Table of Contents
- PUBLIC FUNDING
- GUIDE TO DETAILED RECORD KEEPING
Monetary Contributions:Control System
The State Campaign Fund (Public Funding) was established in 1976 after the U.S. Supreme Court ruled that campaign spending limits cannot be imposed on candidates unless they are using public funds. Michigan’s Public Funding program provides funds from the State Campaign Fund only to gubernatorial candidates.
This manual is designed to explain the requirements of the Michigan Campaign Finance Act (MCFA) for gubernatorial candidates who wish to apply for public funding. Accurate record keeping is necessary to meet the requirements of, an insure compliance with, the MCFA. In addition to providing an explanation of the requirements, this manual seeks to provide a suggested basis for adequate record keeping.
Qualification Requirements for Receiving Public Funds:
- The candidate must organize a single committee and file a Statement of Organization with box 12 checked indicating intent to request public funds.
- Contributions received before the date the Statement of Organization is filed shall not be considered qualifying contributions. MCL 169.262(2)
- The candidate must adhere to the $2 million per election expenditure limitation. Candidates who do not receive public funding are not bound by the expenditure limits
- The candidate must raise a minimum of $75,000.00 in qualifying contributions to qualify for public funding
- A qualifying contribution is a contribution from a Michigan resident of $100.00 or less in a calendar year made after April 1 of the year prior to the year in which a governor is to be elected.
- Gubernatorial Candidate Committees submit applications for public funding, along with photocopies of written instruments representing qualified contributions that the committee wishes to have matched to the Bureau of Elections.
Primary Election Public Funds
Contributions are matched $2 in public funds for each $1 of a qualifying contribution up to $100.00. A major party gubernatorial candidate may receive up to $990,000.00 in public funds for the Primary.
General Election Public Funds
The two major party primary election winners who have applied for public funds may receive a flat grant of $1,125,000.00 each for the general election. MCL 169.265(1)]]
- The Campaign Finance Act provides criteria and formulas by which minor party candidates and candidates with no party affiliation may also qualify to receive public funds in the general election. MCL 169.265(2),(3),(4)
Candidates are permitted to use public funds to pay for campaign advertising, campaign staff salaries, campaign travel, telephones, postage and other expenses permitted by the Michigan Campaign Finance Act. Public funds may not be used for personal expenses of the candidate or for any expense that does not further the nomination or election of the candidate to the office of Governor.
The Department of State’s Bureau of Elections administers the Gubernatorial Public Funding Program and certifies that the candidates qualify for funds by processing the Public Funding Applications. The Department of State’s Bureau of Elections also investigates any alleged violations of the Campaign Finance Act, and when necessary, conducts hearings and assesses penalties to ensure compliance with the law. The Department of Treasury disburses the money to the candidate’s committee after certification by the Bureau of Elections. The Department of State’s Internal Security Division audits the financial records of the committees that receive money from the State Campaign Fund after the General election.
A qualifying contribution is a contribution of $100.00 or less in a calendar year made after April 1 of the year prior to the year in which a governor is to be elected. For the Primary Election, the candidate must file applications to receive public funds. The funds are disbursed on a 2-for-1 matching basis. In order to qualify for public funds, the Gubernatorial Candidate Committee must raise a minimum of $75,000.00 in “qualifying contributions.” The qualifying contribution must be from an individual who is a resident of Michigan. For the purpose of this subsection, an individual is considered to reside in this state if he or she is considered a resident of this state under the Michigan Election Law, Act No. 116 of the Public Acts of 1954, being sections 168.1 to 168.992 of the Michigan Compiled Laws.
An individual is not limited to contributing $100.00 per year to the committee. However, not more than $100.00 of an individual’s aggregate contribution may be used as a qualifying contribution in any calendar year. Qualified contributions have to be issued after April 1st of the year prior to the election year (Year 1) or during the year of the election (Year 2). A contribution is considered issued on the date the check or money order is written, the date cash of $20.00 or less is given, or the date on which the contributor authorizes a credit card charge. This date is referred to as the “issue date.” The year listed on the check will be the year that the will determine eligibility. A contribution may only be matched for the calendar year it was issued. MCL 169.264(3)
Example 1: Contributor gives the maximum contribution of $3,400.00 on May 1, 2009. The committee may apply to receive $200.00 in matching funds.
