The 2017-18 Budget: Considering the State's Role in Elections

The 2017-18 Budget: Considering the State’s Role in Elections M AC TAY LO R • L E G I S L A T I V E A N A L Y S T • M ARC H 2 017 2017-18 BUDGET 2 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET EXECUTIVE SUMMARY Counties Administer Most Elections and Pay Elections Costs. As traditionally has been the case across the United States, county governments in California administer most local, state, and federal elections pursuant to state and federal law. Typically, counties appropriate funds from their general funds to pay for costs related to administering elections. Cities, special districts, and schools pay for a share of elections costs as well. Often, these local governments reimburse the county based on the proportion of the ballot dedicated to the local governments’ candidates and issues. Neither the state nor the federal government provides regular payments for county elections administration. State Requires Certain Activities in Elections Administration. Since 1975, the state must pay for the associated cost (in most cases) of election-related requirements imposed on counties. These requirements are called reimbursable mandates. The state has placed a handful of requirements on counties related to elections administration costing roughly $30 million in general election years. For many years, however, the state has suspended the mandates. When a mandate is suspended, the requirement remains in law but local governments do not have to comply with the requirements in that year and the state has no reimbursement obligation. Counties typically have continued to comply with these requirements, effectively paying for these state-priority costs with local funds. Recent Law Created Optional New Voting Model. Under SB 450 (Chapter 832 of 2016), counties may replace the current precinct model of voting with a new “vote center” model. Rather than opening thousands of polling places, implementing counties will be required to open a certain number of vote centers (based on population). Vote centers will be similar to polling places, but will offer more services than polling places and be open for more days. Effective Elections Administration an Important State Interest. The state has a clear interest in secure, timely, and uniform elections. While the state reaps regular benefits from county elections administration, it only sporadically provides funding to counties for election activities. Relying on the existing mandates system to provide state support to elections is ineffective. We recommend the Legislature develop a new financial relationship between the state and counties to (1) direct statewide elections policy and (2) provide a reasonable and reliable level of financial support that reflects the benefits to the state of county elections administration. The pending implementation of SB 450 provides an opportunity for the Legislature to consider how to structure such a financial relationship to ensure consistency across counties as well as address other elections issues. Create Block Grant for Ongoing Support. We suggest the Legislature consider sharing in the cost of elections through a block grant. A block grant would provide counties state support to partially offset county costs to comply with a range of elections activities specified by the Legislature. In addition to making block funding contingent on county implementation of the vote center model, the Legislature could include other elections issues like timely vote counting, protecting elections systems, keeping voter registration current, and complying with existing suspended mandates. There are various options for how to distribute the block grants. For example, basing the grant amount on the number of registered voters could encourage counties to increase voter registration. www.lao.ca.gov Legislative Analyst’s Office 3 2017-18 BUDGET 4 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET INTRODUCTION In 2016, the Legislature passed and the to that landscape in counties choosing to adopt Governor signed SB 450, the Voter’s Choice the new elections model permitted. We then Act (Chapter 832). The law allows counties to layout a framework for considering the roles and implement a new model of voting that enables responsibilities in elections. The report concludes voters to cast their votes over a period of days prior by outlining options the Legislature could consider to election day. This new model is a significant to provide financial support to counties for change in state elections policy. A subset of elections administration to ensure secure, timely, counties may implement the new model in 2018. and uniform elections. The Governor’s budget All other counties may move to this model in 2020. does not include any state support for elections This report discusses the landscape of elections administration or SB 450 implementation. administration in California today and the changes ELECTIONS IN CALIFORNIA Administration oversees county administration of elections by promulgating regulations that provide direction to Counties Administer Most Elections. counties about how to comply with statute; advising As traditionally has been the case across the local elections officials on how to administer United States, county governments in California elections; testing and approving all voting administer most local, state, and federal elections equipment used in the state; coordinating