Federal matching funds

Money supplied to campaign funds from public resources and administered by the Federal Election Commission.

Federal matching funds match donations made by individual contributors dollar-for-dollar up to a maximum of $250 per donation.

Candidates are not obliged to take matching funds, but if they opt to do so they must restrict their spending to a maximum of approximately $40m during the presidential primary period.

Funding is paid out in three stages:

• Matching funds for the primaries
• A block grant for the conventions
• A further block grant for the general election

Those who decline matching funds are free from any spending limits (although they are still bound by contribution limits including the $1000 limit from each individual).

This stems from a 1975 Supreme Court ruling, Buckley v. Valeo, which stated that donating money was a form of expression protected by the First Amendment of the Constitution.

To qualify for funds, candidates need to show they are viable by raising at least $100,000 in individual donations, including at least $5,000 in each of 20 states.

Candidates who fail to receive at least 10% of the popular vote in two successive primary elections lose their eligibility for continued payments, unless and until they receive at least 20% of the vote in a later primary.

The two major parties - Democrat and Republican - are automatically entitled to a public grant to pay for the cost of Presidential conventions.

Minor parties - those who presidential candidates received between 5% and 25% of the vote in the preceding election - are also entitled to a smaller subsidy in proportion to the vote they received.

New parties are not eligible.

In the general election proper the two major parties receive a block grant, while minor parties receive an amount proportionate to the vote they received in previous elections.