Hawaii Bill Would Reform Civil Asset Forfeiture Process, Opt State Out of Federal Program

by Mike Maharrey, Tenth Amendment Center

HONOLULU, Hawaii (Jan. 20, 2024) – A bill introduced in the Hawaii Senate would reform the state’s asset forfeiture process to require a conviction in most cases. The enactment of this bill would also effectively opt the state out of a program that allows police to circumvent more strict state forfeiture laws by passing cases off to the feds.

Sen. Joy San Buenaventura and two cosponsors introduced Senate Bill 2124 (SB2124) on Jan. 17. The legislation would restrict asset forfeiture to felony cases and would require a criminal conviction before prosecutors could proceed with the process in most cases.

Passage would effectively opt Hawaii out of a federal program that allows state and local police to get around more strict state asset forfeiture laws. 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) that remains in effect today.

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. Through this process, state or local police hand the forfeiture case to the feds to prosecute even though there was initially no federal involvement in the investigation and seizure. State and local police can also tap into equitable sharing by working with the feds on joint task forces. About 85 percent of equitable sharing cases arise from these joint task forces, but a significant number also begin with adoption.

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.

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.

SB2124 directly addresses the federal equitable sharing program with the following language:

Notwithstanding the provisions of section 712A-7, a seizing agency or prosecuting attorney shall not enter into an agreement to transfer or refer property seized under section 712A-6, unless the seized property includes United States currency in excess of $100,000, to a federal agency directly, indirectly, through adoption, through an intergovernmental joint task force or by other means that circumvent the provisions of this section.

The vast majority of cases far fall below that $100K threshold.

The proposed law would also address the “policing for profit” motive inherent in the forfeiture system by directing all forfeiture proceeds to be transferred to the general fund after the payment of expenses incurred during the forfeiture process. Under current law, 25 percent of forfeiture funds go to police agencies, 25 percent to prosecuting attorneys, and 50 percent go to the attorney general.

NECESSARY

While some people believe the Supreme Court “ended” asset forfeiture, its opinion in Timbs v. Indiana ended nothing. Without further action, civil asset forfeiture remains. Additionally, as law professor Ilya Somin noted, the Court left an important issue unresolved. What exactly counts as “excessive” in the civil forfeiture context?

“That is likely to be a hotly contested issue in the lower federal courts over the next few years. The ultimate effect of today’s decision depends in large part on how that question is resolved. If courts rule that only a few unusually extreme cases qualify as excessive, the impact of Timbs might be relatively marginal.”

Going forward, opponents of civil asset forfeiture could wait and see how lower federal courts will address this “over the next few years,” or they can do what a number of states have already taken steps to do, end the practice on a state level, and opt out of the federal equitable sharing program as well.

WHAT’S NEXT

At the time of this report, HB2124 had not been referred to a committee. Once it receives a committee assignment, it will need to get a hearing and pass by a majority vote before moving forward in the legislative process.