Amended in Assembly July 16, 2015

Amended in Senate June 2, 2015

Amended in Senate April 6, 2015

Senate BillNo. 443


Introduced by Senator Mitchell

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(Principal coauthor: Senator Leno)

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(Principal coauthors: Assembly Members Cristina Garcia and Hadley)

end insert
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(Coauthors: Senators Anderson and Jackson)

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(Coauthor: Assembly Member Jones-Sawyer)

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February 25, 2015


An act to amend Sections 11470.1, 11488.4,begin insert 11488.5,end insert 11489, and 11495 of, and to add Sectionsbegin delete 11471.2 and 11488.7end deletebegin insert 11471.2, 11488.7, and 11489.1end insert to, the Health and Safety Code, relating to forfeiture.

LEGISLATIVE COUNSEL’S DIGEST

SB 443, as amended, Mitchell. Forfeiture: controlled substances.

Existing law subjects certain property to forfeiture, such as controlled substances and equipment used to process controlled substances. Existing law allows peace officers, under specified circumstances, to seize property that is subject to forfeiture. Existing law authorizes specified public agencies to bring an action to recover expenses of seizing, eradicating, destroying, or taking remedial action with respect to any controlled substance. In a forfeiture action with regards to cash or negotiable instruments of a value of not less than $25,000, existing law requires the state or local agency to prove by clear and convincing evidence that the property is subject to forfeiture. Existing law requires seized property or the proceeds from the sale of that property to be distributed among specified entities. Existing law requires the Attorney General to publish a yearly report on forfeiture within the state.

This bill would require a prosecuting agency to seek or obtain a criminal conviction for the unlawful manufacture or cultivation of any controlled substance or its precursors prior to an entry of judgment for recovery of expenses of seizing, eradicating, destroying, or taking remedial action with respect to any controlled substance. The bill would prohibit maintaining an action for recovery of expenses against a person who has been acquitted of the underlying criminal charges.

The bill would prohibit state or local law enforcement agencies from transferring seized property to a federal agency seeking adoption by the federal agency of the seized property. The bill would also require that any property seized pursuant to any federal law that authorizes the sharing or transfer of forfeited property be distributed according to state law, thereby imposing a state-mandated local program. The bill would further prohibit state or local agencies frombegin delete receivingend deletebegin insert requesting an equitable share from a federal agency ofend insert specified seized property if a conviction for the underlying offenses is notbegin delete obtained or if federal law prohibits distributing the proceeds or property received in accordance with state law.end deletebegin insert obtained.end insert

The bill would require notices of a forfeiture action to contain additional details, such as the rights of an interested party at a forfeiture hearing. The bill would require the court to appoint counsel for the defendant in the forfeiture proceeding if a defendant in a related criminal matter is represented by court-appointed counsel, thereby creating a state-mandated local program. The bill would change the burden of proof that a state or local law enforcement agency must meet to succeed in a forfeiture action with regards to cash or negotiable instruments of a value not less than $25,000, from a clear and convicting standard to beyond a reasonable doubt.begin insert The bill would also make other specified changes to court forfeiture proceedings, including allowing parties to waive the requirement that forfeiture cases be tried in conjunction with related criminal cases when the forfeiture hearing is continued or stayed.end insert

The bill would allow recovery of attorney’s fees for defendants or claimants in a forfeiture action who substantially prevail. The bill would make specified changes to the distribution of proceeds from forfeiture actions under state law, including reducing distributions to seizing law enforcement agencies and prosecutor’s offices, and providing distributionsbegin delete to courts, public defenders, and a specified nonprofit organization providing training in the use of laws permitting seizure and forfeiture of assets.end deletebegin insert to specified funds for specified purposes.end insert The bill would also require the Attorney General to include additional information on forfeiture actions in the yearly report.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P3    1

SECTION 1.  

Section 11470.1 of the Health and Safety Code
2 is amended to read:

3

11470.1.  

(a) The expenses of seizing, eradicating, destroying,
4or taking remedial action with respect to, any controlled substance
5or its precursors shall be recoverable from:

6(1) Any person who manufactures or cultivates a controlled
7substance or its precursors in violation of this division.

8(2) Any person who aids and abets or who knowingly profits
9in any manner from the manufacture or cultivation of a controlled
10substance or its precursors on property owned, leased, or possessed
11by the defendant, in violation of this division.

12(b) The expenses of taking remedial action with respect to any
13 controlled substance or its precursors shall also be recoverable
14from any person liable for the costs of that remedial action under
15Chapter 6.8 (commencing with Section 25300) of Division 20 of
16the Health and Safety Code.

