Implementation of the Democracy Protection Act
NY-ADR
5/23/18 N.Y. St. Reg. SBE-21-18-00047-P
NEW YORK STATE REGISTER
VOLUME XL, ISSUE 21
May 23, 2018
RULE MAKING ACTIVITIES
STATE BOARD OF ELECTIONS
PROPOSED RULE MAKING
NO HEARING(S) SCHEDULED
I.D No. SBE-21-18-00047-P
Implementation of the Democracy Protection Act
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:
Proposed Action:
Amendment of section 6200.10; addition of section 6200.11 to Title 9 NYCRR.
Statutory authority:
Election Law, sections 14-107(5-a), 14-107-b and 3-102(17)
Subject:
Implementation of the Democracy Protection Act.
Purpose:
The rule effectuates the amendments to article 14 of the Election Law resulting from chapter 59 of the Laws of 2018.
Substance of proposed rule (Full text is posted at the following State website:www.elections.ny.gov):
The proposed amendment to section 6200.10, and the addition of section 6200.11, implements changes in law resulting from the New York State Democracy Protection Act, Chapter 59 of the Laws of 2018, Part JJJ. The proposed regulation modifies current regulations as follows: a) Prohibits foreign entities from forming an independent expenditure committee and purchasing political ads in order to influence New York elections; b) Requires that internet and digital advertisements paid for by Independent Expenditure Committees and targeted to 50 or more members of the General Public Audience be subject to disclosure requirements; c) Requires all paid independent political online ads to clearly display that the ad was not authorized by any candidate and who actually paid for the ad; and d) Requires television or radio broadcast stations, provider of cable or satellite televisions, or online platforms to collect the registration documents of Independent Expenditure committees when such committees purchase purchases communications in the form of an independent expenditure.
Additionally, the proposed regulation defines “online platform” as follows: "An online platform means: (1) a public-facing Internet Web site, web application, or digital application, including a social network, ad network or search engine, which sells political advertisements and has 50,000,000 or more unique monthly United States visitors or users for a majority of months during the preceding 12 months."
Text of proposed rule and any required statements and analyses may be obtained from:
Nicholas R. Cartagena, Esq., State Board of Elections, 40 North Pearl Street, Ste. 5, Albany, NY 12207, (518) 474-2064, email: [email protected]
Data, views or arguments may be submitted to:
Same as above.
Public comment will be received until:
60 days after publication of this notice.
Regulatory Impact Statement
1. Statutory authority: The New York State Democracy Protection Act, Chapter 59 of the Laws of 2018, Part JJJ, requires the New York State Board of Elections to promulgate rules related to the Board maintaining and making available for public inspection records and copies of paid internet or digital advertisements by Independent Expenditure committees. Further the Act requires the Board to promulgate regulations defining the scope of the term "online platform.” Election Law §§ 14-107 [5-a] and 14-107-b expressly authorizes the New York State Board of Elections to promulgate such rules and regulations. Election Law § 3-102(17) authorizes the State Board of Elections to “perform such other acts as may be necessary to carry out the purposes of this chapter."
2. Legislative objectives: The legislative objective furthered by the proposed regulation is to ensure transparency for independent expenditures in the form of internet and digital advertising and to protect New York elections from foreign influence.
3. Needs and benefits: The regulation increases transparency by requiring internet and digital political advertisements in the form of independent expenditures on online platforms to comply with certain disclosure requirements. The proposed regulation also aims to prevent foreign influence in State and Local elections by prohibiting foreign entities from purchasing political advertisements. Further, the proposed regulation requires Independent Expenditure committees to disclose internet and digital political advertisements to the State Board in certain formats so the Board can create and maintain a database of internet and digital political advertisements on its website.
4. Costs:
a. This regulatory amendment does not increase costs to regulated parties as the regulation reflects only existing statutory obligations. There is a cost related to the time and effort of Online Platforms, who now have to collect registration forms from Independent Expenditure committees purchasing political advertisements. There is an increased cost to the time and effort for Independent Expenditure committees who have to report all internet and digital advertisements and disclose them to the State Board in certain formats.
b. There is an increased cost to the State Board, as the State Board is now obligated to collect records and copies of internet and digital advertisements from Independent Expenditure Committees and create and maintain a database on its website of such advertisements.
c. This assessment of cost is based on the nature of the regulation.
d. This regulatory amendment does not create new costs as the reporting obligations are in Election Law 14-107.
