Colorado Republicans Kill Bill to Close Federal Asset Forfeiture Loophole

DENVER, Colo. (March 30, 2017) – A Republican controlled Colorado Senate committee killed a bill that would have closed an asset forfeiture loophole that allows state and local police to circumvent more stringent state asset forfeiture laws.

Despite bipartisan sponsorship, Senate Bill 136 (SB136) failed to advance out of the Senate Committee on Judiciary by a vote of 2-3. The vote was on party lines, with 2 Democrats in favor and 3 Republicans opposing.

The bill would have created an extensive reporting system related to asset forfeiture for law enforcement agencies to follow. An important provision in the bill would have prohibited Colorado law enforcement agencies from entering into agreements to transfer seized property to a federal agency directly, indirectly, by adoption, through an intergovernmental joint taskforce or by any other means, unless the seized property includes more than $100,000 in cash.

While Colorado asset forfeiture laws don’t provide the level of protection they should, they are stricter than federal law. The Institute of Justice gives Colorado forfeiture laws a C. They do include a high bar to forfeit property, but they do not require a criminal conviction. They also provide relatively robust protections for innocent third-party property owners, and law enforcement can only keep up to 50 percent of proceeds.

With these relatively stringent policies in place, police have an incentive to pass cases to the feds in order to circumvent them. Unsurprisingly, the state ranks 15th in the country in the amount of federal asset forfeiture money it brings in.

The situation in California was similar until recently. The state has some of the strongest state-level restrictions on civil asset forfeiture in the country, but law enforcement would often bypass the state restrictions by partnering with a federal asset forfeiture program known as “equitable sharing.” Under these arrangements, state officials would simply hand over forfeiture prosecutions to the federal government and then receive up to 80 percent of the proceeds—even when state law banned or limited the practice. According to a report by the Institute for Justice, Policing for Profit, California ranked dead last of all states in the country between 2000 and 2013 as the worst offender. In other words, California law enforcement was passing off a lot of cases to the feds and collecting the loot. During the 2016 legislative session, the state closed the loophole.

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 deplorable “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.