Guide to Equitable Sharing
for State, Local, and Tribal
Law Enforcement Agencies
March
2024
Guide to Equitable Sharing | i
CONTENTS
CONTENTS
Foreword .................................................................................................................................... iii
I. Asset Forfeiture Programs and Equitable Sharing Overview
.................................................1
A. Department of Justice Asset Forfeiture Program
..........................................................................1
B. Department of the Treasury Asset Forfeiture Program
...............................................................2
C. Equitable Sharing Program
...............................................................................................................3
II. Which Agencies May Participate in the Equitable Sharing Program?
.................................5
A. Eligible Agencies
.................................................................................................................................5
1. State, Local, or Tribal Law Enforcement Agencies
....................................................5
2. State and Local Prosecutorial Agencies
.......................................................................5
3. State National Guard Counterdrug Unit
.....................................................................6
B. Ineligible Agencies
..............................................................................................................................6
1. Task Forces
......................................................................................................................6
2. Federal Agencies
............................................................................................................7
3. Non-Governmental Entities
.........................................................................................7
III. How Do Agencies Participate in the Equitable Sharing Program?
.....................................8
A. Joining th
e Equitable Sharing Program
..........................................................................................8
B. Compliance
..........................................................................................................................................8
1. ESAC Compliance
..........................................................................................................8
2. Civil Rights Compliance
...............................................................................................9
C. Participating in a Federal Forfeiture
................................................................................................9
IV. What Is the Pr
ocess to Apply for and Receive a Share?
......................................................10
A. Requesting an Equitable Share
.......................................................................................................10
1. Department of Justice-Led Investigations
................................................................10
2. Department of the Treasury-Led Investigations
......................................................10
B. Calculating Shares.............................................................................................................................11
1. Federal Contribution
...................................................................................................12
2. State, Local, and Tribal Contribution
........................................................................12
3. Task Force Contribution
.............................................................................................12
4. Spin-o Investigations
.................................................................................................13
5. Distribution Cap
..........................................................................................................13
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C. Department of Justice Equitable Sharing Deciding Authorities ..............................................13
1. Federal Investigative Agency
......................................................................................13
2. United States Attorney
.................................................................................................13
3. Department of J
ustice, Criminal Division
................................................................13
D. Department of the Treasury Equitable Sharing Deciding Authorities
...................................14
1. Federal Investigative Agency
......................................................................................14
2. Department of the Treasury, Treasury Executive Oce for Asset Forfeiture
......14
E. Common Causes of Sharing Payment Delay
...............................................................................14
F. Sharing Is Always Based on Net Proceeds
....................................................................................15
V. What Are the Uses of Equitably Shared Funds?
..................................................................16
A. General Guidance on Supplantation and Budgeting
.................................................................16
1. Supplantation
................................................................................................................ 16
2. Anticipated equitably shared funds should not be budgeted
.................................16
B. Use of Shared Funds
......................................................................................................................... 17
1. Permissible Uses
...........................................................................................................17
2. Impermissible Uses
......................................................................................................20
C. Return of Equitably Shared Funds
................................................................................................22
D. Treasury Oset Program
.................................................................................................................22
VI. What Are the Accounting Procedures and Requirements for Shared Proceeds?
............. 23
A. Bookkeeping Procedures and Internal Controls
........................................................................23
VII. What Are the Reporting and Audit Requirements?
........................................................25
A. Agency Status
.................................................................................................................................... 25
B. Equitable Sharing Agreement and Certication (ESAC)
..........................................................25
C. Extinguishment of Funds
................................................................................................................26
D. Audit Requirements
.........................................................................................................................26
E. Record Retention
..............................................................................................................................26
F. Program and Policy Changes
..........................................................................................................27
VIII. How Does an Agency Terminate Program Participation?
.............................................28
IX. What If Agencies Do Not Comply with Program Requirements?
....................................29
Guide to Equitable Sharing | iii
Program Overview
Foreword
is Guide to Equitable Sharing for State, Local, and Tribal Law Enforcement Agencies (Guide) applies to
equitable sharing through both the Department of Justice and the Department of the Treasury’s Asset
Forfeiture Programs (collectively, the Equitable Sharing Program).
is Guide replaces and supersedes all previous versions of the Guide and other previously issued
guidance.
e Department of Justice and the Department of the Treasury may make further decisions and issue
guidance independent of this Guide to ensure the integrity of the Program. In addition to the Guide
and other guidance issued by the Department of Justice and Department of the Treasury, the Equitable
Sharing Program is subject to other applicable federal laws, rules, regulations, and Executive Orders.
e Guide sets forth the Department of Justice and Department of the Treasury policies applicable to the
Equitable Sharing Program. It does not, however, create or confer any legal rights, privileges, or benets
that may be enforced in any way by private parties. See United States v. Caceres, 440 U.S. 741 (1979).
