GET THE LEAD OUT Act of 2016

The Sustaining Our Democracy Act, introduced as S. 2588, establishes a Democracy Advancement and Innovation Program. This program allocates federal funds to states for "democracy promotion activities," which include upgrading voting equipment and voter registration systems, enhancing cybersecurity for election infrastructure, expanding polling places, and improving early and mail voting. The bill also funds recruitment, training, and protection of election officials. This creates a new, dedicated funding stream for states to modernize their election systems, directly benefiting companies that provide the necessary technology and services. The money trail for this bill flows from the federal government, through the Office of Democracy Advancement and Innovation, directly to states via allocations. States will then procure goods and services from private companies to implement the mandated activities. This includes hardware for voting machines, software for voter registration and election management, cybersecurity solutions, and IT consulting services. The bill establishes a State Election Assistance and Innovation Trust Fund, indicating a sustained funding mechanism for these activities. Companies with existing government contracts or those specializing in secure IT infrastructure and election technology are well-positioned to capture these state-level contracts. Historically, federal funding for election infrastructure has driven significant market activity. Following the Help America Vote Act (HAVA) of 2002, which provided $3.9 billion to states for election reform, companies like Election Systems & Software (ES&S) and Dominion Voting Systems saw increased demand for their products. While these are private companies, the broader impact on technology providers for government services was evident. For example, government IT contractors experienced sustained growth. The current bill focuses heavily on cybersecurity and innovation, indicating a shift towards advanced technology solutions rather than just hardware replacement. This suggests a strong tailwind for cybersecurity firms and IT service providers. Specific companies stand to gain from this legislation. Technology providers specializing in secure networking and cloud services, such as $MSFT and $GOOGL (Google Cloud), will see increased demand for secure election data storage and processing. Cybersecurity firms like $CACI, $SAIC, $LDOS, and $DXC, which have extensive government contracting experience, are positioned to secure contracts for protecting election infrastructure. Manufacturers of voting equipment and related hardware, such as $HPQ for secure printing and computing solutions, will also benefit. Telecommunications companies like $VZ and $T, which provide critical network infrastructure, will see increased demand for secure and reliable connectivity for election systems. Companies that offer voter registration software and election management platforms will also experience a surge in demand. Conversely, companies not involved in government contracting or election technology will see no direct impact. This bill has been referred to the Committee on Rules and Administration. Given the bipartisan sponsorship (15 cosponsors), it indicates moderate legislative momentum. The next step involves committee hearings and potential markups. If it passes committee, it moves to a full Senate vote. The timeline for passage is uncertain, but the establishment of a dedicated trust fund suggests a long-term commitment to funding these activities once enacted. The immediate impact is the creation of a new, federally funded market for election technology and services, which will materialize as states begin to receive allocations and issue RFPs.