BILL ANALYSIS Ó
SB 443
Page A
Date of Hearing: July 14, 2014
Counsel: David Billingsley
ASSEMBLY COMMITTEE ON PUBLIC SAFETY
Bill Quirk, Chair
SB
443(Mitchell) - As Amended June 2, 2015
As Proposed to be Amended in Committee
SUMMARY: Requires additional due process protection in cases
where the State of California seeks to forfeit assets in
connection with specified drug offenses. Changes the process
concerning how money or property forfeited under federal
forfeiture law is distributed to state or local law enforcement.
SB 443
Page B
Specifically, this bill:
1)States that it shall be necessary to obtain a criminal
conviction for the unlawful manufacture or cultivation of any
controlled substance or its precursors in order to recover law
enforcement expenses related to the seizing or destroying of
illegal drugs.
2)Specifies that state and local law enforcement authorities
shall not refer, or otherwise transfer, property seized under
state law to a federal agency seeking the adoption of the
seized property.
3)Clarifies that language of this bill does not prohibit the
federal government from seeking forfeiture under federal law,
or sharing proceeds from federal forfeiture proceedings with
state and local law enforcement in those situations where
there are joint investigations.
4)States that all property, money, or other things of value
received by any state or local law enforcement agency pursuant
to any federal law that authorizes the sharing or transfer
forfeited property to a state or local law enforcement agency
shall be promptly transferred, sold, and distributed through
the State Asset Forfeiture Fund for Law Enforcement Purposes.
5)Creates the State Asset Forfeiture Fund for Law Enforcement
Purposes where money or property received by state or local
law enforcement based on any federal law that authorizes
sharing of forfeited property will be deposited. Money from
the fund will be distributed primarily for criminal justice
SB 443
Page C
purposes and the courts.
6)Provides that the money in the State Asset Forfeiture Fund for
Law Enforcement Purpose shall be distributed as follows:
a) To the state agency or local government for costs
incurred by it in connection with the sale of the property,
including expenditures for any necessary costs for public
notice, hearings, or for any necessary repairs, storage, or
transportation of any property lawfully forfeited;
b) The remaining funds shall be distributed as follows:
i) Twenty four percent (24%) to the General Fund; and,
ii) Seventy six percent (76%) to the State Asset
Forfeiture Fund for Courts and Criminal Justice Purposes
to be made available, upon appropriation by the
Legislature, for purposes of criminal and civil court
functions, prosecution, public defense and indigent
defense, law enforcement, crime prevention including
afterschool programs for adolescents and drug treatment
for adolescents and adults, and victim services.
7)Provides that a state or local law enforcement agency may not
receive forfeited property or proceeds from property forfeited
pursuant to federal law unless a defendant is convicted in an
underlying or related criminal action of a specified offense,
or any offense under federal law that includes all of the
elements of a specified California offense.
SB 443
Page D
8)Requires a conviction on the related, specified criminal
charge to forfeit property in every case in which a claim is
filed to contest the forfeiture of property, unless the
defendant in the related criminal case willfully fails to
appear for court.
9)Requires proof beyond a reasonable doubt in all forfeiture
cases which are contested.
10)States that if the defendant in the related criminal matter
is represented by court-appointed counsel, the trial court
shall appoint counsel for the defendant in the forfeiture
proceeding.
11)Specifies that in any forfeiture proceeding in which the
defendant or claimant substantially prevails, the defendant or
claimant shall be entitled to recover reasonable attorneys'
fees and other litigation costs reasonably incurred by the
defendant or claimant.
12)Allows forfeiture of property less than $25,000 if notice of
the forfeiture has been provided, as specified, and no claims
have been made.
13)Specifies that property less than $25,000, which has been
forfeited because no claim has been made on the property, will
be disposed of in the manner required by State Asset
Forfeiture Fund for Law Enforcement Purposes.
SB 443
Page E
14)Allows more time to make a claim contesting forfeiture.
15)Allows property of $25,000 or more to be forfeited through a
judicial process when no claim to the forfeited property has
been made within the specified time. Requires property
forfeited in this manner will be disposed as directed by State
Asset Forfeiture Fund for Law Enforcement Purposes.
16)Any property forfeited after a contested forfeiture hearing
with be disposed of with 40% going to state and local law
enforcement groups that participated in the seizure, 24% to
the general fund, 34% to the State Asset Forfeiture Fund for
Courts and Criminal Justice Purposes, 1% to nonprofit group of
prosecutors to provide forfeiture education, 1% to nonprofit
group of criminal defense attorney to educate on forfeiture.
