ELECTRONIC FILING
OF CAMPAIGN FINANCE
DISCLOSURE REPORTS
OVERVIEW
IMPLEMENTING AN EFFECTIVE ELECTRONIC FILING SYSTEM: A STEP-BY-STEP GUIDE
RECOMMENDATIONS
THE COST OF ELECTRONIC FILING
ELECTRONIC FILING AND "DISCLOSURE PHOBIA"
ELECTRONIC FILING SYSTEMS AT FOUR AGENCIES
PUTTING IT ALL TOGETHER
DISCLOSURE INFORMATION: FROM THE CAMPAIGN TO THE PUBLIC
This chapter gives an overview of electronic filing of campaign finance reports across the country. It then provides recommendations for implementing an electronic filing system. This comprehensive, step-by-step guide is based on the experience of agencies that have established electronic filing. The guide is followed by a discussion of costs and of meeting political resistance to electronic filing. Answers to some of the most common questions concerning electronic filing are included in Appendix V for additional guidance. The chapter closes with a detailed account of how four different jurisdictions have implemented, or plan to implement, electronic filing systems to administer their disclosure laws and improve public access.
Chart B provides a summary of electronic filing activity across the country. The chart is presented with one caveat: It will soon be outdated as an increasing number of agencies move toward electronic filing, recognizing it as the most efficient, accurate, and ultimately cost effective means to computerize campaign finance information.
The irony is that all the campaigns use computers, and then they translate it to hard copy and then they give it to us. 22
Connecticut Secretary of State Miles Rapoport accurately describes the waste of resources that results from the failure to implement electronic filing of campaign finance disclosure reports. Literally thousands of campaign committees nationwide use computers to prepare their disclosure reports, then file paper copies with the agency. If the agency has the resources, it then re-enters the data - by hand - back into a computer for auditing and public disclosure purposes. The outcome is that disclosure agencies are less efficient and public access to campaign finance information may be delayed.
Some disclosure agencies are taking themselves out of the data entry business and instituting electronic filing of campaign reports. By early 1996, electronic filing systems were operating in Florida, New Mexico, New York City, North Carolina, San Francisco, Seattle, and Texas. Before the year is out, Arizona, Hawaii, Iowa, Michigan, Oklahoma, and Washington will be added to the list, according to officials in those states. In addition, Kentucky has begun developing an electronic filing system, while Ohio is redesigning its existing electronic reporting software to meet recent changes in the law. Disclosure agency officials in Missouri are seeking guidance from the legislature before they develop an electronic filing system under a law recently adopted in that state.
More than a third of these jurisdictions make electronic filing of campaign reports mandatory, either for all filers, candidates for certain offices, or those who meet a specific threshold of financial activity. These include Florida, Hawaii, Kentucky, Missouri, San Francisco, and Washington. Ohio's law provides for mandatory electronic filing of reports at the discretion of the disclosure agency. However, electronic filing remains voluntary at least for now, according to the Office of Secretary of State.
The system in place in New York City can be described as "quasi-mandatory." There, if candidates submit computer generated paper disclosure reports, they must also submit the information electronically on a computer diskette.
Under the Presidential Primary Matching Fund program, the Federal Election Commission requires all candidates who maintain their records on computer to use magnetic tape or disk when submitting the lists of contributions eligible to be matched with public dollars. Unfortunately, the FEC does not require computerized filing for the candidates' campaign disclosure reports, which list all of their contributions and are filed separately from their matching fund submissions. The agency is just beginning to develop an electronic filing system for congressional campaign reporting.
Jurisdictions that have voluntary electronic filing systems have had mixed success. Some agency officials acknowledge that many candidates are reluctant to use a filing method that will expose their campaign finance activities to greater scrutiny by their political opponents and the press. In some jurisdictions, candidates do not participate in voluntary electronic filing programs because they simply do not use computers as part of their campaign. During Florida's last gubernatorial race, approximately half of the 20 eligible filers submitted electronic reports under a voluntary system. Since then, the Division of Elections has adopted a rule requiring all candidates and committees to file their reports in an electronic format. In Texas, only 20 out of a possible 1,500 committees voluntarily used that state's electronic filing system during the 1994 election cycle. None were high-profile candidates.
