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S.B. 175 Enrolled

                 

PROTECTION OF PRIVATE LAWFULLY

                 
OBTAINED PROPERTY

                 
2004 GENERAL SESSION

                 
STATE OF UTAH

                 
Sponsor: D. Chris Buttars

                  Mike Dmitrich
                  Ron Allen
                  Patrice M. Arent
                  Gregory S. Bell
                  Leonard M. Blackham
                  Curtis S. Bramble
                  Gene DavisDan R. Eastman
Beverly Ann Evans
James M. Evans
Karen Hale
Thomas V. Hatch
John W. HickmanPaula F. Julander
Sheldon L. Killpack
Peter C. Knudson
L. Alma Mansell
Ed P. Mayne
Carlene M. Walker                  
                  LONG TITLE
                  General Description:
                      This bill modifies the Utah Uniform Forfeiture Procedures Act regarding property owner
                  interests, allocation of forfeiture proceeds, and reporting.
                  Highlighted Provisions:
                      This bill:
                      .    provides additional definitions;
                      .    increases innocent owner protections;
                      .    repeals the provision for depositing forfeiture proceeds in the Uniform School Fund;
                      .    creates a restricted account for specified state forfeiture funds, and provides that
                  funds in the account shall be appropriated to the Commission on Criminal and
                  Juvenile Justice;
                      .    specifies accountability standards in management of forfeited property and of the
                  proceeds;
                      .    specifies law enforcement purposes for which the proceeds may be used and those
                  purposes for which the proceeds may not be used;
                      .    specifies standards and procedures for allocation of the proceeds to law enforcement
                  agencies by the Commission on Criminal and Juvenile Justice; and


                      .    requires reporting by agencies and by the Commission on Criminal and Juvenile
                  Justice.
                  Monies Appropriated in this Bill:
                      None
                  Other Special Clauses:
                      None
                  Utah Code Sections Affected:
                  AMENDS:
                      24-1-2, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-3, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-4, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-6, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-7, as last amended by Chapter 185, Laws of Utah 2002
                      24-1-10, as last amended by Chapter 185, Laws of Utah 2002
                      24-1-11, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-12, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-14, as enacted by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
                      24-1-15, as last amended by Chapter 185, Laws of Utah 2002
                  ENACTS:
                      24-1-3.5, Utah Code Annotated 1953
                      24-1-17, Utah Code Annotated 1953
                      24-1-18, Utah Code Annotated 1953
                      24-1-19, Utah Code Annotated 1953
                      24-1-20, Utah Code Annotated 1953
                  REPEALS:
                      24-1-16, as last amended by Chapter 185, Laws of Utah 2002
                 
                  Be it enacted by the Legislature of the state of Utah:

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                      Section 1. Section 24-1-2 is amended to read:
                       24-1-2. Purpose.
                      It is the intent of this chapter to:
                      (1) provide [for] a uniform set of procedures and substantive standards for the criminal
                  and civil forfeiture of property within the state of Utah;
                      (2) permit law enforcement personnel to deter crime by lawfully seizing and forfeiting
                  contraband and the instrumentalities and proceeds of criminal conduct;
                      (3) protect innocent owners and innocent interest holders from the [wrongful taking]
                  forfeiture of their property;
                      (4) ensure that seizures and forfeitures of property from private citizens are [not
                  disproportionate] in proportion to the violation or crime committed;
                      (5) ensure direct control and accountability over the use and sale of forfeited property and
                  [the proceeds generated therefrom] the revenue resulting from the disposal of forfeited property;
                  [and]
                      (6) ensure the revenue resulting from property forfeiture allows continued:
                      (a) law enforcement, crime prevention, and drug courts; and
                      (b) other appropriate activities related to the functions under Subsection (6)(a);
                      (7) maximize the benefits of, and accountability for, federal asset forfeiture sharing for the
                  citizens of the state; and
                      [(6)] (8) direct that any and all revenues resulting from the sale of forfeited property be
                  [contributed to the Uniform School Fund] allocated to the Utah Commission on Criminal and
                  Juvenile Justice for grants to state and local law enforcement agencies according to specified
                  guidelines.
                      Section 2. Section 24-1-3 is amended to read:
                       24-1-3. Definitions.
                      As used in this section:
                      (1) "Account" means the Criminal Forfeiture Restricted Account created in Section
                  24-1-18 .

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                      [(1)] (2) "Agency" [shall mean] means any agency of municipal, county, or state
                  government, including law enforcement agencies, law enforcement personnel, and
                  multi-jurisdictional task forces.
                      (3) "Claimant" means:
                      (a) any owner of property as defined in this section;
                      (b) any interest holder as defined in this section; and
                      (c) any other person or entity who asserts a claim to any property seized for forfeiture
                  under this section.
                      (4) "Complaint" means a civil complaint seeking the forfeiture of any real or personal
                  property pursuant to this chapter.
                      (5) "Constructive seizure" means a seizure of property where the property is left in the
                  control of the owner and the seizing agency posts the property with notice of seizure by that
                  agency for forfeiture.
                      [(2)] (6) "Contraband" [shall mean] means any property, item, or substance which is
                  unlawful to produce or to possess under state or federal law.
                      (7) (a) "Innocent owner" means an owner or interest holder who held an ownership
                  interest in property at the time the conduct subjecting the property to seizure occurred, and:
                      (i) did not have actual knowledge of the conduct subjecting the property to seizure; or
                      (ii) upon learning of the conduct subjecting the property to seizure, took reasonable steps
                  to prohibit the illegal use of the property.
                      (b) "Innocent owner" means an owner or interest holder who acquired an ownership
                  interest in the property and who had no knowledge that the illegal conduct subjecting the property
                  to seizure had occurred or that the property had been seized for forfeiture, and:
                      (i) acquired the property in a bona fide transaction for value;
                      (ii) was a person, including a minor child, who acquired an interest in the property
                  through probate or inheritance; or
                      (iii) was a spouse who acquired an interest in property through dissolution of marriage or
                  by operation of law.

