealing the true identity of the
actual donor, the IE can simply list the pass-through PAC as a top
donor, further obscuring the special interests attempting to manipulate
a local election while evading the spirit of the law.
This bill therefore mandates that when a PAC or political committee, as
defined in Election Law § 14-100 is one of the top three donors of an IE
communication, the communication shall list the top donors of the PAC
instead. This rule would apply at each level of the transfer chain, so
that if the PAC is itself funded by another middleman PAC, the ad must
list the donors of that PAC as well. As donor disclosures are required
to be conspicuously and separately made in a box at the bottom of the
ad, or, if the ad is broadcast, clearly spoken in a pitch and tone
substantially similar to the rest of the advertisement, this look-
through obligation will disincentivize IE committees from layering PACs
upon sub-PACs to maliciously comply with the law.
This bill will improve enforcement of our state's campaign finance laws
while closing loopholes that let bad actors escape its intent, improving
the transparency, integrity, and fairness of all elections across our
state.
 
PRIOR LEGISLATIVE HISTORY:
None
 
FISCAL IMPLICATIONS:
TBD
 
EFFECTIVE DATE:
This act shall take effect on the ninetieth day after it shall have
become a law
1 "New York State Passes Changes to Lobbying and Campaign Finance Laws."
Wileyrein, 2016, www.wiley.law/newsletter-New-York- State-Passes-Chang-
es-Lobbying-Campaign-Finance-Laws. Accessed 15 May 2026.
(2) "Independent Expenditure Committee Information." New York State
Board of Elections, 2026, elections.ny.gov/independent-expenditure-
committee-infounation. Accessed 15 May 2026.
(3) Garber, Nick. "Conservative Group Wants to Run Anti-Mamdani Ads -
but Not Disclose Its Donors." Crainsnewyork.com, Grains New York Busi-
ness, 2 Oct. 2025, www. crainsnewyork.com/ politics-policy/conservative-
group-wants-run-anti- mamdani-ads-not-di sclose-donors/. Accessed 15 May
2026.

Statutes affected:
S10663: 14-126 election law, 14-126(3) election law