Seattle introduced voluntary electronic filing for its 1995 municipal elections. Out of 33 candidates, however, just three participated in the voluntary system. Only 12 candidates took advantage of New Mexico's system in the 1994 election, despite the fact that New Mexico is currently the only jurisdiction to permit filers to file by modem. The low participation there may be due in part to the small number of campaign committees that currently use computers to record contributions and expenditures. Ohio, too, saw very limited use of its voluntary system, but the Secretary of State's office hopes that the improvements it is making to its filing software will encourage more participation in the future.
Both the New York City Campaign Finance Board and the Florida Division of Elections have successfully used electronic filing in conjunction with the public financing programs they administer. Candidates benefit since electronic filing of their contribution reports can expedite the pay-out of matching funds. When electronic filing is implemented in Missouri, committees that file on paper will be penalized by being required to pay a fee for the agency to convert the report from paper to electronic form. The fee will be up to $5 for the first page of the report and $1 for each subsequent page.
Most agencies that have implemented electronic filing provide filing software to committees. To attract users, a number of agencies incorporated user-friendly features into their software. For example, the software provided by New York City, New Mexico, Texas, San Francisco, and Seattle have pop-up menus from which filers can select and insert contributor or committee names and addresses. New Mexico's software flags the omission of required contributor occupation information, and New York City's software cautions the filer that an individual contributor appears to have exceeded the contribution limit.23
Campaign management features are a way in which at least one agency hopes to attract users to its electronic filing program. Jack Whitmer, designer of an electronic filing system being developed at Iowa State University for the Iowa Elections Board, touts his system as one which "the candidate can't win without." When completed, that system should be able to track contributors and automatically generate solicitation and thank you letters for the committee, as well as provide information on voting patterns in districts throughout the state. New Mexico and New York City are more conservative about including campaign management features and are instead creating software that stores data in a file format that a candidate's campaign management software package can accept.
Florida, New Mexico, and Texas developed their filing software in-house. Software consultants assisted San Francisco, Seattle, and New York City in preparing the software that the agencies now distribute to candidates free of charge. Ohio used a vendor to develop its original candidate filing software but is creating its new version in-house.
At least two agencies instituted electronic filing without previously entering campaign finance disclosure information into a database by hand. The San Francisco Registrar of Voters had no computerization before instituting mandatory electronic filing. The office of the Registrar did not consider manually keying data into their computers because it realized that electronic filing would be far more efficient.
Like San Francisco, the Texas Ethics Commission rejected hand-entry of its campaign disclosure records as too labor intensive. Instead, the Commission developed its present voluntary electronic filing system. California, Connecticut, Iowa, Kentucky, Missouri, and Oklahoma are among the other jurisdictions that do not currently key campaign finance information into a database but are planning to go directly to electronic filing.
The New York City Campaign Finance Board chose to implement electronic filing incrementally. Currently, electronic filing is limited to only four reporting schedules - contributions, expenditures, in-kind contributions, and contribution refunds, although the Board is planning to have electronic filing capabilities for many more schedules in time for the 1997 elections. During the 1993 elections, half of the reports filed were in an electronic format. However, because many of the largest filers filed electronically, nearly two-thirds of the transactions entered into its campaign finance disclosure database were uploaded from an electronic format. The staff was therefore able to key-punch the remaining third and provide campaign finance information in a timely manner.
A number of agencies that have implemented electronic filing have found that instituting a standard file format aids in the flow of information and the creation of disclosure databases. The San Francisco County Registrar of Voters did not have a standard filing format in place when it first implemented its electronic filing program, and it encountered problems with compatibility as soon as it started receiving electronically filed reports. The Registrar did not want to burden filers by requiring a standard filing format in the middle of an election cycle, but will eventually use a standard, ASCII format that the agency's computer can read.
The New York City Campaign Finance Board also requires filers to submit their electronic reports pursuant to the Board's standard format. Filers who choose not to use C-SMART, the Board's free filing software, must have their filing format approved prior to the first submission, or the Board will not accept the filing. The Board provides filers with written ASCII file specifications, including a description of the information to be entered, and the format and length of each field. Jeff Easton, Systems Administrator for the Board, notes that the format "mirrors the C-SMART" format and is "not that complex."
IMPLEMENTING AN EFFECTIVE ELECTRONIC FILING SYSTEM: A STEP-BY-STEP GUIDE
Electronic filing of campaign finance reports benefits campaign committees, disclosure agencies, and, most importantly, the public. Filing software makes it easier for campaign committees to file complete, accurate disclosure reports. Electronic filing makes disclosure agencies more productive by decreasing the time and resources they devote to computerizing and auditing reports. Finally, public access to campaign finance information improves dramatically because data is available in electronic format soon after disclosure reports are filed.
