Asset forfeiture reform bill falls victim to COVID-shortened session

In a normal legislative session, lawmakers, prosecutors and interest groups would have had some time to hash out their differences on civil asset forfeiture, possibly paving the way for the passage of a reform that advocates have sought for years.

The 2020 session, however, was far from normal. The COVID-19 crisis led the legislature to go on hiatus for more than a month, and when lawmakers returned to the Capitol, the House of Representatives and Senate operated independently of each other, with little coordination or cooperation.

Senate Bill 1556 would have made a number of changes to Arizona’s civil asset forfeiture system, under which law enforcement and prosecutors can take money and property allegedly used for or resulting from crimes. Chief among them would be to require a criminal conviction before property can be permanently taken.

For advocates of reform, requiring a conviction before property can be taken through forfeiture is a matter of basic fairness and constitutional rights. In the United States, people are supposed to be considered innocent until proven guilty, and no one is supposed to be deprived of property without due process of law.

“This is about protecting Arizonans against an abuse that’s gone on. This is about protecting their property rights, their civil rights and the due process rights that have been bastardized over the years,” said Sen. Eddie Farnsworth, R-Gilbert, who sponsored the bill.

The Senate passed SB1556 unanimously on March 10 and with little discussion. Before that, it had been approved by the Senate Judiciary Committee, which Farnsworth chairs, without any testimony. Farnsworth said during the hearing that there wasn’t time to hear testimony. Critics say there was an understanding, or least hope, that there would be amendments before it went up for a final vote in the House.

The Maricopa County Attorney’s Office sent Farnsworth a markup of SB1556 with dozens of proposed changes, and later sent the same proposal to members of the House Judiciary Committee, which approved the bill last week. 

But shortly after the Senate approved the bill, the legislature recessed for more than a month due to the COVID-19 crisis. When lawmakers finally reconvened, the Senate quickly moved to adjourn the session, while the House sought to pass dozens of bills that the Senate had already approved.

Because the Senate had signaled its intention to end the session as soon as possible, few wanted to take their chances by passing amendments in the House that would need to go back to the upper chamber for another vote. The general view was that amendments to any of the bills, SB1556 among them, might spell doom for the legislation. And because lawmakers already passed a baseline budget in March – a special session to address a looming budget deficit is a certainty – lawmakers worried that any funding that SB1556 cost county attorneys or the attorney general’s office wouldn’t be replaced for more than a year.

“I think the bill was a victim of COVID-19,” said Paul Avelar, an attorney with the Institute for Justice, a libertarian legal advocacy organization that took a lead role in advocating for SB1556.

Had the bill won approval and become law, Arizona would have been the 20th state to require law enforcement to obtain a conviction before taking someone’s property through forfeiture. As it stands now, state law does not even require charges to be filed. 

And the onus is on the property owner to defend themselves in civil court, where legal fees can often exceed the value of the property at issue. 

Asset forfeiture abuse motivated by money, say critics

Critics say abuse is rampant in the system, which was originally intended for the assets of major criminal enterprises but is largely used for smaller-scale offenders. 

While the majority of money and property taken through forfeiture cases in Arizona came from the “big fish” that these laws were intended to target, the majority of overall cases involve smaller fries. In fiscal year 2019, 77% of asset forfeiture cases in Arizona, which accounts for 719 cases, involved cash values of less than $10,000 according to a report from the Institute of Justice. But those cases accounted for less than 9% of the total value of property forfeited that year. 

In one highly publicized case, a Pinal County woman lost her pickup truck, valued at $6,000, after her son was arrested while driving it and charged with stealing accessories that he’d attached to the vehicle.

And Arizona Center for Investigative Reporting in 2017 exposed a lack of oversight on how law enforcement agencies spend seized money, including several cases where money was clearly misspent.

Proceeds from civil asset forfeiture are often used to fund prosecutorial agencies. In some cases, they’re used to provide restitution to victims.

The system as it currently exists creates a “very perverse incentive to take property,” Farnsworth said.

“Make no mistake: This is about money. This is about controlling the money. This is about money flowing in, without any supervision, around the legislative appropriation authority,” Farnsworth, R-Gilbert, said of the opposition to SB1556.

The bill would have made other substantial changes to the process of taking property through forfeiture, overhauling the process to place a higher burden of proof on the government and making it easier for people to challenge law enforcement’s seizure of their property.

Democratic opposition doomed reforms

While assorted criminal justice reform organizations backed SB1556, House Democrats, normally their staunch allies on reform measures, unanimously voted against the bill, ensuring its defeat. The GOP holds a bare 31-29 majority in the House, meaning they can’t afford to lose a single vote on any legislation opposed by the Democrats. 

Eight Republicans also voted against the bill.

Opponents cited a number of reasons for voting against the bill. Some warned that it would make it more difficult for prosecutors to target criminals’ ill-gotten gains or get restitution for victims who have lost money to crooks, a concern voiced by county attorneys from across the state. Some were wary of depriving prosecutorial agencies and possibly public defenders of the funding that forfeiture provides, at least without finding a way to replace that money from other sources.

On top of those rationales, some lawmakers simply do not support the idea of requiring a conviction.

Rep. Diego Rodriguez, D-Phoenix, said he would not support a conviction requirement for two reasons: He worries it would make it more difficult for victims to get back money they’ve lost to criminals, and agencies won’t get back the revenue they rely on for their budgets. Rodriguez said he’s not willing to take away that money and just hope that lawmakers replace it in the future.

