BILL ANALYSIS Ó
SENATE COMMITTEE ON PUBLIC SAFETY
Senator Loni Hancock, Chair
2015 - 2016 Regular
Bill No: SB 443 Hearing Date: April 21, 2015
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|Author: |Mitchell |
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|Version: |April 6, 2015 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|JM |
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Subject: Forfeiture: Controlled Substances
HISTORY
Source: Drug Policy Alliance; American Civil Liberties Union;
Institute for Justice
Prior Legislation:AB 639 (Norby) - 2012, Died in Senate
Appropriations
SB 1866 (Vasconcellos) - 2000, Vetoed
SB 1255 (Hughes) - Ch. 1022, Stats. 1994
AB 114 (Burton) - Ch. 664, Stats. 1994
Support: Unknown
Opposition:California District Attorneys Association
PURPOSE
The purpose of this bill is to 1) require a criminal conviction
for forfeiture of alleged cash drug proceeds and assets in
excess of $25,000; 2) reduce the percentage of forfeiture
proceeds distributed to prosecutors, law enforcement and the
General Fund; 3) distribute 5% of forfeiture proceeds to each of
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the courts and public defense; 4) require that California
standards be met before federal forfeiture proceeds can be
distributed to a state of local law enforcement agency through
equitable sharing; 5) grant a right to counsel for indigent
defendants in civil drug forfeiture matters; 6) authorize
attorneys' fees and costs for prevailing defendants in
forfeiture cases; 7) prohibit adoption by federal authorities of
a state forfeiture matter; and 8) require the California
Department of Justice's annual asset forfeiture report to
include data on forfeitures initiated under California law,
federal adoptions, forfeiture case that were prosecuted under
federal law, the number of suspects charged with drug crimes,
the number of criminal charges brought under each of state and
federal law and the disposition of these cases.
Existing law establishes an asset-forfeiture procedure for
drug-related cases. (Health & Saf. Code §§ 11469-11495.)
Existing law provides that the principal objective of forfeiture
is law enforcement and that forfeiture shall be conducted with
due process. (Health & Saf. Code § 11469, subd. (a).)
Existing law sets out detailed procedures for a drug forfeiture
action, including: the filing of a petition for forfeiture
within one year of seizure, notice of seizure, publication of
notice, the right to a jury trial, and a motion for return of
property. (Health & Saf. Code § 11488.4.)
Existing law requires a conviction in an underlying criminal
case and provides that the burden of proof in the (civil)
judicial forfeiture action shall be beyond a reasonable doubt.
(Health & Saf. Code § 11488.4, subd. (i)(3).)
Existing law does not require a conviction on an underlying drug
offense where the property sought to be forfeited is cash or
negotiable securities over $25,000, and allows forfeiture upon a
burden of proof of "clear and convincing evidence" under these
circumstances. (Health & Saf. Code § 11488.4, subd. (i)(4).)
Existing law allows for administrative (nonjudicial) forfeiture
for cases involving personal property worth $25,000 or less. A
full hearing is required if a claim as to the property is filed,
as specified. (Health & Saf. Code § 11488.4, subd. (j).)
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Existing law provides a scheme for the distribution of fund from
forfeitures and seizures. Specifically, after distribution to
any bona fide innocent owners and reimbursement of expenses, 65%
of proceeds go to participating law enforcement agencies, 10% to
the prosecutorial agency, and 24% to the General Fund. (Health
& Saf. Code § 11489.)
Existing law requires the Department of Justice (DOJ) to publish
an annual report detailing specified information on forfeiture
actions. (Health & Saf. Code § 11495, subd. (c).)
This bill requires a conviction for cultivation or manufacture
of a controlled substance before judgment of forfeiture is
entered.
This bill provides that a conviction is required before judgment
is entered in a forfeiture matter involving cash or negotiable
instruments of a value in of at least $25,000.
This bill provides that the prosecutor shall prove beyond a
reasonable doubt that cash or negotiable instruments with a
value of at least $25,000 meet the requirement for forfeiture.
This bill provides that if a defendant in the criminal case
associated with the forfeiture action is represented by
appointed counsel, counsel shall be appointed in the forfeiture
action.
This bill provides that a defendant who prevails in a forfeiture
action shall be entitled to litigation costs and attorneys'
fees.
This bill prohibits a state or local law enforcement agency from
transferring property seized under state law for adoption by a
federal agency.
This bill provides that any forfeited property received by state
or local law enforcement agencies pursuant to federal equitable
sharing or adoption laws and rules shall be deposited and
distributed according to state law.
This bill provides that a conviction is required before
forfeiture can be ordered if the defendant fails to appear in
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the underlying criminal action.
This bill provides that 60% of forfeiture proceeds shall be
distributed to each state or local agency that participated in a
forfeiture action, in proportion to the contribution of the
agency.