These elements are incorporated in the following step-by-step guide to implementing an electronic filing system.
Electronic filing" is becoming a buzzword among campaign finance researchers and reform activists, as well as at disclosure agencies across the country. For purposes of this report, electronic filing is the transmission of campaign finance reporting information from the filer's computer to the agency's system by way of modem or computer diskette. The specific features of an electronic filing system will depend on a jurisdiction's size, reporting requirements, and resources.
The following road map of the steps to take (and pitfalls to avoid) along the path toward electronic filing is based on the experiences of a number of disclosure agencies that have already traveled that route. Its six steps are integral to an electronic filing system that improves agency efficiency and provides that the campaign finance disclosure database is comprehensive and updated in a timely fashion. The elements include:
1. Mandatory Electronic FilingEach of the six features is discussed in detail below.2. Standard Format for Electronically Filed Reports
3. Filing Software Development
4. Enforcement Software Development
5. Incremental Implementation of Electronic Filing
6. Inclusion of Data from Paper Reports
1. MANDATORY ELECTRONIC FILING
The benefits of electronic filing can be realized only if a significant number of financially active candidates file electronically. If the majority of transactions are filed electronically, less time and fewer resources will be used entering campaign finance information into a database by hand. For these reasons, electronic filing at the federal, state and local level should be mandatory for committees that reach a defined threshold of contributions or expenditures. The precise threshold will vary depending on the average amounts received or spent by campaigns, and, to a lesser extent, the degree to which campaigns already use computers. The threshold should be high enough so that candidates running a low-budget campaign will not have to file electronically, but low enough to cover the majority of candidates who have a significant amount of financial activity. If they choose, candidates who do not meet the threshold can volunteer to file electronically.
Jurisdictions concerned about unduly burdening candidates may want to permit committees otherwise required to file electronically to file a statement demonstrating why electronic filing would be a hardship. Florida's electronic filing rules include such a provision. However, all candidates who use computers to prepare disclosure reports should be required to file electronically.
2. STANDARD FORMAT FOR ELECTRONICALLY FILED REPORTS
For an electronic filing system to be acceptable to the majority of mid-to-large filers, disclosure agencies should accept electronic reports created on commercial software as well as those created on agency software. Larger committees that already use campaign management software should not be burdened with maintaining two record keeping systems, one for campaigning purposes and another for filing disclosure reports. However, without constantly changing their programs, disclosure agencies will not be able to compile data supplied on myriad software formats into a single database. Therefore, the agency should develop a standard file format that filers will be required to use.
Commercial software vendors have the resources, technological capability, and incentive to develop software that will meet agency specifications.
3. FILING SOFTWARE DEVELOPMENT
CONFER WITH FILING COMMITTEES
MAKE THE SOFTWARE USER FRIENDLY
CREATE SOFTWARE THAT PRE-AUDITS THE REPORT
DO NOT INCLUDE CAMPAIGN MANAGEMENT FEATURES AS PART OF AGENCY SOFTWARE
TEST THE PRODUCT
GIVE SOFTWARE TO CANDIDATES FREE OF CHARGE
Agency staff or outside contractors can develop candidate filing software. Sara Woelk of the Texas Ethics Commission noted that an agency can create software in-house if it has one or two computer experts on staff.
When developing candidate software, agencies or their consultants should consult with active filing committees. When the New York City Campaign Finance Board began developing its filing software, its first step involved interviews with various campaigns "to pinpoint the essential features that would make the program useful" for large and small campaigns alike.24 Likewise, the Federal Election Commission, which is in the earliest stages of developing electronic filing, is working with a few campaigns to determine the filers' needs. According to Staff Director John Surina, the FEC believes that by working in conjunction with the committees, the agency can "keep the regulated community from rebelling" against the move from paper to electronic reporting.
State and local disclosure agencies that provide filing software have attempted to make it easy to use. In most cases, for example, the computer image on the filing software mirrors the paper filing forms. If filers are familiar with the form because they previously have seen or used a paper version, they will feel more comfortable with the computer format. Other user friendly features include pop-up menus from which the filer can use one or two keystrokes to select and insert the full name and address of a PAC, contributor or vendor whose name has previously been entered.