Guide to Equitable Sharing | 1
Program Overview
I. Asset Forfeiture Programs and Equitable Sharing Overview
Asset forfeiture is the taking of property by the government without compensation because of the
property’s connection to criminal activity. It is a legal tool that enables the federal government to recover
property that can be used to compensate victims of the crime underlying the forfeiture, among other
important law enforcement interests.
A. Department of Justice Asset Forfeiture Program
e Department of Justice’s (Justice) Asset Forfeiture Program encompasses the seizure, forfeiture,
and disposition of assets that represent the proceeds of, or were used to facilitate, federal crimes. e
Attorney General exercises statutory authority to manage the Program. See 28U.S.C. § 524(c)(1)
(establishing the Justice Assets Forfeiture Fund (AFF), managed by the Attorney General).
e Asset Forfeiture Program has four primary goals:
1. To punish and deter criminal activity by depriving criminals of property used in or acquired
through illegal activities.
2. To promote and enhance cooperation among federal, state, local, tribal, and foreign law
enforcement agencies.
3. To recover assets that may be used to compensate victims when authorized under federal law.
4. To ensure the Program is administered professionally, lawfully, and in a manner consistent with
sound public policy.
See Department of Justice, e Attorney General’s Guidelines on the Asset Forfeiture Program (July 2018)
(Attorney General’s Guidelines)
e AFF receives the proceeds of forfeiture made pursuant to laws enforced or administered by members
of Justice’s Asset Forfeiture Program. irteen agencies, including Justice agencies and components as
well as non-Justice agencies, comprise the Asset Forfeiture Program’s membership:
• Asset Forfeiture Management Sta, Justice Management Division
• Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF)
• Drug Enforcement Administration (DEA)
• Federal Bureau of Investigation (FBI)
• Money Laundering and Asset Recovery Section (MLARS), Criminal Division
• Organized Crime Drug Enforcement Task Forces (OCDETF)
• U.S. Attorney’s Oces (USAO)
• U.S. Marshals Service (USMS)
• U.S. Department of Agriculture – Oce of Inspector General (USDA-OIG)
• U.S. Department of Defense – Defense Criminal Investigative Service (DCIS)
2 | Guide to Equitable Sharing
• U.S. Department of State – Bureau of Diplomatic Security (DSS)
• U.S. Food and Drug Administration – Oce of Criminal Investigations (FDA-OCI)
• U.S. Postal Inspection Service (USPIS)
1
B. Department of the Treasury Asset Forfeiture Program
By separate statutory authority, the Department of the Treasury (Treasury) manages the Treasury Asset
Forfeiture Program. See 31 U.S.C. § 9705(a) (establishing the Treasury Forfeiture Fund (TFF), managed
by the Secretary of the Treasury). Like Justice’s Asset Forfeiture Program, the Treasury Asset Forfeiture
Program also has four priorities:
1. To administer and manage the Treasury Forfeiture Fund (TFF) program in a scally
responsible manner that seeks to minimize administrative costs and maximize the benets for
law enforcement and the compensation of eligible victims;
2. To ensure program policies protect due process rights of individuals;
3. To focus resources on strategic cases and investigations that result in actions against high
prole criminals and criminal enterprises to aect the greatest nancial damage to criminal
organizations; and
4. To foster a strong working relationship between federal and state or local law enforcement
agencies.
See Department of the Treasury, Treasury Executive Oce for Asset Forfeiture (TEOAF).
e TFF receives the proceeds of forfeitures made pursuant to laws enforced or administered by Treasury
and Department of Homeland Security law enforcement agencies. TFF member agencies are:
• U.S. Immigration and Customs Enforcement – Homeland Security Investigations (HSI)
• Internal Revenue Service – Criminal Investigation (IRS-CI)
• U.S. Secret Service (USSS)
• U.S. Customs and Border Protection (CBP)
• U.S. Coast Guard (USCG)
• Other agencies as dened by statute. See 31 U.S.C. § 9705(o)
1
Participation in an investigation led by the U.S. Postal Inspection Service may result in equitable sharing that is paid from the U.S. Postal
Inspection Service Forfeiture Fund. These payments are considered Justice equitable sharing funds for the purpose of this Guide.
Guide to Equitable Sharing | 3
Program Overview
C. Equitable Sharing Program
One of the ancillary benets of asset forfeiture is the potential to share federal forfeiture proceeds in
appropriate cases with cooperating state, local, and tribal law enforcement agencies through equitable
sharing. rough equitable sharing, any state, local, or tribal law enforcement agency that directly
participates in a law enforcement eort that results in a federal forfeiture may request an equitable share
of the net proceeds of the forfeiture.