17(c) It shall be necessary to seek or obtain a criminal conviction
18for the unlawful manufacture or cultivation of any controlled
19substance or its precursors prior to the entry of judgment for the
20recovery of expenses. If criminal charges are pending against the
21defendant for the unlawful manufacture or cultivation of any
22controlled substance or its precursors, an action brought pursuant
23to this section shall, upon a defendant’s request, be continued while
24the criminal charges are pending.

P4    1(d) The action may be brought by the district attorney, county
2counsel, city attorney, the State Department of Health Care
3Services, or Attorney General. All expenses recovered pursuant
4to this section shall be remitted to the law enforcement agency
5which incurred them.

6(e) (1) The burden of proof as to liability shall be on the plaintiff
7and shall be by a preponderance of the evidence in an action
8alleging that the defendant is liable for expenses pursuant to
9paragraph (1) of subdivision (a). The burden of proof as to liability
10shall be on the plaintiff and shall be by clear and convincing
11evidence in an action alleging that the defendant is liable for
12expenses pursuant to paragraph (2) of subdivision (a). The burden
13of proof as to the amount of expenses recoverable shall be on the
14plaintiff and shall be by a preponderance of the evidence in any
15action brought pursuant to subdivision (a).

16(2) Notwithstanding paragraph (1), for any person convicted of
17a criminal charge of the manufacture or cultivation of a controlled
18substance or its precursors there shall be a presumption affecting
19the burden of proof that the person is liable.

20(f) Only expenses which meet the following requirements shall
21be recoverable under this section:

22(1) The expenses were incurred in seizing, eradicating, or
23destroying the controlled substance or its precursors or in taking
24remedial action with respect to a hazardous substance. These
25expenses may not include any costs incurred in use of the herbicide
26paraquat.

27(2) The expenses were incurred as a proximate result of the
28defendant’s manufacture or cultivation of a controlled substance
29in violation of this division.

30(3) The expenses were reasonably incurred.

31(g) For purposes of this section, “remedial action” shall have
32the meaning set forth in Section 25322.

33(h) For the purpose of discharge in bankruptcy, a judgment for
34recovery of expenses under this section shall be deemed to be a
35debt for willful and malicious injury by the defendant to another
36entity or to the property of another entity.

37(i) Notwithstanding Section 526 of the Code of Civil Procedure,
38the plaintiff may be granted a temporary restraining order or a
39preliminary injunction, pending or during trial, to restrain the
40defendant from transferring, encumbering, hypothecating, or
P5    1otherwise disposing of any assets specified by the court, if it
2appears by the complaint that the plaintiff is entitled to the relief
3demanded and it appears that the defendant may dispose of those
4assets to thwart enforcement of the judgment.

5(j) The Legislature finds and declares that civil penalties for the
6recovery of expenses incurred in enforcing the provisions of this
7division shall not supplant criminal prosecution for violation of
8those provisions, but shall be a supplemental remedy to criminal
9enforcement.

10(k) Any testimony, admission, or any other statement made by
11the defendant in any proceeding brought pursuant to this section,
12or any evidence derived from the testimony, admission, or other
13statement, shall not be admitted or otherwise used in any criminal
14proceeding arising out of the same conduct.

15(l) No action shall be brought or maintained pursuant to this
16section against a person who has been acquitted of criminal charges
17for conductbegin delete which may beend deletebegin insert that isend insert the basis for an action under this
18section.

19

SEC. 2.  

Section 11471.2 is added to the Health and Safety
20Code
, to read:

21

11471.2.  

(a) State or local law enforcement authorities shall
22not refer or otherwise transfer property seized under state law
23begin insert authorizing the seizure of propertyend insert to a federal agency seeking the
24adoptionbegin insert of the seized propertyend insert by the federal agencybegin delete of the seized
25property.end delete
begin insert for proceeding with federal forfeiture.end insert Nothing in this
26section shall be construed to prohibit the federal government, or
27any of its agencies, frombegin insert seizing property,end insert seeking forfeiture under
28federalbegin delete law.end deletebegin insert law, or sharing federally forfeited property with state
29or local law enforcement agencies when those state or local
30agencies work with federal agencies in joint investigations arising
31out of federal law or federal joint task forces comprised of federal
32and state or local agencies.end insert

33(b) All property, moneys, negotiable instruments, securities, or
34other things of value received by any state or local law enforcement
35agency pursuant to any federal law that authorizes the sharing or
36transferbegin insert by federal agenciesend insert of all or a portion of forfeited property
37or the proceedsbegin delete ofend deletebegin insert fromend insert the sale of forfeited property to a state or
38local law enforcement agency shall be promptly transferred, sold,
39andbegin delete depositedend deletebegin insert distributedend insert as set forth inbegin delete Section 11489.end deletebegin insert subdivision
40(a) of Section 11489.1.end insert