and pursuant to various requirements established compiling the tabulation of votes from each county; under state and federal law. County elections and certifying final election results. In addition, the officials administer almost every part of voting in Secretary of State has many direct administrative California including: processing voter registrations; responsibilities in statewide elections including: accepting candidate filings; verifying signatures maintaining the statewide voter registration on petitions to qualify initiatives for the ballot; system, known as VoteCal; tracking and certifying determining what equipment voters use to cast initiatives for the statewide ballot; determining the ballots at polling places; establishing precinct order of candidates on the ballot; and printing and boundaries and poll locations; printing ballots mailing the statewide voter guide. and sample ballots; mailing materials to voters (including ballots for people who vote by mail); Funding hiring and training poll workers and other County General Purpose Funds Pay Elections temporary staff; receiving ballots; and tabulating Administration Costs. Typically, a county election results. appropriates funds from its general fund to pay for Secretary of State Provides Statewide costs related to administering elections. As is the Oversight and Direction. The Secretary of State case with any general purpose funds, boards of is the state’s chief elections officer and oversees supervisors must determine how to allocate these county administration of all federal and state limited resources among a number of competing elections within California. The Secretary of State priorities. www.lao.ca.gov Legislative Analyst’s Office 5 2017-18 BUDGET Local Governments Typically Pay County to election years. Although the state has not paid Administer Elections. Counties often administer for these regular ongoing costs, it has provided elections for cities, special districts, and schools in one-time funds to counties on occasion for the county. These local governments typically pay particular elections issues. Below, we discuss a few counties for administering their local elections, examples of when counties have received one-time based on the proportion of the ballot dedicated to funds from the federal or state governments to the local governments’ candidates and issues put address specific needs in administering elections. to the voters—this cost allocation sometimes is One-Time Federal and State Funding in 2002. referred to as “ballot real estate.” Voting equipment and the administration of U.S. State Has Not Provided Regular Payments elections became a prominent issue following the for Elections Administration. The state requires contested presidential election in 2000. At the various activities to be performed by counties federal level, the Help America Vote Act of 2002 when administering elections. Proposition 4 (HAVA) established standards for federal elections. (1979) requires the state to reimburse local To help state and local governments implement governments for requirements placed upon the requirements established under HAVA, the them by the state after 1975. These requirements federal government provided funding to the states. are called reimbursable state mandates. Some California received $392 million in federal funds required elections activities are reimbursable to implement the mandates established under the state mandates. Prior to Proposition 1A (2004), federal law—$195 million of which was allocated there was no payment schedule for reimbursing to counties to comply with HAVA voting system local governments for these state mandates. As a requirements. Of the $195 million, the Secretary of result, the state went many years without paying State indicates that—as of July 20, 2016—counties counties for the costs associated with certain state have $35.6 million remaining for these purposes. elections requirements. Proposition 1A required Thirty counties have expended all of the federal the state (1) to reimburse local governments for funds available to them for this purpose, and these outstanding prior years’ mandates costs nine counties have more than 50 percent of their and (2) either to suspend or reimburse local allocated federal funds still available. In addition governments for state mandates on an ongoing to federal funds made available to counties in 2002, basis. Mandates can be suspended as part of California voters also approved the issuance of the annual budget bill. When a mandate is $200 million in state bonds for counties to procure suspended, the requirement remains in law but new voting equipment. The nearby box explains local governments do not have to comply with the what happened with these funds. suspended mandate requirements in that year. One-Time State Funding in 2016. In spring For many years, the state has suspended 2016, the Secretary of State raised concerns to the election mandates, providing no regular assistance Legislature that counties were facing high overtime to counties. Currently, the state owes counties costs and other expenses related to unusually high about $71 million for outstanding elections numbers of (1) initiatives seeking qualification mandates incurred in prior years. Despite these for the November 2016 general election and mandates being suspended, counties continue the (2) residents registering to vote before the activities associated with the suspended laws— June 2016 primary. The Legislature made available costing counties roughly $30 million in general $16.3 million in one-time state funds to reimburse 6 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET counties for specified election costs through Voter Registration in California. To be eligible Chapter 11 of 2016 (AB 120, Committee on Budget). to vote in California, a person must be (1) a U.S. The Secretary of State reports that 47 counties citizen, (2) a resident of California, (3) at least received reimbursements totaling $15.7 million. 