This bill provides that 5% of forfeiture proceeds shall be
distributed to the prosecuting agency that processed the
forfeiture.
This bill provides that 10% of forfeiture proceeds shall be
disbursed to the court where the forfeiture action occurred.
These funds shall be deposited to the newly created "Judicial
Asset Forfeiture Fund in the State Treasury and, upon
legislative appropriation, expended for court administration in
the county of forfeiture.
This bill provides that 5% of forfeiture proceeds shall be
disbursed to the public defender's office or provider of
indigent defense services in the jurisdiction of the forfeiture
action.
This bill strikes the provision in existing law under which 1%
of forfeiture proceeds are paid to a nonprofit organization of
prosecutors for use in training prosecutors and law enforcement
agencies in forfeiture laws and ethics.
This bill provides that 20% of forfeiture proceeds shall be
deposited into the General Fund.
This bill requires the Attorney General to annually report on
the following additional matters:
The number of forfeiture cases initiated under state
law;
The number of cases adopted by the federal government;
The number of cases initiated in joint federal-state
actions that were prosecuted under federal law;
The number of suspects charged with a controlled
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substance violation; and
The disposition of cases.
COMMENTS
1.Need for This Bill
The author's background information includes a summary of the
provisions in the bill. The summary provides:
Conviction Requirement for Seizure of Cash in Excess
of $25,000: Under California's existing forfeiture
statute, the state can forfeit a person's cash or
other negotiable instruments in excess of $25,000
without first convicting the person of an underlying
or related criminal offense. In contrast, a
conviction is required prior to forfeiture of cash
less than $25,000, real property, boats, cars,
airplanes, and other personal property. This leaves
California's civil asset forfeiture law ripe for abuse
by law enforcement, and permits innocent Californians
to have their property taken by the government without
due process. SB 443 would require a conviction as a
precondition to cash forfeitures both over and under
$25,000. The bill would create uniformity in
California's drug-related asset forfeiture law and
ensure a more concrete connection between the
forfeited property and criminal activity.
Right to Counsel in the Civil Asset Forfeiture
Proceeding: Property owners have the right to
challenge civil asset forfeiture actions, but indigent
defendants have no right to appointed counsel.
Forfeiture actions are complicated and costly to
challenge, and typically require an experienced
attorney. Innocent property owners who can neither
afford counsel nor adequately represent themselves are
often forced to give up their property simply because
they cannot contend against the government. To remedy
this problem, SB 443 would require the court to
appoint counsel for indigent property owners in
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forfeiture proceedings.
Attorneys 'Fees: Current law does not provide for the
recovery of attorneys' fees for successful asset
forfeiture claimants. SB 443 would allow them
claimants to recover reasonable costs and attorneys'
fees.
Expanded Reporting Requirements: The Attorney General
must publish an annual asset forfeiture report. To
provide greater transparency and help prevent abusive
practices, SB 443 would require that the report
include information about the number of forfeiture
actions initiated by state or local agencies under
California law, the number of cases adopted by the
federal government, the number of cases initiated by a
joint federal-state action that were prosecuted under
federal law, the number of suspects charged with a
controlled substance violation, the number of alleged
criminal offenses that were prosecuted under federal
or state law, and the disposition of cases.
Distribution of Forfeiture Proceeds: Under existing
law, 65% of asset forfeiture proceeds are distributed
to law enforcement, 10% to the prosecuting agency, 24%
to the general fund and 1% for training of prosecutors
on asset forfeiture. (According the annual Attorney
General's Report, most counties give this money to
California District Attorneys Association). Because
this bill could require more resources for courts and
indigent defense in forfeiture actions, this bill
would reallocate some forfeitures proceeds for these
purposes. Specifically, the bill would reduce
proceeds to law enforcement and prosecutors to 60% and
5% respectively, reduce the General Fund allocation to
20%, eliminate the 1% to a nonprofit association of
prosecuting attorneys, and allocate 10% to the courts
and 5% to the public defender's office in the
jurisdiction where the forfeitures occur.
Prohibits "Adoptive Forfeitures": Pursuant to
so-called "equitable sharing" of assets transferred to
federal control, local and state law enforcement may
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circumvent California's more stringent asset
forfeiture laws, take advantage of more lenient
federal law, and receive up to 80% of the proceeds
from the forfeiture action. Through this procedure,
local law enforcement officers who seize property
pursuant to an alleged state law violation apply to a
federal agency to "adopt" the property and initiate
federal forfeiture proceedings. This bill would
prohibit local and state law enforcement from seeking
federal adoption of seized property for federal
forfeiture. It would neither affect the ability of
the federal government to take possession of property
or California law enforcement to engage in truly joint
operations with federal agencies/
Limits Equitable Sharing in Joint Investigations:
This bill provides that local and state law
enforcement can only receive forfeiture proceeds
pursuant to joint federal- state investigations where
there is a conviction in an underlying or related
criminal action for an offense that authorizes
forfeiture under California law. SB 443 requires that
any forfeiture proceeds paid to local and state law
enforcement pursuant to joint investigations with
federal agencies be distributed according to state
law. SB 443 further states that, to the extent that
federal law does not permit such a distribution, state
and local law enforcement agencies are prohibited from
receiving such funds.
