NASHVILLE, Tenn. (April 25, 2018) – Last Thursday, Tennessee Gov. Bill Haslam signed a bill into law that modestly reforms the state’s asset forfeiture laws, but leaves a loophole in place allowing police to circumvent stricter state laws by passing cases off to the feds.

Rep. Mike Carter (R-Ooltewah) introduced House Bill 2021 (HB2021) in January. The new law requires law enforcement agencies to provide formal notification within five days of a property seizure or of a forfeiture-warrant hearing. Authorities must provide notice whether or not the owner was present at the time the property was taken. The law also requires the state to pay attorney fees if a person proves police wrongfully seized their property. The new law streamlines the process to challenge a forfeiture for people who have assets seized and are charged at the scene. Additionally, HB2021 stipulates that merely possessing large amounts of cash is not considered a crime.

The House passed HB2021 88-0 on April 4. The Senate passed the bill 30-0 the next day. With Gov. Haslam’s signature, the bill goes into effect Oct. 1, 2018. Provisions allowing victims of wrongful seizures go into effect Jan. 1, 2019.

While HB2021 takes some small steps to reform Tennessee’s asset forfeiture law, the Republican-controlled legislature killed a bill featuring more robust provisions in order to advance the newly passed law. HB4021 would have required a criminal conviction before prosecutors could proceed with asset forfeiture and closed a federal loophole. The bill was never given a hearing in the House Criminal Justice Committee.

Aggressive law enforcement lobbying almost certainly killed the more comprehensive reform bill. According to media reports in Tennessee, police lobbyists even opposed the more modest reforms. This is typical. A recent committee hearing in Minnesota revealed the duplicity and effectiveness of law enforcement lobbying.

HB2021 also fails 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 policy directive issued last July by Attorney General Jeff Sessions for the Department of Justice (DOJ)

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 new 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 often bypass 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.

Tennessee 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.

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.


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