Filing software, whether supplied by the disclosure agency or commercial vendors, can automatically perform audit functions before a committee files its disclosure report. "Pre-audits" ensure that a more accurate product reaches the agency and can save candidates the embarrassment and expense of having to file amendments to inaccurate reports. Just before a filer transmits the report to the disclosure agency, the software can audit the report to warn the filer if a mandatory field is empty or if a date is outside the range for the filing period. It can also ensure that there are no mathematical errors, that summary information accurately reflects the detailed information contained within the body of the report, and that no single contributor has exceeded an aggregate contribution limit. A message can appear on the computer screen when a problem is discovered, warning the filer that an amendment will have to be filed if the report is not corrected.
Very basic warning systems provide an advantage over paper filings as they can significantly reduce the number of errors on disclosure reports. As a result, agencies will spend less time seeking corrections, candidates will file fewer amendments, and the public will receive more accurate information.
Even where electronic filing is not implemented in a jurisdiction, committees routinely use commercial software to prepare their disclosure reports. Customers of commercial software vendors should demand that the program perform auditing checks for computational errors, blank fields, and contribution limits prior to printing a report to be filed with the agency. Disclosure agencies should make their auditing standards available to vendors, so that the vendors can prepare conforming software. Software vendors can promote auditing functions as a featured selling point, stressing to candidates how such features will both prevent errors and save time.
Many candidate and political party committees use campaign management software to assist with electioneering activities. When designing campaign reporting software, disclosure agencies may be tempted to include campaign management features. However, providing software that facilitates campaign activities creates the appearance that the agency is aiding in the election of candidates.
In addition to questions of appropriateness, an agency decision to provide campaign management features in its reporting software presents practical problems. First, doing so could add significantly to the cost of developing the software. It may mean the difference between being able to write the program in-house or hiring an outside vendor to do the job. Additionally, an agency will have to regularly update its software in order to meet the demands of its users for increased campaign management capabilities.
Disclosure agencies have the burden of convincing legislative bodies that electronic filing is a wise investment of public funds. Nothing could be more damaging to the agency's effort than a system that fails. Therefore, in addition to implementing electronic filing incrementally, as discussed below, the development process must factor in sufficient time to fully test the product before it is widely used.
To prevent embarrassing mistakes from being made, agencies should first test the system in-house, using data from actual reports from previous periods. The New York City Campaign Finance Board tested its electronic filing system using 5000 real transactions taken from reports filed in earlier election cycles. The system should also be tested using committees active in the current election cycle.
In order to facilitate voluntary or mandatory electronic filing by small to mid-size committees, the agency should provide electronic filing software free of charge to any committee that wishes to use it. Committees currently do not have to pay for the blank paper reports they ultimately file, nor should they be required to pay for electronic filing software. The agency will have to cover the minimal cost of the diskettes but will reap substantially greater savings as a result of electronically filed reports. Agencies can also distribute their filing software by placing it in a state-wide net system to be downloaded by users.
4. ENFORCEMENT SOFTWARE DEVELOPMENT
Electronic filing can greatly increase the agency's ability to review reports for potential violations. The Executive Director of Iowa's Ethics and Campaign Disclosure Board, Kay Williams, points out that "you don't have good disclosure if you don't have some way of assuring the reports filed are more than putting pen to paper." Agency auditing software can ensure that errors are quickly brought to the attention of filers and corrections made. Conversely, it can enable enforcement officials to detect violations - and impose penalties - in a timely manner.
Agency auditing software, like candidate filing software, should include automatic checks for computational errors, dates outside the reporting period, and contributions or expenditures in excess of the legal limit. Agency software should also track committee filings, automatically generating delinquency letters and, where applicable, computing fines when reports are missing or late.
5. INCREMENTAL IMPLEMENTATION OF ELECTRONIC FILING
Setting up an electronic filing system does not have to be impossibly complex. In fact, disclosure officials who have successfully introduced electronic reporting all emphasize the importance of building the system incrementally. It is more important to take the first step, starting with a simple filing system, than to delay the move to computerized reporting with over-ambitious plans.
North Carolina's Board of Elections started by offering "conversion" software to filers, which enables candidates to prepare reports using whatever programs they have and then convert the data to a format compatible with the agency's equipment. New York City's Campaign Finance Board wrote filing software, starting with the most common disclosure forms, including contributions and expenditures. Next, the agency will add the remaining reporting schedules, such as loans and transfers, to its filing software capabilities. Florida started with gubernatorial candidates in 1994 before extending electronic filing to all office-seekers in 1996.