18 years old on election day, (4) not currently The specific amount received by each county varied incarcerated or on parole for the conviction of depending on the county’s number of (1) eligible a felony, and (5) not prohibited from voting by voters and (2) signatures on initiative petitions a court due to mental capacity. Individuals can being verified. register to vote up to and including election day. Individuals registering within two weeks of Voting election day are conditionally registered—pending Beyond the specific requirements established verification they are not registered elsewhere—and in state and federal law, county elections officials must use “provisional” ballots. (Provisional ballots have discretion in how people vote in their county. are used when there are questions about a given Consequently, election operations—including voter’s eligibility. Once his or her eligibility to vote equipment used to cast and count ballots—vary is verified, the ballot is counted.) As of October 24, across counties. In addition, voter preferences vary 2016, the Secretary of State reported that 78 percent across the counties, affecting the proportion of of the approximately 25 million people eligible to (1) eligible voters who are registered to vote and vote in California were registered to vote in the (2) registered voters who vote by mail or in person November 2016 general election. Figure 1 (see next at the polling place. page) shows how voter registration varies across the state by county. A False Start in Modernizing California Voting Equipment Bond Money Provided to Counties on Matching Basis to Replace Voting Equipment. Voters approved Proposition 41 in 2002. The proposition allowed the state to sell $200 million in general obligation bonds to assist any county in the purchase of new voting equipment that was certified by the Secretary of State. In order to receive bond monies, a county had to expend $1 of county funds to receive $3 of bond monies—a three-to-one ratio of state-to-county money. The proportion of the bond monies available to each county depended on a formula that took into account each county’s number of eligible, registered, and participating voters and number of polling places. In addition to Proposition 41 money, the federal government provided $195 million to upgrade voting systems in 2002. Decertification of Purchased Voting Equipment. In the years following Proposition 41’s passage, some counties replaced defunct punch card voting systems with electronic voting equipment. By 2005, actions taken by then Secretary of State Kevin Shelley and the Legislature imposed certain restrictions on electronic voting systems. In 2007, then Secretary of State Debra Bowen established new rules relating to the testing and requirements of electronic voting equipment. Through these state actions, several counties were forced to abandon their recently purchased electronic voting systems and, instead, rely on paper-based, optical scan technology. Little has changed since 2007—most counties continue to use paper-based, optical scan systems for polling place voting. www.lao.ca.gov Legislative Analyst’s Office 7 2017-18 BUDGET Voter Participation in California. In the participated in that election. Voter participation— November 2016 election, about 14.6 million votes or “turnout”—varies significantly by the type were cast in California. This means that about of election, among other factors. Voter turnout three-fourths of registered voters in the state in presidential elections tends to be higher, for Figure 1 Share of Eligible Voters Registered to Vote Varies by County Registration as Percent of Eligible Voters Less Than 65% Between 65% and 75% Between 75% and 85% Greater Than 85% 8 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET example, while turnout for special elections tends In total, about 58 percent of the 14.6 million ballots to be low. For example, in the November 2016 cast in the November election in California were election 68 percent of registered voters in Los VBM ballots. The share of voters casting VBM Angeles voted; however, in the March 7, 2017 ballots in that election varied across the state consolidated municipal and special election, fewer from fewer than one-half of voters casting their than 20 percent of registered voters cast ballots. ballots by mail in Los Angeles, Lassen, and Merced Precinct Model of Voting. The traditional Counties to more than 90 percent of registered voting model relies on precincts—a geographical voters voting by mail in Napa, Alpine, Plumas, and subdivision of a county determined by a county’s Sierra Counties. elections official. State law generally requires Antiquated Equipment and Systems Used that each precinct include no more than 1,000 by Most Counties. All but a few counties in the voters (excluding permanent vote by mail voters). state use voting systems that are more than a Counties with high