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                      (8) (a) "Interest holder" means a secured party as defined in Subsection 70A-9a-102 (72),
                  a mortgagee, lien creditor, or the beneficiary of a security interest or encumbrance pertaining to
                  an interest in property, whose interest would be perfected against a good faith purchaser for
                  value.
                      (b) "Interest holder" does not mean a person who holds property for the benefit of or as
                  an agent or nominee for another person, or who is not in substantial compliance with any statute
                  requiring an interest in property to be recorded or reflected in public records in order to perfect
                  the interest against a good faith purchaser for value.
                      (9) "Legal costs" means the costs and expenses incurred by the prosecuting agency, not
                  to exceed 20% of the net value of the forfeited property.
                      (10) "Legislative body" means:
                      (a) (i) the state Legislature, county commission, county council, city commission, city
                  council, or town council that has fiscal oversight and budgetary approval authority over a seizing
                  agency; or
                      (ii) the seizing agency's governing political subdivision; or
                      (b) the lead governmental entity of a multijurisdictional task force, as designated in a
                  memorandum of understanding executed by the agencies participating in the task force.
                      [(3)] (11) "Multijurisdictional task force" [shall mean] means a law enforcement task
                  force or other agency comprised of persons who are employed by or acting under the authority of
                  different governmental authorities, including federal, state, county or municipal governments, or
                  any combination [thereof] of these agencies.
                      [(4)] (12) "Owner" [shall mean] means any person or entity, other than an interest holder
                  as defined in this section, that possesses a bona fide legal or equitable interest in real or personal
                  property[, including a security interest].
                      (13) "Program" means the Crime Reduction Assistance Program created in Section
                  24-1-19 .
                      [(5)] (14) "Property" [shall mean] means all property, whether real or personal, tangible
                  or intangible.

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                      [(6)] (15) "Prosecuting attorney" [shall mean the public attorney authorized by a specific
                  provision of state law to initiate forfeiture proceedings under this chapter.] means:
                      (a) the state attorney general and any assistant attorney general;
                      (b) any district attorney or deputy district attorney; and
                      (c) any county attorney or assistant county attorney;
                      (d) any other attorney authorized to commence an action on behalf of the state under this
                  chapter or other provisions of state law.
                      (16) "Seize for forfeiture" means seizure of property:
                      (a) by a law enforcement officer or law enforcement agency, including a constructive
                  seizure; and
                      (b) accompanied by an assertion by the officer or agency or by a prosecuting attorney that
                  the property is seized for forfeiture in accordance with this chapter.
                      [(7) "State law" means all Utah law, including municipal, county and state law.]
                      Section 3. Section 24-1-3.5 is enacted to read:
                      24-1-3.5. Jurisdiction and venue.
                      (1) A state district court has jurisdiction over any action filed in accordance with this
                  chapter regarding:
                      (a) all interests in property if the property for which forfeiture is sought is within this state
                  at the time the action is filed; and
                      (b) the interests of owners or interest holders in the property, if the owner or interest
                  holder is subject to the personal jurisdiction of the district court.
                      (2) (a) In addition to the venue provided for under Title 78, Chapter 13, Place of
                  Trial-Venue, or any other provisions of law, a proceeding for forfeiture under this chapter may be
                  maintained in the judicial district in which:
                      (i) any part of the property is found; or
                      (ii) a civil or criminal action could be maintained against an owner or interest holder for
                  the conduct alleged to give cause for the forfeiture.
                      (b) A claimant may obtain a change of venue under Section 78-13-9 .

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                      Section 4. Section 24-1-4 is amended to read:
                       24-1-4. Civil Procedures.
                      (1) An agency which seizes property under any provision of state law subjecting [an
                  owner's] the property to [civil] forfeiture shall, as soon as practicable, but in no case more than 30
                  days after seizure:
                      (a) prepare a detailed inventory of all property seized and transfer the seized property to a
                  designated official within the agency, who shall be responsible for holding and maintaining seized
                  property pending a court order of release or final determination of forfeiture and disposition of
                  property under this chapter;
                      (b) notify the prosecuting attorney for the appropriate jurisdiction who is responsible for
                  initiating [civil] forfeiture proceedings under this chapter of the items of property seized, the place
                  of the seizure and any persons arrested at the time of seizure; and
                      (c) give written notice to all owners and interest holders known, or reasonably
                  discoverable after due diligence, of [the following items]:
                      (i) the date of the seizure and the property seized;
                      (ii) the owner's or interest holder's rights and obligations under this chapter, including the
                  availability of [counsel and] hardship relief in appropriate circumstances; and
                      (iii) [an outline] a brief description of the [steps in the] statutory basis for the forfeiture
                  and the judicial proceedings by which property is forfeited under this chapter.
                      (2) (a) If the seizing agency fails to provide notice as required in [subparagraph]
                  Subsection (1)[(c)], an owner or interest holder entitled to notice who does not receive notice
                  may void the forfeiture with respect to the owner's or interest holder's interest in the property by
                  bringing a motion before the appropriate district court and serving it upon the seizing agency.
                  [Such] The motion may be brought at any time prior to the final disposition of the property under
                  this chapter.
                      (b) If an owner or interest holder brings a motion to void the forfeiture for lack of the
                  notice required under [subparagraph] Subsection (1)[(c)], the court shall void the forfeiture unless
                  the seizing agency demonstrates:

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                      [(a)] (i) good cause for the failure to give notice to that owner; or
                      [(b)] (ii) that the owner otherwise had actual notice of the seizure.
                      (3) (a) Within [90] 60 days of any seizure, the prosecuting attorney shall file a complaint
                  for forfeiture in the appropriate district court and serve a summons and notice of intent to seek
                  forfeiture with a copy of the complaint upon all owners and interest holders known to the
                  prosecuting attorney to have an interest in the property. Service shall be by one of the following
                  methods:
                      [(i) personal service upon each owner whose name and address is known, or by mailing a
                  copy to the last known address; or]
                      [(ii) upon all other owners whose addresses are not known, by publication in a newspaper
                  of general circulation in the county where the seizure was made for a period of two consecutive
                  weeks.]
                      (i) if the owner's or interest holder's name and current address are known, either by
                  personal service by any person qualified to serve process, by a law enforcement officer, or by
                  certified mail, return receipt requested, to that address;
                      (ii) if the owner's or interest holder's name and address are required by law to be on
                  record with any state agency in order to perfect an interest in property and the owner's or interest
                  holder's current address is not known, by mailing a copy of the notice by certified mail, return
                  receipt requested, to the most recent address listed by any of those agencies; or
                      (iii) if the owner's or interest holder's address is not known and is not on record as
                  provided in Subsection (3)(a)(i) or (ii), by publication for two successive weeks in a newspaper of
                  general circulation in the county in which the seizure occurred.
                      (b) Notice is effective upon the earlier of personal service, publication, or the mailing of a
                  written notice.
                      (c) The summons and notice of intent to seek forfeiture shall:
                      (i) be addressed to the known owners and interest holders of the seized property, and to
                  the person from whom the property was seized;
                      (ii) contain the name, business address, and business telephone number of the prosecuting

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                  attorney seeking the forfeiture; and
                      (iii) contain:
                      (A) a description of the property which is the subject matter of the forfeiture proceeding;
                      (B) notice that a complaint for forfeiture has been or will be filed;
                      (C) the time and procedural requirements for filing an answer or claim;
                      (D) notice of the availability of hardship or bond release of the property; and
                      (E) notice that failure to file an answer or other claim regarding the seized property will
                  result in a default judgment against the seized property.
                      [(b)] (d) The complaint shall describe with reasonable particularity:
                      (i) the property which is the subject matter of the forfeiture proceeding;
                      (ii) the date and place of seizure; and
                      (iii) the allegations which constitute a basis for forfeiture.
                      (4) (a) If the prosecuting attorney does not timely file a complaint for forfeiture of the
                  property in accordance with [subparagraph] Subsection (3), the agency shall promptly return the
                  property to its owner and the prosecuting attorney [shall] may take no further action to effect the
                  forfeiture of [such] the property.
                      (b) If the agency knows of more than one owner, it shall return the property to the owner
                  who was in possession at the time of the seizure.
                      (5) (a) In any case where the prosecuting attorney files a complaint for forfeiture of
                  property, an owner or interest holder may file a claim and an answer to the complaint.
                      (b) The claim and answer shall be filed within 30 days after the complaint is served in
                  person or by mail, or where applicable, within 30 days after publication under [subparagraph]
                  Subsection (3)[(a)(ii)].
                      (6) (a) Except as otherwise provided in this chapter, [civil] forfeiture proceedings are
                  governed by the Utah Rules of Civil Procedure.
                      (b) The court shall take all reasonable steps to expedite forfeiture proceedings and shall
                  give [such] these proceedings the same priority as is given to criminal cases.
                      (c) In all suits or actions brought for the civil forfeiture of any property under this

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                  chapter, the burden of proof is on the prosecuting attorney to establish, by clear and convincing
                  evidence, to what extent, if any, property is subject to forfeiture.
                      (d) The right to trial by jury applies to [civil] forfeiture proceedings under this chapter.
                      Section 5. Section 24-1-6 is amended to read:
                       24-1-6. Innocent owners.
                      (1) An innocent owner's or interest holder's interest in property [shall] may not be
                  forfeited [civilly] under any provision of state law.
                      (2) The prosecuting attorney [shall have] has the burden of establishing by clear and
                  convincing evidence that an [individual is not an innocent] owner[.]or interest holder:
                      [(3) With respect to an ownership interest in existence at the time the conduct subjecting
                  the property to seizure took place, the term "innocent owner" means an owner who:]
                      [(a) did not have actual knowledge of the conduct subjecting the property to seizure; or]
                      [(b) upon learning of the conduct subjecting the property to seizure, took reasonable
                  steps to prohibit such use of the property.]
                      (a) is criminally responsible for the conduct giving rise to the forfeiture, subject to
                  Subsection (4);
                      (b) knew of the conduct giving rise to the forfeiture, and allowed the property to be used
                  in furtherance of the conduct;
                      (c) acquired the property with notice of its actual or constructive seizure for forfeiture
                  under this chapter;
                      (d) acquired the property knowing the property was subject to forfeiture under this
                  chapter; or
                      (e) acquired the property in an effort to conceal, prevent, hinder, or delay its lawful
                  seizure or forfeiture under any provision of state law.
                      [(4)] (3) For purposes of [subparagraph (3)(b), no] this chapter, an owner [shall] or
                  interest holder may not be required to take steps that he reasonably believes would be likely to
                  [subject any person (other than the person whose conduct gave rise to the forfeiture) to] result in
                  physical harm or danger to any person. An owner or interest holder may demonstrate that he