17) Each year, the Attorney General shall publish a report which
sets forth the following information for the state, each
county, each city, and each city and county:
a) The number of forfeiture actions initiated and
administered by state or local agencies under California
law, the number of cases adopted by the federal government,
and the number of cases initiated by a joint federal-state
action that were prosecuted under federal law;
b) The number of cases and the administrative number or
court docket number of each case for which forfeiture was
ordered or declared;
SB 443
Page F
c) The number of suspects charged with a controlled
substance violation;
d) The number of alleged criminal offenses that were under
federal or state law;
e) The disposition of cases, including no charge, dropped
charges, acquittal, plea agreement, jury conviction, or
other;
f) The value of the assets forfeited; and,
g) The recipients of the forfeited assets, the amounts
received, and the date of the disbursement.
EXISTING LAW:
1)Establishes an asset-forfeiture procedure for drug-related
cases. (Health & Saf. Code, §§ 11469-11495.)
SB 443
Page G
2)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.)
3)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 in cases
where the value of the forfeited property is under $25,000.
(Health & Saf. Code, § 11488.4, subd. (i)(3).)
4)Specifies that forfeiture 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).)
5)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).)
6)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, 24% to the General Fund, and
1% to nonprofit group of prosecutors to provide forfeiture
education. (Health & Saf. Code § 11489.)
SB 443
Page H
7)Requires the Department of Justice (DOJ) to publish an annual
report detailing specified information on forfeiture actions.
(Health & Saf. Code, § 11495, subd. (c).)
FISCAL EFFECT: Unknown.
COMMENTS:
1)Author's Statement: According to the author, "SB 443 will
reign in abuses surrounding the practice to civil asset
forfeiture, and reestablish the most basic tenets of
Constitutional law and values, requiring that in most cases, a
defendant be convicted of an underlying crime before cash or
property can be permanently seized. This bill will require
that more drug asset forfeiture cases be handled under state
law, rather than transferred to federal courts, and that
seized assets are dispersed to local law enforcement agencies,
courts, defenders, prosecutors and the General Fund, pursuant
to state law."
2)Differences in California and Federal Forfeiture Law:
Compared to California law, Federal law gives law enforcement
more power and puts fewer burdens on the government before
property is forfeited. Some ways in which California and
federal provisions differ are:
a) Administrative forfeiture: While state law limits cases
involving personal property worth $25,000 or less, under
federal law administrative forfeiture is available for any
amount of currency and personal property valued at $500,000
SB 443
Page I
or less, including cars, guns, and boats. [19 U.S.C.
Section 1607(a).]
b) Burden of proof: Under federal civil forfeiture law,
the government's burden of proof is "preponderance of the
evidence." [18 U.S.C. Section 983(c)(1).] This is a lower
standard than the "beyond a reasonable doubt" standard used
in California.
c) Conviction: In contrast to California law, federal
civil forfeiture law does not require a conviction in any
cases. (18 U.S.C. Section 981.)
d) Use of forfeited assets: Under federal law, a seizing
agency can use the seized asset or transfer it to a state
or local agency that participated in the proceedings. [18
U.S.C. Section 881(e)(1)(A).] Direct use of the forfeited
asset is disallowed under state law.
3)Three Exceptions to the California Requirement that Forfeiture
Action Must Have a Conviction:
a) The forfeiture of cash or negotiable instruments whose
value is at least $25,000. (Health & Saf. Code 11488.4,
sud. (i)(4)-(5).)
b) When the defendant in the underlying criminal case is
also the claimant in the forfeiture action and willfully
fails to appear in the criminal case. Application for
forfeiture must be approved by a judge. The prosecution
must provide notice of its application for entry of default
to the defense attorney and make a showing of due diligence
to locate the defendant. (Health & Saf. Code 11488.4, sud.
(k).)
c) When no one files a claim contesting the forfeiture.
(Health & Saf. Code 11488.4, sud. (i)(1)-(3).)
SB 443
Page J
4)Federal Law on Sharing Forfeiture Proceeds with State and
Local Law Enforcement Agencies: Section 881(e)(3) of Title
21, United States Code, provides that: The Attorney General
shall assure that any property transferred to a State or local
law enforcement agency? (A) has a value that bears a
reasonable relationship to the degree of direct participation
of the State or local agency in the law enforcement effort
resulting in the forfeiture, taking into account the total
value of all property forfeited and the total law enforcement
effort as a whole; and with respect to the violation of law on
which the forfeiture is based; and (B) will serve to encourage
further cooperation between the recipient State or local
agency and Federal law enforcement agencies
5)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>
---------------------------
<1>
http://www.washingtonpost.com/news/the-watch/wp/2015/01/20/how-much-civil-asset-forfeiture-will-holders-new-policy-actually-preve
nt/
SB 443
Page K
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. 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
--------------------------
<2> http://www.dea.gov/ops/taskforces.shtml
SB 443
Page L
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.)
