This bill would make legislative findings and declarations as to the necessity of a special statute for the City of Elk Grove.

Existing law subjects certain property used or acquired in violation of the California Uniform Controlled Substances Act to forfeiture, such as controlled substances, equipment used to process controlled substances, and real property of any property owner who is convicted of violating specified controlled substances crimes with respect to that property.

This bill would authorize the City of Elk Grove to adopt an ordinance authorizing the city, until January 1, 2024, to confiscate and seek an order of forfeiture of property, whether personal or real, if that property is used to violate city code. The bill would require any ordinance adopted pursuant to this section to provide the owner of the property with adequate notice and opportunity to challenge the grounds of the seizure, and ensure that the property is only seized to the extent that the value of the property is commensurate with the gravity of the code violation for which it was used.

This bill would make legislative findings and declarations as to the necessity of a special statute for the City of Elk Grove.

Date of Hearing: April 17, 2018

Counsel: Sandra Uribe

ASSEMBLY COMMITTEE ON

Reginald Byron Jones-Sawyer, Sr., Chair

ABPCA Bill Id:

Author:() – As Ver:

SUMMARY:

Authorizes the City of Elk Grove to adopt an ordinance allowing the city to confiscate and seek an order of civil forfeiture of real or personal property for violations of the city’s ordinances. Specifically, this bill:

1. Allows the City of Elk Grove to adopt an ordinance allowing it, until January 1, 2024, to confiscate and seek an order of civil forfeiture of real or personal property for a violation of any city ordinance.
   
2. Requires any adopted ordinance to provide the owner of the property with adequate notice, an opportunity to challenge the grounds of the forfeiture, and ensure that the property is seized only to the extent reasonable in relation to the violation for which it was used.
   
3. Does not limit the authority of city, county or federal officials to confiscate and seek an order of civil or criminal forfeiture under any other local, state, or federal law.
   
4. Sunsets these provisions on January 1, 2024.

EXISTING LAW:

1. Establishes an asset-forfeiture procedure for drug-related cases. (Health & Saf. Code, §§ 11469-11495.)
   
2. Describes the items and property that are subject to drug asset forfeiture. (Health & Saf. Code, § 11470.)
   
3. States that it is necessary to obtain a criminal conviction for the unlawful manufacture or cultivation of any controlled substance or its precursors in order to recover law enforcement expenses related to the seizing or destroying of illegal drugs. If criminal charges are pending, the defendant may request that an action for recovery of expenses be continued while the charges are pending. ((Health & Saf. Code, § 11470.1, subd. (c).)
4. Specifies that state and local law enforcement authorities shall not refer, or otherwise transfer, property seized under state law to a federal agency seeking the adoption of the seized property. (Health & Saf. Code, § 11471.2, subd. (a).)
5. States that the federal government is not prohibited from seeking forfeiture under federal law, or sharing proceeds from federal forfeiture proceedings with state and local law enforcement in those situations where there are joint investigations. (Health & Saf. Code, § 11471.2, subd. (a).)
6. States that state or local law enforcement are not prohibited from participating in joint law enforcement operation with federal agencies. (Health & Saf. Code, § 11471.2, subd. (a).)
7. Details procedural requirements in a state forfeiture action, including: the filing of a petition for forfeiture within one year of seizure, notice of seizure, publication of notice, the right to a jury trial, and a motion for return of property. (Health & Saf. Code, § 11488.4.)
   
8. Requires the issue of forfeiture to be bifurcated from the criminal trial and be tried after conviction, unless waived by the parties. (Health & Saf. Code, § 11488.4, subd. (i)(3).)
   
9. Requires a conviction on the related, specified criminal charge to forfeit property in every case in which a claim is filed to contest the forfeiture of property, unless the defendant in the related criminal case willfully fails to appear for court, or if the value of the assets is less than $40,000, as specified. (Health & Saf. Code, § 11488.4, subds. (i) & (k).)
   
10. Requires proof beyond a reasonable doubt in all forfeiture cases which are contested, except cash or negotiable instruments of $40,000 or less for which the standard is proof by clear and convincing evidence. (Health & Saf. Code, § 11488.4, subd. (i).)
    