P6    1(c) A state or local law enforcement agencybegin delete may not receiveend delete
2begin insert participating in a joint investigation with a federal agency shall
3not request an equitable share from the federal agency ofend insert
all or a
4portion of the forfeited property or proceeds frombegin insert the sale ofend insert
5 property forfeited pursuant to federal law unless a defendant is
6convicted in an underlying or related criminal action of an offense
7begin insert for which property is subject to forfeiture asend insert specified in Section
811470begin insert or Section 11488,end insert orbegin delete anyend deletebegin insert anend insert offense under federal law that
9includes all of the elements of an offensebegin insert for which property is
10subject to forfeiture asend insert
specified inbegin delete Section 11470. If federal law
11prohibits compliance with Section 11489 or ifend delete
begin insert Sections 11470 and
1211488.end insert

13begin insert(d)end insertbegin insertend insertbegin insertIfend insert a conviction in the underlying or related criminal action
14is not obtained, state law enforcement authorities shall notbegin delete receiveend delete
15begin insert request an equitable share from the federal agency of all or a
16portion of theend insert
forfeited property or proceeds from the sale of
17begin delete forfeited property shared or transferredend deletebegin insert property forfeitedend insert pursuant
18to federal law.

19

SEC. 3.  

Section 11488.4 of the Health and Safety Code is
20amended to read:

21

11488.4.  

(a) (1) Except as provided in subdivision (j), if the
22Department of Justice or the local governmental entity determines
23that the factual circumstances do warrant that the moneys,
24negotiable instruments, securities, or other things of value seized
25or subject to forfeiture come within the provisions of subdivisions
26(a) to (g), inclusive, of Section 11470, and are not automatically
27made forfeitable or subject to court order of forfeiture or
28destruction by another provision of this chapter, the Attorney
29General or district attorney shall file a petition of forfeiture with
30the superior court of the county in which the defendant has been
31charged with the underlying criminal offense or in which the
32 property subject to forfeiture has been seized or, if no seizure has
33occurred, in the county in which the property subject to forfeiture
34is located. If the petition alleges that real property is forfeitable,
35the prosecuting attorney shall cause a lis pendens to be recorded
36in the office of the county recorder of each county in which the
37real property is located.

38(2) A petition of forfeiture under this subdivision shall be filed
39as soon as practicable, but in any case within one year of the seizure
40of the property which is subject to forfeiture, or as soon as
P7    1practicable, but in any case within one year of the filing by the
2Attorney General or district attorney of a lis pendens or other
3process against the property, whichever is earlier.

4(b) Physical seizure of assets shall not be necessary in order to
5have that particular asset alleged to be forfeitable in a petition
6under this section. The prosecuting attorney may seek protective
7orders for any asset pursuant to Section 11492.

8(c) The Attorney General or district attorney shall make service
9of process regarding this petition upon every individual designated
10in a receipt issued for the property seized. In addition, the Attorney
11General or district attorney shall cause a notice of the seizure, if
12any, and of the intended forfeiture proceeding, as well as a notice
13stating that any interested party may file a verified claim with the
14superior court of the county in which the property was seized or
15if the property was not seized, a notice of the initiation of forfeiture
16proceedings with respect to any interest in the property seized or
17subject to forfeiture, to be served by personal delivery or by
18registered mail upon any person who has an interest in the seized
19property or property subject to forfeiture other than persons
20designated in a receipt issued for the property seized. Whenever
21a notice is delivered pursuant to this section, it shall be
22accompanied by a claim form as described in Section 11488.5 and
23directions for the filing and service of a claim.

24(d) An investigation shall be made by the law enforcement
25agency as to any claimant to a vehicle, boat, or airplane whose
26right, title, interest, or lien is of record in the Department of Motor
27Vehicles or appropriate federal agency. If the law enforcement
28agency finds that any person, other than the registered owner, is
29the legal owner thereof, and that ownership did not arise subsequent
30to the date and time of arrest or notification of the forfeiture
31 proceedings or seizure of the vehicle, boat, or airplane, it shall
32forthwith send a notice to the legal owner at his or her address
33appearing on the records of the Department of Motor Vehicles or
34appropriate federal agency.

35(e) When a forfeiture action is filed, the notices shall be
36published once a week for three successive weeks in a newspaper
37of general circulation in the county where the seizure was made
38or where the property subject to forfeiture is located.

39(f) All notices shall set forth the time within which a claim of
40interest in the property seized or subject to forfeiture is required
P8    1to be filed pursuant to Section 11488.5. The notices shall explain,
2in plain language, what an interested party must do and the time
3in which the person must act to contest the forfeiture in a hearing.
4The notices shall state what rights the interested party has at a
5hearing. The notices shall also state the legal consequences for
6failing to respond to the forfeiture notice.

