SB 461 — AN ACT CONCERNING POLITICAL SPENDING AND STATE-GRANTED CORPORATE POWERS.

2816(b) 8Whenever ofany 12corporation Raisedis Billmore No.461than dissolutiontwo years in default of afiling corporationits annual report as providedrequired inby thissection section.33-1243, the Secretary of sSB461 / File No.

(b)568 Whenever8 anysSB461 corporationFile isNo. more than two years in default of filing its annual report as required by section 33-1243, the Secretary of the State may notify such corporation by electronic mail addressed to such corporation and sent to the corporation'selectronic mail address as last shown on the Secretary's records that under the provisions of this section the corporation is to be administratively dissolved.

568 the State may notify such corporation by electronic mail addressed to such corporation and sent to the corporation'selectronic mail address as last shown on the Secretary's records that under the provisions of this section the corporation is to be administratively dissolved.

(c) Whenever it comes to the attention of the Secretary of the State that a corporation has failed to maintain a registered agent or that such registered agent cannot, with reasonable diligence, be found at the address shown in the records of his[his] the Secretary's office, the Secretary of the State may notify such corporation by electronic mail addressed to such corporation sent to such corporation at its electronic mail address as last shown on the Secretary's records that under the provisions of this section the corporation is to be administratively dissolved.

Unless the corporation within three months of the mailing of such notice files an appointment of registered agent, the Secretary of the State shall prepare and file in his[his] the Secretary's office a certificate of administrative dissolution stating that the delinquent corporation has been administratively dissolved by reason of its default.

(d) Whenever the Secretary of the State is notified by the State Elections Enforcement Commission that the commission has determined, pursuant to section 9-7b, that aacorporation corporationhas violatedviolatedthe the provisions of subsection (a) of section 1 of this act, the Secretary of the State may notify such corporation by electronic mail addressed and sent to such corporation at its electronic mail address as last shown on the Secretary's records that under the provisions of this section the LCOcorporation No.is to be administratively dissolved.

2816The 9Secretary of 12the RaisedState Billshall enter a certificate of dissolution upon the record of the corporation not later than ninety days after notifying such corporation, except that the Secretary shall delay entering such certificate upon receipt ofnotificationfromtheState ElectionsEnforcement Commission sSB461 / File No.

461568 corporation9 issSB461 toFile beNo. administratively dissolved.

Unless568 the corporation, within three months of the sending of such notice, provides to the Secretary documentation indicating that suchits corporationdetermination has been appealed the determination of the commission in accordance with the provisions of chapter 54,54. the Secretary of the state shall prepare and file in his office a certificate of administrative dissolution stating that the violative corporation has been administratively dissolved by reason of such violation.

IfUpon theresolution corporation,of within such threeappeal, months,the providesState toElections Enforcement Commission shall notify the Secretary suchof documentation,the State as to whether such administrativecertificate of dissolution shallmay be stayedentered until,andinaccordanceupon with,anythe finaljudicialresolutionofsuchrecord appeal.of such corporation.

[(d)]Upon (e)receipt Dissolutionof shallsuch benotification, effective upon the filing by the Secretary of the State inshall hisenter office of such certificate ofimmediately. administrative dissolution.

[(d)] (e) Dissolution shall be effective upon the filing by the Secretary of the State in [his] the Secretary's office of such certificate of administrative dissolution.

LCO(4) No.the foreign corporation does not inform the Secretary of the State under section 33-1217 or 33-1218 that its registered agent or registered office has changed, that its registered agent has resigned or that its registered office has been discontinued within sixty days of the change, resignation or discontinuance;

2816(5) 10an incorporator, director, officer or agent of 12the Raisedforeign Billcorporation signed a document he knew was false sSB461 / File No.

