Commissioner on forfeiture fund rules, reprogramming history, and sustainability concerns
Shahada explains DOJ rules governing forfeiture funds—they cannot fund permanent salaries and must supplement, not supplant, DOI's budget. She reports DOI has reprogrammed nearly $19M since FY2023 and plans $11M more in FY2026, but warns these finite funds will run out in 2-3 years and the city cannot legally base budget decisions on forfeiture availability.
With respect to forfeiture funds, federal and state law allow the profits of criminal activity to be forfeited to the government
and shared with the investigating agencies that worked on the case, with the general guideline that these funds must support law enforcement activities.
The majority of DOI's forfeiture funds are the result of partnering with federal prosecutors on criminal investigations.
And there are specific Department of Justice rules that dictate how forfeiture funds may and may not be spent.
For instance, forfeiture funds may not be used to fund salaries for permanent staff positions, but may be used for training or law enforcement technology.
Specifically, the guidelines require that forfeiture funds supplement, not supplant, DOI's budget.
Importantly, the city is prohibited from making budgetary decisions based on the availability of DOI's federal forfeiture funds.
In other words, the city cannot decide to cut DOI's budget based on the amount of forfeiture funds DOI receives, with the expectation that forfeiture will cover the budgetary gap.
Most importantly, if the city were to consider federal forfeiture funds in determining DOI's budget, per DOJ guidelines, DOI could lose its access to the funding.
Over the last several years, DOI has reprogrammed federal forfeiture funds, all in accordance with DOJ guidelines, to manage mandated budget cuts from the city,
specifically related to OTPS items such as updating the agency's computer infrastructure, including our case management system, as well as purchasing computers and laptops for agency staff.
Since fiscal year 2023, DOI has spent nearly $19 million by reprogramming its forfeiture dollars to supplement DOI's budget and support the agency's essential law enforcement operations.
In fiscal year 2026,
DOI plans to spend an additional $11 million by reprogramming its forfeiture funds.
in accordance with DOJ guidelines.
But this type of reprogramming is not sustainable in the long term because forfeiture funds are finite and there is no way to predict how much forfeiture funding will come into DOI in the future from our investigations.
And again, it is not permissible for the city to make budgeting decisions
based on the availability of forfeiture funds.
Put simply, the city must start to properly fund DOI before these funds run out.