populations have thousands decade old. In many cases, components of the of precincts. Each address in a county is assigned systems no longer are supported or produced by a precinct. Each precinct has a polling place manufacturers. In one example, a county’s system where voters are expected to cast their ballot. If had a failed part that no longer is supported by a voter goes to a polling place other than the one the manufacturer or easy to replace. The county designated for his or her precinct, the voter must purchased a replacement part through eBay. In cast a “provisional” ballot. Depending on the another example, a county uses the same system election, each polling place may have numerous it used in the 1990s. Although this county’s ballot types—for example, at a primary election system has been updated periodically, it currently the polling place may have different ballots for each relies on computers that operate on Microsoft political party. In a general election, ballots will Windows XP—an operating system that was vary based on the governments and representatives released in 2001 and no longer receives free security serving the precincts at the polling place. (For upgrades or other support from the manufacturer. example, voters served by two different school Both of these examples raise serious concerns districts may be assigned to the same polling place about the security of the voting system as well as and require different ballots for school board the possibility of a catastrophic failure of voting candidates.) systems in counties. Updating these systems Voting by Mail a Popular Alternative. requires money and political support from counties California voters have the choice to cast their to spend the necessary funds on these upgrades ballots in person at a polling place or through the instead of other priorities in their budgets. In many mail. Voters who choose to vote by mail can do cases, counties appear to be allowing their systems so on a one-time or permanent basis. Voting by to “limp along” in the hope that the state or federal mail has become increasingly popular. Statewide, government will again provide financial assistance about 12.2 million voters—nearly 63 percent of to replace the systems. all registered voters—received a mail ballot in the Some Counties Plan to Replace Equipment November 2016 general election. About 70 percent Soon. Although many counties we spoke with have of these vote-by-mail (VBM) ballots were returned no imminent plans to replace their equipment, a (either through the U.S. Postal Service or dropped few counties recently acquired new voting systems. at polls) to county elections officials to be counted. Other counties have established plans to replace www.lao.ca.gov Legislative Analyst’s Office 9 2017-18 BUDGET their existing systems within a certain number of marked ballots. This modification prevents failed years, regardless of whether they receive state or punches, but still relies on the old system. Instead federal funds. Most counties with plans to replace of purchasing or leasing a system maintained by a their existing systems intend to purchase or lease vendor, Los Angeles County is in the late stages of equipment from one of a handful of vendors. developing its own open source system. Although Los Angeles County is taking a different the county will rely on a vendor to manufacture approach. It currently uses one of the most the equipment, the county will own all intellectual antiquated voting systems in the state. Their rights to the system. Figure 2 shows photographs system is referred to as a “modified punch card” of the current modified punch card system and the system, which converts punch card ballots into prototype of the county’s new system. SB 450: NEW MODEL FOR VOTING IN CALIFORNIA Under SB 450, counties may replace the current All Registered Voters Receive Vote by Mail precinct model of voting with a new “vote center” Ballots. In implementing counties, all registered model. This section explains the structure of the new voters will receive a vote-by-mail ballot. This is model for counties other than Los Angeles County. different from the model that exists today, which The requirements for Los Angeles County vary requires voters to request VBM ballots. Under somewhat, but the overarching structure is the same. the vote center model, voters may submit their VBM ballots by mail (which requires postage), by Changes to Elections Administration turning them in at drop boxes (located throughout Implementation Is Optional. Counties are not the county), or by returning their ballots to a vote required to implement SB 450. Doing so is at the center or the county registrar of voters. discretion of county elections officials. Fourteen Vote Centers Open Ten Days Prior to Election counties—Calaveras, Inyo, Madera, Napa, Nevada, Day. Senate Bill 450 requires implementing Orange, Sacramento, San Luis Obispo, San Mateo, counties to open at least one vote center per 50,000 Santa Clara, Shasta, Sierra, Sutter, and Tuolumne— registered voters ten days prior to election day. may implement SB 450 for the 2018 election cycle. (Counties with fewer than 50,000 registered voters All other counties may implement the system for must open two vote centers.) Three days prior to the 2020 election cycle. election day, counties must open at least one vote Vote Centers Replace Polling Places. center per 10,000 registered voters. The vote centers Rather than open