11. Allows forfeiture of property less than $25,000 if notice of the forfeiture has been provided, as specified, and no claims have been made. (Health & Saf. Code, § 11488.4, subd. (j).)
    
12. Provides a scheme for the distribution of fund from forfeitures and seizures. (Health & Saf. Code, § 11489.)
    
13. Provides that a violation of a county ordinance is a misdemeanor unless by ordinance it is made an infraction. The violation of a county ordinance may be prosecuted by county authorities in the name of the People of the State of California or redressed by civil action. (Gov. Code, § 25132, subd. (a).)
    
14. Provides that a violation of a city ordinance is a misdemeanor unless by ordinance it is made an infraction. The violation of a city ordinance may be prosecuted by the city authorities in the name of the People of the State of California, or redressed by civil action. (Gov. Code, § 36900, subd. (a).)
    
15. Defines a nuisance as anything which is injurious to health, indecent or offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property, or unlawfully obstructs the free passage or use, in the customary manner, of any public right of way. (Civ. Code, § 3479.)

FISCAL EFFECT:

Unknown

COMMENTS:

1. Author's Statement: According to the author, “The city of Elk Grove and surrounding areas are experiencing a proliferation of illegal marijuana grow houses which pose a significant risk and immediate threat to the health and safety of the community. Additionally, illegal marijuana grow houses contribute to the black market undercutting efforts by the state to regulate a nascent industry and creating a competitive disadvantage for operators participating in the legal market.
   
   “According to statistics from the U.S. Drug Enforcement Administration (DEA), California was a hot spot for illegal indoor grows in 2016, with police seizing over 312,000 plants, representing 75 percent of all plants grown indoors and taken by law enforcement across the U.S.
   
   “Within the last year, the city of Elk Grove has received over 175 calls for service involving illegal marijuana grow houses. In 2017 alone, 40 illegal pot houses were shut down with several of them located in middle class residential neighborhoods where homes sell for over $400,000.
   
   “AB 3208 provides the city of Elk Grove an additional tool to help combat the spread of illegal marijuana residential grow houses. The bill will provide a financial disincentive for operators of illegal marijuana grow houses by allowing law enforcement to seize property used in violation of city code.”
   
2. Asset Forfeiture: Civil asset forfeiture has allowed the government to seize and keep cash, cars, real estate, and any other property suspected of being connected to criminal activity even if the owner is never convicted of a crime. For this reason, “[s]tatutes imposing forfeitures are not favored and are to be strictly construed in favor of the persons against whom they are sought to be imposed. This disfavor applies notwithstanding the strong governmental interest in stemming illegal drug transactions.” (People v. $10,153.38 in United States Currency (2009) 179 Cal.App.4th 1520, 1525-1526.)
   
   California’s drug asset forfeiture laws were revised and curtailed in 2016. In most cases, the state is now required to obtain a criminal conviction as a condition precedent to the forfeiture of any property. Also, in most cases, the prosecutor must establish its case beyond a reasonable double.
   
   This bill permits the City of Elk Grove to circumvent state forfeiture laws and their due process protections, and establish its own civil forfeiture procedures for violations of any city ordinance. Although any adopted ordinance allowing forfeiture must provide notice, an opportunity to challenge the forfeiture, there are no minimum standards and no requirement of a criminal conviction, as is the case under state law. Why should the residents of the City of Elk Grove potentially be afforded less due process protections than the rest of the residents of the State of California?
   
   Moreover, while the City of Elk Grove states that illegal marijuana grow houses are affecting quality of life and compromising public safety, arguably there are other cities facing the same issue. In fact, the City of Sacramento writes in support of the bill because it is “facing an epidemic of illegal grow activity.” If this bill is enacted, would it open the door for other municipalities to seek the same permission?
   
3. Nuisance Abatement. A public nuisance is generally defined as "Anything which is injurious to health, or is indecent, or offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property by an entire community or neighborhood, or by any considerable number of persons, or unlawfully obstructs the free passage or use, in the customary manner, of any navigable lake, or river, bay, stream, canal, or basin, or any public park, square, street, or highway." In addition, a city's legislative body may declare what constitutes a nuisance via ordinance.