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                  took reasonable action to prohibit [such] the illegal use of the property by, for example:
                      (a) timely notifying a law enforcement agency of information that led the owner to know
                  that conduct subjecting the property to seizure would occur, was occurring, or has occurred; [or]
                      (b) timely revoking or attempting to revoke permission for those engaging in [such] the
                  illegal conduct to use the property; or
                      (c) taking reasonable actions to discourage or prevent the illegal use of the property.
                      [(5) With respect to an ownership interest acquired after the conduct subjecting the
                  property to seizure has occurred, the term "innocent owner" means a person who, at the time he
                  acquired the interest in the property, had no knowledge that the illegal conduct subjecting the
                  property to seizure had occurred or that the property had been seized for forfeiture, and:]
                      [(a) acquired the property in a bona fide transaction for value;]
                      [(b) was a person, including a minor child, who acquired an interest in property through
                  probate or inheritance; or]
                      [(c) was a spouse who acquired an interest in property through dissolution of marriage or
                  by operation of law.]
                      (4) If the state relies on Subsection (2)(a) to establish that a person is not an innocent
                  owner or interest holder, and if the owner or the interest holder is criminally charged with the
                  conduct giving rise to the forfeiture and is acquitted of that charge on the merits:
                      (a) the property subject to the forfeiture or the value of the property, if the property has
                  been disposed of under Subsection 24-1-7 (15), shall be returned to the owner or interest holder;
                  and
                      (b) any payments required under this chapter regarding holding the property shall be paid
                  to the owner or interest holder.
                      [(6)] (5) No owner may assert, under this [paragraph] section, an ownership interest in
                  contraband.
                      (6) Property is presumed to be subject to forfeiture under this chapter if the prosecuting
                  attorney establishes, by clear and convincing evidence, that:
                      (a) the owner or interest holder has engaged in conduct giving cause for forfeiture;

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                      (b) the property was acquired by the owner or interest holder during that period of the
                  conduct giving cause for forfeiture or within a reasonable time after that period; and
                      (c) there was no likely source for the purchase or acquisition of the property other than
                  the conduct giving cause for forfeiture.
                      (7) A finding that property is the proceeds of conduct giving cause for forfeiture does
                  not require proof that the property was the proceeds of any particular exchange or transaction.
                      Section 6. Section 24-1-7 is amended to read:
                       24-1-7. Hardship release of seized property.
                      (1) After property is seized for forfeiture, a person or entity may not alienate, convey,
                  sequester, or attach that property until the court issues a final order of dismissal or an order of
                  forfeiture regarding the property.
                      (2) The seizing agency or the prosecuting attorney may authorize the release of property
                  seized for forfeiture to its owner if retention of actual custody is unnecessary.
                      (3) With the consent of a court of competent jurisdiction, the prosecuting attorney may
                  discontinue forfeiture proceedings and transfer the action to another state or federal agency which
                  has initiated forfeiture proceedings involving the same property.
                      (4) Property seized for forfeiture is considered to be in the custody of the district court
                  and subject only to:
                      (a) the orders and decrees of the court having jurisdiction over the property or the
                  forfeiture proceedings; and
                      (b) the acts of the seizing agency or the prosecuting attorney pursuant to this chapter.
                      (5) (a) An owner of property seized pursuant to this chapter may obtain release of the
                  property by posting with the district court a surety bond or cash in an amount equal to the current
                  fair market value of the property as determined by the court or by the parties' stipulation.
                      (b) The district court may refuse to order the release of the property if:
                      (i) the bond tendered is inadequate;
                      (ii) the property is contraband or is retained as evidence; or
                      (iii) the property is particularly altered or designed for use in conduct giving cause for

