II. METHODOLOGY

• All Department of Justice Asset Forfeiture Funds are scored as 100 percent drug-related.

• The Comprehensive Crime Control Act of 1984 established the Justice Department's Assets Forfeiture Fund (AFF), into which forfeited cash and the proceeds of the sale of forfeited properties are deposited. Most assets are forfeited because they were used in or acquired as a result of, violations of racketeering, money laundering, or drug trafficking statutes.



• Until December 1994, the fund was administered by the Executive Office for Asset Forfeiture, Office of the Deputy Attorney General. Since that time, that fund has been administered by the Asset Forfeiture Management Staff, Justice Management Division.



• The AFF supports Goal 2 and Goal 5 of the National Drug Control Strategy by reducing drug- related violence and crime, as well as disrupting the sources of supply through the seizure and forfeiture of assets used by those who illegally manufacture or distribute drugs. The AFF funds may be used for several purposes:



• Asset Management Expenses. These include expenses incurred in connection with the seizure, inventory, appraisal, packaging, movement, storage, maintenance, security, and disposition (including destruction) of assets.



• Other Asset Specific Expenses. These include case-specific expenses incurred in connection with normal proceedings undertaken to perfect the United States' interest in seized property through forfeiture. Such expenses include fees and other costs of advertising, translation, court reporting, expert witness fees, courtroom exhibit services, travel, and subsistence related to a specific proceeding, and other related items. Also included are payments of qualified third party interests, such as expenses incurred in the payment of valid liens, mortgages, and ownership interests pursuant to court order or a favorable ruling on a petition for remission or mitigation of the forfeiture.



• Equitable Sharing Payments. These include distributions of the net proceeds (after recovering direct costs) of forfeitures to foreign governments and to state and local law enforcement agencies in proportion to the degree of their direct participation in the law enforcement effort that resulted in the forfeiture.



• Program Management Expenses. These include expenses incurred in carrying out forfeiture program responsibilities that are not related to any one specific asset or to any one specific seizure or forfeiture (e.g., audits and evaluations). Also included are expenses of forfeiture related automated data processing; contracting for services directly related to the processing of and accounting for assets and forfeiture cases; forfeiture-related printing and graphic services; asset seizure and forfeiture training; the storage, protection, and destruction of controlled substances; and contracting for services directly related to the identification of forfeitable assets.



• Investigative Expenses. These include certain specific expenses incurred in support of, or in furtherance of criminal investigations. Current authorities provide (1) awards for information or assistance directly related to violations of the criminal drug laws of the United States or of Sections 1956 and 1957 of Title 18, Sections 5313 and 5324 of Title 31, and Section 6050I of the Internal Revenue Code of 1986, or leading to a civil or criminal forfeiture by any Federal agency participating in the Fund; (2) purchases of evidence of any violation of the controlled Substances Act, the Controlled Substances Import and Export Act, RICO, or 18 U.S.C. 1956 and 1957; and (3) equipping of conveyances for law enforcement functions.



• Other Uses. These include payments under the permanent indefinite portion of the fund for overtime salaries, travel, fuel, training, equipment, and similar costs incurred by state or local law enforcement officers in a joint law enforcement operation with a Federal law enforcement agency participating in the fund.



• Transfers to Other Accounts. These reflect the transfer of proceeds in excess of the amounts required for the above activities to other accounts. Congress provided for excess funds, if any, to be transferred to the Bureau of Prisons (1988-1989), the U.S. Attorneys (1989), and the Special Forfeiture Fund (1990-1997). Currently, one half of any excess balance will be transferred to the Special Forfeiture Fund. 28 U.S.C. 524(c)(8)(E) provides for the use of any remaining excess balance by the Attorney General for any federal law enforcement, litigative/prosecutive, and correctional activities, or any other authorized purpose of the Department of Justice.

IV. BUDGET SUMMARY

1997 Base Program

• The FY 1997 level totals $401 million, which includes $23 million in definite authority, $345 million in permanent indefinite authority, and $33 million in unobligated Super Surplus funds. All Super Surplus funds are expected to be allocated and obligated in FY 1997.



• The FY 1997 base includes $196 million for state and local assistance activities in support of Goal 2 of the National Drug Control Strategy and $205 million for investigative and prosecution activities, as well as for international drug-trafficking activities which support Goal 5 of the Strategy.



• Deposits to the fund are estimated at $373.0 million for FY 1997, an increase of 10 percent compared to 1996 receipts of $338.1 million. Receipts in 1996 were the lowest since 1988. FY 1992 deposits totaled $531.0 million, FY 1993 deposits totaled $555.7 million, FY 1994 deposits totaled $549.9 million, and FY 1995 deposits totaled $487.5 million. The program is in decline for several reasons, including adverse court decisions, and increased emphasis on law enforcement activities that do not produce forfeitures.



• Equitable sharing with foreign, state, and local governments is expected to be $170 million in FY 1997, approximately 45.6 percent of the total deposits to the fund.

• The President's drug budget request totals $376 million. This includes $23 million in definite authority and $353 million in permanent indefinite authority. While this appears to be a decrease of $25 million compared to 1997, the 1997 level includes $33 million in Super Surplus funds. Since that amount will not be available in FY 1998, the FY 1998 estimates actually reflect an increase of $8 million, all within the permanent indefinite part of the fund. The following provides a programmatic description of the FY 1998 request by Strategy Goal:



• The total FY 1998 drug control request for Goal 2 activities is $204 million, an increase of $8 million over FY 1997. The request includes additional resources for State and local assistance activities.



• The total FY 1998 drug control request for Goal 5 activities is $172 million. While this represents a decrease of $33 million from the FY 1997 level, the 1997 level included $33 million in Super Surplus Funds, which will not be available in FY 1998.



• Based on current projections, receipts to the Fund in FY 1998 will be $390 million, including interest earned on the Bank of Credit and Commerce International (BCCI) balances ($14 million) which are not available for general operations of the Fund.

V. PROGRAM STATISTICS

	1996 Actual	1997 Estimate	1998 Projected
Dollars in Millions
Deposits From Forfeited Assets	$338.1	$373.0	$390.0
Equitable Sharing Payments	$159.5	$170.0	$180.0

VI. PROGRAM ACCOMPLISHMENTS

• During 1996, exclusive of cash seizures, a total of 24,696 assets were seized at an estimated value of $227.1 million. These figures include 587 real properties at an estimated value of $75.6 million. At the end of 1996, a total of 24,875 assets were on hand, including $580.2 million on deposit in the Seized Asset Deposit Fund, $34.2 million in cash seizures not on deposit, 1,389 real properties valued at $482.5 million, 29 businesses valued at $38.7 million, and 14,263 other assets with an estimated value of $223.1 million.