THE SENATE |
S.B. NO. |
2004 |
THIRTY-FIRST LEGISLATURE, 2022 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO PROPERTY FORFEITURE.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION
1. The legislature finds that civil asset forfeiture laws are
controversial and have been evolving throughout the country over the thirty
years since Hawaii passed the Hawaii omnibus criminal forfeiture act, codified
as chapter 712A, Hawaii Revised Statutes, that covers civil asset
forfeiture. Hawaii's process allows law enforcement agencies to
seize and keep property based on suspicion that the property is connected to
criminal activity. Property, such as vehicles, houses, cash, and
jewelry, can be taken without the property owner having been convicted of a
crime or even being formally accused of one, and the burden of proof is shifted from the
State to the property owner.
Additionally, the
legislature finds that there is a potential incentive to improperly seize
property for forfeiture, as state and county law enforcement agencies are
permitted to retain all proceeds from the sale of the forfeited property. According to the Institute for Justice, a nonprofit civil liberties law firm,
between 2001 and 2018, Hawaii generated at least $20,000,000
in forfeiture revenue under state law
and an additional $29,000,000 under the federal equitable
sharing program where state or local law enforcement agencies partner
with federal agencies and share in the proceeds. The estimated value of property seized by Hawaii law enforcement agencies
was $1,050,463 in fiscal year 2018-2019 and $963,055 in fiscal year 2019-2020.
The Institute for
Justice recommends abolishing civil forfeiture entirely, which four states have
done, Maine in 2021, Nebraska in 2016, New Mexico in 2015, and North Carolina in
1985. In those four states a criminal conviction
is required prior to someone's assets being seized. The legislature takes note of the Institute of
Justice's "D-" (D minus) rating of Hawaii's civil forfeiture laws and
the characterization that the State's laws "are among the nation's
worst".
Furthermore, the
Institute for Justice recommends other reforms to make the forfeiture process
fairer, beginning with eliminating potential financial incentives to seize and
keep forfeited property and instead changing the law to direct any proceeds to
the general revenue fund or other neutral fund. Eight jurisdictions prohibit
law enforcement from keeping the proceeds from forfeited property, and eight prevent
participation in the federal equitable sharing program. Another reform
is to adopt a high standard of proof to establish a civil asset forfeiture,
such as "beyond a reasonable doubt". Eighteen
jurisdictions have a standard higher than Hawaii's "preponderance of the
evidence" standard, and for ten of those jurisdictions, it is equivalent
to beyond a reasonable doubt. The third suggested reform, which a
number of jurisdictions have already made, involves requiring law enforcement
to prove that owners consented to or possessed knowledge of the crime that led
to the seizure of their property, restoring the presumption of innocence used
in criminal proceedings. The legislature finds that none of these
recommendations have been implemented in Hawaii.
Accordingly, the purpose
of this Act is to make the State's civil asset forfeiture process more just by:
(1) Restricting civil asset forfeiture to cases involving the commission of a felony offense where the property owner has been convicted of an underlying felony offense;
(2) Directing
any forfeiture proceeds to the general fund;
(3) Amending
the allowable expenses for moneys in the criminal forfeiture fund;
(4) Requiring
the attorney general to adopt rules necessary to carry out the purpose of the
Hawaii omnibus criminal forfeiture act; and
(5) Amending
the deadline for the attorney general to report to the legislature on the use
of the Hawaii omnibus criminal forfeiture act.
SECTION 2. Chapter 712A, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:
"§712A- Equitable
sharing program; restrictions. 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.
§712A- Records of forfeited property. (1) Each seizing agency and
prosecuting attorney shall maintain records showing:
(a) The authority
under which the forfeited property was forfeited;
(b) The date on
which each item of forfeited property was forfeited;
(c) The department
or agency that has possession of the forfeited property;
(d) A description
of each item of forfeited property; and
(e) The estimated
value of each item of forfeited property.
(2)
The seizing agency shall maintain all records of forfeited; property and
shall make the records open to inspection.
The seizing agency shall post the records on a publicly accessible
website."