2
e Equitable Sharing Program (Program)
3
is an important aspect of the Justice and Treasury Asset
Forfeiture Programs. Federal law authorizes the Attorney General and the Secretary of the Treasury
to share federally forfeited assets with participating law enforcement agencies.
4
e exercise of this
authority is discretionary and limited by statute. e Attorney General and the Secretary of the Treasury
are not required to share assets in any case. Participation in an investigation with a member of the Justice
Asset Forfeiture Program may result in equitable sharing paid from Justice’s AFF, while participation
in an investigation with a Treasury Asset Forfeiture Program member agency may result in equitable
sharing paid from Treasury’s TFF.
e Program enhances cooperation among federal, state, local, and tribal law enforcement by providing
valuable additional resources to state, local, and tribal law enforcement agencies assisting with
investigations into violations of federal laws. However, the Program is designed to supplement and
enhance, not supplant, appropriated agency resources.
In addition, by statute, the Attorney General and the Secretary of the Treasury must also ensure that any
asset transferred to a participating agency through the Program:
(A) has a value that bears a reasonable relationship to the degree of direct participation of the state or
local agency in the law enforcement eort resulting in the forfeiture, taking into account the total
value of all property forfeited and the total law enforcement eort as a whole; and with respect to
the violation of law on which the forfeiture is based; and
(B) will serve to encourage further cooperation between the recipient state or local agency and federal
law enforcement agencies.
5
2
By policy change in early 2023, both the Justice and Treasury Programs no longer allow tangible or real property to be directly shared
with or transferred to a state or local law enforcement agency. This includes but is not limited to vehicles, vessels, computers, electronic
equipment, and real property.
3
In this Guide, “Program” refers to both the Department of Justice and the Department of the Treasury Equitable Sharing Programs
collectively, unless otherwise noted.
4
21 U.S.C. § 881(e)(1)(A) & (3), 18 U.S.C. § 981(e)(2), and 19 U.S.C. § 1616a; 31 U.S.C. § 9705(b)(4)(A) and (b)(4)(B). See also
Attorney General’s Guidelines, Sec. V.G. (authorizing equitable sharing with state, local, and tribal law enforcement agencies).
5
21 U.S.C. § 881(e)(3).
4 | Guide to Equitable Sharing
Not all law enforcement eorts will result in equitable sharing. Distributions to owners, lienholders,
federal nancial institution regulatory agencies, and victims, and federal retention, take precedence
over equitable sharing. See Attorney General’s Guidelines, Sec. V.G. and Guidelines for TFF Agencies on
Processing Refunds, Sec. V.A. at 6. In addition, domestic equitable sharing can occur only aer victims
have been compensated in full, and aer any international sharing is completed. See Justice, Asset
Forfeiture Policy Manual (2023) (Policy Manual), Chap. 8, Sec. X, and Guidelines for TFF Agencies on
Processing Refunds, Sec. II at 2.
Guide to Equitable Sharing | 5
Program Overview
II. Which Agencies May Participate in the Equitable Sharing Program?
A. Eligible Agencies
Determinations of agency eligibility to participate in the Program lie solely within the discretion of
Justice and Treasury.
1. State, Local, or Tribal Law Enforcement Agencies
Only state, local, or tribal law enforcement agencies may participate in the Program. For purposes of the
Program:
• A law enforcement agency means a state, local, or tribal government agency authorized
to engage as its primary function in the investigation, apprehension, or prosecution of
individuals suspected or convicted of oenses against the criminal laws of the United States or
of any state, county, municipality, or territory of the United States.
6
• A primary function means one that: (1) occupies a clear majority of the agency’s working time
over a typical work cycle; and (2) is performed on a regular and recurring basis by the agency
and a majority of its ocers, employees, and agents. Functions that are of an emergency,
incidental, or temporary nature are not considered primary even if they amount to a majority
of an agency’s working time.
Furthermore, a law enforcement agency is primarily composed of, or employs, individuals designated or
qualied under state statutes as peace ocers tasked with the prevention, investigation, or prosecution
of criminal violations and the apprehension of suspects. ese ocers exercise full police powers and
perform full police duties, such as investigating and making arrests for all types of criminal activity,
seizing property, executing warrants and court orders, serving subpoenas, and carrying rearms.
Traditional law enforcement agencies generally include city, district, local, county, state, or tribal police,
sheri, or highway patrol departments, and state or local prosecutors’ oces.
Agencies that have limited or specialized law enforcement duties generally do not qualify. For example,
an agency such as a comptroller’s oce, re marshal, or regulatory or licensing agency whose primary
mission is not law enforcement but has a unit that primarily investigates specic types of criminal
activities does not qualify as a law enforcement agency for purposes of the Program. Likewise,
governmental entities that do not employ their own police departments, such as those that obtain police
services through a contract with another agency, do not meet the denition of a law enforcement agency.