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                  forfeiture.
                      (c) If a surety bond or cash is posted and the property seized and then released on a bond
                  or cash is forfeited, the court shall order the forfeiture of the surety bond or cash in lieu of the
                  property.
                      (6) (a) As soon as practicable after seizure for forfeiture, and in no case later than 30 days
                  after seizure for forfeiture, the seizing agency shall conduct a written inventory of the property
                  seized.
                      (b) The seizing agency shall deposit property that is in the form of cash or other readily
                  negotiable instruments into a restricted account maintained by the agency solely for the purpose
                  of managing and protecting the property from commingling, loss, or devaluation during the
                  pendency of the forfeiture proceedings.
                      (c) The seizing agency shall have in place written policy for the identification, tracking,
                  management, and safekeeping of seized property, which shall include a prohibition against the
                  transfer, sale, or auction of forfeited property to any employee of the seizing agency.
                      (d) An agency may not be awarded any funds from forfeiture through the Crime
                  Reduction Assistance Program under Section 24-1-19 if the agency has not established or
                  maintained the inventory policy, restricted account, and written policies required by this
                  Subsection (6).
                      [(1)] (7) An owner is entitled to the immediate release of seized property from the seizing
                  agency pending the final determination of [civil] forfeiture if:
                      (a) the owner [has] had a possessory interest in the property at the time of seizure;
                      (b) continued possession by the agency or the state pending the final disposition of the
                  forfeiture proceedings will cause substantial hardship to the owner, such as:
                      (i) preventing the functioning of a legitimate business;
                      (ii) preventing any individual from working;
                      (iii) preventing any minor child or student from attending school;
                      (iv) preventing or hindering any person from receiving necessary medical care;
                      (v) hindering the care of an elderly or disabled dependent child or adult;

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                      (vi) preventing an owner from retaining counsel to provide a defense in the forfeiture
                  proceeding; or
                      (vii) leaving any individual homeless, or any other condition that the court determines
                  causes a substantial hardship; [and]
                      (c) the hardship from the continued possession by the agency of the seized property
                  outweighs the risk that the property will be destroyed, damaged, lost, concealed, or transferred if
                  it is returned to the owner during the pendency of the proceeding[.]; and
                      (d) determination of substantial hardship under this Subsection (7) is based upon the
                  property's use prior to the seizure.
                      [(2)] (8) The right to appointed counsel under Section 24-1-9 applies throughout civil
                  forfeiture proceedings, including an owner's motion for hardship release.
                      (9) An owner may file a motion for hardship release:
                      (a) in the court in which forfeiture proceedings have commenced; or
                      (b) in any district court having jurisdiction over the property, if forfeiture proceedings
                  have not yet commenced.
                      (10) The motion for hardship release shall also be served upon the prosecuting attorney
                  or the seizing agency within ten days after filing the motion.
                      [(3)] (11) The court shall render a decision on a motion [or complaint] for hardship filed
                  under [Subsection (2)] this section not later than [ten] 20 days after the date of filing, or ten days
                  after service upon the prosecuting attorney or seizing agency, whichever is earlier, unless [the
                  ten-day] this period is extended by the [consent of the] parties or by the court for good cause
                  shown.
                      [(4)] (12) (a) If the owner demonstrates substantial hardship pursuant to [subparagraph
                  (1)] this section, the court shall order the property immediately released to the owner pending
                  completion of proceedings by the government to obtain forfeiture of the property.
                      (b) The court may place [such] conditions on release of the property as it finds [are]
                  necessary and appropriate to preserve the availability of the property or its equivalent for
                  forfeiture.

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                      [(5) Subparagraph (1) shall]    (13) The hardship release does not apply if the seized
                  property is:
                      (a) contraband;
                      (b) currency or other monetary instrument or electronic funds, unless [such] the property
                  is used to pay for the reasonable costs of defending against the forfeiture proceeding or
                  constitutes the assets of a legitimate business; or
                      (c) likely to be used to commit additional illegal acts if returned to the owner.
                      (14) (a) The court may order property which has been seized for forfeiture to be sold as
                  allowed by Subsection (15), leased, rented, or operated to satisfy a specified interest of any owner
                  or interest holder, or to preserve the interests of any party on motion of that party.
                      (b) The court may enter orders under Subsection (14)(a) after notice to persons known to
                  have an interest in the property, and after an opportunity for a hearing.
                      (15) (a) A sale may be ordered under Subsection (14) when the property is liable to
                  perish, waste, or be significantly reduced in value, or when the expenses of maintaining the
                  property are disproportionate to its value.
                      (b) A third party designated by the court shall dispose of the property by commercially
                  reasonable public sale and distribute the proceeds in the following order of priority:
                      (i) first, for the payment of reasonable expenses incurred in connection with the sale;
                      (ii) second, for the satisfaction of any interests, including those of interest holders, in the
                  order of their priority as determined by Title 70A, Uniform Commercial Code; and
                      (iii) third, any balance of the proceeds shall be preserved in the actual or constructive
                  custody of the court, in an interest-bearing account, subject to further proceedings under this
                  chapter.
                      Section 7. Section 24-1-10 is amended to read:
                       24-1-10. Prejudgment and postjudgment interest.
                      In any [civil or criminal] proceeding to forfeit currency or other negotiable instruments
                  under this chapter, the court shall award a prevailing [owner] party prejudgment and
                  postjudgment interest on the currency or negotiable instruments at the legal rate of interest

