Texas Committee Holds Hearing on Bills to Reform Asset Forfeiture, Withdraw From Federal Program

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On Monday, a Texas House committee held a hearing on two bills that would reform the state’s civil asset forfeiture laws and effectively withdraw the state from a federal program that allows police to circumvent more strict state forfeiture laws by passing cases off to the feds.

The House Criminal Jurisprudence Committee held a hearing on House Bill 404 (HB404) and House Bill 182 (HB182) on April 15.

Sponsored by Rep. Senfornia Thompson (D-Houston), HB404 would effectively end civil asset forfeiture in Texas and replace it with a criminal forfeiture process. Under the proposed law, the state could not complete the forfeiture process without a criminal conviction in virtually all cases. The legislation also addresses the “policing for profit” motive inherent in the current forfeiture process by requiring all proceeds after expenses to be deposited in the county’s general fund. Under the current law, law enforcement agencies get to keep up to 70 percent of forfeiture proceeds.

The committee considered substitute language for HB404. At the time of this report, that language was not available and it was unclear exactly how it would change the effect of the bill.

Sponsored by Rep. Terry Canales (D-Edinburg) HB182 would make more modest reforms. The proposed law would make it more difficult for the state to seize assets by raising the burden of proof prosecutors must meet from  “a preponderance of the evidence” to “clear and convincing evidence.” While the state would still be able to seize assets without a conviction, passage of HB182 would take a first step toward reforming a Texas asset forfeiture process that the Institute of Justice called “terrible.”

Passage of either bill would take a big step toward closing 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 policy directive issued in July 2017 by then-Attorney General Jeff Sessions for the Department of Justice (DOJ).

The House Criminal Jurisprudence Committee also considered a third bill relating to asset forfeiture. Rep. Harold Dutton (D-Houston) introduced House Bill 479 (HB479) on Feb. 20. The legislation would require a conviction in order to complete the forfeiture process, but would not close the federal loophole.

FEDERAL LOOPHOLE

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.

HB404 and HB182 would close the loophole in most situations with the following language.

A law enforcement agency or attorney representing the state may not directly or indirectly transfer seized property to any federal law enforcement authority or other federal agency unless

(1) The value of the seized property exceeds $50,000; and
(2) the attorney representing the state determines that:
(A) the activity giving rise to the investigation or seizure is interstate in nature and sufficiently complex to justify the transfer; or
(B) the seized property may only be forfeited under federal law.

The vast majority of forfeiture cases fall below that $50,000 threshold.

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.

Why?

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.

WHAT’S NEXT

One of the three bills will have to be brought back up in the House Criminal Jurisprudence Committee for a vote before moving forward in the legislative process.

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