BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        SB 443|
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                                UNFINISHED BUSINESS 


          Bill No:  SB 443
          Author:   Mitchell (D), et al.
          Amended:  8/4/16  
          Vote:     21 

           SENATE PUBLIC SAFETY COMMITTEE:  5-2, 4/21/15
           AYES:  Hancock, Leno, Liu, McGuire, Monning
           NOES:  Anderson, Stone

           SENATE APPROPRIATIONS COMMITTEE:  5-1, 5/28/15
           AYES:  Lara, Beall, Hill, Leyva, Mendoza
           NOES:  Nielsen
           NO VOTE RECORDED:  Bates

           SENATE FLOOR:  38-1, 6/3/15
           AYES:  Allen, Anderson, Bates, Beall, Berryhill, Block,  
            Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall,  
            Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson,  
            Lara, Leno, Liu, McGuire, Mendoza, Mitchell, Monning,  
            Moorlach, Morrell, Nguyen, Pan, Pavley, Roth, Runner, Stone,  
            Vidak, Wieckowski, Wolk
           NOES:  Leyva
           NO VOTE RECORDED:  Nielsen

           ASSEMBLY FLOOR:  24-44, 9/10/15 - See last page for vote (FAIL)

           ASSEMBLY FLOOR:  69-7, 8/15/16 - See last page for vote

           SUBJECT:   Forfeiture:  assets:  controlled substances


          SOURCE:   American Civil Liberties Union
          Coalition for Humane Immigrant Rights of Los Angeles 
                    Drug Policy Alliance
                    Ella Baker Center for Human Rights








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                    Institute for Justice


          DIGEST:  This bill requires a conviction before California law  
          enforcement agencies can share in the proceeds of drug asset  
          forfeiture in joint federal-state task force cases; except for  
          seizures of cash in excess of $40,000; prohibits "adoption" by  
          federal authorities of California law enforcement drug asset  
          seizures; and requires additional data in the California  
          Department of Justice report on California drug asset  
          forfeiture.


          Assembly Amendments allow California law enforcement to receive  
          "equitable sharing" of federal asset forfeiture of the proceeds  
          of cash in excess of $40,000 without the need for a conviction  
          and eliminate the requirement in the bill that equitable sharing  
          proceeds of California law enforcement shall be distributed  
          pursuant to California law.


          ANALYSIS:   


          Existing law:

           1) Establishes an asset-forfeiture procedure for drug-related  
             cases.  (Health & Saf. Code §§ 11469-11495.)


           2) 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).)


           3) 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.)










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           4) 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).)


           5) 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).)


           6) 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).)


           7) 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.)


           8) 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:


           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. 









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           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 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) Clarifies that this bill does not prohibit state or local  
             law enforcement from participating in joint law enforcement  
             operation with federal agencies.


           5) Specifies 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 one of the specified  
             California offenses.  Specifies an exception to the  
             conviction requirement if the value of the assets is greater  
             than $40,000.


           6) States that if a defendant, charged with a specified  
             criminal offense arising from a state or local joint law  
             enforcement operation with federal agency, willfully fails to  
             appear in court, or is deceased, there shall be no  
             requirement of a criminal conviction in order for state or  
             local law enforcement to receive an equitable share of any  
             federal forfeiture proceeding.


           7) 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  








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             defendant in the related criminal case willfully fails to  
             appear for court, or if the value of the assets is in excess  
             of $40,000, as specified.


           8) Requires proof beyond a reasonable doubt in all forfeiture  
             cases which are contested, except cash or negotiable  
             instruments of $40,000 or more for which the standard is  
             proof by clear and convincing evidence.


           9) Allows forfeiture of property less than $25,000 if notice of  
             the forfeiture has been provided, as specified, and no claims  
             have been made.


           10)Allows more time to make a claim contesting forfeiture.


           11)Allows property of $40,000 or more to be forfeited through a  
             judicial process when no claim to the forfeited property has  
             been made within the specified time.


           12)Requires, each year, the Attorney General to 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;










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              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.


           13)Requires the Legislative Analyst's Office to provide a  
             report to the Legislature by December 31, 2020, about the  
             economic impact on state and local law enforcement budgets  
             because of changes to the forfeiture process proposed by this  
             bill.


          Background


          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."










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          Federal forfeiture law is less burdensome for law enforcement  
          and gives law enforcement more benefits than state law.  For  
          example:


            Conviction:  California: Conviction generally required, except  
            where the property seized was cash in excess of $25,000.   
            (Health & Saf. Code §11488.4, subd. (i)(3) Federal:  No  
            conviction required. (18 U.S.C. § 981.)


            Burden of proof:  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).)  
            Federal: Preponderance of the evidence.  (18 U.S.C. § 983  
            (c)(1).) 


            Administrative forfeiture (limited or no court hearings):   
            California: Only available for cases involving personal  
            property worth $25,000 or less.  (Health & Saf. Code §11488.4,  
            subd. (i)(4).)  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:  California: No direct use of seized  
            assets, such as vehicles or planes.  (Health & Saf. Code §  
            11489.)  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:  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).)  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.)









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            Exemptions for Family Property, other Limitations:   
            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).  Federal: No family exemption. California: If  
            property subject to seizure is a boat, vehicle or other  
            conveyance, the drugs must be of a specified weight or volume.  
             (Health & Saf. Code §1147, subd. (e). Federal law: No weight  
            or volume limits.  (21 U.S.C. § 881 (a)(4).)


          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," which includes  
          "adoption," through which a U.S. Attorney 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 and follow guidelines, including that  
          the district attorney must consent to the transfer.  Minimum  
          value amounts vary by 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 each agency.   
          (21 U.S.C. §881 (e)(3).)  State and local and agencies can  
          receive up to 80% of an adopted forfeiture. 