6)Proposed Amendments: The proposed amendments attempt to
address some of the concerns that have been articulated by
district attorney offices and other stakeholders.
The proposed amendments permit forfeiture in cases where the
defendant willfully fails to appear in his or her criminal
court proceedings.
The proposed amendments eliminate earlier language which would
have provided that 5% of the proceeds of forfeited property go
to the public defender office in county in which the
forfeiture proceeding was initiated. Concerns had been
articulated that if public defender offices received money
directly connected to their defense of forfeiture actions,
there would be a conflict of interest. The proposed
amendments also eliminate money going directly to the district
attorney offices that processes the forfeiture action, to
remove any similar conflict of interest. Similar concerns
have been raised regarding law enforcement agencies who are
currently the direct beneficiary of any successful forfeiture
action in which they are involved.
As an alternative, the proposed amendments create the State
Asset Forfeiture Fund for Law Enforcement Purposes. The
proposed amendments direct that money and property forfeited
through federal law which is shared with state and local law
SB 443
Page M
enforcement agencies be distributed through that fund. The
proposed amendments also direct that money or property
forfeited because no person makes a claim to challenge the
forfeiture, will go through the same fund.
Forfeited property and money received by state or local law
enforcement from federal authorities as part of equitable
sharing or other federal program will be deposited in the
State Asset Forfeiture Fund for Law Enforcement Purposes to be
distributed to law enforcement agencies statewide based on the
population of the jurisdiction they serve.
Forfeited property and proceeds obtained through California
forfeiture process when no individual files a claim with
distributed through the State Asset Forfeiture Fund for Law
Enforcement Purposes in the following manner: Reimburse law
enforcement agencies and local government for any costs
related to the forfeited property; remaining money in the
fund will to distributed to the General Fund (24%) and to the
State Asset Forfeiture Fund for Courts and Criminal Justice
Purposes (76%) to fund law enforcement, criminal and civil
courts, prosecution and public defense, crime prevention, drug
treatment and victim services.
7)Argument in Support: According to Drug Policy Alliance, "SB
443 would reestablish the most basic tenets of Constitutional
law and values, requiring that in most cases, a defendant be
convicted of an underlying crime before cash or property can
be permanently seized. It will require that more drug asset
forfeiture cases be handled under state law, rather than
transferred to federal courts, and that seized assets are
dispersed to local law enforcement agencies, courts,
defenders, prosecutors and the General Fund, pursuant to state
law.
"From 2002 to 2013, the vast majority of assets seized by law
enforcement agencies in California were steered into the
federal courts. From 2002 to 2013, the annual revenue from
asset forfeiture to law enforcement coffers in California
SB 443
Page N
pursuant to state actions, state laws and through state
courts, remained stable at approximately 18.3 million dollars.
However, assets seized from California residents and revenue
provided to California law enforcement agencies through
federal courts and pursuant to federal laws more than tripled
from 2002 to over $100 million dollars per year in 2012 and
2013. SB 43 by Senator Mitchell will create conditions
whereby most cases will remain in our state courts and be
prosecuted according to the laws of California, which have
superior due process standards and property rights
protections, including protection of guiltless spouses and
family members. And importantly, Senator Mitchell's bill
provides that in state law, there will be no permanent loss of
property or cash without a conviction for the underlying
criminal case.
"Furthermore, SB 443 will eliminate the current fiscal
incentives offered by the federal government that rewards
California law enforcement agencies for steering cases into
the federal process. Under current law, the federal
Department of Justice of Department of Treasury may seize
property and cash, and force permanent forfeiture without
charging a person with any crime, or seeking a conviction.
And under federal law and so-called "equitable sharing," the
local law enforcement gets an 80% slice of the forfeiture,
even when there was no criminal conviction. Under Senator
Mitchell's bill, local law enforcement entities will only
receive revenue from seizure and forfeiture, if the federal
government convicts the defendants.
"Whatever its original intent, there is a growing bipartisan
consensus that civil asset forfeiture has turned into
government run amok and that reform is urgently needed to
protect common people from unconstitutional overreach. Civil
asset forfeiture was originally conceived as a way to drain
resources away from drug 'kingpins', these programs have been
perverted into an ongoing attack on low-income individuals and
families who are unable to afford to fight the federal
government in civil court. Furthermore, despite federal laws
SB 443
Page O
and guidelines that intended to insure non-supplantation,
civil asset forfeiture has become a relied upon source of
funding for law enforcement agencies all across the state.
Civil asset seizure was never intended to be a primary funding
source for law enforcement, and the fact that it has evolved
into such has not only led to greater abuses, but also an
unhealthy and growing overreliance on it."
