Researcher: TA Page 1 4/17/23 OLR Bill Analysis sHB 6910 AN ACT RESTORING THE CITIZENS' ELECTION PROGRAM. SUMMARY This bill makes several changes affecting the Citizens’ Election program (CEP), the state’s voluntary public campaign financing system available to legislative and statewide office candidates. It (1) doubles, from $6 million to $12 million, the general election grant for participating gubernatorial candidates and (2) beginning with the 2030 election, shortens the look-back period for making inflationary adjustments for gubernatorial primary and general election grants. With respect to qualifying contributions (QCs) raised by candidates participating in the CEP, the bill caps the inflation adjustments to the maximum QC by an individual at the broadly applicable contribution limits for the relevant office set in state campaign finance law. It also requires that participating statewide office candidates receive QCs from a minimum number of contributors. Beginning with the 2026 election cycle, the bill moves up, from January 15 in the year of the election to October 31 in the year preceding the election, the deadline by which the State Elections Enforcement Commission (SEEC) must adjust various CEP grant, contribution, and limit amounts for inflation (e.g., QC and grant amounts). It also makes the inflation calculation period for each of these amounts October 1- September 30, rather than January 1-December 31 as under current law. Additionally, the bill allows participating candidates to receive a CEP grant for a new election or primary ordered by a court or for adjourned elections and primaries (i.e., a tie). It aligns the deadlines for candidate committees’ final campaign finance statements before a state election or primary by requiring nonparticipating candidates who are (1) 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 2 4/17/23 unopposed or (2) opposed only by another nonparticipating candidate to file a supplemental campaign finance statement on the Thursday before the election, rather than current law’s requirement that they file a statement seven days before the election. Beginning in FY 26, the bill requires that the deposit of unclaimed property funds into the Citizens’ Election Fund (CEF) for any fiscal year before the fiscal year of a gubernatorial election be the amount deemed necessary by SEEC to pay grants to CEP candidates. It also eliminates a provision in current law requiring that transfers from the unclaimed property fund to the CEF be reduced in the subsequent fiscal year by the amount of any corporation business tax revenue deposited in the CEF. Additionally, the bill transfers an unspecified amount from the General Fund to the CEF in FY 24 (§ 6). Lastly, the bill makes technical and conforming changes. EFFECTIVE DATE: July 1, 2023 § 2 — GUBERNATORIAL GRANT S Base Amount and Inflation Adjustments Current law sets a CEP general election base grant amount of $6 million for participating gubernatorial candidates and requires SEEC to quadrennially adjust it for inflation. In 2022, the full grant amount for a participating gubernatorial candidate in a general election was $7,746,000. The bill doubles the base grant amount to $12 million and, beginning with the 2030 election, changes the timeframe for which SEEC must calculate an inflation adjustment. The bill retains existing law’s base grant amount ($1.25 million) for a participating gubernatorial candidate in a primary, but it similarly changes the timeframe for calculating the inflation adjustment starting in 2030. In 2022, the grant amount for a gubernatorial candidate in a primary was $1,613,750. Inflation Adjustment. Existing law requires SEEC to adjust CEP grant amounts based on changes in the consumer price index for all urban consumers (CPI-U) as published by the U.S. Department of Labor, 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 3 4/17/23 Bureau of Labor Statistics. Currently, SEEC must base the gubernatorial grant inflation adjustment on the CPI-U change from January 1, 2010, through December 31 in the year before the applicable election. For both primary and general election grants to gubernatorial candidates, the bill (1) retains this adjustment calculation for the 2026 gubernatorial election and (2) beginning with the 2030 election, shortens the inflation look-back period to October 1, 2023 (reducing the amount of the adjustment). Relatedly, it requires SEEC, beginning with the 2030 election, to (1) base the adjustment on CPI-U changes from this date through September 30 in the year before the adjustment must be made (presumably, the year before the election) and (2) publish the adjustment by October 31 in the year before the