2.The Major Differences Between California and Federal
Forfeiture Law
Federal forfeiture law is less burdensome for law enforcement
and gives law enforcement more benefits than state law. Some
ways in which California and federal provisions differ are:
Conviction:
o California: Conviction generally required,
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except where the property seized was cash in excess of
$25,000. (Health & Saf. Code §11488.4, subd. (i)(3)
o Federal: No conviction required. (18 U.S.C. §
981.)
Burden of proof:
o California: Beyond a reasonable doubt for most
cases. The burden is clear and convincing evidence
(with no underlying conviction) in cases involving at
least $25,000 in cash. (Health & Saf. Code §11488.4,
subd. (i)(4).)
o Federal: Preponderance of the evidence. (18
U.S.C. § 983 (c)(1).)
Administrative forfeiture (limited or no court hearings):
o California: Only available for cases involving
personal property worth $25,000 or less. (Health &
Saf. Code §11488.4, subd. (i)(4).)
o Federal: Available for any amount of currency
and personal property valued at $500,000 or less,
including cars, guns, and boats. (19 U.S.C. § 1607
(a).)
Use of forfeited assets:
o California: No direct use of seized assets,
such as vehicles or planes. (Health & Saf. Code §
11489.)
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o Federal: Seizing agency can use the asset or
transfer it to a state or local agency that
participated in the proceedings. (18 U.S.C. § 881
(e)(1)(A).)
Disbursement of Forfeited Assets:
o California: 65% to law enforcement agency, 10%
to prosecuting agency, 24% to general fund, 1% to law
enforcement training. (Health & Saf. Code § 11489,
subd. (b).)
o Federal: 80% (maximum) of seized proceeds to
the agency or agencies involved in the seizure of the
assets. (21 U.S.C. § 881 (e); U.S. DOJ, Guide to
Equitable Sharing, p. 12.)
Exemptions for Family Property, other Limitations:
o California: No forfeiture of family residence
partly owned by innocent party and no forfeiture of
vehicle necessary for family transportation. (Health &
Saf. Code §11470, subds. (e) and (g).
o Federal: No family exemption
o California: If property subject to seizure is
a boat, vehicle or other conveyance, the drugs
associated with the vehicle must be of a specified
weight or volume. (Health & Saf. Code §1147, subd.
(e).
o Federal law: No weight or volume limits apply
under federal law. (21 U.S.C. § 881 (a)(4).)
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3."Equitable Sharing" by State and Local Law Enforcement of
Federal Forfeiture Proceeds, including Adoption of State
Forfeitures by Federal Authorities
Because there is overlapping jurisdiction in drug-related
crimes, California law enforcement agencies can avoid relatively
stringent state forfeiture laws by participating in joint
federal-state investigations or by transferring assets seized
pursuant to state law to federal authorities. This entire
process is referred to as "equitable sharing." Equitable
sharing includes "adoption," through which the U.S. Attorney
essentially processes a state forfeiture under federal law.
To participate in equitable sharing, a California law
enforcement agency must execute an agreement with U.S. DOJ. DOJ
has promulgated guidelines for forfeiture adoption, including
that the district attorney must consent to the transfer.
Procedurally, the local or state agency files a request to
federal authorities to adopt a state seizure. Minimum value
amounts apply and vary by federal court district. The amount of
money and property disbursed to local or state law enforcement
is based on "the degree of direct law enforcement effort" by the
state or local agency. (21 U.S.C. §881 (e)(3).) State and
local and agencies can receive up to 80% of the proceeds of an
adopted forfeiture case.
As explained in Comment # 4, United States Attorney General
Holder has recently issued an order that prohibits adoption of
local and state forfeitures, except in a case where US DOJ
specifically approves the adoption. The order is administration
policy and does not have the force of law. Because adoption
cases involve a small percentage of equitable sharing, the new
policy will have limited effects. Further, agencies may seek to
make more seizures under the umbrella of joint federal-state
task forces so that equitable sharing rule, not state law,
applies. Given the much stricter standards for California
forfeiture, it can be argued that state and local agencies have
substantial incentives to avoid California law and work with
federal agencies instead.