Both cities and counties are allowed, via ordinance, to establish administrative procedures for abating nuisances that include the ability to recover abatement costs via special assessments and abatement liens. However, cities and counties can also go after the person alleged to have caused the nuisance in civil and criminal proceedings.

This bill would allow law enforcement agencies in the City of Elk Grove to seize real and personal property without conviction for conduct which amounts to a misdemeanor or even an infraction. Although both the author and the sponsor state that the impetus of this bill is to combat illegal marijuana grow houses, the language is not so limited. It permits seizure and civil forfeiture of property for a violation of any city ordinance.

1. Argument in Support: According to the City of Elk Grove, the sponsor of this bill, “The City is sponsoring this bill because illegal marijuana grow houses in Elk Grove affects our quality of like and compromises public safety. Large scale illegal marijuana grow houses produce quantities beyond the legal limits called for in Proposition 64 that goes well beyond personal use and are often shipped to other states. This is the kind of illegal operation targeted under this legislation.
   
   “Last year alone, the City’s Police Department and Code Enforcement teams shut down 40 illegal grow houses. Additionally, the City’s Street Crimes Unit received in excess of 175 calls for service regarding these homes.
   
   “If signed by the Governor, the bill would provide law enforcement with another tool to protect our residents and the quality of life in our City. We are seeking a balanced approach to allow for lawful marijuana grow operations to continue to take place, while targeting highly sophisticated, unsafe, and illegal marijuana grow operations which compromise our safety and quality of life.”
   
2. Arguments in Opposition:
   
   1. According to the American Civil Liberties Union of California, “This bill seeks to circumvent the critical due process protections the legislature put in place less than two years ago when it passed SB 443 (Mitchell – Stats. 2016, ch. 831), and breathe new life into civil asset forfeiture, a remnant of the failed war on drugs. At a time when U.S. Attorney General Jess Sessions is seeking to reinvigorate civil asset forfeiture, it is critical that California resist these harmful policies, not promote them.
      
      “In 2016, the legislature passed SB 443, a bill designed to curb abuses of the civil asset forfeiture process that fell disproportionately on low income people and people of color. At the heart of SB 443 was the requirement that a person be convicted of an underlying crime before his or her property may be permanently taken by the government. SB 443 received broad bipartisan support in both houses of the legislature, and was the product of thoughtful negotiation amongst stakeholders that resulted in the California Police Chiefs Association, the California State Sheriffs Association, and the California District Attorneys Association all removing their opposition to the legislation.
      
      “AB 3208 seeks to undo that work, by permitting the city of Elk Grove to bypass state law and adopt an ordinance authorizing the city to confiscate and seek an order of forfeiture of any personal or real property without first obtaining a conviction, and without the additional due process protections built into the state civil forfeiture process. We have grave concerns about the government forfeiting property absent a criminal conviction in an underlying case.
      
      “Investigations have consistently found that people of color are disproportionately at risk of having law enforcement take their property under civil asset forfeiture laws…. In the year prior to SB 443’s passage, data showed that fully half of all assets forfeited in California through the federal Equitable Sharing program came from communities where more than 70% of the residents were people of color.”
      
   2. The California Land Title Association writes, “While AB 3208 is currently written to apply to only one city thus far, we believe this bill would create a very dangerous precedent that undermines the real property and constitutional rights of homeowners, especially those who are landlords renting their homes to others. If this new process that eliminates due process rights is successful, we have little doubt that other cities would also take advantage of such a ‘streamlined’ process for seizing homes….
      
      “While the homes used for illegal grow houses targeted by AB 3208 are often second, rental or income-producing properties, as opposed to a real property owner’s primary residence, such a fact does not create a compelling government interest in undermining or eliminating homeowners’ due process rights via real property seizure without a criminal conviction.

