Last Tuesday, a Michigan Senate committee passed a bill that would reform asset forfeiture laws to prohibit the state from taking property without a criminal conviction in most cases. But the legislation leaves a loophole in place allowing police to circumvent stricter state laws by passing cases off to the feds.
Sen. Pete Lucido (R-Shelby Township) introduced Senate Bill 2 (SB2) on Jan. 15. The legislation would reform Michigan law by requiring a criminal conviction before prosecutors could proceed with asset forfeiture in cases involving an aggregate net equity value of property less than $50,000. Under current law, the state can seize assets even if a person is never found guilty of a crime. The $50,000 threshold would cover most forfeiture cases in Michigan. A study in Colorado found that 85 percent of cases fell below the $50,000 level.
The Senate Committee on Judiciary and Public Safety passed SB2 without amendment on Jan. 29.
A companion bill (HB4001) sponsored by Rep. Jason Wentworth (R) is pending in the House Committee on Judiciary.
According to the Institute for Justice, the state of Michigan earned a D- grade for its civil asset forfeiture laws. Michigan law enforcement agencies may presently keep up to 100% of all the forfeiture proceeds that come from seized assets.
While passage of SB2/HB4001 would significantly reform the state’s asset forfeiture laws, they fail to address a loophole that allows state and local police to get around more strict state asset forfeiture laws in a vast majority of situations. This is particularly important in light of a 2017 policy directive issued by then-Attorney General Jeff Sessions for the Department of Justice (DOJ).
A federal program known as “Equitable Sharing” allows prosecutors to bypass more stringent state asset forfeiture laws by passing cases off to the federal government through a process known as adoption. The DOJ directive reiterates full support for the equitable sharing program, directs federal law enforcement agencies to aggressively utilize it, and sets the stage to expand it in the future.
Law enforcement agencies can circumvent more strict state forfeiture laws by claiming cases are federal in nature. Under these arrangements, state officials simply hand cases over to a federal agency, participate in the case, and then receive up to 80 percent of the proceeds. However, when states merely withdraw from participation, the federal directive loses its impact.
Until recently, California faced this situation. The state has some of the strongest state-level restrictions on civil asset forfeiture in the country, but state and local police were circumventing the state process by passing cases to the feds. According to a report by the Institute for Justice, Policing for Profit, California ranked as the worst offender of all states in the country between 2000 and 2013. In other words, California law enforcement was passing off a lot of cases to the feds and collecting the loot. The state closed the loophole in 2016.
Michigan could close this loophole in most situations by effectively withdrawing from the federal program. We recommend the following language.
1. A law enforcement agency or prosecuting authority may not enter into an agreement to transfer or refer seized property to a federal agency directly, indirectly, by adoption, through an intergovernmental joint taskforce or by other means for the purposes of forfeiture litigation and instead must refer the seized property to appropriate local or state prosecuting authorities for forfeiture litigation under this chapter unless the seized property includes U.S. currency in excess of $100,000.
2. This paragraph preempts laws by township, municipal, county and other governments in the state which regulate civil and criminal forfeiture.
As the Tenth Amendment Center previously reported the federal government inserted itself into the asset forfeiture debate in California. The feds clearly want the policy to continue.
We can only guess. But perhaps the feds recognize paying state and local police agencies directly in cash for handling their enforcement would reveal their weakness. After all, the federal government would find it nearly impossible to prosecute its unconstitutional “War on Drugs” without state and local assistance. Asset forfeiture “equitable sharing” provides a pipeline the feds use to incentivize state and local police to serve as de facto arms of the federal government by funneling billions of dollars into their budgets.
SB2 will move to the full Senate for further consideration.