These and other pioneering agencies recommend the incremental approach for several reasons. The most obvious is the likelihood of avoiding the problems and delays that result from trying to do too much at once. Another is the need to establish the credibility - and acceptability - of the agency's electronic reporting system with the public, press, and filers. This is particularly important where incumbents oppose the move to computerized reporting and might consider withholding resources for its operation. It is better to get a simple, workable system in place sooner and then continue to enhance it afterwards.
6. INCLUSION OF DATA FROM PAPER REPORTS
Even with an electronic filing system in place, some candidates and committees will still file on paper, either because they do not meet the threshold for filing electronically, or because the system is voluntary. To ensure that the campaign data of all filers will be subject to the same level of scrutiny and analysis, the information of paper filers should be keyed into the database as well.
This guide provides the steps to developing a successful electronic campaign finance reporting system. In interviews with disclosure officials and political observers, two additional issues came up repeatedly: costs and political resistance to electronic filing. Both are discussed below.
There are a number of factors that will affect the cost of electronic filing, including:
The adequacy of the agency's existing hardware;
Whether agency staff or outside vendors develop the software;
The complexity of auditing functions the agency software will be required to perform;
The number of campaign committees to which electronic filing will apply; and
The types of transactions (e.g., contributions, expenditures, loans) required to be reported electronically.
The number of variables makes it difficult to give a cost estimate that will be applicable in every jurisdiction. However, examples of the experience in several jurisdictions may provide some guidance as to how much an electronic filing system can cost.
Florida, New Mexico, and Texas developed electronic filing systems in-house, at no cost to the agency other than staff time and, in a few cases, some additional hardware. Ohio used a vendor to create its first version of electronic filing software. However, changes in the disclosure law as well as an overhaul of the Secretary of State's computer system have prompted the Elections Division to write new software in-house so that it can make updates as needed. Others wishing to create their electronic filing systems in-house can most certainly learn from these agencies, most of which are willing to share information on software development.
A number of agencies chose to use outside computer consultants to assist in developing electronic filing systems. New York City, which already had its campaign finance database up and running when it decided to implement electronic filing, opted for guidance from an outside contractor and implemented its filing system for an initial cost of about $70,000. San Francisco and Seattle both acted as beta-test sites for a software vendor, and as such, received the firm's services at no cost. Hawaii's electronic filing system should be fully operational by the summer of 1996. The state has a $50,000 electronic filing budget and contracted with a software vendor to design filing, conversion, and agency auditing software for that amount. The Washington Public Disclosure Commission was given just $10,000 for a pilot electronic filing program. Agency officials estimate that it will cost an additional $70,000 for a complete electronic filing system.
While New York City, San Francisco, and Seattle were satisfied with the vendors they chose, at least three states had bad experiences going with a low cost software vendor. Connecticut, North Carolina, and Kentucky all reported that they never received a workable electronic filing system, losing time, money, and in some cases, support for electronic filing. Despite the setbacks, each state is planning to move ahead with electronic filing programs in the future.
Legislatures should recognize the importance of campaign finance disclosure and provide sufficient funding for implementation, so that other states do not have to suffer the same problems as Connecticut, Kentucky, and North Carolina. Where that is not the situation, agencies can seek out ways to finance their electronic filing systems more creatively. Some states are attempting to fund electronic filing through bond issues. Other agencies are seeking to keep the fines or filing fees they collect to pay for electronic filing systems. The Iowa Campaign Finance Disclosure Board is in the fortunate position of having received grants from Iowa State University to develop its electronic filing and agency software.
Oklahoma may have the most unusual source of funds for the electronic filing program it is creating. Oklahoma's former governor pled guilty to a campaign violation and, as part of his plea bargain, was required to give his remaining campaign funds to the state Ethics Commission. The deal resulted in $72,000, to be used for electronic filing.
ELECTRONIC FILING AND "DISCLOSURE PHOBIA"
Despite the delay in public access and the waste of resources that result from hand entry of campaign finance information to disclosure databases, many elected officials are reluctant to change the existing system. One agency official describes the problem as two-fold, saying that legislators have both "computer phobia and disclosure phobia." Computer phobia can be countered with easy-to-use filing software, training, and support. Disclosure phobia is more difficult to combat.