7(g) Nothing contained in this chapter shall preclude a person,
8other than a defendant, claiming an interest in property actually
9seized from moving for a return of property if that person can show
10standing by proving an interest in the property not assigned
11subsequent to the seizure or filing of the forfeiture petition.

12(h) (1) If there is an underlying or related criminal action, a
13defendant may move for the return of the property on the grounds
14that there is not probable cause to believe that the property is
15forfeitable pursuant to subdivisions (a) to (g), inclusive, of Section
1611470 and is not automatically made forfeitable or subject to court
17order of forfeiture or destruction by another provision of this
18chapter. The motion may be made prior to, during, or subsequent
19to the preliminary examination. If made subsequent to the
20preliminary examination, the Attorney General or district attorney
21may submit the record of the preliminary hearing as evidence that
22probable cause exists to believe that the underlying or related
23criminal violations have occurred.

24(2) Within 15 days after a defendant’s motion is granted, the
25people may file a petition for a writ of mandate or prohibition
26seeking appellate review of the ruling.

27(i) (1) With respect to property described in subdivisions (e)
28and (g) of Section 11470 for which forfeiture is sought and as to
29which forfeiture is contested, the state or local governmental entity
30shall have the burden of proving beyond a reasonable doubt that
31the property for which forfeiture is sought was used, or intended
32to be used, to facilitate a violation of one of the offenses
33enumerated in subdivision (f) or (g) of Section 11470.

34(2) In the case of property described in subdivision (f) of Section
3511470, for which forfeiture is sought and as to which forfeiture is
36contested, the state or local governmental entity shall have the
37burden of proving beyond a reasonable doubt that the property for
38which forfeiture is sought meets the criteria for forfeiture described
39in subdivision (f) of Section 11470.

P9    1(3) In the case of property described in paragraphs (1) and (2),
2begin insert where forfeiture is contested,end insert a judgment of forfeiture requires as
3a condition precedent thereto, that a defendant be convicted in an
4underlying or related criminal action of an offense specified in
5subdivision (f) or (g) of Section 11470 which offense occurred
6within five years of the seizure of the property subject to forfeiture
7or within five years of the notification of intention to seek
8forfeiture. If the defendant is found guilty of the underlying or
9related criminal offense, the issue of forfeiture shall be tried before
10the same jury, if the trial was by jury, or tried before the same
11court, if trial was by court, unless waived by all parties. The issue
12of forfeiture shall be bifurcated from the criminal trial and tried
13after conviction unless waived by all the parties. If the defendant
14in the related criminal matter is represented by court-appointed
15 counsel, the trial court shall appoint counsel for the defendant in
16the forfeiture proceeding.

17(4) If there is an underlying or related criminal action, and a
18criminal conviction is required before a judgment of forfeiture
19may be entered, the issue of forfeiture shall be tried in conjunction
20therewith.begin insert In such a case, the issue of forfeiture shall be bifurcated
21from the criminal trial and tried after conviction unless waived by
22the parties.end insert
Trial shall be by jury unless waived by all parties. If
23there is no underlying or related criminal action, the presiding
24judge of the superior court shall assign the action brought pursuant
25to this chapter for trial.

26(j) The Attorney General or the district attorney of the county
27in which property is subject to forfeiture under Section 11470 may,
28pursuant to this subdivision, order forfeiture of personal property
29not exceeding twenty-five thousand dollars ($25,000) in value.
30The Attorney General or district attorney shall provide notice of
31proceedings under this subdivision pursuant to subdivisions (c),
32(d), (e), and (f), including:

33(1) A description of the property.

34(2) The appraised value of the property.

35(3) The date and place of seizure or location of any property
36not seized but subject to forfeiture.

37(4) The violation of law alleged with respect to forfeiture of the
38property.

P10   1(5) (A) The instructions for filing and serving a claim with the
2Attorney General or the district attorney pursuant to Section
311488.5 and time limits for filing a claim and claim form.

4(B) If no claims are timely filed, the Attorney General or the
5district attorney shall prepare a written declaration of forfeiture of
6the subject property to the state and dispose of the property in
7accordance withbegin delete Section 11489.end deletebegin insert subdivision (b) of Section 11489.1.end insert
8 A written declaration of forfeiture signed by the Attorney General
9or district attorney under this subdivision shall be deemed to
10provide good and sufficient title to the forfeited property. The
11prosecuting agency ordering forfeiture pursuant to this subdivision
12shall provide a copy of the declaration of forfeiture to any person
13listed in the receipt given at the time of seizure and to any person
14personally served notice of the forfeiture proceedings.