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                  established by Section 15-1-1 .
                      Section 8. Section 24-1-11 is amended to read:
                       24-1-11. Attorneys' fees and costs.
                      In any [civil or criminal] proceeding to forfeit seized property under this chapter, the court
                  shall award a prevailing [owner] party reasonable attorneys' fees and other costs of [suit] litigation
                  reasonably incurred by the owner. An owner who prevails only in part [shall be] is entitled to
                  recover reasonable attorneys' fees and reasonable costs of suit related to those issues on which he
                  prevailed.
                      Section 9. Section 24-1-12 is amended to read:
                       24-1-12. Compensation for damaged property.
                      (1) [In any civil or criminal proceeding,] If property seized for forfeiture is returned by
                  operation of this chapter, an owner [shall have a private] has a civil right of action against a
                  seizing agency for any claim based upon the negligent destruction, loss, damage, or other injury to
                  seized property while in the possession or custody of [a state] the agency[, if the property was
                  seized for the purpose of initiating forfeiture proceedings under this chapter].
                      (2) [For the purposes of] As used in this section, "damage or other injury" does not
                  include normal depreciation, deterioration, or ordinary wear and tear.
                      Section 10. Section 24-1-14 is amended to read:
                       24-1-14. Proportionality.
                      (1) (a) An owner's interest in property, excluding contraband, [shall not be civilly or
                  criminally forfeited under a] is not subject to forfeiture under any provision of state law [unless
                  such] if the forfeiture is substantially [proportional to both] disproportional to the use of the
                  property in committing or facilitating a violation of state law and the value of the property.
                      (b) Forfeiture of property used solely in a manner that is merely incidental and not
                  instrumental to the commission or facilitation of a violation of law is not proportional[, as a
                  matter of law].
                      (2) (a) In determining proportionality, the court shall consider:
                      (i) the conduct giving cause for the forfeiture;

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                      (ii) what portion of the forfeiture, if any, is remedial in nature;
                      (iii) the gravity of the conduct for which the claimant is responsible in light of the offense;
                  and
                      (iv) the value of the property.
                      (b) If the court finds that the forfeiture is substantially disproportional to the conduct for
                  which the claimant is responsible, it shall reduce or eliminate the forfeiture, as it finds appropriate.
                      (3) The prosecuting attorney has the burden to demonstrate that any forfeiture is
                  proportional to an alleged violation of state law. It is the province of the court, not the jury, to
                  decide questions of proportionality.
                      Section 11. Section 24-1-15 is amended to read:
                       24-1-15. Transfer and sharing procedures.
                      (1) For purposes of this section, property is [deemed] considered to be "seized" whenever
                  any agency takes possession of the property or exercises any degree of control over the property.
                      (2) (a) Seizing agencies or prosecuting attorneys authorized to bring civil or criminal
                  forfeiture proceedings under this chapter [shall] may not directly or indirectly transfer seized
                  property to any federal agency or any governmental entity not created under and subject to state
                  law unless the court enters an order, upon petition of the prosecuting attorney, authorizing the
                  property to be transferred. The court may not enter an order authorizing a transfer unless:
                      (i) the activity giving rise to the investigation or seizure is interstate in nature and
                  sufficiently complex to justify [such] the transfer;
                      (ii) the seized property may only be forfeited under federal law; or
                      (iii) pursuing forfeiture under state law would [unduly] unreasonably burden prosecuting
                  attorneys or state law enforcement agencies.
                      (b) Notwithstanding [Subparagraph] Subsection (2)(a), the court may refuse to enter an
                  order authorizing a transfer to the federal government if [such] the transfer would circumvent the
                  protections of the Utah Constitution or of this chapter that would otherwise be available to the
                  property owner.
                      (c) Prior to granting any order to transfer pursuant to [Subparagraph] Subsection (2)(a),

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                  the court must give any owner the right to be heard with regard to the transfer.
                      (3) (a) [All] Subject to Subsection (3)(b), all property, money, or other things of value
                  received by an agency pursuant to federal law which authorizes the sharing or transfer of all or a
                  portion of forfeited property or the proceeds of the sale of forfeited property to an agency [shall
                  be promptly transferred to the state treasurer and sold and deposited in the Uniform School Fund
                  as provided under Section 24-1-16 .]:
                      (i) shall be used in compliance with federal rules and regulations relating to equitable
                  sharing;
                      (ii) shall be used only for those law enforcement purposes specified in Subsection
                  24-1-19 (8); and
                      (iii) may not be used for those law enforcement purposes prohibited in Subsection
                  24-1-19 (9).
                      (b) If an agency receives forfeiture proceeds under Subsection (3)(a) that equal an
                  amount that is more than 25% greater than the annual budget of the receiving agency, the amount
                  of the proceeds that is in excess of 125% of the agency's annual budget shall be passed through by
                  the agency to the Commission on Criminal and Juvenile Justice to be used for the purposes under
                  Section 24-1-19 .
                      [(b)] (c) Subject to [Subparagraph] Subsection (3)(a), state agencies are encouraged to
                  seek an equitable share of property forfeited by the federal government and to cooperate with
                  federal law enforcement agencies in all cases in which [such] cooperation is in the interest of this
                  state.
                      (d) A law enforcement agency awarded any equitable share of property forfeited by the
                  federal government may only use the award monies after approval or appropriation by the
                  agency's legislative body.
                      (e) Law enforcement agencies are entitled to their equitable share of property forfeited by
                  the federal government since March 29, 2001.
                      (f) (i) Each agency awarded any equitable share of property forfeited by the federal
                  government shall file copies of all federal equitable sharing certifications, applications, and reports