thousands of polling places, also must be open on election day. (In some cases, implementing counties will be required to open counties may have slightly fewer vote centers in the a certain number of vote centers (based on three days prior to election day; however, counties population). Vote centers will be similar to polling with at least 20,000 registered voters must have places, but will offer more services to voters. at least two vote centers during this period.) At a Counties will have far fewer vote centers than vote center, a voter can register to vote or update polling places, but the center will be open for longer his or her voter registration and/or cast his or her periods before an election. vote either by turning in a VBM ballot or using a 10 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET voting machine. Vote centers Figure 2 must meet accessibility and Los Angeles County's language requirements as Current and Prototype Voting Machines defined in current law. As prescribed by the measure, Current Modified Punch Card Voting System vote centers also must be distributed across the county “so as to afford maximally convenient options for voters” and “established at accessible locations as near as possible to public transportation routes.” A Voter Can Use Any Vote Center in County. Today, a voter not wishing to use a VBM ballot and, instead, vote in person must go to his or her designated polling place. Under SB 450, a voter can use any vote center in his or her county. If a registered voter does not bring his or Prototype Electronic Voting System her VBM ballot to the vote center, he or she can receive a ballot and vote there. As a result, vote centers must be able to provide all ballot types at every vote center. Each county has multiple ballot types to reflect the different governments and districts serving and representing each resident. Individuals Can Los Angeles County Registrar of Voters. Simultaneously Register and Vote at Vote Centers. As already cast a ballot. As the statewide voter registry noted earlier, vote centers will be able to register of record, VoteCal will allow counties to do these voters and allow newly registered voters to vote in checks. person. To do this, vote centers will have to check Implementing Counties Must Have Plan whether an individual is already registered in Approved by Secretary of State. Counties another county as well as whether the individual implementing SB 450 must develop a plan for www.lao.ca.gov Legislative Analyst’s Office 11 2017-18 BUDGET implementing the statute’s requirements. The plan model. In part, this may be because additional costs must be developed with input from communities to implement the measure must be incurred now across the county. Moreover, counties must meet while net benefits might not be realized for many with community groups to discuss the plan and years. allow for public comment. Once a county’s plan is Remaining Work and Challenges finalized, the county must submit the plan to the Secretary of State for approval. The Secretary of Secretary of State Finalizing Necessary State may approve, approve with modifications, Regulations. The Secretary of State indicates or reject a county’s plan. Counties must update that it has nine packets of regulations that it is these plans every few years with input from their preparing to submit to the Office of Administrative communities. Law in order to complete the regulatory process and promulgate regulations related to SB 450 Fiscal Effects on Counties Uncertain implementation. The need for these regulations Overall SB 450 Costs May Be Lower Than preceded the passage of SB 450. While SB 450 Current Model in Some Counties. To implement does not require new regulations itself, its passage SB 450, counties will have to establish vote centers, assumed these regulations would be in place. provide all ballot types at every vote center, and Figure 3 summarizes these regulations. The mail all registered voters a VBM ballot, among Secretary of State is soliciting regular input from other requirements. These activities come with some the counties and is working closely with the amount of new costs not incurred under the current statewide association of county elections officials voting model. For instance, some counties may to develop these regulations. The Secretary of have to pay for the use of facilities for vote centers. State hopes to have established some regulations Vote centers also may require additional paid staff as soon as within a few months, while others for some counties. On the other hand, some costs likely will be completed several months from associated with the current voting model may now—perhaps in 2018. The Secretary of State has decline. For instance, the SB 450 system requires identified which regulations it sees as a priority for fewer voting machines. Under the current model, SB 450 implementation and hopes to promulgate counties need voting machines for potentially these higher priority regulations first. Although thousands of polling places. Under SB 450, counties the Secretary of State is working closely with will only need equipment for the significantly counties, many counties have indicated that they fewer vote centers. Whether overall elections costs are concerned that the amount of time it is taking will increase or decrease with the implementation to promulgate these regulations will hamper their of SB 450 likely will vary by county. A couple of