“In many situations, a ‘landlord’ is not large-scale investor that is well-funded and has access to in-house general counsel or a law firm on retainer to monitor all of the homes in their portfolio for legal issues that may arise. Many ‘landlords’ are family members who have inherited a home from parents or relatives or are renting out their last home as a source of income in addition to their existing employment. Thus, the term ‘landlord’ really applies to a lot of Californians that are far from well-heeled, with sophisticated business operations that are protected by attorneys well-versed in such matters.

“In addition, in California, it is very difficult for landlords to constantly monitor the activities of renters living in their homes without violating the renter’s right to use and enjoy the property pursuant to the rental contract. Many laws in this state specifically prohibit owners from randomly assessing and inspecting their properties to check for such things as illegal grows. In short, random and unannounced visits by landlords is neither encouraged nor supported by our state statutes. Undoubtedly, these types of visits would be considered harassment and actionable even if the landlord is trying to thwart the activity targeted by this bill.

“Furthermore, California has gone out of its way to make it very difficult for a landlord to evict a tenant even if the landlord may have a suspicion that something is amiss without having tangible and irrefutable evidence at their disposal to support this concern. Eviction laws in California are very costly, time consuming, and make it very difficult for a landlord to evict an undesirable tenant without just cause.

“As currently written, innocent landlords who do not have actual knowledge of the illegal activity and have not been convicted of a crime, could have the most important underlying asset they own – the income-producing home—seized by Elk Grove as we interpret the bill.

“Lastly, this bill would most likely add ‘insult to injury’ since many times these innocent landlords, upon discovering the illegal grow, often have to spends tens of thousands of dollars in repairs from illegal and dangerous modifications made to the house by the criminals running the grow houses.

“In short, innocent landlords will suffer as a result of this bill….

“CLTA fully understands and is sympathetic to the frustrations of Elk Grove, law enforcement, and the communities adversely affected by illegal grow houses. We also understand the temptation to skirt constitutional protections ensconced in both the State and US Constitution relating to asset forfeiture to combat this problem in California.

“However, significantly ‘streamlining’ due process protections to provide more convenience for local government and law enforcement is a very slippery slope that will have unintended consequences in the long run. Most disturbing is that many times those consequences will likely fall on the low-income and minority communities that seem to be disproportionally affected by asset forfeiture laws historically.”

1. Related Legislation:
   
   1. AB 2495 (Mayes) would prevent cities and counties, including an attorney acting on behalf of a city, county, or city and county, from charging a defendant for the costs of investigating and prosecuting a criminal case, including a violation of a local ordinance. AB 2495 is pending vote on the Assembly Floor.
      
   2. AB 2598 (Quirk) would increase the fine amounts that counties and cities may assess for violations of their ordinances and building and safety codes. AB 2598 is pending vote on the Assembly Floor.
      
2. Prior Legislation:
   
   1. SB 443 (Mitchell), Chapter 831, Statutes of 2016, requires additional due process protections in cases where the state of California seeks to forfeit assets in connection with specified drug offenses, and requires a criminal conviction when property or money forfeited under federal law is distributed to state or local law enforcement, unless the value is greater than $40,000.
      
   2. AB 639 (Norby), of 2011-2012 Legislative Session, would have changed drug asset forfeiture law to discourage federal adoption of such cases. AB 639 was held in the Senate Appropriations Committee.
      
   3. SB 567 (Torlakson) Chapter 60, Statutes of 2003, increased the fines for city and county ordinances determined to be a criminal infraction.
      
   4. SB 1866 (Vasconcellos), of the 1999-2000 Legislative Session, would have made changes in asset forfeiture transfers, shifted distribution of money from forfeited property and required the Attorney General to publish electronic reports. SB 1866 was vetoed.
      

REGISTERED SUPPORT / OPPOSITION:

Support

City of Elk Grove (Sponsor)
City of Sacramento

Opposition

American Civil Liberties Union of California
California Land Title Association
Drug Policy Alliance
Ella Baker Center for Human Rights
Friends Committee on Legislation of California
Law Enforcement Action Partnership
Legal Services for Prisoners with Children

SEIU of California

Analysis Prepared by: