Support for Bill Removing Unnecessary Donor Disclosures & Burdensome, Redundant Filing Requirements from Non-Profit Organizations
SUMMARY
The Non-Profit Organizations Committee issued a report in support of legislation that would amend Executive Law 172 to remove burdensome and redundant filing requirements placed on charitable 501(c)(3) organizations, and protect the privacy of donors to those organizations who do not engage in lobbying or political activities. Most 501(c)(3) nonprofit organizations registered with the New York Attorney General’s Charities Bureau must file their full federal tax filing annually with the Charities Bureau. As of January 1, 2021, those organizations have to file the same documents again with the Department of State. This is a wholly unnecessary, redundant filing requirement. This bill would eliminate the duplicate Department of State filing requirement. The bill recognizes that, to the extent the enacting statute was oriented to bringing transparency to the flow of political funding, the focus on charitable organizations, which are prohibited from directing funding for political purposes, is misdirected and redundant. The charitable sector is already overwhelmed with the additional legal compliance, administrative obligations, loss of revenue and increased need for services among impacted communities that have arisen out of the COVID-19 pandemic; passage of this legislation will help relieve some of the burden on non-profits without threatening oversight of their activities.
ADVOCACY
Letter from advocates to Governor Hochul urging enactment – September 2, 2021
BILL INFORMATION
A.1141-A (M. of A. Paulin) / S.4817-A (Sen. Krueger) – Prohibits the disclosure of the names, addresses and telephone numbers of contributors and the amounts contributed that are reported on financial disclosure reports of certain not-for-profit organizations (NYS 2020)
OUTCOME
Signed by the Governor, Chp. 612, Approval Memo 40 – November 12, 2021
REPORT
REPORT ON LEGISLATION BY THE NON-PROFIT ORGANIZATIONS COMMITTEE
A.1141-A (M. of A. Paulin)
S.4817-A (Sen. Krueger)
AN ACT to amend the executive law, in relation to prohibiting the disclosure of certain information required on financial disclosure reports of certain not-for-profit organizations
THIS BILL IS APPROVED
The Non-Profit Organizations Committee of the New York City Bar Association supports the enactment of the proposed legislation, which would amend Executive Law 172 to remove burdensome and redundant filing requirements placed on charitable 501(c)(3) organizations, and protect the privacy of donors to those organizations who do not engage in lobbying or political activities. The Committee endorses the findings and arguments in support of the bill outlined in the appended legislative memo.[1]
The Committee further supports the bill for the following reasons:
- The bill rightfully recognizes that requiring charities to file reports with the Department of State is unnecessary and administratively burdensome. While this would be a burden in even the best of times, the charitable sector is already overwhelmed with the additional legal compliance, administrative obligations and loss of revenue arising out of the COVID-19 pandemic.
- Given the backdrop of litigation around the constitutional import afforded the confidentiality of donor information, the bill also clarifies that donor information will be kept confidential and used only for legitimate enforcement purposes, which furthers the state’s interest by safeguarding its ability to continue to collect such information.
- The New York Attorney General’s Charities Bureau is an actively involved oversight agency and is already charged with monitoring the activities of charitable organizations and enforcing charitable law. This bill recognizes that, to the extent the enacting statute was oriented to bringing transparency to the flow of political funding, the focus on charitable organizations, which are prohibited from directing funding for political purposes, is entirely misdirected and redundant.
Non-Profit Organizations Committee
Jacqueline D. Ewenstein, Co-Chair
Amarah K. Sedreddine, Co-Chair
May 2021
Footnotes
[1] See also generally, Report in Opposition to Part UU of the Governor’s FY21Public Protection and General Government Article VII Legislation, New York City Bar Association, March 16, 2020, https://www.nycbar.org/reports/opposition-to-proposed-donor-disclosure-requirements-for-certain-non-profits-report/.