Example 2: Contributor gives $3,300.00 on May 1, 2009 and $100.00 on January 10, 2010. The committee may apply to receive $200.00 in 2009 and $200.00 in 2010, a total of $400.00 in matching funds.
- Available funds are determined by the State Treasurer: If insufficient funds exist for full funding to eligible primary election public funding candidates, the campaign funds shall be distributed to public funding candidates on a pro rata basis (i.e. proportional) and not on a first come first serve basis.MCL 169.261(5)
A qualifying contribution does not include:
- A subscription, loan, advance, deposit of money, in-kind contribution or expenditure, or anything else of value as prescribed in the Act.
- A contribution by an individual who resides outside of this state. (For purposes of this subsection, an individual is considered to reside in this state if he or she is considered a resident of this state under the Michigan Election Law, Act No. 116 of the Public Acts of 1954, being sections 168.1 to 168.992 of the Michigan Compiled Laws.)
- A contribution by a Political Committee, Political Party Committee, Independent Committee, Candidate Committee, Ballot Question Committee, corporation, joint stock company, non-incorporated business, labor union, domestic dependent sovereign (Indian tribe), partnership, limited liability company or limited liability partnership (unless allocated to the individual partner or individual member of the limited liability company or limited liability partnership).
The first date that an application can be filed to request public funds is January 1st of the year in which the office of governor is to be elected. Original public funding applications may be filed over the internet or on computer disk using the Michigan Electronic Reporting and Tracking System (MERTS) for Gubernatorial Candidate Committees. The software is provided free of charge by the Bureau of Elections. The applications may also be filed using other software that has been approved by the Department of State.
The Public Funding Application consists of two forms: Page one of the Schedule of Qualifying Contributions (referred to in this manual as the Application Cover Page) and the Schedule of Qualifying Contributions. The Cover Page of the Application contains various identifying information about the candidate, the committee and the application along with a verification statement that the candidate and the treasurer certify that the contributions therein meet the criteria for qualifying contributions and that the candidate and treasurer agree to adhere to the expenditure limitations and other provisions of the Campaign Finance Act. Each Public Funding Application Cover Page must include:
- Committee Campaign Finance Identification Number.
- Committee name, mailing address and telephone number.
- The candidate’s county of residence.
- The Political Party affiliation of the candidate.
- The committee treasurer’s name, address and telephone number.
- Name and address of depository (for public funds).
- Application Number (If Resubmission, must include both a Resubmission and original Application Number.)
- Total amount of qualifying contributions included on Application.
- Amount of public funds requested on Application.
- Verification statement with electronic signatures, or paper cover page with written signatures of gubernatorial candidate and committee treasurer.
- The Schedule of Qualifying Contributions is the alphabetized listing of the qualifying contributions for which the committee is requesting matching funds. MERTS automatically assigns the sequence numbers to the contributions. Each contribution (not contributor) is assigned a sequence number. The first contribution listed on the first application is assigned sequence number one, the second listed contribution number two and so on. If the last contribution listed on the first application ends with the sequence number 1925, the first contribution listed on the second application will be sequence number 1926.
Supporting Documentation required with a Public Funding Application:
In addition to the information keyed into MERTS, the committee must provide the following documentation:
- a clear photocopy of the check, money order or other written instrument for each contribution
- if the contribution was $20.00 or less in cash, a copy of the solicitation form is required
- copy of the deposit slip for those contributions (the bank name and account numbers should be blacked out for the privacy of the contributor)
A Public Funding Application will not be processed until the Bureau has received the relevant documentation.
Prior to submitting documentation to the Bureau of Elections the application must be printed and the assigned sequence number written on the associated copy of the written instrument. Example: Sequence number “1″ is written on the copy of the check from the transaction that was given the sequence number “1.”
After review of each application the Bureau of Elections will send a certification letter to the committee. A coded list of ineligible contributions will be listed in the certification letter. If a contribution was not matched because of an error in the application the committee may make corrections on a resubmission application.