abilities to implement the SB 450 vote center model counties considering implementing SB 450 in 2018 in 2018. To date, the state has not provided the indicated that they believe overall costs will decline Secretary of State any new resources to implement largely as a result of needing fewer voting machines SB 450 despite bill analyses that indicated the and hiring fewer poll workers. (These counties Secretary of State would incur roughly $300,000 in need to update their voting equipment for the 2018 additional annual costs. election regardless of whether they implement Unlikely That All Authorized Counties Will SB 450.) Despite the potential long-term savings of Implement the New System in 2018. Those counties SB 450, some counties may not implement the new permitted to implement SB 450 in 2018, as well 12 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET as Los Angeles County, are participating in an Significant Voter Outreach Will Be Needed. As ongoing workgroup with the Secretary of State. mentioned earlier, county registrars are required Based on conversations in those workgroups as to do significant outreach when developing their well as discussions with counties, we do not believe SB 450 implementation plans. In addition, counties that all counties permitted to implement SB 450 in will need to do significant outreach to voters 2018 will do so. In some cases, county registrars are when shifting to the new model. Voters who are concerned about garnering sufficient support for not permanent vote-by-mail voters will need to the new system from their communities and boards understand why they are receiving VBM ballots of supervisors. In other cases, counties are unsure and their options for casting their votes. For as to whether or not they can meet the equipment example, in many cases, voters who choose to vote needs—and other related costs—associated with in person have gone to the same polling place in implementation. Counties permitted to implement their neighborhood for decades to cast their ballots. the new model in 2018 will likely decide whether to Without sufficient outreach, these voters may not do so later in 2017. understand why they (1) are receiving a ballot in Figure 3 Status of Regulations Related to Elections Administration Associated Subject Statute Description Status Conditional voter Chapter 497 of 2012 Requirements related to the procedures for Developing draft. registration (AB 1436) conditional voter registration. Recounts Chapter 723 of 2015 Requirements related to the procedures for Developing draft. (AB 44) recounting ballots and how counties can impose charges on other governments for recounts. Ballot pickup Chapter 724 of 2015 Requirements related to sealing of ballots and Draft developed. (AB 363) delivery of ballots to central counting location. VoteCal Chapter 728 of 2015 Various changes to voter registration procedures Draft developed. External (AB 1020) related to the state’s voter registration system of review expected in April. record, VoteCal. Motor Voter Chapter 729 of 2015 Requirements related to canceling voter Submitted to OAL. Public (AB 1461) registrations of persons who are ineligible to vote. comment period ends in April. Also includes requirements for education and outreach on new Motor Voter registration law. Vote by mail drop Chapter 733 of 2015 Requirements related to the security of vote by mail Draft developed. External boxes (SB 365) drop off locations and drop boxes. review expected in April. Ballot printing Chapter 734 of 2015 Requirements for “ballot on demand systems,” Rulemaking documents drafted. (SB 439) which print ballots for voters as needed. SOS anticipates submitting regulations to OAL in April. ePollbooks Chapter 734 of 2015 Requirements for “ePollbooks” and their use. Rulemaking documents drafted. (SB 439) ePollbooks contain information regarding SOS anticipates submitting registered voters. regulations to OAL in April. Vote-by-mail and Chapter 821 of 2016 Requirements for processing vote by mail and Draft developed. provisional ballot (AB 1970) provisional ballots. processing SOS = Secretary of State and OAL = Office of Administrative Law. www.lao.ca.gov Legislative Analyst’s Office 13 2017-18 BUDGET the mail and (2) cannot vote at their customary implementing SB 450 is at each county’s discretion. polling place (assuming the polling place is not As a result, some counties may shift to the new being used as a vote center). Reaching out to voters model, while others may not. This could present will be particularly important due to the fact that challenges for voters who may be confused as to some counties will be implementing the new model which system their county uses. Moreover, this while neighboring counties will not. will require the Secretary of State to oversee two Moving Forward, the State May Have different types of election models. Two Different Voting Models. As noted earlier, ROLES AND RESPONSIBILITIES IN ELECTIONS Counties Best Positioned to Administer Counties (and other local governments) generally Elections. California governments form a complex bear elections’ costs without regular support from web of overlapping boundaries of federal, state, the state. and local government districts. Administering Effective Elections Administration an elections—that is, determining which residents are Important State Interest. The state has a clear eligible to vote in a particular district election and interest in secure and timely