          On January 16, 2015, former United States Attorney General  
          Holder issued an order that was widely described as effectively  
          ending equitable sharing of federal forfeiture proceeds.   
          However, the order did not limit equitable sharing in joint  
          federal-state investigations.  The policy prohibits wholesale  
          "adoption" of what would otherwise solely be a state or local  
          seizure.  Adoptions account for about 3% of forfeitures.  Total  
          equitable sharing amounts to about 22% of forfeitures.   
          (http://www.washingtonpost.com/news/the-watch/wp/2015/01/20/how-m 
          uch-civil-asset-forfeiture-will-holders-new-policy-actually-preve 
          nt/.) 










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          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No


          According to the Assembly Appropriations Committee, an  
          unquantifiable revenue loss, in the millions, to state and local  
          agencies by:


          1)Requiring a conviction of the underlying crime prior to asset  
            forfeiture, and prohibiting local agency participation in  
            federal asset distribution if there is no conviction. 


          2)Prohibiting the transfer of property to federal agencies; thus  
            preventing local and state agencies from receiving equitable  
            share of seized property.




          SUPPORT:   (Verified8/15/16)


          American Civil Liberties Union (co-source)
          Coalition for Humane Immigrant Rights of Los Angeles (co-  
          source)
          Drug Policy Alliance (co- source)
          Ella Baker Center for Human Rights (co- source)
          Institute for Justice (co- source)
          A New PATH
          ACT for Women and Girls
          Alpha Project
          Americans for Safe Access
          Americans for Tax Reform 
          Amity Foundation
          Asian American Drug Abuse Program
          Asian Americans Advancing Justice
          Broken No More
          California Association for Micro Enterprise Opportunity 
          California Association of Alcohol and Drug Program Executives,  
          Inc.








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          California Association of Black Lawyers
          California Partnership
          California Prison Focus
          California Public Defenders Association 
          California State Conference of the NAACP
          Californians United for a Responsible Budget
          Center for Living and Learning
          Consumer Federation of California
          Courage Campaign
          Dignity and Power Now
          Electronic Frontier Foundation
          FACTS Education Fund
          Firearm Policy Coalition
          Former Senator John Burton
          Friends Committee on Legislation California
          Further the Work
          Howard Jarvis Taxpayers Association
          Immigrant Legal Resource Center
          Inland Empire Immigrant Youth Coalition
          Justice Fellowship
          Justice Not Jails
          Law Enforcement against Prohibition 
          Lawyers Committee for Civil Rights
          Legal Services for Prisoners with Children 
          Los Angeles Regional Reentry Partnership
          National Federation of Independent Business 
          National Organization for the Reform of Marijuana Laws 
          Partnership for the Advancement of New Americans
          San Diego County Apartment Association
          San Diego Criminal Defense Bar
          San Diego La Raza Lawyers Association
          San Diego LGBT Center
          San Diego Organizing Project
          Service Employees International Union
          Tarzana Treatment Centers, Inc.
          United Farm Workers
          Veterans Democratic Club of San Diego County
          Western Center on Law and Poverty
          Westward Liberty
          William C. Velásquez Institute










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          OPPOSITION:   (Verified8/15/16)




          Association of Deputy District Attorneys


          Association for Los Angeles Deputy Sheriffs
          California Association of Code Enforcement Officers
          California College and University Police Chiefs Association
          California Narcotic Officers Association
          Los Angeles County Professional Peace Officers Association
          Los Angeles Police Protective League
          Riverside Sheriffs' Association
           ASSEMBLY FLOOR:  24-44, 9/10/15 (FAIL)
           AYES: Bloom, Bonta, Brough, Burke, Chiu, Dababneh, Cristina  
            Garcia, Gordon, Hadley, Harper, Holden, Jones-Sawyer, Levine,  
            Lopez, Maienschein, McCarty, Quirk, Rendon, Santiago, Mark  
            Stone, Thurmond, Ting, Weber, Atkins
           NOES:  Achadjian, Alejo, Travis Allen, Baker, Bigelow,  
            Calderon, Chang, Chávez, Chu, Cooley, Cooper, Dahle, Daly,  
            Dodd, Frazier, Beth Gaines, Gallagher, Eduardo Garcia, Gatto,  
            Gray, Grove, Roger Hernández, Irwin, Jones, Kim, Lackey,  
            Linder, Low, Mathis, Mayes, Medina, Melendez, O'Donnell,  
            Olsen, Patterson, Perea, Rodriguez, Salas, Steinorth, Wagner,  
            Waldron, Wilk, Williams, Wood
           NO VOTE RECORDED:  Bonilla, Brown, Campos, Chau, Eggman,  
            Gipson, Gomez, Gonzalez, Mullin, Nazarian, Obernolte,  
            Ridley-Thomas

           ASSEMBLY FLOOR:  69-7, 8/15/16
           AYES:  Travis Allen, Atkins, Baker, Bigelow, Bloom, Bonilla,  
            Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau,  
            Chávez, Chiu, Chu, Cooley, Dababneh, Dahle, Daly, Dodd,  
            Eggman, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto,  
            Gipson, Gomez, Gonzalez, Gordon, Grove, Hadley, Harper,  
            Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine,  
            Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty,  
            Medina, Melendez, Mullin, Nazarian, Obernolte, Patterson,  
            Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth,  
            Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk,  








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            Wood, Rendon
           NOES:  Achadjian, Arambula, Cooper, Frazier, Gray, O'Donnell,  
            Williams
           NO VOTE RECORDED:  Alejo, Beth Gaines, Roger Hernández, Olsen



          Prepared by:Jerome McGuire / PUB. S. / 
          8/19/16 19:54:00


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