The Gubernatorial Candidate Committee may receive up to $990,000.00 in public funds for the Primary Election by submitting additional Public Funding Applications after the Secretary of State has certified the first application. In order to receive the maximum $990,000.00 in public funds, the committee must submit applications and adequate documentation for $495,000.00 in qualifying contributions. The committee may not submit an application for public funds after December 15th of the election year.
In order to facilitate the disbursement of public funds from the State Campaign Fund to eligible candidates as soon as possible, the Department of State may enter into an expedited payment agreement with a Gubernatorial Candidate Committee. The agreement may be offered to the committee after the Department has certified the committee’s first Public Funding Application as having a minimum of $75,000.00 in qualifying contributions that meet all requirements for matching with public funds.
To be considered for an expedited payment agreement, the Gubernatorial Candidate Committee must comply with the following conditions:
- The committee must file its Public Funding Application by disk or over the Internet using software provided by the Department of State or privately obtained software that meets the file layout criteria approved by the state.
- The committee’s first Application must be certified by the Department of State with no more than 10% error rate.
Under the agreement, the Department of State agrees to conduct a preliminary review of an electronically filed Public Funds Application within 3 business days after receipt of the Application and certify to the Department of Treasury that 90% of the amount requested by the committee may be paid to the Gubernatorial Candidate Committee. After an in depth review of the Application, the Department determines whether additional funds should be certified for the Application or if the amount paid was in excess of the qualifying amount. If the amount paid was in excess, the committee must refund the excess or the Department has the option of making an adjustment on the certification of a subsequent Application.
The agreement does not apply to the following:
- Applications filed on paper
- Applications containing less than $5,000.00 in qualifying contributions
- Resubmission applications
The percentage of payment authorized in the agreement may be changed if the committee’s error rate exceeds 10% on two or more applications. The agreement is in effect for Public Funding Applications filed by the committee from the date the agreement is signed by the gubernatorial candidate, the committee treasurer and an authorized representative of the Department of State until 5:00 on the day of the primary election. A copy of the Agreement Regarding Expedited Application For Payment From The State Campaign Fund may be found in Appendix D of this manual.
The Bureau of Elections may determine that an individual contribution does not qualify for matching with public funds for several reasons. Contributions that are not matched for correctable errors may be submitted again on a Resubmission with corrections made or with additional documentation provided to the Bureau. A Resubmission consists only of contributions for which corrections have been made or additional documentation is being provided by the committee for reconsideration by the Bureau. Once a qualifying contribution has been submitted on an Application, it must never be listed on a subsequent Application, but only on a Resubmission.
Following are Ineligible Reason Codes with which the Bureau identifies contributions that are not matched. The codes indicate why a particular contribution was not matched with public funds. A coded list of ineligible contributions is included with the certification letter sent by the Bureau to the committee after review of each Application.
|Code #||INELIGIBLE REASON CODES and DEFINITIONS|
|01||CONTRIBUTOR’S NAME INCOMPLETE OR MISSING: The name and address of the contributor is required by Section 63(1).|
|02||CONTRIBUTOR’S ADDRESS INCOMPLETE OR MISSING: The name and address of the contributor is required by Section 63(1).|
|03||DATE OF ISSUE MISSING OR UNACCEPTABLE: The date the check or money order was written, the date the cash contribution of $20.00 or less was made, or the date the credit card charge was authorized is required to determine in which year the contribution is matchable. A contribution must have been issued after April 1, Year 1, and must not have been issued prior to the filing date of the Candidate Committee’s Statement of Organization. (Sections 12(1) and 62(2).)|