election, rather than by January 15 in the year of the election as current law provides. The bill makes parallel changes to other CEP inflation adjustments beginning with the 2026 election, but it does not shorten the look-back period for these adjustments (see INFLATION ADJUSTMENTS below). Changes to Other Gubernatorial Grant Amounts Existing law sets several circumstances in which participating candidates may receive only a portion of the full CEP grant amount for a general election (e.g., if running unopposed or applying for a grant 70 or fewer days before the election). In doubling the base grant to $12 million for gubernatorial candidates, the bill correspondingly doubles each of these reduced grant amounts, as shown in the table below. As under current law and the bill, SEEC must adjust each of these amounts for inflation (see above). The grant adjustments are described in more detail following the table. 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 4 4/17/23 Table: General Election Grants for Gubernatorial Candidates* Grant Current Law The Bill Reductions to the Bill’s Grant Amounts Based on Application Date 75% Grant 65% Grant 55% Grant 40% Grant Major party, full grant (full opposition) $6,000,000 $12,000,000 $9,000,000 $7,800,000 $6,600,000 $4,800,000 Major party, 60% grant (limited opposition) 3,600,000 7,200,000 5,400,000 4,680,000 3,960,000 2,880,000 Major party, 30% grant (unopposed) 1,800,000 3,600,000 2,700,000 2,340,000 1,980,000 1,440,000 Minor and Petitioning, full grant 6,000,000 12,000,000 9,000,000 7,800,000 6,600,000 4,800,000 Minor and Petitioning, 2/3 grant 4,000,000 8,000,000 6,000,000 5,200,000 4,400,000 3,200,000 Minor and Petitioning, 1/3 grant 2,000,000 4,000,000 3,000,000 2,600,000 2,200,000 1,600,000 * Must be adjusted for inflation Major Party Candidates. By law, major party candidates receive the following grant amounts: 1. the full grant amount if they are opposed by another major party candidate, or if they are opposed by a minor or petitioning party candidate who qualifies for a grant (see below); 2. 60% of the full grant amount if they are opposed only by a minor party or petitioning candidate who has not qualified for a grant; and 3. 30% of the full grant amount if they are unopposed. Minor Party and Petitioning Candidates. By law, minor party 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 5 4/17/23 candidates may receive a general election grant equal to the grant for a major party candidate only if the candidate for the same office representing the same minor party at the last regular election received at least 20% of the votes cast for that office. Similarly, an eligible petitioning candidate may receive a full grant for the general election only if his or her petition is signed by a number of qualified electors equal to at least 20% of the number of votes cast for the same office at the last regular election. (Both receive a one-third grant by meeting a 10% threshold or a two-thirds grant by meeting a 15% threshold.) Reductions Based on Application Date. Existing law has a four- step grant reduction schedule under which candidate committees that submit their applications 70 or fewer days before the election receive reduced general election grants. These reduced amounts are as follows and apply to major and minor party and petitioning candidates: 1. 75% of the full grant amount (application submitted 70 through 57 days before the election), 2. 65% of the full grant amount (application submitted 56 through 43 days before the election), 3. 55% of the full grant amount (application submitted 42 through 29 days before the election), and 4. 40% of the full grant amount (application submitted 28 days before the election through the last day that SEEC accepts grant applications). § 1 — QUALIFYING CONTRIBUT IONS Inflation Adjustment Cap: Individual QCs By law, candidates qualify for the CEP by raising an aggregate amount of QCs. QCs must come from individual donors, and SEEC must adjust for inflation both the maximum individual QC amount as well as the aggregate QC amounts. Under existing law, individual QC amounts range from $5 to $250, and the inflation-adjusted maximum for the 2022 election was $290. The bill caps inflation adjustments to maximum QC amounts at the broadly 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 6 4/17/23 applicable contribution limits by an individual for the relevant office set in state campaign finance law. Under existing law, these limits are (1) $3,500 for governor; (2) $2,000 for other statewide offices (i.e., lieutenant governor, secretary of the state, state treasurer, state comptroller, and attorney general); (3) $1,000 for state senator; and (4) $250 