Among elected officials there is a resistance to disclosure rules which they see as providing political opponents with speedier and more detailed scrutiny of their campaign finance activities. An informal survey of state agencies indicates that electronic filing is often stalled by state and local legislatures that are unwilling to support legislation and the appropriation necessary to implement it. In Maryland, for example, the state legislature has rejected electronic filing legislation three years in a row, according to Rebecca Wicklund of the Board of Elections. Similar attempts in California, Connecticut, and New York State were also recently defeated.
This is not to say there is no support among elected officials for electronic campaign finance disclosure. Within the past year, Congress and legislatures in Hawaii, Missouri, and Ohio have approved legislation (although not always funding) authorizing electronic transmission of disclosure reports.
By and large, however, the impetus for moving into the computer age is coming from news organizations, money-and-politics researchers, campaign reform advocates, and the public. Agencies that put a premium on providing easy public access to campaign finance data can foster a strong constituency among these groups for methods that deliver more detailed information and that do so faster.
Legislatures, candidates, and disclosure agencies should not resist the move to electronic filing. Electronic filing is a technologically feasible method to conserve limited agency resources by shifting data entry costs from disclosure agencies to campaigns, while improving public access to campaign finance information.
ELECTRONIC FILING SYSTEMS AT FOUR AGENCIES
The following is a detailed description of electronic filing in three jurisdictions. Also included is a description of the comprehensive system currently being developed in Iowa. Finally, Chart B provides an overview of electronic filing developments in other jurisdictions.New York
San Francisco
New Mexico
Iowa
NEW YORK CITY CAMPAIGN FINANCE BOARD
In 1988, a provision to the New York City Charter established public financing of city campaigns. It was written into law that the New York City Campaign Finance Board create and maintain a computerized database of campaign finance information to assist in the payment of public matching funds, audits, and public disclosure. Within six months, the Board had a computerized database up and running.
During the 1989 elections, the first year the database was used, manual data entry of contribution and expenditure information meant that while hard copies of disclosure reports were immediately available to the public, computerized public disclosure reports were available only after the general election. In an effort to improve public access, the Board created its electronic filing system, first used in 1993. Now, data from electronically filed reports is uploaded to the computerized database at a rate of approximately 1000 transactions every ten minutes. The result is that detailed computerized campaign finance reports are available to the public within two weeks of filing.
The Board began developing its electronic filing software, C-SMART, in April of 1992. The software is available for IBM compatible computers only, and filers submit their reports via diskette, not modem. In developing their electronic filing system, the Board used both outside consultants and in-house personnel. The Board also created a new position, C-SMART Coordinator, to manage the system and be a troubleshooter for questions and problems.
Following their philosophy of implementing electronic filing incrementally, only four reporting schedules - monetary contributions, in-kind contributions, expenditures, and refunds - were initially included in C-SMART. Despite limiting the number of schedules for electronic filing, C-SMART "processes approximately 90 percent of the typical campaign's data entry reporting needs."25 The next version of the software, expected in time for use during the 1997 election cycle, will contain all of New York City's reporting schedules.
C-SMART benefits filers by warning them of possible contributions over the legal limit, contributions that are missing required employer information, and invalid public funding matching claims. The software also aggregates contributions from the same source and searches previously entered data for names in order to determine whether the same contributor or payee has already been entered. If so, the filer does not have to enter the information again. As an additional aid to filers, the Board instituted a 24 hour help-line. Even if a filer has a question at an odd hour of the day or night, he can leave a voice mail message and a staff member will return the call within a few hours. During the last reporting period, the Board rotated staff members to check the voice mail.
The Board recognized that some committees would want to use their own software to create electronic disclosure reports. Therefore, in addition to accepting files submitted using C-SMART, the Board accepts electronic submissions created on alternate software. To ensure compatibility, candidates using their own software must strictly adhere to the file format required by the Board, and submit a sample filing for the Board's approval prior to the filing deadline. Although only 8 percent of the candidates used an alternate format, those doing so included some of the larger campaigns, yielding over 45 percent of the transactions ultimately loaded onto the database in 1993.
While the large volume of transactions reported using software other than C-SMART indicates the importance of accepting reports created on commercial software, the Board did encounter some problems with these submissions. Although the pre-approval process was useful in eliminating some of the most common errors, the Board occasionally found that the electronic submissions did not match the required paper submissions. This problem should be alleviated by 1997, when the Board hopes to eliminate the paper reports and replace them with signed, certified control sheets. The Board also plans to emphasize to committees that the pre-submissions should be prepared by the same campaign workers using the same procedures as those used to prepare the actual reports.