elections. Moreover, facilitating that contest—is a function best suited some level of uniformity across counties in for county government. Counties not only are elections administration is valuable. Many familiar with their landscape of governments, but legislative and other voting districts span multiple also the preferences of their residents. This local counties. Significant variation in elections knowledge allows counties to organize elections in procedures across counties could have implications a manner consistent with local needs. Counties also for voter turnout, and by extension, election results. are large enough to allow for economies of scale in State’s Financial Role in Elections. Due to voting—residents can vote for all of their elected the state’s challenging reimbursable mandates officials using one ballot in a county administered process, the Legislature does not often place election. new reimbursable requirements upon local County Administration Yields Significant governments. And when new requirements Benefits to the State. The state derives significant have been imposed, the Legislature typically benefits from county administration of elections. has suspended them to avoid reimbursement These benefits include relieving the state from to counties. Counties typically have continued organizing thousands of local government elections to comply with the requirements (because they as well as the elections for California’s members remain in state law), effectively paying for these of Congress, the State Legislature, other statewide state-priority costs with local funds. In addition, positions (like the Governor and Secretary of State), the state has made a number of changes to and statewide initiatives. In fact, in many elections, elections administration (see Figure 3) which are state issues make up the majority of the ballot. not yet identified as reimbursable mandates but While the state reaps regular benefits from county may impose new costs on counties. Given the elections administration, it only sporadically importance of uniformity in elections, relying provides funding to counties for elections activities. on the existing mandates system is ineffective. 14 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET We recommend that the Legislature develop a implementation of SB 450 provides an opportunity new financial relationship between the state and for the Legislature to consider how to structure county elections officials that allows the state to such a financial relationship to ensure consistency (1) direct statewide elections policy and (2) provide across counties as well as address other elections a reasonable and reliable level of financial issues. In the next section, we provide options for support that reflects the benefits to the state of how the state could provide such support. county elections administration. The pending STATE FUNDING OF COUNTY ELECTION ACTIVITIES Considerations for Providing Funding. In would need to set the funding at such a level as to assessing the state’s role in funding county election cover a reasonable portion of the associated costs activities, the Legislature will want to consider such so that counties would be willing to participate. key factors as existing—largely unfunded—state As an example, the Legislature could model a new mandated responsibilities; any net costs that funding arrangement along the lines of the existing might result from implementing SB 450; and Education Mandates Block Grant. This program the major costs of buying and replacing voting provides the same per-pupil funding level to machines. In addition, there may be other elections participating districts for various state educational improvements the Legislature may want that go requirements. School districts that participate in beyond current requirements. These could include the block grant—currently 95 percent of districts— timely vote counting, protecting elections systems, cannot claim reimbursement for mandate and keeping voter registration current. (The box requirements covered by the block grant. If the on the next page goes into more detail on some Legislature were to establish a similar program for of these potential issues.) When determining the county election activities, the amount of funding proper level of state support, the Legislature will provided would depend on the number of activities want to consider all existing requirements as well required and the share of counties the Legislature as any other desired improvements to the elections hoped would participate. Should the Legislature system. want elections to be more uniform across counties, A Different Process for Funding. As discussed the amount of funding would have to be set at above, the process the state uses to achieve such a level as to get most—if not all—counties to its local elections priorities—the mandates participate. process—simply has not worked. We suggest Create Block Grant for Ongoing Support. the Legislature consider a different approach. In We recommend the Legislature structure this new approach, the state and counties would ongoing support for elections as a block grant share in the costs of elections, with state support to participating counties. At minimum, we addressing the costs associated with a range of recommend the Legislature require participating activities directed by the Legislature. Only those counties to implement SB 450 by 2022. We also counties choosing to