|04||DATE OF RECEIPT MISSING OR UNACCEPTABLE: The date the committee received the contribution is required by section 63(1).) A qualifying contribution must have been received after April 1, Year 1. (Section 12(1)).|
|05||TOTAL AMOUNT OF CONTRIBUTION MISSING OR INCORRECT: This information is required by section 63(1) and should match the total amount of the check or other written instrument. A comparison is made between the written instrument and the information provided on the Application. If the dollar amounts do not agree, the contribution will be declared ineligible for matching. The committee may resubmit the contribution on a Resubmission with correction of the information.|
|06||AMOUNT OF QUALIFYING CONTRIBUTION MISSING OR INCORRECT: The portion of the contribution being submitted as a qualifying contribution is incorrect. The committee is responsible for monitoring the amounts submitted for each contributor to avoid excess submissions.|
|07||DATE OF RECEIPT IS PRIOR TO DATE OF ISSUE: The contribution cannot be received before the check or other written instrument has been written or before the cash contribution of $20.00 or less was given.|
|08||CONTRIBUTOR HAS PREVIOUSLY CONTRIBUTED MAXIMUM QUALIFYING AMOUNT FOR YEAR OF ISSUE: The committee has already matched $100.00 for Year 1 or Year 2 from this contributor.|
|09||CONTRIBUTION WOULD CAUSE CONTRIBUTOR TO EXCEED MAXIMUM QUALIFYING AMOUNT FOR YEAR OF ISSUE: If this contribution is matched for the amount indicated, it would cause the contributor to exceed the Year 1 or Year 2 maximum amount of $100.00.|
|10||CONTRIBUTION APPEARS TO HAVE BEEN PREVIOUSLY SUBMITTED: Although this contribution may have a separate sequence number, this appears to be the same contribution as previously submitted. Or, the committee may be trying to match a contribution on a resubmission that was previously matched on an application.|
|11||COPY OF WRITTEN INSTRUMENT WAS NOT ENCLOSED: Copies of written instruments are required to verify the contributions listed on the Application.|
|12||CONTRIBUTION DOES NOT APPEAR TO BE FROM AN INDIVIDUAL MICHIGAN RESIDENT: Qualifying contributions must be from individuals who are Michigan residents as defined by Michigan Election Law.|
|13||TOTAL CONTRIBUTION APPEARS TO EXCEED ELECTION CYCLE CONTRIBUTION LIMITS: Excess contributions are prohibited and therefore no portion of an excess contribution is matchable until reduced to the allowable limit.|
|14||QUALIFYING CONTRIBUTION AMOUNT EXCEEDS CONTRIBUTION AMOUNT: The amount shown on the Application as the qualifying amount can never exceed the total amount of the contribution.|
|15||CONTRIBUTION IS SHOWN AS BEING FROM TWO OR MORE PERSONS: Each contribution must be listed separately in alpha order, as required by Section 63(1).|
|16||JOINT CONTRIBUTION FOR WHICH THERE IS NO ALLOCATION STATEMENT: A joint contribution must provide an allocation to both contributors. Each contributor can sign the check or sign an allocation statement. (Lukens 10–10–1978.) A separate entry is made for each contributor.|
|17||SIGNATURE OF CONTRIBUTOR ILLEGIBLE OR MISSING: The signing of the written instrument reflects the intent of the contributor to make the contribution. (Lukens 10–10–1978.)|
|18||PAYEE NAME MISSING FROM WRITTEN INSTRUMENT OR UNACCEPTABLE FOR MATCHING : The contributor must indicate the name of the Gubernatorial Candidate Committee receiving the contribution on the written instrument or on accompanying documentation. This is necessary because the candidate may still have an undissolved committee for another elective office and a contribution to any committee other than the candidate’s Gubernatorial Candidate Committee is not matchable with public funds.|
|19||TOTAL CONTRIBUTION AMOUNTS ON ALLOCATION STATEMENT, APPLICATION AND WRITTEN INSTRUMENTS ARE INCONSISTENT: Based on the review of all documents submitted, the amount that appears on the application is not consistent with support documentation, (e.g., check amount is $250.00, allocation statement amount is $150.00 each from two contributors or the total amount shown on the allocation is $500.00).|
|20||WRITTEN INSTRUMENT APPEARS TO BE SIGNED BY PERSON OTHER THAN CONTRIBUTOR LISTED ON APPLICATION: The application must reflect the name of the actual contributor. (If John Doe signed the written instrument, Sam Harris’ name should not be reported on the Application as the contributor.)|
|21||ALLOCATION INDICATED ON APPLICATION DIFFERS FROM THAT INDICATED ON ALLOCATION STATEMENT: The amounts allocated on the allocation statement signed by the contributors do not equal the amount indicated on the Application; (e.g., the allocation statement indicates that a check for $200.00 is to be 50/50, however, the Application reflects $75/$125).|