5. Local government mandates: There are no additional responsibilities imposed by this rule upon any county, city, town, village, school district, fire district or other special district.
6. Paperwork: This proposed rule imposes no new reporting or regulatory filing requirements not provided for by statute, but statutory compliance requires Online Platforms to collect registration documents from Independent Expenditure committees.
7. Duplication: There is no jurisdictional duplication created by this rulemaking.
8. Alternatives: This rulemaking amends the existing regulations to conform to the requirements of Election Law §§ 14-107 and 14-107-b as amended by Chapter 59 of the Laws of 2018. The definition of the term online platform could be amended to include more or less entities.
9. Federal standards: Not applicable.
10. Compliance schedule: The rule provides no new compliance schedules not already expressly provided for by §§ 14-107 and 14-107-b of the Election Law.
Regulatory Flexibility Analysis
1. Effect of rule: There is no impact on local government due to this rule. This rule will have a minimal impact on small business. Should a small business engage in independent expenditures, the existing statute and regulation would require the committee to register and report activity to the State Board of Elections. This rule reflects a statutory amendment to Election Law §§ 14-107 and 14-107-b in 2018.
2. Compliance requirements: If a small business engaged in independent expenditures, it is required under existing law to register with the State Board of Elections as a political committee and to comply with the provisions of Article 14 of the Election Law, as applicable, including disclosing internet and digital political ads. In regards to the definition of “Online Platform,” the proposed definition functionally excludes small businesses that operate a website. This rule has no impact on local governments.
3. Professional services: A small business that engages in independent expenditures may acquire accounting services to maintain and report activity to comply with the existing reporting requirements. This rule making, conforming the statute to the regulatory text, does not significantly change any such potential need.
4. Compliance costs: It is unclear what the compliance costs are for regulated business or industry to comply with this rule. This rule making, conforming the statute to the regulatory text, does not significantly change any such potential need. Nothing in this rule mandates any entity to engage in the activities triggering filing requirements.
5. Economic and technological feasibility: Our assessment of the economic and technological feasibility of compliance with this rule, as with the existing rule, is that a small business would need a computer to make required disclosures.
6. Minimizing adverse impact: The rule requires no mitigation of impacts on small businesses as it regulates independent expenditures and reporting by those entities which choose to engage in those activities on an equal basis. The rules does not require engaging in such activities. The rules has no impact on local governments.
7. Small business and local government participation: The State Board of Elections has solicited and will continue to solicit public comment. This would include comments that may suggest alternatives to minimize the impact on small businesses that choose to make independent expenditures regulated by Article 14 of the Election Law.
For rules that either establish or modify a violation or penalties associated with a violation: not applicable.
Initial review of the rule, pursuant to SAPA § 207: not applicable.
Rural Area Flexibility Analysis
Under SAPA 202-bb(4)(a), when a rule does not impose an adverse economic impact on rural areas and the agency finds it would not impose reporting, recordkeeping, or other compliance requirements on public or private entities in rural areas, the agency may file a Statement in Lieu of. This rule has statewide application, amending the rules for independent expenditure reporting as provided by Election Law §§ 14-107 and 14-107-b. The proposed rule does not create any new reporting, recordkeeping or other routine compliance requirements as they are already expressly required by law. Accordingly, this rule has no adverse impacts on any area.
Job Impact Statement
1. Nature of impact: This rule should have minimal or no impact on jobs as it amends existing independent disclosure requirements by political committees and provides that Online Platforms collect registration forms from Independent Expenditure committees.
2. Categories and numbers affected: This rule will impact committees which engage in independent expenditure activity and Online Platforms. This rules will not create employment opportunities.
3. Regions of adverse impact: This rules has a statewide applicability, and has no disproportionate adverse impact on jobs or employment opportunities in any region.
4. Minimizing adverse impact: The State Board of Elections has not taken any measures to minimize adverse impact on existing jobs or promote the development of new employment opportunities because the State Board of Elections has determined this rule would not have an adverse impact on jobs.
5. Self-employment opportunities: Not applicable.
6. Initial review of the rule, pursuant to SAPA § 207: Not applicable.
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