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Fair Elections Fund

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.

Objective

The objective of the audit is to determine whether the Clerk and Recorder’s Office is adequately prepared to administer the Fair Elections Fund ahead of the next municipal election in April 2023.

Background

In 2018, Denver voters approved the creation of the Fair Elections Fund to publicly finance some campaigns and promote fairness and equity in municipal elections. The fund is meant to empower average residents and reduce the influence of large donations.

The City and County of Denver sets aside some General Fund dollars to support the Fair Elections Fund. Participating candidates agree to subject themselves to lower campaign contribution limits and they must accept only smaller donations. In return, the Fair Elections Fund will provide those candidates with matching contributions of nine times the amount of each small-dollar donation they collect.

Why this matters

The Clerk and Recorder’s Office needs sufficient policies and procedures and a developed evaluation strategy to ensure the city’s Fair Elections Fund achieves the goals that voters had in mind when they approved the program in 2018 — namely to reduce the impact of large donations and those from political action committees and to increase the impact average residents can have.

Findings

Finding 1 - The Clerk and Recorder’s Office Lacks Fully Developed Policies and Procedures to Administer the Fair Elections Fund

While the office has taken some steps to create required policies, many gaps remain as of early February 2022.

The office can better prepare itself to administer the Fair Elections Fund by creating and implementing a comprehensive set of documented policies and procedures that would help ensure the city complies with Denver ordinance, local election rules, and leading practices.

Finding 2 - The Clerk and Recorder’s Office Has No Strategy to Evaluate the Success of the Fair Elections Fund

As of early February 2022, the office lacks a plan to evaluate the fund and ensure it achieves its intended goals of reducing the influence of large donations in municipal elections. Without a program evaluation plan, city staff members will not:

Be able to monitor the fund’s progress.
Have the information they need to improve the fund.
Necessarily share information with the public about whether the fund is fulfilling voters’ intended goals.

Recommendations

1.1 Develop and Implement Policies and Procedures – As soon as possible, the Clerk and Recorder’s Office should develop and implement policies and procedures that meet the requirements of city ordinance and election rules, as applicable, and ensure:

Only certified candidates receive money from the Fair Elections Fund.
The city accurately calculates the matching funds and pays them on time.
The city offers online and in-person training for candidates who receive the matching public funds.
Only match-eligible contributions are approved.
The office audits candidates’ campaign finance reports.
Participating candidates spend the matching public funds in line with election rules and city ordinance.

Agency Response: Agree, Implementation Date – August 1, 2022

2.1 Design and Implement a Program Evaluation Plan – Before Aug. 15, 2022, the Clerk and Recorder’s Office should design and implement a plan to evaluate the Fair Elections Fund to ensure it continuously collects data and analyzes performance indicators to assess the fund’s effectiveness, efficiency, and impact before, during, and after municipal elections. The analysis should be well-documented, involve relevant stakeholders and the public, and serve as the foundation for ongoing quality improvement and management decision-making regarding the Fair Elections Fund.

Agency Response: Agree, Implementation Date – August 1, 2022

2.2 Develop Communication Protocols – Before Aug. 15, 2022, the Clerk and Recorder’s Office should develop formal protocols to communicate with relevant stakeholders and the public about evaluations of the Fair Elections Fund to improve the fund’s performance.

Agency Response: Agree, Implementation Date – August 1, 2022

Auditor's Letter

May 19, 2022

The objective of our audit of the Denver Fair Elections Fund was to determine whether the Clerk and Recorder’s Office is adequately prepared to administer the fund in compliance with city campaign finance laws and regulations ahead of the next municipal election in April 2023. I am pleased to present the results of this audit.

The audit found that, as of early February 2022, the Clerk and Recorder’s Office does not have fully developed policies and procedures to administer the Fair Elections Fund and it has no strategy to evaluate how well the fund works. But it is making progress.

By implementing recommendations to develop and implement comprehensive policies, a program evaluation plan, and a communication plan, the Clerk and Recorder’s Office will be better equipped to administer and improve the Fair Elections Fund now and in the future.

This performance audit is authorized pursuant to the City and County of Denver Charter, Article V, Part 2, Section 1, “General Powers and Duties of Auditor.” We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

We extend our appreciation to the personnel in the Clerk and Recorder’s Office who assisted and cooperated with us during the audit. For any questions, please feel free to contact me at 720-913-5000.

Denver Auditor,

Timothy O'Brien, CPA