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1999-4: Contributions from Limited Liability Companies Are Acceptable

Friday, January 15, 1999

Re: Administrative Code §3-703(1) (f), (1-a), (6); Charter §1052(a) (12); Op. No. 1999-4

An advisory opinion has been requested on whether candidates participating in the voluntary Campaign Finance Program may accept contributions from limited liability companies ("LLC's") 1. Two recently adopted laws prohibit participating candidates from accepting contributions from corporations. New York City Administrative Code §3-703(1-a); New York City Charter §1052(a) (12). See Advisory Opinion No. 1998-2 (October 23, 1998) and Advisory Opinion No. 1999-3 (January 7, 1999).

In examining whether LLC's are subject to the corporate contribution limit of New York State Election Law §14-116, the State Board of Elections held that LLC's are not corporations. State Board of Elections 1996 Opinion No. 1 (October 30, 1996) 2. There is no indication that either the City Council or the Charter Revision Commission intended to treat contributions from an unincorporated organization, such as an LLC, in the manner prescribed for contributions from corporations.

Thus, the Board concludes that LLC's are not corporations under Administrative Code §3-703(1-a) and Charter §1052(a) (12). Participating candidates may accept contributions from LLC's subject to the contribution limits and disclosure requirements of the Campaign Finance Act. See Administrative Code §3-703(1) (f), (6).

NEW YORK CITY CAMPAIGN FINANCE BOARD3

1 The request was made by Isaac Schwartz, on behalf of City Council candidate Joseph Dweck, by letter dated January 8, 1999.

2 The Federal Election Commission ("FEC") has also addressed whether LLC's are corporations. See, e.g., FEC Advisory Opinions No. 1998-11 and No. 1998-15 (both September 3, 1998); also 63 Fed. Reg. 243 (December 18, 1998) (proposed regulations).

3 Newly-appointed Boardmember Dennis Mehiel did not participate in the deliberation on this Advisory Opinion.