By implementing electronic filing and the computerized database, New York City is able to provide outstanding public access in a variety of formats. Electronic and paper reports are available for public inspection immediately upon filing. One to two weeks after filing, the complete database, which includes data uploaded from electronic filers and manually entered from paper reports, is available for purchase on disk at a cost of $75. In 1993, the press as well as the campaigns themselves bought the databases on disk. During the election the press carried stories about the sources of candidates' contributions, which - according to First Deputy Director Dan Sedlis - could not have been written so quickly were it not for electronic filing.
The campaign finance database enables the Board to prepare detailed analyses of disclosure information at regular intervals prior to the election. The following six cumulative public disclosure reports are generated by the Board throughout the election cycle:
Contributions by Candidate, sorted alphabetically by contributor name;
Expenditures by Candidate, sorted alphabetically by payee name;
Contributions by Candidate, sorted alphabetically by employer name;
Contributions by Intermediary, sorted alphabetically by intermediary and then contributor name;
Contributions by Candidate, sorted by contribution amount; and
Contributions across all Candidates, sorted alphabetically by contributor name.
Additionally, the Board will provide detailed information over the phone to anyone who calls.
The Board now provides public computer terminals in its offices so that members of the public can search for contribution and expenditure information in a variety of ways. The Board is also looking into making the disclosure information available on a dial-up service.
SAN FRANCISCO COUNTY REGISTRAR
OF VOTERS
San Francisco was the first jurisdiction in the country to mandate that campaign finance disclosure reports be filed electronically. In May 1993, the San Francisco Board of Supervisors adopted an ordinance requiring all committees active in city and county races to file electronic diskettes along with their paper reports. The requirement applies to committees that raise or spend $5,000 in a calendar year.
San Francisco's was a paper-only disclosure operation. Registrar of Voters Germaine Q. Wong decided to put the information on a database in order to make it more accessible to the public, media, and researchers. After experimenting with scanning in the data, the agency chose electronic filing as the most efficient method by which to transmit information to the database.
The Board of Supervisors did not allocate funds to implement the new ordinance. However, the Registrar's office was able to develop its electronic filing program by agreeing to serve as a beta-test site for a software vendor seeking to test its political disclosure product. As a result, the software was designed and technical support provided at no cost to the agency.
The filing software was offered to candidates, general purpose committees, and ballot measure committees at no charge. Filers also were permitted to use commercial software to prepare their reports.
The vendor developed basic agency file management software to automatically accept reports that were filed using its software. Several features were added that enabled the Registrar to log in reports and to identify delinquent filers. In addition, the vendor created public access software, allowing the public not only to view the disclosure reports on agency terminals but also to copy the data to floppy diskettes in the format of their choice.
In 1994, the first year of operation, around 45 candidate and ballot measure committees participated in the electronic filing program. In the 1995 mayoral race, six candidates filed electronically, the majority of them preferring to use their own rather than the agency-provided filing software.
San Francisco's electronic filing experience is a success story, despite some missteps. According to Campaign Services Manager Naomi Nishioka, the fact that political committees were not required to file their reports in a standard filing format "created . . . the inability to incorporate and import all of the different file types into one database." However, because the agency wanted to implement the ordinance as quickly as possible, it chose to do so in spite of this weakness. In March 1995, the Registrar's office issued a request for proposals to develop a standard filing format.
Another problem occurred because filers were not instructed on what type of diskette to use or how to label diskettes. As a result, the agency received incompatible diskettes and labels which did not include the committee name or report period. Some diskettes contained more than one campaign report, making it difficult to determine which was the correct report for that filing period.
Despite the problems, Ms. Nishioka says that the media covering the elections were able to analyze data much earlier than in previous elections. Additionally, the Registrar worked with the California Voter Foundation, a private, nonprofit organization, to put a voter guide and campaign finance disclosure database on the World Wide Web in October 1995. The public thus had a variety of resources from which it could obtain information about candidates' finances before casting their ballots at the polls.
Looking toward the future, San Francisco plans to have a standard filing format in place for candidates and other filers participating in the 1996 elections. Eventually, the agency hopes to accept reports filed via modem and to institute security measures to protect their transmission.