“I did not consider this bill to be what I would call criminal justice reform. Just because you add necessity for a condition to a civil process in my mind does not make this criminal justice reform,” said Rodriguez, a criminal defense attorney who has been one of legislative Democrats’s loudest voices for criminal justice reform, serving on an ad hoc committee in the House that explored possible changes to Arizona’s strict criminal sentencing laws. 

Rep. Reginald Bolding, D-Phoenix, another advocate of criminal justice reform, said he would support new restrictions on forfeiture, which could include requiring a conviction in some cases. And he worries that prosecutors could seize assets as a way of pressuring defendants into unfavorable plea deals. But he was wary of making conviction a blanket requirement for all cases.

Other Democratic lawmakers said the conviction requirement wasn’t the reason they voted against SB1556. 

Rep. Kirsten Engel, D-Tucson, an attorney who served with Bolding and Rodriguez on the sentencing reform committee, said she believes prosecutors should be required to get a conviction before taking someone’s property, and believes there’s a lot of support among her Democratic colleagues in the House for that reform.

But that was far from the only change that SB1556 would have made. The complex, 43-page bill would have overhauled the process through which prosecutors pursued asset forfeiture. And the uncertainty, fueled by warnings from prosecutors and others, gave Engel pause about what the real effect of the legislation would be, she said.

Currently, after the state provides notice that it intends to take someone’s property through forfeiture, the owner or other interested parties have 30 days to challenge that in court. The government then has another 60 days to initiate forfeiture, at which point the matter goes to civil litigation.

SB1556 would have required law enforcement to return any property within 10 days of an arrest, unless they plan to hold it as evidence or for future forfeiture, in which case they must justify the seizure of property to a court. The property owner or other interested parties would twice as long to challenge it – 60 days – and would have an opportunity to convince a judge to return the property to them immediately. 

Then, following a criminal conviction, the government would have 60 days to initiate forfeiture.

Prosecutors: Bill would have shielded criminal assets

One of the biggest points of contention is whether prosecutors would still have the ability to seize property and hold it while a criminal case plays out. 

Ryan Anderson, a spokesman for Attorney General Mark Brnovich, said the office isn’t opposed to requiring conviction. But SB1556 would restrict prosecutors from holding property while the criminal case is pending to ensure that criminals don’t sell or otherwise shield assets, Anderson said. If that happened, there might not be anything left to seize once a defendant is convicted.

“This bill was a trojan horse that had far more policy and practical outcomes and effects that went beyond just requiring a conviction,” Anderson said.

Avelar and Farnswroth say that’s not the case. While SB1556 would give more rights to the accused and others whose property is seized, prosecutors could still put a lien on that property while they await the outcome of a criminal case. 

For Engel, that uncertainty was concerning. She said House Democrats, including those on the Judiciary Committee, where she voted against SB1556, simply didn’t have enough time to vet the legislation. Committee members had little time to prepare and examine the many issues that prosecutors and other opponents raised.

“The hang-up was not a resistance to making that fundamental reform,” Engel said of the conviction requirement. “But that’s clearly not all this bill did. This bill came up with a totally new process for civil asset forfeiture in this state. It completely reorganized that process.”

Engel also noted that the Maricopa County Attorney’s Office had concerns about the proposed 10-day period to show why they should be permitted to seize property. And while she’s willing to strip prosecutors of funding derived from forfeiture, Engel said that issue made her wary of voting for the bill, and questioned whether it would only hit law enforcement budgets, or whether it would also affect public defender offices, which are funded by the counties. 

During the debate in the House Judiciary Committee, Engel and Rodriguez focused heavily on the funding aspect of the bill and the revenue that prosecutors would lose if it passed.

Rep. Jennifer Jermaine, D-Chandler, also said she supports a conviction requirement. But because of the constraints they were working under in the COVID-shortened session, there wasn’t enough time to work out some of the prosecutors’s concerns, she said.

“There’s always next year, and I would rather pass good policy,” Jermaine said.

House Minority Leader Charlene Fernandez, D-Yuma, said SB1556 was being rushed through, and her caucus relied on its attorney members who were on the judiciary committee, like Engel and Rodriguez, who said the bill needed changes. Furthermore, she said Democrats weren’t consulted about the legislation before it came up for a vote.

In addition to the various other issues they had with SB1556, Democratic lawmakers largely believed that the legislature should simply adjourn sine die instead of taking up any legislation that wasn’t related to the COVID crisis.

“There were a lot of unknowns,” Fernandez said. “That was not the time and place.”

‘Surprise’ that there even was a vote

Nate Wade, a Pima County public defender who serves on the board of Arizona Attorneys for Criminal Justice, which supported the bill, said he was disappointed to hear “a lot of political talk” and objections that “prosecutors and law enforcement would have their budgets affected.” 

But he said he wasn’t surprised that some Democratic lawmakers were reluctant to dig into such a weighty issue at that point in the session. Wade said he presumed the bill was dead and was surprised the House even put it on the calendar for its frenzied final week.

“I would guess that there would be a different story if this was up in a regular session, when people were prepared and there had been plenty of discussion,” Wade said.

Of course, not every prosecutor is on board with a conviction requirement if other concerns are addressed. Some, such as Yavapai County Attorney Sheila Polk, would oppose such a requirement under any circumstances.

GOP lawmakers were far more supportive of the bill, with 23 of 31 House Republicans voting for it. But some still had concerns, arguing that the proposed overhaul would hamstring prosecutors, deprive victims of restitution and cut off needed funding for prosecutorial agencies.

Rep. T.J. Shope, R-Coolidge, told the Mirror that he doesn’t think there should be a conviction requirement for forfeiture.

“I was surprised it went up for a vote in the first place,” he said.