461568 (4)10 thesSB461 foreignFile corporationNo. does not inform the Secretary of the State under section 33-1217 or 33-1218 that its registered agent or registered office has changed, that its registered agent has resigned or that its registered office has been discontinued within sixty days of the change, resignation or discontinuance;

(5)568 an incorporator, director, officer or agent of the foreign corporation signed a document he knew was false in any materialrespect with intent that thedocument be deliveredto the Secretary of the State for filing;

or (7) the Secretary of the State is notified by the State Elections Enforcement Commission that the commission has determined, pursuant to section 9-7b, that the foreign corporation has violated the provisions of subsectionsubsection(a)ofsection1ofthisact,except (a)ofsection1that ofthisact,excepttheSecretary that,shalldelay ifsuchforeigncorporationappeals such determinationrevocation inupon accordancereceipt with the provisions of chapternotification 54,from anythe suchcommission revocationthat shallits bedetermination stayedhas until,been andappealed in accordance with,with anythe finalprovisions judicial resolution of suchchapter appeal.54.

Upon resolution of such appeal, the State Elections Enforcement Commission shall notify the Secretary of the State as to whether such revocation may be resumed.

Upon receipt of such notification, the Secretary of the State shall resume such revocation immediately.

7 January 1, 2027 33-1225 Statement of Purpose:Legislative Commissioners:

ToInSections3(c)and(e), (1)and6(c)and(e),"hisoffice"waschangedto"[his] prohibitthe anySecretary's corporationoffice" formedfor inconsistency. this state, and any foreign corporation doing business in this state, from making any political expenditure unless such political expenditure is made from a political committee established by such corporation, and (2) modify the LCO No.

2816GAE 11Joint ofFavorable 12Subst. Raised Bill No.

461sSB461 corporate/ powersthatFile thestateNo. may grant to entitiesincorporatedinthis state.

[Proposed568 deletions11 aresSB461 enclosedFile inNo. brackets.

Proposed568 additionsThe following Fiscal Impact Statement and Bill Analysis are indicatedprepared byfor underline,the exceptbenefit thatof whenthe members of the entireGeneral textAssembly, solely for purposes of ainformation, billsummarization orand resolutionexplanation orand ado sectionnot ofrepresent athe billintent orof resolutionthe isGeneral new,Assembly itor iseither notchamber underlined.]thereof LCOfor No.any purpose.

2816In 12general, fiscal impacts are based upon a variety of 12informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

Agency Affected Fund-Effect FY 27 $ FY 28 $ Resources of the General Fund GF - Potential See Below See Below Revenue Loss Note:

GF=General Fund Municipal Impact:

None Explanation The bill prohibits corporations from making political expenditures unless through that corporation's political action committee (PAC) and lays out a process by which a corporation may be administratively dissolved for noncompliance, resulting in a potential loss of revenue to the Resources of the General Fund beginning in FY 27.

The potential revenue loss is associated with the additional corporations that would be subject to administrative dissolution under the bill.

The exact revenue loss will depend on the number of violations and dissolutions processed.

The Out Years The annualized ongoing fiscal impact identified above would continue into the future, subject to the number of violations and dissolutions processed due to the provisions of the bill.

sSB461 / File No.

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568 OLR Bill Analysis sSB 461 AN ACT CONCERNING POLITICAL SPENDING AND STATE- GRANTED CORPORATE POWERS.

SUMMARY This bill prohibits corporations (whether formed in Connecticut or authorized to conduct business here) from making expenditures (as defined under the state’s campaign finance laws;

see BACKGROUND) unless they are made by a corporation’s political committee (PAC;

see BACKGROUND).

The prohibition applies regardless of existing state law or any corporation’s filed certificate of incorporation or the related bylaws.

Corporations that violate this requirement may be subject to (1) administrative dissolution or (2) revocation of their certificate of authority to conduct business in the state (§ 1).

(This prohibition may be seen as an unconstitutional condition on free speech and may be vulnerable to challenge as violating a corporation’s constitutional First Amendment rights and existing U.S.

Supreme Court precedent.

