More than two dozen Pa. lawmakers reported stakes in businesses with overdue filings

Twenty members of the House and five members of the Senate disclosed income or a financial interest in companies that had overdue filings, according to a review of lawmakers’ most recent statements of financial interests. Those statements list their sources of income, creditors, business interests and gifts they’ve received. 

Representatives Russ Diamond (R-Lebanon), Jim Haddock (D-Lackawanna), Charity Krupa (R-Fayette) and Martina White (R-Philadelphia), reported income or a financial interest from businesses that were not registered with the state at all. 

More than a dozen lawmakers with overdue filings voted for the omnibus bill that shifted the reporting timeframe. As of last year, businesses are now required to submit information annually instead of once every decade. 

The new law requires businesses to list at least one individual responsible for managing and operating the business. Many of the businesses with late filings did not list those individuals, making it difficult to determine a company’s ownership structure.

Philip Hensley-Robin, the executive director of the government reform group Common Cause Pennsylvania, said it is unlikely the late filings attempt to “obscure anything” and suspects many lawmakers were simply unaware of the new requirement. 

“That said, we are not talking about just any business here,” Hensley-Robin added. “We’re talking about businesses that either employ or are owned by legislators who themselves voted on this bill and should be aware of the requirement. In that case, we can say we expect transparency, and we expect legislators who vote in our laws to also follow them.”

In response to requests for comment from the Capital-Star, more than a dozen lawmakers submitted their overdue filing or said they planned to do so. Two lawmakers said they had listed the wrong business on their statement of financial interest and have since updated it. 

Several legislators told the Capital-Star that they did not receive any notice from the Pennsylvania Department of State and therefore were unaware the filing was overdue. 

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Geoff Morrow, a spokesperson for the department, said the agency has “multiple outreach methods it uses to communicate with businesses about the annual report requirement” including advertising campaigns, outreach events and mailed reminders.

Prior to the change going into effect last year, Pennsylvania was the only state that did not require businesses to submit an annual or, in some cases, biennial report. 

“In every state except Pennsylvania, every entity that’s created under that state’s law must make a filing every year, simply to confirm that it’s alive, and also to provide basic information,” William Clark Jr., a former chair of the Pennsylvania Bar Association, said during a 2021 hearing on the bill. “And that’s just the rule everywhere except Pennsylvania, interestingly.”

Beginning in 2027, businesses that fail to file their report will be subject to administrative dissolution six months after the reporting deadline has passed. That means, most practically, a business could lose the exclusive rights to its name. 

That deadline depends on the type of business. Domestic and foreign corporations have until June 30 of each year, limited liability companies until September 30, and limited partnerships and business trusts have until December 31. 

Even if a business has been administratively dissolved, it can be reinstated.