NEW MEXICO SECRETARY OF STATE-ETHICS ADMINISTRATION
New Mexico provides an example of how an uncomplicated electronic filing system can be implemented. During the 1994 election cycle, New Mexico permitted candidates to file electronically by modem or diskette, using reports prepared with agency software. Twelve filers, including the winning governor, voluntarily filed electronically. Most candidates filed their reports by modem to the Agency's Compuserve address. Ethics Administration requires that a signed certification page be filed in addition to the electronic report, to satisfy signature requirements. The office has already issued 50 electronic filing packages for the next election cycle.
The filing software was developed entirely in-house by Systems Analyst David Caldwell. New Mexico made no additional outlays for hardware, and only minimal expenditures for candidate training. Mr. Caldwell said that the candidates who used the straightforward software, "ran with it," and the Bureau did not need to provide filers with significant training or support.
New Mexico has chosen not to include campaign management features with its software, because, as Ethics Administrator David Harrell notes, doing so presents an "ethical dilemma." He says, "the agency's function is helping people to comply with the law; it is not helping people run for office." In an effort to make the software more appealing to candidates, the reporting data entered into the agency's software can be exported for use with campaign management software.
New Mexico does not have a complete campaign finance database, because it does not have the resources to key in data from paper reports. The public is able to sort data from electronic reports on a terminal provided at the agency. Members of the public can also purchase electronic reports on diskette for a fee of $30 ($25 if they bring their own disk). While the Secretary of State's Office has a home page on the World Wide Web, Mr. Harrell has decided not to make electronic filers' disclosure information available on the site. Since the paper filers' information would not likewise be available, he is concerned that other candidates might be discouraged from volunteering to file electronically.
IOWA ETHICS AND CAMPAIGN DISCLOSURE BOARD
In contrast to New Mexico's fairly simple electronic filing system, the Iowa Ethics and Campaign Disclosure Board, in conjunction with Iowa State University, is in the process of developing a complex, integrated system of voluntary electronic filing, campaign management, auditing, and public access. The Iowa Disclosure Board is in the unique position of having had support for their electronic filing project provided by Iowa State University. Recognizing that "other states are [not] going to be that fortunate," Professor Jack Whitmer, who has been developing the system, says that "what we're doing will be in the public domain and so we would hope that [other jurisdictions] could leverage on what we have done so it doesn't cost them as much." The Iowa Campaign Finance Reporting System is expected to be in place in time for the 1996 elections.
Campaign finance information that is filed electronically by modem or diskette will be loaded to a disclosure database at the agency. If reports filed on paper meet a required format, they will be scanned into the database; if not, they will be keyed in manually. In addition to the database, there will be a bulletin board system that will immediately display all electronically filed reports. Users will be able to access the database at the disclosure office or by way of a dial-up system. Following her philosophy that "we're here for the people's right to know," Executive Director Kay Williams would like to have public access terminals in every county disclosure office.
Officials at the Board and their collaborators from Iowa State University recognize that the success of their system will depend upon a significant number of candidates filing electronically. To encourage voluntary filing, the free filing software will have extensive campaign management features.
Among the campaign management features to be included is the ability for candidates and other committees to import and sort data files from computerized voter registration records. Selected data will be inserted into a "Constituent Roster" from which candidates can organize various campaign activities, including mass mailings of campaign information and solicitation letters. Additionally, the software will also perform a pre-filing audit to search for omissions and other errors.
The software will be provided in DOS, Windows, and Macintosh formats, and candidates will be permitted to file electronically using other software if it conforms to format specifications.
PUTTING IT ALL TOGETHER
This diagram shows how campaign finance information will get from the committee treasurer's desk to the public and the press by using electronic filing.
Committees will key campaign finance data into the filing software - the only time the data needs to be entered by hand - and the data will be transmitted to the agency by disk or modem. The report, as filed, will almost immediately be made available to the public on agency terminals and, ideally, over the Internet or other on-line system, where it can be viewed by the public and the press.
Within days of filing, the report will be audited by agency software, which checks for computational errors, excessive contributions, or blank fields. It will also be loaded onto a database, along with every other electronically filed report. Data from reports filed on paper will be keyed into the database as well.
The database will be used for objective agency analysis of campaign finance information and will also be publicly available so that the press can perform in-depth analysis, and interested voters can discover who is funding the campaigns of their local candidates.26