Presumably, it does not affect a corporation’s ability to make independent expenditures (IEs) under state or federal law (see BACKGROUND).) Under current law, the state gives certain general powers to both for- profit and non-profit corporations formed or doing business here, such as the authority to make payments or donations or conduct other lawful acts to further the corporation’s business affairs.

The bill restricts these powers by adding the prohibition described above (§§ 2 & 5).

Under the bill, if theState Elections Enforcement Commission (SEEC) notifies the secretary of the state (SOTS) that it has determined a corporation formed under Connecticut law violated the prohibition, the sSB461 / File No.

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568 secretary may notify the corporation, through an email as last shown in her records, that it will be administratively dissolved.

Unless, within 90 days after SOTS notifies the corporation, SEEC gives SOTS documentation of the corporation’s appeal of the determination under the Uniform Administrative Procedures Act (UAPA), SOTS must file a certificate of administrative dissolution and note the reason.

If SEEC notifiesSOTSaboutanappeal,thedissolutionisstayed.Oncetheappeal is resolved, SEEC must notify SOTS as to whether she must proceed with the dissolution.

If so, she must file the certificate immediately (§§ 3 & 6).

The bill establishes substantially similar procedures for revoking foreign (non-Connecticut) corporations’ certificate of authority to do business in the state for violating the bill’s prohibition, but it does not provide a specific deadline for SOTS to wait for SEEC’s notification of an appeal before she may proceed with the revocation (§§ 4 & 7).

(Presumably, under the bill, SOTS may choose not to notify the corporation, as the bill appears to give her discretion, and therefore not trigger the administrative dissolution or revocation procedures.) EFFECTIVE DATE:

January 1, 2027 BACKGROUND Expenditures and Contributions Under Campaign Finance Law Under state law an “expenditure,” with certain exceptions, is generally any purchase, payment, distribution, loan, advance, deposit, or gift of money or anything of value, when made to promote the success or defeat of any candidate, referendum question, or political party (CGS § 9-601b).

Similarly, individuals and committees are limited in the amount of contributions they may give to candidates or other committees.

With certain exceptions, contributions include expenditures and any gift, subscription, loan, advance, payment or deposit of money or anything of value, made to promote the success or defeat of any candidate, referendum question, or political party (CGS § 9-601a).

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568 These limits vary depending on the type of contributor and the receiving committee or candidate (for example, PACs formed by business entities may only give $5,000 to a gubernatorial candidate that is not receiving public campaign funding).

Independent Expenditures State law authorizes persons (including individuals, entities, and committees) to make unlimited IEs, which are expenditures made without the consent, coordination, or consultation of a (1) candidate or candidate’s agent, (2) candidate committee, (3) PAC, or (4) party committee (CGS § 9-601c).

Federal law has a similar definition and authorization (11 C.F.R.

§ 100.16).

PAC A PAC is (1) a committee organized by a business entity or organization;

(2) persons other than individuals, or two or more individuals organized or acting jointly conducting activities in or outside the state;

(3) an exploratory committee;

(4) a committee established by or on behalf of a slate of candidates in a primary for the office of justice of the peace, but not a candidate committee or a party committee;or(5)alegislativecaucusorlegislativeleadershipcommittee (CGS § 9-601(3)).

SEEC Authority By law, SEEC receives complaints from SOTS, registrars of voters, town clerks, and individuals under oath about alleged election law violations.

It investigates and holds hearings as it deems appropriate and may issue subpoenas and levy civil penalties (CGS § 9-7b(a)).

Related Case In 2010, the U.S.

Supreme Court ruled in Citizens United v.

Federal Election Commission, that corporations and unions have the same political speech rights as individuals under the First Amendment.

It found no compelling government interest for prohibiting corporations and unions from using their general treasury funds to make election- related independent expenditures.

Correspondingly, it struck down a sSB461 / File No.

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568 federal law banning this practice and overruled two of its prior decisions.

COMMITTEE ACTION Government Administration and Elections Committee Joint Favorable Substitute Yea 13 Nay 6 (03/23/2026) sSB461 / File No.

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