SECTION 3. Section 712A-5, Hawaii Revised Statutes, is amended to read as follows:
"§712A-5 Property subject to forfeiture; exemption. (1) The following is subject to forfeiture:
(a) Property described in a statute authorizing forfeiture;
(b) Property used or
intended for use in the commission of, attempt to commit, or conspiracy to commit
a covered offense, or [which] that facilitated or assisted
such activity;
(c) Any firearm [which] that
is subject to forfeiture under any other subsection of this section or [which] is
carried during, visible, or used in furtherance of the commission, attempt to commit,
or conspiracy to commit a covered offense, or any firearm found in proximity to
contraband or to instrumentalities of an offense;
(d) Contraband or untaxed cigarettes in violation of chapter 245, which shall be seized and summarily forfeited to the State without regard to the procedures set forth in this chapter;
(e) Any proceeds or other property acquired, maintained, or produced by means of or as a result of the commission of the covered offense;
(f) Any property
derived from any proceeds [which] that were obtained directly
or indirectly from the commission of a covered offense;
(g) Any interest in,
security of, claim against, or property or contractual right of any kind
affording a source of influence over any enterprise [which] that has been
established, participated in, operated, controlled, or conducted in order to
commit a covered offense; and
(h) All books,
records, bank statements, accounting records, microfilms, tapes, computer data,
or other data [which] that
are used, intended for use, or [which] that facilitated or assisted in
the commission of a covered offense, or [which] that document the use of
the proceeds of a covered offense.
(2)
[Except that:] The following is not subject to forfeiture; provided that nothing in
this paragraph shall be construed to prevent the seizure of property before
conviction pursuant to section 712A-6:
[(a) Real property,
or an interest therein, may be forfeited under the provisions of this chapter
only in cases in which the covered offense is chargeable as a felony offense
under state law;
(b)] (a) No property shall
be forfeited under this chapter [to the extent of an interest of an owner,] by reason of [any
act or omission established by that owner to have been committed or omitted without
the knowledge and consent of that owner;] the commission of any covered offense
unless:
(i) The covered offense is chargeable as a felony offense under state law; and
(ii) The owner has been convicted of the covered offense by a verdict or plea, including a no contest plea or a deferred acceptance of guilty plea or no contest plea;
(b) No property shall be forfeited under this chapter by reason of any act or omission established by the owner to have been committed or omitted without the knowledge and consent of the owner;
(c) No conveyance used by any person as a common carrier in the transaction of a business as a common carrier is subject to forfeiture under this section unless it appears that the owner or other person in charge of the conveyance is a consenting party or privy to a violation of this chapter;
(d) No conveyance is subject to forfeiture under this section by reason of any act or omission established by the owner thereof to have been committed or omitted without the owner's knowledge or consent; and
(e) A forfeiture of a conveyance encumbered by a bona fide security interest is subject to the interest of the secured party if the secured party neither had knowledge of nor consented to the act or omission.
(3) This chapter shall not apply to the forfeiture
of an animal prior to disposition of criminal charges pursuant to section
711-1109.2.
(4) This section shall not prohibit or restrict
forfeitures authorized by law other than this chapter."
SECTION 4. Section 712A-16, Hawaii Revised Statutes, is amended to read as follows:
"§712A-16 Disposition of property forfeited. (1) All property forfeited to the State under this chapter shall be transferred to the attorney general, who:
[(a) May transfer
property, other than currency, which shall be distributed in accordance with
subsection (2) to any local or state government entity, municipality, or law
enforcement agency within the State;
(b)] (a) May sell
forfeited property to the public by public sale; provided that for leasehold
real property:
(i) The
attorney general shall first offer the holder of the immediate reversionary
interest the right to acquire the leasehold interest and any improvements built
or paid for by the lessee for the then fair market value of the leasehold interest
and improvements. The holder of the
immediate reversionary interest shall have thirty days after receiving written
notice within which to accept or reject the offer in writing; provided that the
offer shall be deemed to be rejected if the holder of the immediate
reversionary interest has not communicated acceptance to the attorney general
within the thirty-day period. The holder
of the immediate reversionary interest shall have thirty days after acceptance
to tender to the attorney general the purchase price for the leasehold interest
and any improvements, upon which tender the leasehold interest and improvements
shall be conveyed to the holder of the immediate reversionary interest[.];
(ii) If the holder of
the immediate reversionary interest fails to exercise the right of first
refusal provided in subparagraph (i), the attorney general may proceed to sell
the leasehold interest and any improvements by public sale[.]; and
(iii) Any dispute between the attorney general and the holder of the immediate reversionary interest as to the fair market value of the leasehold interest and improvements shall be settled by arbitration pursuant to chapter 658A;
[(c)] (b) May
sell or destroy all raw materials, products, and equipment of any kind used or
intended for use in manufacturing, compounding, or processing a controlled substance
or any untaxed cigarettes in violation of chapter 245;
[(d)] (c) May compromise and pay valid
claims against property forfeited pursuant to this chapter; or
[(e)] (d) May make any other disposition
of forfeited property authorized by law.