|22||RECEIPT DATE OF WRITTEN INSTRUMENT IS PRIOR TO COMMITTEE FILING DATE AS REFLECTED ON STATEMENT OF ORGANIZATION: Contributions received before the filing of a Statement of Organization for the office of Governor shall not be considered as qualifying contributions. Section 62(2).|
|23||COPY OF WRITTEN INSTRUMENT IS ILLEGIBLE OR UNACCEPTABLE. Written instrument is unreadable due to quality of photocopy or penmanship, etc.|
|24||DOCUMENTATION IS INCONSISTENT WITH WRITTEN INSTRUMENT OR APPLICATION. The information on the documentation differs from the information provided on the Application or on the written instrument.|
|25||APPEARS TO BE CASH CONTRIBUTION OVER $20.00.|
|26||COPY OF POWER OF ATTORNEY MUST BE PROVIDED AND MUST INCLUDE AUTHORITY TO MAKE POLITICAL CONTRIBUTIONS: If the written instrument indicates that the signatory is signing under a power of attorney for the indicated contributor, a copy of the power of attorney must be included in the documentation with specific authority indicated.|
REFER TO THE MERTS USER MANUAL FOR THE GUBERNATORIAL CANDIDATE COMMITTEE INSTRUCTIONS ON CREATION AND SUBMISSION OF PUBLIC FUNDING APPLICATIONS.
If contributions submitted on an Application are rejected for errors that are correctable, the contributions may be resubmitted with additional documentation or corrections. A Resubmission is filed on a paper Application form only and cannot be filed over the Internet or on disk. The Resubmission may be created using the MERTS software and is then printed out and the paper copy is filed along with the additional documentation at the Bureau of Elections’ office in Lansing.
The cover page contains similar information as the original Public Funding Application, except that Item 8b is checked, indicating that the document is a Resubmission of an Application. Do not mix contributions from different Applications on one Resubmission. A separate Resubmission must be filed for each Application that has contributions to be corrected. The sequence number of the contribution remains the same as it was on the original Application.
REFER TO THE MERTS USER MANUAL FOR THE GUBERNATORIAL CANDIDATE COMMITTEE INSTRUCTIONS ON CREATION AND SUBMISSION OF PUBLIC FUNDING APPLICATIONS.
THE PUBLIC FUNDS STATUS REPORT
The committee is required to file a Public Funds Status Report if unexpended public funds have not been returned to the State within 60 days after the election for which they were received. The single exception to this is that public funds are considered “expended” and may be retained past that date if the committee documents that it owes debts that qualify to be repaid with public funds.
In order to retain public funds past the 60-day limit, the committee must obtain the prior written approval of the Bureau of Elections by providing adequate documentation as to the status of the public funds account and of the debts or obligations owed. This includes copies of the invoices for the debts that must have been incurred before the election.
The committee cannot receive public funds for the primary election after the primary election has passed except to the extent that debts or obligations subject to repayment with public funds are still owed for goods or services used in the primary election. Adequate documentation is required.
The Public Funds Status Report is designed to provide this documentation in all cases. The information required on the report is in addition to, not in lieu of, the information reported on Campaign Statements. All of the information on the Public Funds Status Report must also be shown on a subsequent Campaign Statement. The Public Funds Status Report must be filed every 30-calendar days as long as public funds are retained by the committee, beginning on the 60th day following the election.
The Public Funds Status Report will always cover a specific period of time. It begins one day after the closing date of the last Campaign Statement filed or one day after the most recent Public Funds Status Report. The beginning balance of the account (line 10) will be either of the following:
The amount owed at the beginning of the period, page 2 of the Status Report (second column, lower half of the page) must be the same as one of the following:
It is possible that a committee involved in both the Primary and General elections will be simultaneously retaining public funds from both elections past the 60-day limit. In this case, a separate Public Funds Status Report for each public funds account is required every 30 days.
