Denver Needs Clear Policies for Campaign Finance Matching

Published on May 19, 2022

A female candidate speaks into a hand-held microphone standing behind a lectern. The base of the lectern is illustrated as a roll of $50 bills.

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DENVER – Months ahead of the first payouts from the new Fair Elections Fund, the Clerk and Recorder’s Office is still working to ensure accuracy in how it will manage the program, according to a new audit from Denver Auditor Timothy M. O’Brien, CPA.

“The next municipal election is coming up in less than a year, and candidates are already declaring their intent to participate in the new Fair Elections Fund,” Auditor O’Brien said. “I felt it was important to audit this program now, so the Clerk and Recorder’s Office has a chance to get ahead of any outstanding operational needs.”

Our team completed a readiness audit of the Fair Elections Fund and looked at gaps in policies and procedures, as well as how the office is planning for accountability after the 2023 Denver municipal election.

The Clerk and Recorder’s Office was making progress by the time we completed our fieldwork in early February 2022. We made several recommendations to help them take the final, important steps before campaign season gets fully underway.

“If managed well, the Fair Elections Fund could help empower average residents and fewer special interests with deep pockets,” Auditor O’Brien said. “The key here is making sure the city has safeguards in place to ensure nobody can inappropriately take advantage of the new system.”

Denver voters approved the new Fair Elections Fund in 2018 with the intent to promote fairness and equity in municipal elections. Supporters’ goals were to empower average residents and reduce the influence of large campaign donations.

Under the new program, for each qualifying campaign contribution of $50 or less that participating candidates receive, the Fair Elections Fund will match that amount by nine times the original contribution. The money comes from the city’s General Fund and is not supported by an added tax. To qualify, small-donor contributions must be from Denver residents and be accompanied by receipts along with an acknowledgment that the donor freely gave the contribution.

Participating candidates must be approved and certified to participate, and they must complete training. To receive the matching public funds, they can accept money only from individuals and small-donor groups.

The first payments from the Fair Elections Fund will go out in August 2022, ahead of the next municipal election in April 2023. The last chance for candidates to apply for certification to join the program for the next election is Feb. 13, 2023.

In advance of these deadlines, the Clerk and Recorder’s Office has taken positive steps, but remaining gaps must be addressed before August.

The office needs a policy to verify campaign contributions made to participating candidates come from valid sources. And the office needs a way to confirm candidates are accepting only small-dollar contributions.

The Clerk and Recorder’s Office also needs to create a policy to ensure it accurately pays out any matching funds. And it needs to make sure candidates are trained consistently and within the required time frame.

The office needs a plan for how it will notify candidates that they have been approved to participate in the Fair Elections Fund, and it needs a way to enforce the public debate requirement for participating candidates.

Lastly, the Clerk and Recorder’s Office needs to lay out how it will consistently audit candidates’ spending.

Office staff told us they were waiting to create these important policies and procedures until after they launched their new campaign finance system — which debuted at the end of February.

Since then, the Clerk and Recorder’s Office says it is making progress in implementing our recommendations.

We also recommended the office make a plan for collecting data and setting standards so it can understand the success of the program in the long term. A program evaluation plan should be in place before August so management can track and eventually assess whether the Fair Elections Fund is achieving voters’ intended goals.

The Clerk and Recorder’s Office agreed to implement all three of our recommendations.

“I hope the Clerk and Recorder’s Office acts on our recommendations immediately,” Auditor O’Brien said. “This program must be administered consistently and in line with election rules and city ordinance.”

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Denver's Auditor

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