8)Argument in Opposition: According to the Los Angeles County
District Attorney's Office, "SB 443 would require that
federally received asset forfeiture monies be distributed
according to state rather than federal law. The language
contradicts federal law and policy relative to the US
Department of Justice (DOJ) Equitable Sharing Program. Our
county participates in numerous coordinated efforts to address
large scale unlawful narcotics operations. These efforts
involve federal, state and local law enforcement. We believe
that the conflict of law created by SB 443 may jeopardize our
ability to share in the proceeds of recovered assets and to
participate in these important anti-drug task forces.
"Current law does not require a criminal conviction for drug
asset forfeiture where the property to be forfeited is cash or
a negotiable instrument worth $25,000 or more. SB 443 would
require a criminal conviction in these cases. This is
problematic as many criminals fail to file a claim for large
amounts of drug money in order to avoid criminal prosecution.
In these cases, it is fairly clear that the seized asset is
drug money but asset forfeiture would no longer be available
in cases where the defendant cannot be prosecuted (possibly
because he or she has fled the jurisdiction or witnesses are
unavailable to testify).
"SB 443 reduces the amount of forfeited assets that may be
distributed to law enforcement and prosecutors, thus hurting
our ability to fund future anti-drug efforts. Loss of these
funds could make it difficult to investigate and prosecute
major illicit drug operations in California.
SB 443
Page P
"SB 443 provides for a portion of asset forfeiture proceeds to
go to public defenders offices and provides for the
appointment of the public defender to represent the claimants
when they have been appointed in the related criminal case.
This will create a conflict for public defenders as they will
financially benefit from forfeitures that they will now be
tasked with opposing.
"SB 443 provides for payment of attorney fees to the prevailing
party in asset forfeiture cases. However, there is no source
of revenue identified to pay these fees. This could result in
a drain upon county general funds or, alternatively, result in
a reluctance to pursue valid cases, due to the risk to the
county budget."
9)Prior Legislation:
a) AB 639 (Norby), Legislative Session of 2011-2012, would
have changed drug asset forfeiture law to discourage
federal adoption of such cases. AB 639 died in Senate
Appropriations Committee.
b) SB 1866 (Vasconcellos), Legislative Session of
1999-2000, would have made changes in asset forfeiture
transfers, shifts distribution of money from forfeited
property and required the Attorney General to publish
electronic reports. SB 1866 was vetoed.
c) AB 114 (Burton), Chapter 314, Statutes of 1994, provided
guidelines for the use of asset forfeiture.
REGISTERED SUPPORT / OPPOSITION:
SB 443
Page Q
Support
American Civil Liberties Union of California (Co-Sponsor)
Drug Policy Alliance (Co-Sponsor)
Institute for Justice (Co-Sponsor)
A New Path
Alpha Project
Americans for SafeAccess
Amity Foundation
Asian Americans Advancing Justice
Asian American Drug Abuse Program
Broken No More
California State Conference of the NAACP
California Prison Focus
California Public Defenders Association
Californians United for a Responsible Budget
Coalition for Humane Immigrant Rights of Los Angeles (CHIRLA)
Courage Campaign
Dignity and Power Now
FACTS Education Fund
Friends Committee on Legislation of California
Further The Work
Immigrant Legal Resource Center
Inland Empire Immigrant Youth Coalition
Justice Fellowship
Justice Not Jails
Law Enforcement Against Prohibition
Lawyers Committee for Civil Rights of the San Francisco Bay Area
SB 443
Page R
Legal Services for Prisoners with Children
LIUNA Locals 777 & 792
Los Angeles Regional reentry Partnership
Marijuana Policy Project
National Organization for the Reform of Marijuana Laws
New Way of Life Re-Entry Project
R Street Insitute
San Diego Organizing Project
Tarzana Treatment Centers, Inc.
Western Center on Law and Poverty
Westward Liberty
William C. Velasquez Institute
20 Law Professors
Opposition
Association of Deputy District Attorneys
Association of Los Angeles Deputy Sheriffs
California Association of Code Enforcement Officers
California College and University Police Chiefs Association
California District Attorneys Association
California Police Chiefs Association
California Narcotic Officers Association
California State Lodge, Fraternal Order of Police
California State Sheriffs' Association
George Gascon, District Attorney, City and County of San
Francisco
Nancy O'Malley, District Attorney, Alameda County
Los Angeles County District Attorney's Office
Los Angeles County Professional Police Officer Association
Los Angeles Police Protective League
Long Beach Police Officers Association
Riverside Sheriff's Association
SB 443
Page S
Sacramento County Deputy Sheriffs' Association
San Diego County District Attorney
Ventura County District Attorney
Analysis Prepared by:David Billingsley / PUB. S. / (916)
319-3744