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4.The New Federal Policy on Adoption of State Forfeiture Actions
will have Limited Effects
On January 16, 2015, United States Attorney General Holder
issued a new policy order for all United States Attorney
offices. The policy was widely described as effectively ending
equitable sharing of federal forfeiture proceeds with local law
enforcement agencies. However, the order did not limit
equitable sharing in cases involving a joint federal-state task
forces or investigations. The policy prohibits wholesale
"adoption" of what would otherwise solely be a state or local
seizure and forfeiture. Adoptions - counted as a subset of
equitable sharing - account for about 3% of forfeiture deposits.
Total equitable sharing amounts to about 22% of forfeiture
deposits. Thus, approximately 85% of the proceeds of federal
forfeiture that goes to state and local agencies is unaffected
by the new policy.<1>
The policy provides:
Federal adoption of property seized by state or local
law enforcement under state law is prohibited, except
for property that directly relates to public safety
concerns, including firearms. Ammunition, explosives
and property associated with child pornography. To
the extent that seizures of property other than
these?categories are ? considered for federal
adoption?such seizures [must be approved by] the
Assistant Attorney General for the Criminal Division.
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<1>
http://www.washingtonpost.com/news/the-watch/wp/2015/01/20/how-mu
ch-civil-asset-forfeiture-will-holders-new-policy-actually-preven
t/
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The prohibition ? includes?seizures by state or local
law enforcement of vehicles, valuable, and cash,
[including currency, checks] stored value cards" and
specified other categories
The policy order allows equitable sharing as follows:
This order does not apply to (1) seizures by state and
local authorities working together with federal
authorities in a joint task force; (2) seizures?that
are the result of joint federal-state investigations
or that are coordinated with federal authorities as
part of ongoing federal investigations; or (3)
seizures pursuant to federal search warrant, obtained
from federal courts to take custody of assets
originally seized under state law.
It thus appears that many seizures of property by state and
local authorities are still subject to forfeiture under federal
law through the equitable sharing process. It appears that
joint task forces and federal-state cooperation in
investigations is relatively common. Just concerning joint task
force operations, the Drug Enforcement Administration website<2>
explains:
In 2013, the DEA State and Local Task Force Program
managed 259 state and local task forces, which
included Program Funded, Provisional, HIDTA, and
Tactical Diversion Squads. The difference between
funded and provisional state and local task forces is
that the financial support for funded task forces is
provided by DEA headquarters and includes additional
resources for state and local overtime. Provisional
task forces are supported by the operating budgets of
DEA field division offices, without resources from DEA
headquarters, and do not include state and local
overtime. These task forces are staffed by over 2,190
DEA special agents and over 2,556 state and local
officers. Participating state and local task force
officers are deputized to perform the same functions
as DEA special agents. (Italics added.)
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<2> http://www.dea.gov/ops/taskforces.shtml
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5.Federal Asset Forfeiture Proceeds Disbursed to California
Agencies
The use of federal asset forfeiture - through adoption and
equitable sharing - has increased substantially over the past 15
years, as demonstrated by the following table.
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|FEDERAL FORFEITURE DISBURSED |STATE FORFEITURE DISBURSED |
|--------------------------------+--------------------------------|
|2014 - $77 million |Data unavailable |
|--------------------------------+--------------------------------|
|2013 - $86 |2013 - $28 million |
|--------------------------------+--------------------------------|
|2012 - $83 |2012 - $15 |
|--------------------------------+--------------------------------|
|2011 - $79 |2011 - $18 |
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|2010 - $76 |2010 - $16 million |
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|2009 - $60 |2009 - $38.8 |
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|2008 - $52.4 |2008 - $25.5 |
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|2007 - $ 42.8 |2007 - $27.6 |
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|2006 - $42.3 |2006 - $25.6 |
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|2005 - $26.7 |2005 - $19.9 |
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|2004 - $31.3 |2004 - $22.5 |
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|2003 - $24.5 |2003 - $26.6 |
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|2002 - $24 |2002 - $25.6 |
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|2001 - $32.8 |2001 - $25.7 |
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|2000 - $30 |2000 - |
| |$21 |
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6. Argument in Opposition
The California District Attorneys Association argues in
opposition:
One of our primary missions as an association is to
provide training for prosecutors and law enforcement
on the ethics and proper use of forfeiture laws.
Funding for those trainings comes from Health and
Safety Code Section 11489(b)(2)(D), which gives us
one-percent distribution of proceeds from forfeiture
actions in the state. SB 443 eliminates that
distribution.
Making sure that those law enforcement officials and
prosecutors who engage in the forfeiture process are
well trained and ethically prepared to handle
forfeiture cases is of great benefit to the public.
We fail to see how getting rid of the funding
mechanism for those training would be beneficial to
anyone involved in forfeiture proceedings.
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