Reimagining Federal Election Funding

Source: PECF Tax Checkoff Chart 

Reallocating the PECF to Elections 

Reallocating the PECF to elections would provide consistent, additional federal resources to meet a clear and growing need. Election administrators have long called for increased resources for elections, and BPC has echoed those calls to Congress for additional federal funds. The time has come for a new mechanism for election funding. By reallocating the PECF to elections, the federal government gives agency to voters to fund elections. In turn, this incentivizes state and local governments to invest in their election infrastructure as well.  

To understand the current state of election funding, we look to federal grant programs that provide one-off assistance to election offices across the United States. 

A Brief History of Federal Election Funding in the U.S. 

The Help America Vote Act (HAVA) of 2002 established the Election Assistance Commission (EAC) to assist states with federal elections and provide funds for states to replace outdated voting systems. HAVA created minimum election administration standards for states and local government responsible for administering federal elections. Prior to HAVA, there was no federal mechanism for providing state and local governments with funds for election administration. 

As of September 2020, over $4 billion in federal funds has been awarded to 50 states, the District of Columbia, and five U.S. territories since the first year of HAVA grants in 2003. While that money has come in sporadically, it averages approximately $244 million per year each year from 2003 to 2020. For more details on the HAVA grants, see Appendix B. 

Source: EAC 2020 Grant Expenditure Report 

More recently, Congress appropriated $880 million for election security grants in FY2018, FY2020, and FY2022. This was the biggest influx in federal resources for voting since the years immediately following the passage of HAVA. These election security grants were in response to cybersecurity concerns identified during the 2016 election and were allocated to six categories: voting equipment, post-election auditing, voter registration systems, cybersecurity, communication, and other expenses. See Appendix B for a breakdown of the funding by category.  

In 2020, in response to the COVID-19 pandemic, Congress passed the CARES Act, which allocated an additional $400 million to election administrators across the United States. This funding went to voting processes (such as the additional costs of printing mail ballots, installing drop boxes, and leasing larger polling places to accommodate social distancing), staffing, supplies, security and training, communications, subgrants, and other expenditures (such as storing and delivery costs) that arose due to administering voting during a pandemic.    

In the time since HAVA was enacted, elections in the United States have been designated as critical infrastructure. A consistent federal investment in election infrastructure would mitigate local vulnerabilities spread among thousands of jurisdictions that could have national implications if exploited. 

Keeping the PECF Focus on Elections 

The PECF should be reallocated to state and local election offices because they are in dire need of consistent and regular funding. Giving voters the agency to redirect an existing but functionally defunct funding allocation for campaign finance to another similar, yet more viable, elections and democracy-related focus just makes sense.  

Federal funding of elections has largely been reactive and intermittent. HAVA, for example, passed in response to the election system weaknesses exposed by the 2000 election. The 2018 and 2020 election security grants came in response to foreign attempts to interfere in the 2016 election. And despite the CARES Act funding, election administrators across the country did not have sufficient funds in 2020 to meet the demands of conducting a presidential election during a global pandemic. 

To supplement the CARES Act funding, the Center for Tech and Civic Life issued approximately $356 million in private funding to local election jurisdictions in 2020. Those funds are likely not coming again; moreover, we believe that, to avoid the appearance of bias, funding elections is an inherently governmental responsibility. 

The PECF’s original intention was to provide public support for candidates running for office. By reallocating the fund to election administration, Congress would demonstrate a large investment in free, fair, and secure elections. Election administration bolsters the legitimacy of the candidates elected to public office by ensuring they are elected democratically.  

What Reallocating the PECF Could Achieve 

Consistent federal funds would contribute to maintaining and updating voter registration systems, providing accessible and secure options for voters to cast a ballot, ensuring fair and efficient ballot tabulation processes, and improving the physical security and cybersecurity of election offices. Recommendations for what funds would be used for in each of these four areas are documented in Prioritizing Achievable Federal Election Reform, a cross-partisan effort of five nonprofit think tanks. The funds would also support staffing and resource shortages. Unlike the HAVA grants, the reallocation of the PECF would guarantee annual, regular funding to support high-caliber election best practices.   