15(C) If a claim is timely filed, then the Attorney General or
16district attorney shall file a petition of forfeiture pursuant to this
17section within 30 days of the receipt of the claim. The petition of
18forfeiture shall then proceed pursuant to other provisions of this
19chapter, except that no additional notice need be given and no
20additional claim need be filed.

21(k) If in any underlying or related criminal action or proceeding,
22in which a petition for forfeiture has been filed pursuant to this
23section, and a criminal conviction is required before a judgment
24of forfeiture may be entered, the defendant willfully fails to appear
25as required,begin insert there shall be no requirement of a criminal conviction
26as a prerequisite to the forfeiture. In these cases,end insert
forfeiture shall
27be ordered as against the defendant and judgment entered upon
28default, upon application of the state or local governmental entity.
29In its application for default, the state or local governmental entity
30shall be required to give notice to the defendant’s attorney of
31record, if any, in the underlying or related criminal action, and to
32make a showing of due diligence to locate the defendant. In moving
33for a default judgment pursuant to this subdivision, the state or
34local governmental entity shall be required to establish a prima
35facie case in support of its petition for forfeiture.

36begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 11488.5 of the end insertbegin insertHealth and Safety Codeend insertbegin insert is
37amended to read:end insert

38

11488.5.  

(a) (1) Any person claiming an interest in the
39property seized pursuant to Section 11488 may, unless for good
40cause shown the court extends the time for filing, at any time within
P11   130 days from the date of thebegin delete firstend deletebegin insert lastend insert publication of the notice of
2seizure, if that person was not personally served or served by mail,
3or within 30 days after receipt of actual notice, file with the
4superior court of the county in which the defendant has been
5charged with the underlying or related criminal offense or in which
6the property was seized or, if there was no seizure, in which the
7 property is located, a claim, verified in accordance with Section
8446 of the Code of Civil Procedure, stating his or her interest in
9the property. An endorsed copy of the claim shall be served by the
10claimant on the Attorney General or district attorney, as
11appropriate, within 30 days of the filing of the claim. The Judicial
12Council shall develop and approve official forms for the verified
13claim that is to be filed pursuant to this section. The official forms
14shall be drafted in nontechnical language, in English and in
15Spanish, and shall be made available through the office of the clerk
16of the appropriate court.

17(2) Any person who claims that the property was assigned to
18him or to her prior to the seizure or notification of pending
19forfeiture of the property under this chapter, whichever occurs
20begin delete first,end deletebegin insert last,end insert shall file a claim with the court and prosecuting agency
21pursuant to Section 11488.5 declaring an interest in that property
22and that interest shall be adjudicated at the forfeiture hearing. The
23property shall remain under control of the law enforcement or
24prosecutorial agency until the adjudication of the forfeiture hearing.
25Seized property shall be protected and its value shall be preserved
26pending the outcome of the forfeiture proceedings.

27(3) The clerk of the court shall not charge or collect a fee for
28the filing of a claim in any case in which the value of the
29respondent property as specified in the notice is five thousand
30dollars ($5,000) or less. If the value of the property, as specified
31in the notice, is more than five thousand dollars ($5,000), the clerk
32of the court shall charge the filing fee specified in Section 70611
33of the Government Code.

34(4) The claim of a law enforcement agency to property seized
35pursuant to Section 11488 or subject to forfeiture shall have priority
36over a claim to the seized or forfeitable property made by the
37Franchise Tax Board in a notice to withhold issued pursuant to
38Section 18817 or 26132 of the Revenue and Taxation Code.

39(b) (1) If at the end of the time set forth in subdivision (a) there
40is no claim on file, the court, upon motion, shall declare the
P12   1property seized or subject to forfeiture pursuant to subdivisions
2(a) to (g), inclusive, of Section 11470 forfeited to the state. In
3moving for a default judgment pursuant to this subdivision, the
4state or local governmental entity shall be required to establish a
5prima facie case in support of its petition for forfeiture.

6(2) The court shall order thebegin delete forfeitedend deletebegin insert money forfeited or the
7proceeds of the sale ofend insert
property to be distributed as set forth in
8begin delete Section 11489.end deletebegin insert subdivision (b) of Section 11489.1.end insert

9(c) (1) If a verified claim is filed, the forfeiture proceeding shall
10be set for hearing on a day not less than 30 days therefrom, and
11the proceeding shall have priority over other civil cases. Notice of
12the hearing shall be given in the same manner as provided in
13Section 11488.4. Such a verified claim or a claim filed pursuant
14to subdivision (j) of Section 11488.4 shall not be admissible in the
15proceedings regarding the underlying or related criminal offense
16set forth in subdivision (a) of Section 11488.

17(2) The hearing shall be by jury, unless waived by consent of
18all parties.