The committee must report in the Receipts and Expenditures sections of the status report all transactions that occurred in the public funds account during the coverage period. The date of the transaction, the name of the person the public funds were received from or paid to, and the amount of the transaction is required. The remaining detail regarding the transaction will be included in the Campaign Statement covering that period. The committee must show on page 2 of the status report outstanding debts and obligations subject to repayment with public funds. These debts should have been reported on the Post-Election Campaign Statement as “subject to the $2 million expenditure limitation”.
Required information is:
If the category of the debt has changed since the debt was originally reported, indicate the category in which the debt was first reported. Report the total amounts paid on the debt from public funds and from private funds during the period covered by the report. The “Ending Balance” will reflect the beginning balance minus payments made from both public and private funds. If on any Public Funds Status Report filed after the 60-day limit the ending balance of debt owed is less than the balance of public funds on hand (line 14), the difference must be returned to the State Campaign Fund.
There are four possible times when the Public Funding Status Report must be filed, each having its own unique closing dates and due dates. These are discussed in greater detail below.
Post-Primary Application Report
The committee may receive public funds after the Primary Election through December 31 following the election if debts remain that qualify to be paid with public funds. This only applies if the committee has not reached the maximum in public funds receipts. The last Public Funds Application must be received by the Bureau of Elections no later than December 15 of the election year to allow time for processing.
The committee may receive public funds at this time only if the unpaid debts and obligations that are subject to repayment with public funds exceed the cash balance of the public funds account. A Public Funds Status Report must be submitted with any Post-Primary Application for public funds. The committee must check the “Post-Primary Application” box in Item 1 of the report form and indicate the number of the Application with which it is being submitted. All sections of the form must be completed and it must be accompanied by invoices for the debts listed as outstanding.
60-Day Public Funds Status Report
If the committee has not filed a Termination of Account Report within 60 days after the election for which the public funds were received, the committee must file the 60-Day Status Report as a condition of retaining public funds. The closing date of the period covered is 60 days after the election, and the Report must be filed within 10 days thereafter.
Monthly Public Funds Status Report
After the 60 day limit, the committee must file monthly reports as long as it retains public funds. The closing date of the period covered by the Report is the last day of the month and it must be filed by the 10th day of the following month.
Termination of Public Funds Account Report
The Termination of Public Funds Account Report must be filed when the committee closes its public funds account, unless the account is closed prior to the Post-Election Campaign Statement for the election for which the public funds were received. The closing date of the Report will be the date the account is closed.
Prior to the 60-day limit, the Termination of Account Report may be filed at any time after the closing of the account. However, after the 60-day limit, the Report must be filed within 10 days after the closing of the account. Any debts subject to payment with public funds that were reported on the previous Public Funds Status Report should have zero balances at this time or the committee should indicate that the remaining balance will be paid with private funds. Any balance of public funds shown on line 14 should be returned to the State with the Report. The committee may combine the Termination of Account Report with either the 60-Day Report or the monthly Report if the account is closed at the time the Report is due.
Public Funds Status Report Instructions
- Enter committee’s campaign finance identification number and name, address, and treasurer’s name and address.
- Check a box to indicate the type of Report being filed.
- Check box to indicate whether the Report is related to Primary Election public funds or General Election public funds.
- Indicate the last Campaign Statement filed: Pre-Primary = P1; Post-Primary = P2; Pre-General = G1; Post-General = G2. If a previous Public Funding Status Report was filed, indicate the date on which it was filed. Indicate the period covered by the current report.
- List all money deposited into the public funds account since the last Public Funds Status Report or Campaign Statement (whichever was most recent) and total.
- List all expenditures made from the public funds account since the last Public Funds Status Report or Campaign Statement (whichever was most recent) and total.
- Complete the Balance Statement portion of the form.
- On page 2, list information regarding each debt or obligation that the committee intends to pay with the requested public funds, including:
Copies of vendor invoices must be attached for all debts listed on page 2 of the Report. If, on any Report filed after the 60 day limit, the ending balance of debt owed is less than the balance of public funds on-hand (line 14), the difference must be returned to the State Campaign Fund.
The report must be signed by both the candidate and the committee treasurer. The information required on the Public Funds Status Report is in addition to, not in lieu of, the information reported on Campaign Statements. All of the information on the Report must also be shown in more detailed form on a subsequent Campaign Statement.
