HONOLULU, Hawaii (Jan. 20, 2025) – Lawmakers in Hawaii have introduced two bills aimed at reforming the state’s civil asset forfeiture laws, requiring a criminal conviction before property can be seized, and taking significant steps to close a federal loophole that allows law enforcement to bypass state restrictions.
Sen. Joy San Buenaventura and four cosponsors filed Senate Bill 320 (SB320). Sen. Karl Rhoads and nine cosponsors filed Senate Bill 722 (SB722). The legislation would limit civil asset forfeiture “to cases involving the commission of a felony offense where the property owner has been convicted of an underlying felony offense.”
SB320 and SB722 would also address the “policing for profit” motive inherent in civil asset forfeiture by requiring the state treasurer to deposit forfeiture proceeds into the general fund. 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.
FEDERAL LOOPHOLE
SB320 and SB722 would take significant steps toward closing a federal loophole that allows state and local law enforcement to bypass Hawaii’s stricter asset forfeiture laws through a federal program known as “Equitable Sharing.”
This program enables law enforcement to transfer cases to federal authorities via a process called “adoption,” allowing prosecutors to sidestep state limits and seize property under federal law.
Under these arrangements, state or local police investigate a case on their own and then simply hand it over to a federal agency for prosecution. Even though the feds initially didn’t participate in the investigation, they handle the prosecution under federal law – and then give up to 80 percent of the take to the state law enforcement agency that helped them out.
This allows state and local police to cash in on asset forfeiture even if state law prohibits it.
Adoption accounts for about 30 percent of equitable sharing cases and about 15 percent of the total value forfeited under equitable sharing. The rest, and the vast majority, happens through state-federal joint task forces.
Language in SB320 and SB722 would significantly close the loophole.
“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.”
It’s difficult to say exactly how many cases would be eligible for transfer with that $100,000 cash threshold because only 21 states report forfeiture data. But based on analysis by the Institute for Justice, the vast majority of cases fall below that amount.
The median currency forfeiture averages just $1,276 across the 21 states with available data. Minnesota has the most transparent reporting. According to an IJ lawyer, only seven of the 3,873 cases reported in 2023 included proceeds above $50K.
NECESSARY
While some people believe the Supreme Court “ended” asset forfeiture, its opinion in Timbs v. Indiana ended nothing. The court merely held that the Eighth Amendment provisions prohibiting “expressive fines” apply to the state through the incorporation doctrine.
Without further action, state and federal law enforcement can still use the civil asset forfeiture process with few limits. 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.”
Somin has been proved correct. Six years later, the SCOTUS decision still hasn’t limited asset forfeiture.
The passage of legislation that specifically limits or completely ends state participation in equitable sharing takes concrete steps toward ending it instead of waiting for more court cases.
WHAT’S NEXT
SB320 and SB722 will be assigned to a committee where they must get a hearing and pass by a majority vote before moving forward in the legislative process.
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