Cost Estimates of a Program for Public Financing of

Campaigns for State-Level Political Offices in Washington

John E. King

May 16, 2006

Background

Various proposals have been presented to the Washington State Legislature to establish a program for public financing of campaigns for state-level political offices. The proposals generally encompass races for statewide executive offices, the state legislature, and the state Supreme Court.

There are several uncertainties as to how much such a program would cost, some of which are noted below. A reasonable starting point for making a cost estimate is the aggregate amount spent in recent years on races as to which public financing would be available under the proposals. The addition of estimated costs for administration, enforcement, and voter education would then yield a base-line estimate for operating a public financing program that would provide overall funding at levels comparable to those of the recent past.

Once such a base-line estimate is established, the ways in which costs of a program are likely to depart from past experience can be approached incrementally. Factors likely to affect such costs include both (a) those generated by specific provisions of the public financing program itself (for example, requirements established to qualify for public funding and prescribed levels of public funding) and (b) those attributable to general factors (for example, trends in overall costs associated with political campaigning). In the aggregate, such factors might have the effect of either increasing or decreasing the estimated cost of the program relative to historical levels.

Current Costs of Candidates’ Campaigns for State-Level Political Offices in Washington

Elections are held every four years in Washington – most recently in 2004 – for the following nine statewide executive branch offices:

· Governor

· Lieutenant Governor

· Attorney General

· State Auditor

· Public Lands Commissioner

· Insurance Commissioner

· Secretary of State

· Superintendent of Public Instruction

· State Treasurer.

In the legislative branch, elections are held every two years, in even-numbered years. Senators and representatives are elected from forty-nine districts, with one senator elected for a four-year term and two representatives each elected for a two-year term from each district (twenty-four or twenty-five senators being elected every two years).

In the judiciary, each of the nine justices of the Supreme Court serves a six-year term, with three justices being elected statewide every two years, also in even-numbered years.

The electoral pattern discussed in the preceding paragraphs results in a four-year election cycle that includes one even-numbered year in which state executive, legislative, and judicial races are held, one even-numbered year in which only legislative and judicial races are normally held at the state level, and two odd-numbered years in which no state level races are routinely held. (Exceptions to the general pattern exist and numbers are augmented slightly to the extent special elections are held to fill vacancies in various positions). The period 2001 – 2004, inclusive, constituted such a cycle.

According to the Washington State Public Disclosure Commission (“PDC”), the following amounts were spent by candidates on state level races held in the 2001 –2004 election cycle1:

2001: $ 992,571

2002: $16,750,920

2003: $ 400,496

2004: $40,765,365

Total: $58,909,352

That amounts to an annual average of $14,727,338 during the four-year period.

According to the U.S. Census Bureau,2 Washington’s population was 5,894,121 on April 1, 2000, and 6,203,788 on July 1, 2004. Averaging those numbers yields a figure of 6,048,955, which if divided into the average annual cost of state level elections during the same period yields a cost of $2.43 per Washington resident per year.

Independent Expenditures

Independent expenditures are amounts spent in support of or opposition to particular candidates by individuals or groups who are not affiliated with the campaigns of those candidates or of other candidates in the same races. Programs for public financing of political campaigns frequently address the issue of independent expenditures by supplementing to some extent initial grants made to candidates participating in the programs to at least partially compensate for independent expenditures made in opposition to those candidates or in support of their opponents. Accordingly, the existence of independent expenditures has the potential to increase the cost of a public financing program above what it would be in their absence.

According to the PDC, independent expenditures pertaining to state-level races in Washington for the calendar years 2001 – 2004 were as follows3:

2001: $ 33,389

2002: $ 739,863

2003: $ 0

2004: $7,982,704

Total: $8,755,956

This amounts to an annual average of $2,188,989 during the four-year period, or an average of $0.36 per Washington resident per year.

Administration, Enforcement, and Voter Education Costs

In addition to expenditures for campaigns, a public financing program would incur costs for administration, enforcement, and voter education. A reasonable model for estimating those costs may be found in the experience of Arizona, which has had a state-level public financing program in place since 2000 and has a population roughly comparable to Washington’s (2001 – 2004 averages: Washington, 6,048,955; Arizona, 5,437,2334). According to the 2001 – 2004 annual reports of the Arizona Citizens Clean Elections Commission,5 Arizona’s average annual expenditures for administration and enforcement of its program for the years 2001 – 2004 were $703,886 and for voter education were $1,568,374, for an average annual total of $2,272,260.

The aggregate amount of Arizona’s annual grants to candidates during the 2001 – 2004 period averaged only $4,289,018 per year, but because of substantial fixed-cost components not tied to the amounts of grants, it may be assumed that administration, enforcement, and voter education costs would be somewhat higher, although not proportionately so, if aggregate grant amounts were materially higher. Assuming Washington’s administration, enforcement, and voter education costs were 50% higher than those incurred by Arizona during the 2001 – 2004 period would yield an average annual cost of $3,408,390, or $0.56 per Washington resident per year.

Summary of Estimated Annual Program Costs

Adding the various program cost elements discussed above yields the following:

Average annual costs

Overall Per Washington resident

Candidates’ expenditures: $14,727,338 $2.43

Independent expenditures: $ 2,188,989 $0.36

Administration, enforcement,

and voter education costs $ 3,408,390 $0.56

Total: $20,324,717 $3.366

Variables Likely to Affect Program Costs

Various factors might affect the cost of a state-level public financing program in Washington, including:

· The proportion of candidates who would choose to use the public funding option, as opposed to the traditional private funding option

· The potentially increased number of candidates who would choose to run for office because of the availability of the public funding option

· Requirements established for candidates to qualify for public funding

· Levels of initial public funding established for various races for both primary and general elections

· Supplemental amounts, if any, granted to participating candidates in response to higher levels of expenditures by nonparticipating candidates

· Supplemental amounts, if any, granted to participating candidates in response to independent expenditures pertaining to their races

· Actual costs incurred by the program for administration, enforcement, and voter education functions

· Inflationary trends and other variations in general costs of political campaigns.

Conclusion

Many of the foregoing variable factors are within the discretion of those designing a public financing program. For example, the number of candidates attracted to the program – and the associated costs of publicly funding those candidates’ campaigns – would likely be affected by the numbers and amounts of qualifying contributions candidates might be required to raise in order to participate in the program. Ideally a public financing program would provide sufficient incentives to encourage participation by excellent candidates and enable them to run competitive campaigns without incurring undue overall program costs.

Whatever the precise parameters of a program that might be adopted, it is apparent that Washington could implement a public financing program that would provide as much aggregate funding as was expended on behalf of all the political campaigns for its state-level offices in the 2001 – 2004 election cycle for approximately $3.36 per Washington resident per year.