19(3) The provisions of the Code of Civil Procedure shall apply
20to proceedings under this chapter unless otherwise inconsistent
21with the provisions or procedures set forth in this chapter. However,
22in proceedings under this chapter, there shall be no joinder of
23actions, coordination of actions, except for forfeiture proceedings,
24or cross-complaints, and the issues shall be limited strictly to the
25 questions related to this chapter.

26(d) (1) At the hearing, the state or local governmental entity
27shall have the burden of establishing, pursuant to subdivision (i)
28of Section 11488.4, that the owner of any interest in the seized
29property consented to the use of the property with knowledge that
30it would be or was used for a purpose for which forfeiture is
31permitted, in accordance with the burden of proof set forth in
32subdivision (i) of Section 11488.4.

33(2) No interest in the seized property shall be affected by a
34forfeiture decree under this section unless the state or local
35governmental entity has proven that the owner of that interest
36consented to the use of the property with knowledge that it would
37be or was used for the purpose charged. Forfeiture shall be ordered
38when, at the hearing, the state or local governmental entity has
39shown that the assets in question are subject to forfeiture pursuant
P13   1to Section 11470, in accordance with the burden of proof set forth
2in subdivision (i) of Section 11488.4.

3(e) The forfeiture hearing shall be continued upon motion of
4the prosecution or the defendant until after a verdict of guilty on
5any criminal charges specified in this chapter and pending against
6the defendant have been decided.begin insert In cases in which the forfeiture
7hearing, or any related civil discovery, is continued or stayed, the
8requirement that the forfeiture case be tried in conjunction with
9the related criminal case or to the same jury as in the related
10criminal case may be waived by the parties.end insert
The forfeiture hearing
11shall be conducted in accordance with Sections 190 to 222.5,
12inclusive, Sections 224 to 234, inclusive, Section 237, and Sections
13607 to 630, inclusive, of the Code of Civil Procedure if a trial by
14jury, and by Sections 631 to 636, inclusive, of the Code of Civil
15Procedure if by the court. Unless the court or jury finds that the
16seized property was used for a purpose for which forfeiture is
17permitted, the court shall order the seized property released to the
18person it determines is entitled thereto.

19If the court or jury finds that the seized property was used for a
20purpose for which forfeiture is permitted, but does not find that a
21person claiming an interest therein, to which the court has
22determined he or she is entitled, had actual knowledge that the
23seized property would be or was used for a purpose for which
24forfeiture is permitted and consented to that use, the court shall
25order the seized property released to the claimant.

26(f) All seized property which was the subject of a contested
27forfeiture hearing and which was not released by the court to a
28claimant shall be declared by the court to be forfeited to the state,
29provided the burden of proof required pursuant to subdivision (i)
30of Section 11488.4 has been met. The court shall order the forfeited
31property to be distributed as set forth in Section 11489.

32(g) All seized property which was the subject of the forfeiture
33hearing and which was not forfeited shall remain subject to any
34order to withhold issued with respect to the property by the
35Franchise Tax Board.

36

begin deleteSEC. 4.end delete
37begin insertSEC. 5.end insert  

Section 11488.7 is added to the Health and Safety
38Code
, to read:

39

11488.7.  

In any forfeiture proceeding under this chapter in
40which the defendant or claimant substantially prevails, the
P14   1defendant or claimant shall be entitled to recover reasonable
2attorneys’ fees and other litigation costs reasonably incurred by
3the defendant or claimant. Any final award of fees and costs shall
4be paid directly to the defendant’s or claimant’s attorney.

5

begin deleteSEC. 5.end delete
6begin insertSEC. 6.end insert  

Section 11489 of the Health and Safety Code is
7amended to read:

8

11489.  

Notwithstanding Section 11502 and except as otherwise
9provided in Section 11473, in all cases where the property is seized
10pursuant to this chapter and forfeited to the state or local
11governmental entity and, where necessary, sold by the Department
12of General Services or local governmental entity, the money
13forfeited or the proceeds of sale shall be distributed by the state
14or local governmental entity as follows:

15(a) To the bona fide or innocent purchaser, conditional sales
16vendor, or mortgagee of the property, if any, up to the amount of
17his or her interest in the property, when the court declaring the
18forfeiture orders a distribution to that person.

19(b) The balance, if any, to accumulate, and to be distributed and
20transferred quarterly in the following manner:

21(1) To the state agency or local governmental entity for all
22expenditures made or incurred by it in connection with the sale of
23the property, including expenditures for any necessary costs of
24notice required by Section 11488.4, and for any necessary repairs,
25storage, or transportation of any property seized under this chapter.