for state representative (CGS § 9-611(a)). Required Number of Contributors for Statewide Candidates As noted above, existing law requires that participating candidates raise an aggregate amount of QCs to qualify for a CEP grant. The bill requires that CEP candidates for (1) governor receive QCs from at least 2,250 in-state residents and (2) other statewide offices receive QCs from at least 675 in-state residents. Current law does not set a minimum number of contributors for these offices. §§ 1-3 — INFLATION ADJUSTMENT S For the CEP, existing law (1) sets base amounts for grants to participating candidates, maximum amount of a QC, aggregate amount of QCs that must be raised, and organizational expenditures and (2) requires that each of these base amounts be adjusted for inflation for each election year they apply to. Under current law, SEEC must (1) publish the adjusted amounts by January 15 in the year of the applicable election and (2) base them on inflationary changes from January 1 in a specified year through December 31 in the year before the adjustment must be made (e.g., through December 31, 2021, for the 2022 election). The bill instead requires SEEC to (1) publish the adjusted amounts by October 31 in the year before the applicable election and (2) base them on inflationary changes from October 1 in a specified year through September 30 in the year before the adjustment must be made (presumably, the year before the applicable election). As under existing law, SEEC must base the adjustments on the change in the CPI-U over the applicable time period. The bill’s changes apply beginning with the 2026 election cycle, except that they apply beginning with the 2030 election cycle for 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 7 4/17/23 gubernatorial grant amounts (see above). As described above, the bill also shortens the look-back period for gubernatorial grant adjustments starting in 2030. The table below shows each contribution, grant, or expenditure amount subject to an inflation adjustment and the beginning date for the inflation calculation under current law and the bill. Table: CEP Inflation Adjustments* Contribution, Grant, or Expenditure** Adjustment Frequency Inflation Adjustment Beginning Date: Current Law Inflation Adjustment Beginning Date: The Bill Primary and general election grants for governor Quadrennial January 1, 2010 October 1, 2023* Primary grant for lieutenant governor Quadrennial January 1, 2010 October 1, 2009 Primary and general election grants for secretary of the state, state treasurer, state comptroller, and attorney general Quadrennial January 1, 2010 October 1, 2009 Primary and general election grants for state senator and state representative Biennial January 1, 2008 October 1, 2007 QCs for statewide offices: aggregate amount required and maximum QC amount Quadrennial January 1, 2017 October 1, 2016 QCs for legislative offices: aggregate amount required and maximum QC amount Biennial January 1, 2017 October 1, 2016 Organization expenditure limits*** Biennial January 1, 2010 October 1, 2009 *Beginning with the 2030 election for gubernatorial grant amounts and the 2026 election for the other calculations **Inflation adjustments also apply to a new election or primary ordered by a court or for adjourned elections or primaries (see below). ***By law, organization expenditures are made by legislative caucus, legislative leadership, or party committees for the benefit of candidates or their committees. They are not considered campaign contributions, but the law places restrictions and limits on those made to benefit legislative candidates participating in the CEP. 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 8 4/17/23 § 2 — COURT-ORDERED ELECTIONS AND PRIMARIES The bill allows participating candidates to receive a CEP grant for a new election or primary ordered by a court or for adjourned elections and primaries (i.e., a tie). Currently, adjourned election and primary grants are available only for participating legislative candidates. For each office, the table below lists the contests for which a grant may be awarded and the base grant amount, which must be adjusted for inflation (see above). Table: CEP Grants for New or Adjourned Elections or Primaries Office Type of Contest Grant Amount* Governor Adjourned election, or a new election or primary ordered by a court $250,000 Lieutenant governor A new primary ordered by a court, or an adjourned primary where the candidate is campaigning jointly with the governor and there is no gubernatorial primary 75,000 Secretary of the state, state treasurer, state comptroller, and attorney general Adjourned election, or a new election or primary ordered by a court 75,000 State senator New election or primary ordered by a court** 15,000 State representative New election or primary ordered by a court** 5,000 *Must be adjusted for inflation (see above) **Existing law allows grants for an adjourned election or primary in the same amounts as shown. §§ 4 & 5 — SUPPLEMENTAL FILINGS By law, the treasurer of a candidate committee in a primary or general election with at least one candidate participating in the CEP must file supplemental weekly campaign finance statements with SEEC according to a specified schedule. For both primaries and general elections, treasurers must file the last of these statements on the Thursday before the applicable contest. Currently, treasurers for candidate committees in a state election or primary that are not subject to this requirement (i.e., nonparticipating candidate committees unopposed or opposed only by another nonparticipating candidate) must file their final campaign finance statement for an election or primary on the seventh day (i.e., Tuesday) 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 9 4/17/23 before the applicable contest. The bill instead requires them to file a supplemental statement on the Thursday before the applicable contest, aligning them with the other committees. §§ 7-9 — CEF FUNDING Gubernatorial Elections (§§ 7-9) Deposits Before Gubernatorial Elections. By law, grants to candidates participating in the CEP are made from the CEF. The CEF is funded mostly by proceeds from the state’s sale of abandoned property that escheats (reverts) to it (see BACKGROUND). The law requires that a portion of unclaimed property funds be annually credited to the CEF. Under current law, this deposit must equal the amount deposited in the previous fiscal year, adjusted for inflation by the state treasurer using the CPI-U (e.g., the deposit was $12.6 million in FY 22). Beginning in FY 26, the bill requires that the deposit for any fiscal year before the fiscal year of a gubernatorial election be the amount deemed necessary by SEEC to pay grants to CEP candidates (see below). Under the bill, (1) this SEEC-determined amount also serves as the basis for the subsequent year’s deposit (e.g., the FY 27 deposit) and (2) corporation business tax revenue must be deposited in the CEF if the unclaimed property fund does have sufficient funding to cover the SEEC-determined amount (see below). SEEC Determination. Current law requires SEEC to determine, by January 1 in a state election year, whether the CEF has enough money to provide grants to CEP candidates. The bill (1) requires SEEC to make this determination only in years in which there is an election for governor and (2) moves back the deadline to the 41st day before the primary (i.e., June 28-July 4, depending on the August primary date). Use of Corporation Business Tax Revenue (§ 9) By law, revenue from the corporation business tax must be deposited in the CEF if (1) there are insufficient unclaimed property funds in a fiscal year to cover the required deposit into the CEF or (2) during an election cycle, there are insufficient funds in the CEF to cover grants to 2023HB-06910-R000628-BA.DOCX Researcher: TA Page 10 4/17/23 qualified CEP candidates. In both cases, the deposit must equal the amount of the insufficiency. The bill eliminates a provision in current law requiring that transfers from the unclaimed property fund to the CEF be reduced in the subsequent fiscal year by the amount of corporation business tax revenue deposited in the CEF. BACKGROUND Related Bills sSB 226, reported favorably by the Government Administration and Elections (GAE) Committee, (1) increases the primary and general election grant amounts for gubernatorial candidates and (2) allows gubernatorial candidates to receive a CEP grant before the party convention if they raise the full aggregate amount of QCs. sSB 1224, reported favorably by the GAE Committee, eliminates the inflation adjustments for the aggregate amount of QCs that candidates must raise. CEF The CEF is funded mostly by a statutorily determined amount of proceeds from the sale of abandoned property that escheats to the state. If there are not enough proceeds from escheated property in a fiscal year to cover the required annual deposit, corporation business tax revenues must be deposited into the fund to cover the shortfall. The fund may also receive voluntary contributions, surplus donations from candidate committees, and proceeds from its investment earnings. The state treasurer administers the fund, which is a separate, nonlapsing account in the General Fund. COMMITTEE ACTION Government Administration and Elections Committee Joint Favorable Yea 13 Nay 6 (03/27/2023)