Last month, IJ wrote about a New York District Attorney Thomas Spota finding himself in hot water for using forfeiture funds to pay staff bonuses without county board approval. New records from the Suffolk County comptroller’s office revealed that a total of $3.25 million was paid in bonuses to prosecutors. $550,000 more than initially reported. According to Newsday, the original figure only included bonuses for top management employees based on documents provided by County Executive Steve Bellone’s office. Since the story first broke, Legislator Robert Calarco filed a bill, IR1892, to put a stop to future abuses of forfeiture funds. Although the bill goes a long way to reforming civil forfeiture there is still room for improvement.
The biggest flaw with IR 1892 is that it does not acknowledge the perverse profit incentive that civil forfeiture creates when law enforcement is allowed to retain the proceeds. The “Legislative Intent” section of the bill states that the aforementioned bonuses “skewed and distorted the County’s salary plan by rewarding certain exempt employees in a department that gas access to forfeiture money.” But that misses the real issue which is the ability for law enforcement to directly profit by paying salaries with forfeiture proceeds. New York state law currently allows law enforcement to retain up to 60 percent of forfeiture proceeds.
The bill attempts to put a stop to bonus payment abuse by banning the use of forfeiture proceeds to pay salaries, but with an exception for overtime. The problem with this exception is that law enforcement could simply rig its budget to plan for no overtime and then rely entirely on forfeiture funds for overtime pay thus incentivizing greater use of civil forfeiture. Since the county was already burned by law enforcement it makes no sense for them to leave this kind of loophole which is ripe for abuse. The best solution is to put forfeiture proceeds into a neutral account controlled by the legislature thereby eliminating the profit incentive.
Section three of the bill requires all expenditures $1,000 or greater to be approved by the Public Safety Committee of the Suffolk County Legislature. First, this provision doesn’t limit the number of small expenditures an agency could make, so in theory an agency could make 100 purchases of $999 to subvert this cap. Second, the provision doesn’t limit the type of expenditures law enforcement can make. In other jurisdictions these funds were used for lesser expenditures, such as margaritas machines and cowboy hats, which have no relevance to law enforcement. This provision ought to require an explicit link to law enforcement activities and mandate a punishment for misuse of these funds for expenditures—oddly enough this bill does not include a penalty for the district attorney misusing forfeiture proceeds for bonuses in the future.
One other issue the bill has is deference to state and federal laws when it comes to the use of forfeiture funds for salary payments. Section two of the bill allows salaries to be paid by forfeiture proceeds if “mandated by federal or state law, rule or regulation.” Federal equitable sharing programs directly prohibit the use of forfeiture funds to pay salaries. Moreover, Suffolk County can almost always enact laws that are more stringent than state laws to protect residents’ rights. In this case, that means the county could enact a law prohibiting any forfeiture funds from being used to directly contributing to salaries or expenditures, and instead deposit all forfeiture proceeds in a neutral account controlled by the legislature.
Suffolk County is not the only place in New York with problems managing its forfeiture funds. New York City is currently facing a class-action by the Bronx Defenders for failing to turn over documents requested under Freedom of Information Laws about how it tracks assets seized by the NYPD. Although the Bronx Defenders requested 40 documents, the NYPD turned over just two accounting summaries and a copy of the NYPD patrol guide. But those documents already showed the NYPD may be sitting on millions of dollars in forfeiture funds.
According to the Bronx Defenders:
The accounting summaries show that in 2013 the NYPD reported over $6 million in revenue from seized cash, civil forfeiture revenue, and property sold at auction. The documents also show that the NYPD had a balance of over $68 million in seized currency in any given month in 2013.
These incidents show why New York state lawmakers should follow New Mexico’s example by abolishing civil forfeiture altogether and replace it with criminal forfeiture so that only convicted criminals have their property forfeited. As part of these reforms, forfeiture proceeds should then be deposited in a neutral fund controlled by the legislature to separate the funds from law enforcement’s unchecked control. This would eliminate the profit incentive. It would also protect innocent owners from having their property forfeited, sold and the proceeds turned into law enforcement’s private bankroll.