26(2) The remaining funds shall be distributed as follows:

27(A) begin deleteFifty-four end deletebegin insertFortyend insert percent to the state, local, or state and local
28law enforcement entities that participated in the seizure distributed
29so as to reflect the proportionate contribution of eachbegin delete agency.end delete

30begin delete(i)end deletebegin deleteend deletebegin deleteFifteenend deletebegin insert agency. Fifteenend insert percent of the funds distributed
31pursuant to this subparagraph shall be deposited in a special fund
32maintained by the county, city, or city and county of any agency
33making the seizure or seeking an order for forfeiture. This fund
34shall be used for the sole purpose of funding programs designed
35to combat drug abuse and divert gang activity, and shall wherever
36possible involve educators, parents, community-based
37organizations and local businesses, and uniformed law enforcement
38officers. Those programs that have been evaluated as successful
39shall be given priority. These funds shall not be used to supplant
P15   1any state or local funds that would, in the absence of this clause,
2otherwise be made available to the programs.

3It is the intent of the Legislature to cause the development and
4continuation of positive intervention programs for high-risk
5elementary and secondary schoolage students.begin delete Local law
6enforcement should work in partnership with state and local
7agencies and the private sector in administering these programs.end delete

begin delete

8(ii) The actual distribution of funds set aside pursuant to clause
9(i) shall be determined by a panel consisting of the sheriff of the
10county, a police chief selected by the other chiefs in the county,
11and the district attorney and the chief probation officer of the
12county.

end delete
begin delete

13(B) Five percent to the prosecutorial agency that processes the
14forfeiture action.

end delete
begin delete

15(C) Ten percent to the court in the jurisdiction where the
16forfeiture proceedings are initiated.

end delete
begin delete

17(D) Five percent to the public defender’s office or provider of
18court-appointed counsel in the jurisdiction where the forfeiture
19proceedings were initiated.

end delete
begin delete

20 (E)

end delete

21begin insert(B)end insert Twenty-four percent to the General Fund. Notwithstanding
22Section 13340 of the Government Code, the moneys are hereby
23continuously appropriated to the General Fund. Commencing
24January 1, 2016, all moneys deposited in the General Fund pursuant
25to this subparagraph, in an amount not to exceed ten million dollars
26($10,000,000), shall be made available for school safety and
27security, upon appropriation by the Legislature, and shall be
28disbursed pursuant to Senate Bill 1255 of the 1993-94 Regular
29Session, as enacted.

begin insert

30(C) Thirty-four percent to the State Asset Forfeiture Fund for
31Courts and Criminal Justice Purposes, available upon
32 appropriation by the Legislature for the purposes described in
33subdivision (b) of Section 11489.1.

end insert
begin delete

34 (F)

end delete

35begin insert(D)end insert One percent to a private nonprofit organization composed
36of local prosecutors, which shall use these funds for the exclusive
37purpose of providing a statewide program of education and training
38for prosecutors and law enforcement officers in ethics and the
39proper use of laws permitting the seizure and forfeiture of assets
40under this chapter.

begin delete

P16   1 (G)

end delete

2begin insert(E)end insert One percent to a private nonprofit organization composed
3of local criminal defense attorneys, which shall use these funds
4for the exclusive purpose of providing a statewide program of
5education and training in the use of laws permitting the seizure
6and forfeiture of assets under this chapter.

7(c) Notwithstanding Item 0820-101-469 of the Budget Act of
81985 (Chapter 111, Statutes of 1985), all funds allocated to the
9Department of Justice pursuant to subparagraph (A) of paragraph
10(2) of subdivision (b) shall be deposited into the Department of
11Justice Special Deposit Fund-State Asset Forfeiture Account and
12used for the law enforcement efforts of the state or for state or
13local law enforcement efforts pursuant to Section 11493.

14All funds allocated to the Department of Justice by the federal
15government under its Federal Asset Forfeiture program authorized
16by the Comprehensive Crime Control Act of 1984 (Public Law
1798-473) may be deposited directly into the Narcotics Assistance
18and Relinquishment by Criminal Offender Fund and used for state
19and local law enforcement efforts pursuant to Section 11493.

20Funds that are not deposited pursuant to the above paragraph
21shall be deposited into the Department of Justice Special Deposit
22Fund-Federal Asset Forfeiture Account.

begin delete

23(d) All funds distributed to the courts pursuant to subparagraph
24(C) of paragraph (2) of subdivision (b) shall be deposited into the
25Judicial Asset Forfeiture Fund, which is hereby created in the State
26Treasury. The moneys in the Judicial Asset Forfeiture Fund, upon
27appropriation by the Legislature, shall be expended for the purpose
28of administering the courts in the jurisdiction where the forfeiture
29proceeding occurred.

end delete
begin delete

28 30(e)

end delete

31begin insert(d)end insert All the funds distributed to the state or local governmental
32entity pursuant tobegin delete subparagraphsend deletebegin insert subparagraphend insert (A)begin delete and (B)end delete of
33paragraph (2) of subdivision (b) shall not supplant any state or
34local funds that would, in the absence of this subdivision, be made
35available to support the law enforcement and prosecutorial efforts
36of these agencies.