A reallocation of the PECF to election administration block grants could very well inspire more participation than the 3.34% of tax filers who contributed to it in 2021. By our estimation, if 28% of tax filers checked the PECF box today, it would generate approximately $194 million per year for the PECF. (See Appendix C for the analysis.) If distributed biennially, this number would approach $400 million in the year after a federal election. Increasing the checkoff to $5/$10 would get closer to the $400 million per year, which BPC believes is needed over the long term. Americans know that democracy is at stake, and maybe more willing to contribute to funding election administration than they are to public campaign finance. 

Conclusion 

The PECF is the only federal tax checkoff that allows the American public direct control over how the federal government spends taxpayer dollars. The original intent of the fund—to publicly fund presidential campaigns—has been rendered moot by the stark realities of financing presidential campaigns. By redistributing the PECF to support election administrators, Congress would empower the American public to directly invest in free and fair elections, improving democracy in a democratic manner.  

Appendix A: PECF Funding 

The PECF provides campaign finance to presidential candidates for primaries and for the general election. To be eligible for primary matching funds, candidates must meet a fundraising minimum of $5,000 in each of at least 20 states (i.e., over $100,000 total). Only a maximum of $250 of each individual contribution is counted in determining whether a candidate has met the $5,000 threshold in each state, so a minimum of 20 contributors is required in each of at least 20 different states.  

Eligible presidential candidates must agree to limit their campaign spending for all primary elections to $10 million plus a cost-of-living adjustment. They must also agree to limit campaign spending in each state to $200,000 plus a cost-of-living adjustment or to a specified amount based on the number of voting age individuals in the state. Finally, eligible presidential candidates must limit spending from personal funds to $50,000 if they use primary matching funds. 

General election funds are available to major party presidential nominees in the form of $20 million grants plus a cost-of-living adjustment. To be eligible, nominees of a major party must agree to limit their spending to the amount of the grant and may not accept private contributions for their campaign. Candidates may spend an additional $50,000 from their own personal funds when they take from the general election fund, which does not count against their expenditure limit.  

In 1976, each major party nominee received $21.8 million in general election funds. By 2008—the last year a major party candidate chose to accept a general election grant—that amount had grown to $84.1 million. If major party candidates chose to accept general election grants in 2020, they would have each received $103.7 million. 

Appendix B: EAC Funding 

HAVA Section 101 funds were distributed in 2003 and have been used for a wide range of activities including, but not limited to, voter education, training poll workers, and securing and storing voting equipment. Section 251 funds, also known as requirements payment grants, have been used for improving voting systems including voter registration, system compliance, and implementing provisional ballots and ballot identification for first-time voters. 

The level of funding provided by the HAVA sections 101 and 251 grants has allowed states to begin making needed investments, but the vulnerabilities and needs are far greater than existing funding allows, and will require regular expenditures over several funding cycles. 

The election security grants distributed in FY2018 and FY2020 are broken down into six categories. And the CARES Act funding of 2020 is distributed into seven categories. See below. 

Source: EAC 2020 Grant Expenditure Report 

Appendix C: Projected PECF Contribution 

To arrive at the projection that if 28% of tax filers were to contribute to the PECF, it would generate $194 million annually, we first examined the total number of 1040 tax filers, the PECF IRS tax checkoff percentage, and the total checkoff year to date.  

Tax filers who file jointly have the option to contribute $6 to the fund ($3 for themselves and $3 for their spouse), while single tax filers have the option to contribute $3 to the fund. To generate the average contribution to the PECF per tax filer, we first multiplied the IRS checkoff percentage by the total 1040 tax filers per year. That calculation gave us the estimated number of tax filers who contributed to the fund. We then divided the total checkoff YTD by the estimated number of filers who contributed to determining the average contribution per tax filer for the years 2017 through 2021. Averaging those five numbers, we arrived at an average of $4.40 per tax filer contributed to the PECF per year. 

Approximating the total number of 1040 tax filers using 2021 totals and multiplying that number by a projected 28% of tax filers gives us a total of approximately 44 million tax filers who would need to check the box. If a tax filer averages a $4.40 contribution, we multiply 44 million filers by $4.40 to get $194 million added to the PECF per year.