The Gubernatorial Candidate Committee must return all public funds remaining after payment of debt to the State Campaign Fund. Any interest earned on the public funds bank accounts must also be returned to the state.
If a Gubernatorial Candidate Committee refunds a contribution to a contributor, or if the committee’s bank determines that a contributor’s check or other written instrument is invalid due to insufficient funds subsequent to the contribution being matched with public funds, the committee must refund to the State Campaign Fund all public funds received for that contribution.
When money is being returned the State Campaign Fund, the committee should remit a check to the Bureau of Elections, payable to “State of Michigan”, accompanied by a written explanation of the reason for the return. If the refund is because of the refund or invalidation of a matched contribution, the committee must include the name and address of the contributor, the date of the original receipt, contribution sequence number and Public Funds Application Number on which the contribution was submitted for public funds.
During the year of the gubernatorial election, the Department of State’s Internal Security Division, with the assistance of the Bureau of Elections, will conduct a complete audit of the records of all Gubernatorial Candidate Committees that received public funding. The committee will be contacted to schedule the audit dates (see sample Post-Audit letter).
For the audit, the committee must present for review all records documenting information that was required to be reported on Campaign Statements, including bank statements, checkbooks, canceled checks, wire transfers, internet or other electronic contributions or transactions, contracts, payroll records, vendor invoices, expense vouchers, receipts and other supporting documentation required by the Department for all private funds and public funds accounts.
The purpose of the audit is to verify compliance by the committee with the Campaign Finance Act, especially in the areas of record keeping, reporting requirements, use of public funds for qualified expenditures, proper segregation of funds, use of public funds for a subsequent election and return of unexpended public funds to the state (see Post Election Audit Objectives).
Sample Post-Election Audit Letter
The Department of State will be conducting audits for gubernatorial Candidate Committee’s public and private funds accounts if the candidate received public funds for the 2006 Primary and/or General Elections.
We are requesting that you make available to the Department of State all of the following records regarding all accounts for the 2006 Primary and General Elections from (date committee received the first contribution), through (the date the committee filed the(month) Public Funding Status Report which reflects a balance of in the public funding account). Include all canceled checks, check registers, bank statements, wire transfers, Internet or other electronic contributions or transactions, contracts, payroll records, invoices, receipt and expense vouchers, receipts, independent contractor information and all other supporting documentation required by the Department for your private funds and public funds account. Please ensure that your records are complete as this will be a detailed audit.
Your records should be delivered to the Bureau of Elections, 1st floor of the Treasury Building, 430 W. Allegan Street, Lansing, Michigan 48918 by the morning of (Month) (day), (Year). Your records will be returned to you upon completion of the audit. Your staff does not have to be physically present while the audit is conducted; however, we do request that the treasurer or some other designated person serve as a contact person if the auditors have questions or require additional information from the committee. Your contact with the auditors will be through your Campaign Finance Analyst, in the Bureau of Elections.
Please note that until you report a zero balance in the Public Funding account, a Public Funding Status Report is required to be filed every 30 days with the Bureau of Elections. (A Public Funding Status Report will be due (date).
Please contact your Campaign Finance Analyst if you have any questions.
Evelyn Quiroga, Director Disclosure Data Division
Post-Election Audit Objectives/Scope
The Michigan Department of State will complete an audit of the records of all Gubernatorial Candidate Committees that receive public funding. The purpose of the audit is to review the candidate’s Campaign Finance Statements to provide reasonable assurance of the compliance with the requirements of the Michigan Campaign Finance Act of 1976, PA 388, as amended. The audit will include activities recorded in both the private and public fund accounts.
The audit will have the following objectives:
The auditors will review the reports submitted to the Bureau of Elections along with the banking records, supporting invoices, payroll records, contracts, and records of contributions which must be maintained and supplied by each Committee when requested by the auditors. It is the department’s intent to proceed with audit procedures throughout the campaign process and issue a final report within the year following the gubernatorial election.
Because of the audit requirements, the Bureau requests that gubernatorial Candidate Committees establish checking or draft accounts that provide canceled checks. In addition, the Bureau highly recommends that each Committee establish a system to reconcile their bank statements to their Campaign Finance Statements on a monthly basis.