take state funding would be recommend the Legislature determine which required to perform the specified activities. For the existing mandates, if any, counties should new funding process to be effective, the Legislature perform and include those in the block grant. www.lao.ca.gov Legislative Analyst’s Office 15 2017-18 BUDGET There are various options for how to distribute grant amounts on the number of voters in recent the block grant. For example, basing the grant elections.) The state also could consider using the amount on the number of registered voters could ballot real estate model. That is, the state could encourage counties to increase voter registration. reimburse counties for election costs based on the As an example, were the state to provide $3 per share of the ballot state issues comprise. Because eligible voter, the annual costs would be a bit state issues often are a large share of the ballot, the less than $60 million if all counties participated. ballot real estate model could be more costly than (Alternatively, the Legislature could base the the other options. Other Elections Issues to Consider Various Elections Issues Loom. While the Voter’s Choice Act (Chapter 832) SB 450 presents one new issue facing county elections officials, it is clear that California’s election system faces other significant issues. In designing a new financial relationship with counties, the Legislature could take into account the fiscal impacts of implementing any actions related to the issues discussed below. Counties may take different approaches to addressing these issues. In designing state support, the Legislature may not want to direct specific county activities, but rather focus on the desired outcome of those activities and incentivize counties accordingly. • Timely Vote Counting. Due in large part to the widespread use of vote-by-mail and provisional ballots, counties now take weeks to finish counting ballots. Some voters are saying this undermines their confidence in the election process, in part because California counts ballots so much slower than other states do. Should the Legislature determine that swift determination of elections results is an important state goal, the Legislature could make receipt of funding conditional on counties demonstrating efforts to improve the swiftness of their tallies. Reducing the need for voters to use provisional ballots also could be a goal. • Cybersecurity. The security of electronically stored voting information is paramount to maintaining confidence in elections. While the Secretary of State already sets standards for voting equipment used by counties, the Legislature could take further steps in designing financial support to encourage counties to continually upgrade and maintain their cybersecurity systems. • Voter Registration. Maintaining up to date voter registration will be particularly important with conditional voter registration. VoteCal will facilitate county maintenance of the rolls, but the Legislature may want to consider what other steps counties should take to keep registrations up to date. • Other Outcomes. State support also could be designed to encourage any particular outcomes or goals the Legislature may have with regard to elections administration. The Legislature could require the Secretary of State to gather information over time to see if counties make sufficient progress towards any such legislative priorities. 16 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET Consider One-Time Support to Replace Legislature wish to assist counties again, there Counties Voting Systems. While not directly are various ways to do so—including matching related to the ongoing elections issues discussed grants, short-term loans, or bonds. The state could above, most counties voting equipment is quite provide all of the necessary funds or only a portion. old. Historically, the state has assisted counties The Secretary of State estimates the total costs to in replacing their systems. In part, this may be replace counties’ voting equipment to be around because the state controls what voting equipment $400 million. is available to counties to purchase. Should the CONCLUSION Although the state receives significant regular ongoing support to counties for Legislative benefit from county administration of elections priorities in elections. While the creation of an in California, the state has provided sporadic optional new voting model—SB 450—is an impetus financial support for elections administration. for the Legislature to reconsider the state’s role The existing process to provide state support in elections, we recommend taking a broader for elections administration—the reimbursable approach in considering elections issues addressed mandates process—is ineffective. We recommend by a block grant. that the Legislature create a block grant to provide www.lao.ca.gov Legislative Analyst’s Office 17 2017-18 BUDGET 18 Legislative Analyst’s Office www.lao.ca.gov 2017-18 BUDGET www.lao.ca.gov Legislative Analyst’s Office 19 2017-18 BUDGET LAO Publications This report was prepared by Carolyn Chu and Nick Schroeder, and reviewed by Jason Sisney. The Legislative Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature. To request publications call (916) 445-4656. This report and others, as well as an e-mail subscription service, are available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento, CA 95814. 20 Legislative Analyst’s Office www.lao.ca.gov