(2)
All forfeited property and the sale proceeds thereof, [up to a
maximum of three million dollars per year, not previously transferred pursuant
to [subsection] (1)(a) of this section, shall,] after payment of expenses
of administration and sale, [be distributed as follows:
(a) One quarter
shall be distributed to the unit or units of state or local government [whose]
officers or employees conducted the investigation and caused the arrest of the
person whose property was forfeited or seizure of the property for forfeiture;
(b) One quarter
shall be distributed to the prosecuting attorney who instituted the action
producing the forfeiture; and
(c) One half shall
be deposited into the criminal forfeiture fund established by this chapter.
(3) Property and money distributed to units of
state and local government shall be used for law enforcement purposes, and
shall complement but not supplant the funds regularly appropriated for such
purposes.] including
reimbursement for any costs incurred by the department of the attorney general
related to the seizure or storage of seized property, shall be deposited to the
credit of the state general fund.
[(4)] (3)
There is established in
the department of the attorney general a special fund to be known as the
criminal forfeiture fund, hereinafter referred to as the "fund",
[in] into which shall be deposited [one-half of the proceeds
of a forfeiture and any penalties paid pursuant to section 712A-10(6).] a portion of the
proceeds of each sale made pursuant to this section that is sufficient to cover
expenses of administration and sale. All
moneys in the fund shall be expended by the attorney general and are
appropriated for the [following purposes:
(a) The] payment of any expenses necessary to seize, detain,
appraise, inventory, safeguard, maintain, advertise, or sell property seized,
detained, or forfeited pursuant to this chapter or of any other necessary
expenses incident to the seizure, detention, or forfeiture of [such] property
and [such] contract
services and payments to reimburse any federal, state, or county agency for any
expenditures made to perform the foregoing functions[;].
[(b) The payment of
awards for information or assistance leading to a civil or criminal proceeding;
(c) The payment of
supplemental sums to state and county agencies for law enforcement purposes;
(d) The payment of
expenses arising in connection with programs for training and education of law
enforcement officers;
(e) The payment of
expenses arising in connection with enforcement pursuant to the drug nuisance
abatement unit in the department of the attorney general; and
(f) The payment of
expenses arising in connection with the law enforcement officer independent review
board in the department of the attorney general.
(5)] (4) The attorney
general [may, without regard to the requirements of chapter 91, promulgate]
shall adopt rules [and regulations] necessary to carry out the purpose of this chapter,
including rules concerning the disposition of property, the use of
the fund, and compromising and paying valid claims against property forfeited [pursuant
to this chapter].
[(6)] (5)
[Not] No less
than [twenty] forty days [prior to] before the
convening of each regular session, the attorney general shall provide to the
legislature a report on the use of the Hawaii omnibus criminal forfeiture act
during the fiscal year preceding the legislative session. The report shall include:
(a) The total amount and type of property seized by law enforcement agencies;
(b) The total number
of administrative and judicial actions filed by prosecuting attorneys and the
disposition thereof[;] for each action;
(c) The total number
of claims or petitions for remission or mitigation filed in administrative
actions and the dispositions thereof[;] for each action;
(d) The total amount and type of property forfeited and the sale proceeds thereof;
(e) The total amount and type of property distributed to units of state and local government;
(f) The amount of
money deposited into the [criminal forfeiture] fund; [and]
(g) The amount of money deposited into the general fund; and
[(g)] (h) The amount of money expended by the
attorney general from the criminal forfeiture fund under subsection [(5)] (4) and
the reason for the expenditures."
SECTION 5. Section 712A-19, Hawaii Revised Statutes, is repealed.
["[§712A-19] Construction. It is the intent
of the legislature that this chapter be liberally construed so as to effect the
purposes of this chapter."]
SECTION 6. This
Act does not affect rights and duties that matured, penalties that were incurred,
and proceedings that were begun before its effective date.
SECTION 7. Statutory
material to be repealed is bracketed and stricken. New statutory
material is underscored.
SECTION 8. This Act shall take effect on July 1, 2022; provided that the amendments made to section 712A-16, Hawaii Revised Statutes, by section 4 of this Act shall not be repealed when section 712A-16, Hawaii Revised Statutes, is reenacted on June 30, 2022, by section 7 of Act 161, Session Laws of Hawaii 2016.
INTRODUCED BY: |
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Report Title:
Civil Asset Forfeiture; Property Forfeiture
Description:
Restricts civil asset forfeiture to cases involving the commission of a felony offense where the property owner has been convicted of an underlying felony offense. Directs forfeiture proceeds to the general fund. Amends the allowable expenses for moneys in the criminal forfeiture fund. Requires the attorney general to adopt rules necessary to carry out the purpose of the Hawaii omnibus criminal forfeiture act. Amends the deadline for the attorney general to report to the legislature on the use of the Hawaii omnibus criminal forfeiture act. Limits the transfer of certain forfeiture property to federal agencies. Establishes records requirements.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.