37The court shall order the forfeiture proceeds distributed to the
38state, local, or state and local governmental entities as provided in
39this section.

P17   1For the purposes of this section, “local governmental entity”
2means any city, county, or city and county in this state.

3begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 11489.1 is added to the end insertbegin insertHealth and Safety
4Code
end insert
begin insert, to read:end insert

begin insert
5

begin insert11489.1.end insert  

(a) All property, moneys, negotiable instruments,
6securities, or other things of value received by any state or local
7law enforcement agency pursuant to any federal law that authorizes
8the sharing or transfer of all or a portion of forfeited property or
9the proceeds from the sale of forfeited property to a state or local
10law enforcement agency shall be deposited into the State Asset
11Forfeiture Fund for Law Enforcement Purposes, which is hereby
12created in the State Treasury. Upon appropriation by the
13Legislature, the moneys in the State Asset Forfeiture Fund for Law
14Enforcement Purposes shall be allocated to law enforcement
15agencies statewide, based on the population of the jurisdiction
16served.

17(b) All property, moneys, negotiable instruments, securities, or
18other things of value forfeited pursuant to subdivision (j) of Section
1911488.4 and subparagraph (2) of subdivision (b) of Section
2011488.5 shall be distributed as follows:

21(1) To the state agency or local governmental entity for all
22expenditures made or incurred by it in connection with the sale of
23the property, including expenditures for any necessary costs for
24public notice, hearings, or for any necessary repairs, storage, or
25transportation of any property lawfully forfeited.

26(2) The remaining funds shall be distributed as follows:

27(A) Twenty-four percent to the General Fund.

28(B) Seventy-six percent to the State Asset Forfeiture Fund for
29Courts and Criminal Justice Purposes, which is hereby created in
30the State Treasury. Upon appropriation by the Legislature, the
31moneys in the State Asset Forfeiture Fund for Courts and Criminal
32Justice Purposes shall be made available for the purpose of
33criminal and civil court functions, prosecution, public defense and
34indigent defense, law enforcement, crime prevention including
35after school programs for adolescents and drug treatment for
36adolescents and adults, and victim services.

end insert
37

begin deleteSEC. 6.end delete
38begin insertSEC. 8.end insert  

Section 11495 of the Health and Safety Code is
39amended to read:

P18   1

11495.  

(a) The funds received by the law enforcement agencies
2under Section 11489 shall be deposited into an account maintained
3by the Controller, county auditor, or city treasurer. These funds
4shall be distributed to the law enforcement agencies at their request.
5The Controller, auditor, or treasurer shall maintain a record of
6these disbursements which records shall be open to public
7inspection, subject to the privileges contained in Sections 1040,
81041, and 1042 of the Evidence Code.

9(b) Upon request of the governing body of the jurisdiction in
10which the distributions are made, the Controller, auditor, or
11treasurer shall conduct an audit of these funds and their use. In the
12case of the state, the governing body shall be the Legislature.

13(c) Each year, the Attorney General shall publish a report which
14sets forth the following information for the state, each county, each
15city, and each city and county:

16(1) The number of forfeiture actions initiated and administered
17by state or local agencies under California law, the number of cases
18adopted by the federal government, and the number of cases
19initiated by a joint federal-state action that were prosecuted under
20federal law.

21(2) The number of cases and the administrative number or court
22 docket number of each case for which forfeiture was ordered or
23declared.

24(3) The number of suspects charged with a controlled substance
25violation.

26(4) The number of alleged criminal offenses that were under
27federal or state law.

28(5) The disposition of cases, including no charge, dropped
29charges, acquittal, plea agreement, jury conviction, or other.

30(6) The value of the assets forfeited.

31(7) The recipients of the forfeited assets, the amounts received,
32and the date of the disbursement.

33(d) The Attorney General shall develop administrative guidelines
34for the collection and publication of the information required in
35subdivision (c).

36(e) The Attorney General’s report shall cover the calendar year
37and shall be made no later than March 1 of each year beginning
38with the year after the enactment of this law.

P19   1

begin deleteSEC. 7.end delete
2begin insertSEC. 9.end insert  

If the Commission on State Mandates determines that
3this act contains costs mandated by the state, reimbursement to
4local agencies and school districts for those costs shall be made
5pursuant to Part 7 (commencing with Section 17500) of Division
64 of Title 2 of the Government Code.



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