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Client Alert: Reminder of Obligation to Report Certain Political Contributions in Pennsylvania

12.01.08

Under Pennsylvania statute 25 P.S. § 3260a, entities that are awarded non-bid contracts[1] by the Commonwealth of Pennsylvania or any of its political authorities (such as PSERS and SERS) must file a report of political contributions with the Pennsylvania Secretary of State by February 15 of each year. This report must list all political contributions made in the preceding year (x) by the officers, directors, associates, partners, limited partners,[2] individual owners, members and employees of the entity, and members of their respective immediate families[3] (collectively, "Covered Persons") (y) to state and local elected officials and candidates for state and local elected office (z) if a Covered Person's contributions exceeded $1,000 in the aggregate for all candidates and officials in that year. A form of report is attached to this client alert as Annex A and information from filed reports will be publicly available.  (Click here for Annex A).


The general partner and management company of a fund (the general partner, management company and fund, collectively, the "Fund Entities") admitting a Pennsylvania state authority as a limited partner must file the report and the report must cover all Covered Persons of all Fund Entities. The report must list all qualifying contributions by owners, officers, directors, partners, members, associates of the Fund Entities and their respective immediate families. With respect to employees of the Fund Entities and their immediate families, only those contributions known to the entity’s management must be listed (based on, for instance, an annual survey sent to each employee). If a Covered Person contributes more than $1,000 in the aggregate, the Covered Person's contributions must be listed even if their contributions to each individual candidate or officeholder do not exceed $1,000. If a Fund Entity's Covered Persons have not made contributions that, in the aggregate, meet the threshold, the entity does not have to file a report.


In addition to the obligation imposed by the statute, certain state authorities include obligations in their side letter agreements that the fund must provide copies of the reports to them by February 15 of each year too.


Please call Keith Kaplan at (215) 569-4143 or Jon Katona at (215) 569-4222 if you have any questions about this obligation.


[1]          A negotiated investment by a state authority (such as PSERS or SERS) in an investment fund constitutes a "non-bid contract" covered by the statute.
 
[2]               A reporting fund entity is not required to report the political contributions of its unaffiliated limited partners as long as the unaffiliated limited partner does not directly enter into an agreement with the state agency. 
 
[3]               A person’s "immediate family" includes his or her spouse and unemancipated children.