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                  with the state auditor and the Commission on Criminal and Juvenile Justice at least annually.
                      (ii) This information shall provide details of all awards received from the federal
                  government during the preceding reporting period, including for each award:
                      (A) the agency's case number or other identification;
                      (B) the amount of the award;
                      (C) the date of the award;
                      (D) the identity of the federal agency involved in the forfeiture;
                      (E) how the awarded property has been used; and
                      (F) a statement signed by both the agency's executive officer or designee and by the
                  agency's legal counsel, that the agency has only used the awarded property for crime reduction or
                  law enforcement purposes authorized under Section 24-1-19 , and only upon approval or
                  appropriation by the agency's legislative body.
                      (4) (a) Any agency that violates [Subparagraph] Subsection (2) or (3) is civilly liable to
                  the state for three times the amount of the forfeiture diverted and for costs of suit and reasonable
                  attorneys' fees.
                      (b) Any damages awarded to the state shall be paid to the [Uniform School Fund]
                  Criminal Forfeiture Restricted Account created in Section 24-1-18 .
                      (c) Any agent, including a state law enforcement [officers who are] officer, detached to,
                  deputized or commissioned by, or working in conjunction with a federal agency, who knowingly
                  transfers or otherwise [trades] trades seized property in violation of [Subparagraph] Subsection
                  (2)(a) or who receives property, money, or other things of value under [Subparagraph]
                  Subsection (3)(a) and knowingly fails to transfer [such] the property [to the state treasurer] in
                  accordance with this section is guilty of a class B misdemeanor.
                      Section 12. Section 24-1-17 is enacted to read:
                      24-1-17. Disposition and allocation of forfeiture property.
                      (1) Upon finding that property is subject to forfeiture under this chapter, the court shall
                  order the property forfeited to the state, and the seizing agency shall then:
                      (a) make the payments as required under this chapter; and

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                      (b) transfer possession, custody, and control of the net forfeiture property or proceeds
                  immediately to the Criminal Forfeiture Restricted Account created under Section 24-1-18 .
                      (2) If the forfeiture arises from any violation of Section 23-20-1 relating to wildlife
                  resources, the court shall:
                      (a) direct that the legal costs of the forfeiture proceeding be paid to the prosecuting
                  agency; and
                      (b) direct that the net forfeited property after the legal costs shall be deposited in the
                  Wildlife Resources Account created in Section 23-14-13 .
                      (3) (a) Prior to transferring forfeited property, the seizing agency shall authorize a public
                  or otherwise commercially reasonable sale of that property which is not required by law to be
                  destroyed and that is not harmful to the public.
                      (b) The proceeds of the forfeited property shall remain segregated from other property,
                  equipment, or assets of the seizing agency until transferred to the state in accordance with this
                  chapter.
                      (4) From the forfeited property, both currency and the proceeds or revenue from the
                  property, the seizing agency shall:
                      (a) deduct the seizing agency's direct costs and expenses, as approved by the court, of
                  obtaining and maintaining the property pending forfeiture; and
                      (b) pay the legal costs to the prosecuting agency for the prosecution of the forfeiture
                  proceeding.
                      (5) The remaining forfeited property shall then be deposited in the Criminal Forfeiture
                  Restricted Account created in Section 24-1-18 .
                      (6) All property and proceeds awarded to the state through forfeiture proceedings under
                  this chapter shall be deposited in the Criminal Forfeiture Restricted Account created in Section
                  24-1-18 .
                      Section 13. Section 24-1-18 is enacted to read:
                      24-1-18. Criminal Forfeiture Restricted Account.
                      (1) There is created within the General Fund a restricted account known as the Criminal

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                  Forfeiture Restricted Account.
                      (2) Proceeds from forfeited property and forfeited monies through state forfeitures shall
                  be deposited in this account.
                      (3) Money in the account shall be appropriated to the Commission on Criminal and
                  Juvenile Justice for implementing the Crime Reduction Assistance Program under Section
                  24-1-19 .
                      Section 14. Section 24-1-19 is enacted to read:
                      24-1-19. Crime Reduction Assistance Program.
                      (1) There is created the Crime Reduction Assistance Program.
                      (2) The program shall fund crime prevention and law enforcement activities that have the
                  purpose of:
                      (a) deterring crime by depriving criminals of the profits and proceeds of their illegal
                  activities;
                      (b) weakening criminal enterprises by removing the instrumentalities of crime;
                      (c) reducing crimes involving substance abuse by supporting the creation, administration,
                  or operation of drug court programs throughout the state;
                      (d) encouraging cooperation between local, state, and multijurisdictional law enforcement
                  agencies;
                      (e) allowing the costs and expenses of law enforcement to be defrayed by the forfeited
                  proceeds of crime; and
                      (f) increasing the equitability and accountability of the use of forfeited property used to
                  assist law enforcement in reducing and preventing crime.
                      (3) (a) When property is forfeited under this chapter and transferred to the fund, the
                  Commission on Criminal and Juvenile Justice shall make awards of monies from the fund to state,
                  local, or multijurisdictional law enforcement agencies or political subdivisions of the state in
                  compliance with this section and to further the program purposes under Subsection (2).
                      (b) In granting the awards, the Commission on Criminal and Juvenile Justice shall ensure
                  that the amount of each award takes into consideration:

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                      (i) the demonstrated needs of the agency;
                      (ii) the demonstrated ability of the agency to appropriately use the award;
                      (iii) the degree to which the agency's need is offset through the agency's participation in
                  federal equitable sharing or through other federal and state grant programs; and
                      (iv) the agency's cooperation with other state and local agencies and task forces.
                      (4) Agencies or political subdivisions shall apply for program awards by completing and
                  submitting forms specified by the Commission on Criminal and Juvenile Justice.
                      (5) Applying agencies or political subdivisions shall demonstrate compliance with all
                  reporting and policy requirements applicable under this chapter and under Title 63, Chapter 25a,
                  Criminal Justice and Substance Abuse, in order to qualify as a potential award recipient.
                      (6) Recipient law enforcement agencies may only use program award monies after
                  approval or appropriation by the agency's legislative body, and the award monies are nonlapsing.
                      (7) A recipient law enforcement agency or political subdivision shall use program awards
                  only for law enforcement or controlled substance law enforcement purposes as described in
                  Subsection (8), and only as these purposes are specified by the agency or political subdivision in
                  its application for the award.
                      (8) Permissible law enforcement purposes for which award monies may be used include:
                      (a) controlled substance interdiction and enforcement activities;
                      (b) drug court programs;
                      (c) activities calculated to enhance future investigations;
                      (d) law enforcement training that includes:
                      (i) implementation of the Fourth Amendment of the federal constitution and Utah
                  Constitution Article I, Section 7, and addresses the protection of the individual's rights of due
                  process;
                      (ii) protection of the rights of innocent property holders; and
                      (iii) the Tenth Amendment of the federal constitution regarding states' sovereignty and the
                  states' reserved rights;
                      (e) law enforcement or detention facilities;

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                      (f) law enforcement operations or equipment which are not routine costs or operational
                  expenses;
                      (g) drug, gang, or crime prevention education programs which are sponsored in whole or
                  in part by the law enforcement agency or its legislative body; and
                      (h) matching funds for other state or federal law enforcement grants.
                      (9) Law enforcement purposes for which award monies may not be granted or used
                  include:
                      (a) payment of salaries, retirement benefits, or bonuses to any person;
                      (b) payment of enforcement expenses not related to law enforcement;
                      (c) uses not specified in the agency's award application;
                      (d) uses not approved or appropriated by the agency's legislative body;
                      (e) payments, transfers, or pass-through funding to entities other than law enforcement
                  agencies; or
                      (f) uses, payments, or expenses that are not within the scope of the agency's functions.
                      (10) For each fiscal year, any state, local, or multijurisdictional agency or political
                  subdivision that received a program award shall prepare, and file with the Utah Commission on
                  Criminal and Juvenile Justice and the state auditor, a report in a form specified by the Utah
                  Commission on Criminal and Juvenile Justice. The report shall include the following regarding
                  each award:
                      (a) the agency's name;
                      (b) the amount of the award;
                      (c) the date of the award;
                      (d) how the award has been used; and
                      (e) a statement signed by both the agency's or political subdivision's executive officer or
                  designee and by the agency's legal counsel, that:
                      (i) the agency or political subdivision has complied with all inventory, policy, and
                  reporting requirements of this chapter;
                      (ii) all program awards were used for crime reduction or law enforcement purposes as

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                  specified in the application; and
                      (iii) and only upon approval or appropriation by the agency's or political subdivision's
                  legislative body.
                      (11) The Utah Commission on Criminal and Juvenile Justice shall report in writing to the
                  legislative Law Enforcement and Criminal Justice Interim Committee annually regarding the
                  forfeited property transferred to the fund, awards made by the program, uses of program awards,
                  and any equitable share of property forfeited by the federal government as reported by agencies
                  pursuant to Subsection 24-1-15 (3).
                      Section 15. Section 24-1-20 is enacted to read:
                      24-1-20. State Law Enforcement Forfeiture Account created -- Revenue sources --
                  Use of account designated.
                      (1) (a) There is created in the General Fund a restricted account called the State Law
                  Enforcement Forfeiture Account.
                      (b) All monies awarded to the Department of Public Safety or the Department of
                  Corrections, or any division or agency within either department, through the Crime Reduction
                  Assistance Program created in Section 24-1-19 shall be deposited into the State Law Enforcement
                  Forfeiture Account.
                      (c) All monies previously deposited, or currently held in the Drug Forfeiture Account
                  created in Section 58-37-20 , and that were in that account when it was repealed by Initiative B,
                  which passed in 2000, and which became effective March 29, 2001, shall be transferred to and
                  deposited in the State Law Enforcement Forfeiture Account created in this Subsection (1).
                      (2) The Department of Public Safety and the Department of Corrections may expend
                  amounts as appropriated by the Legislature from the State Law Enforcement Forfeiture Account
                  for law enforcement purposes or controlled substance law enforcement purposes as specified in
                  Section 24-1-19 .
                      (3) That portion of funds forfeited or that are required to be disbursed to other
                  governmental entities under existing contractual agreements or Utah statutory requirements are
                  exempt from this section.

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                      (4) Funds forfeited as a result of the Salt Lake Airport Drug Program operated by the
                  Department of Public Safety, not to exceed the Department of Public Safety's expenditure to that
                  program, are exempt from this section.
                      (5) The Department of Public Safety and the Department of Corrections, as part of the
                  annual legislative budget hearings, shall provide to the legislative Executive Offices and Criminal
                  Justice Appropriations Subcommittee a complete accounting of expenditures and revenues from
                  the funds received under this section.
                      (6) The Legislature may annually provide, in an appropriations act, legislative direction
                  for anticipated expenditures of the monies received under this section.
                      Section 16. Repealer.
                      This bill repeals:
                      Section 24-1-16, Disposition of proceeds from criminal or civil forfeiture.

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