2. State and Local Prosecutorial Agencies
State and local prosecutorial agencies are eligible to receive equitable sharing for assistance they provide
in federal forfeiture cases based on the level of contribution to the total law enforcement eort. In
addition, an agency may be eligible for sharing if it cross-designated a state or local attorney as a Special
Assistant U.S. Attorney (SAUSA) to handle the federal forfeiture or related criminal cases in federal
court.
6
For the purposes of this provision, prosecutors and members of the National Guard are considered sworn law enforcement personnel.
6 | Guide to Equitable Sharing
3. State National Guard Counterdrug Unit
A state National Guard generally does not meet the criteria for participation in the Program as a law
enforcement agency because its primary mission serves a military or other non-law enforcement
purpose. An individual National Guard Counterdrug Unit, however, may be eligible to participate in
the Program if it is a distinct unit of a state National Guard that has counterdrug activities as its primary
mission and it receives funding solely for this purpose. To be eligible, the unit must report to a State’s or
Territory’s jurisdiction when not federalized.
Justice and Treasury determine whether individual National Guard units are eligible to participate in the
Program on a case-by-case basis. Once Justice or Treasury determines that a state National Guard unit is
eligible, the state National Guard unit participates in the Program in the same manner as any other state,
local, or tribal law enforcement agency.
B. Ineligible Agencies
1. Task Forces
Task forces are not eligible to participate as Program members because they are not separate law
enforcement agencies. However, equitable sharing based on a task force’s participation in an investigation
that resulted in a forfeiture may be awarded in one of two ways:
a. Payment to a Fiduciary Agency: Agencies participating in task forces may designate one
task force member agency to serve as the duciary agency for the task force. e duciary
agency must be a Program participant, must be compliant with the Program guidelines and
reporting requirements, and must be an active participating member of the task force. Funds
awarded directly to the duciary agency constitute the duciary agency’s funds and must be
maintained by the duciary agency’s jurisdiction. e duciary agency may earmark funds for
use in support of the task force’s operations, but may not distribute equitably shared funds to
individual task force member agencies, including upon dissolution of the task force.
b. Payment to Individual Task Force Agencies: Compliant state, local, and tribal law
enforcement agencies participating in task forces may request and receive equitable sharing
payments under their individual NCIC codes by ling an individual Justice DAG-71 or
Treasury TD F form.
e task force duciary agencies or any task force member agencies may purchase or lease equipment
and other tangible items as well as pay direct operational expenses such as leases, utilities, and cell phones
for the benet of the task force. However, agencies may not transfer shared funds to task forces or pay for
unspecied or impermissible operational expenses such as overtime or travel and per diem for personnel
from other agencies on the task force. All limitations in Section V.B.2. apply. e agency expending
funds must report the expenditure and maintain ownership and control of any tangible items. Should the
task force dissolve or the duciary withdraw, all equipment must be returned to the purchasing agency.
is ensures that audit and regulatory requirements are met under the Single Audit Act Amendments
of 1996 and Oce of Management and Budget (OMB) Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards.
Guide to Equitable Sharing | 7
Program Overview
2. Federal Agencies
Federal agencies are not eligible to receive equitable sharing funds. However, federal agencies that
(1) are participating members of the Justice or Treasury Asset Forfeiture Programs and (2) contribute
with state, local, or tribal law enforcement agencies to a federal forfeiture action may be eligible to seek a
“federal contribution” to the agency’s forfeiture fund. e federal contribution is a percentage of the total
forfeiture representative of the federal agency’s contribution to the law enforcement action.
Federal agency participants in the Justice or Treasury Asset Forfeiture Programs must seek a federal
contribution via submission of the Federal Contribution Form (FCF), and must follow their agency
policy regarding that submission. e percentage awarded will be based on work hours and qualitative
contributions for eorts leading to the forfeiture. Any award will be made to the participating agency’s
forfeiture fund (i.e., the AFF or the TFF), and not the agency directly. See Policy Manual, Chap. 15.
In no instance will any persons from a federal agency maintain control of shared funds, direct or approve
the use of shared funds, sign as the Agency Head or the Governing Body Head on an Equitable Sharing
Agreement and Certication (ESAC), or certify a DAG-71 or TD F.
3. Non-Governmental Entities
Non-governmental entities, including non-prot organizations and public or private corporations or
institutions, are not eligible to participate in the Program.
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III. How Do Agencies Participate in the Equitable Sharing Program?
A. Joining the Equitable Sharing Program
To become a Program participant, agencies must submit an ESAC and adavit to the Money Laundering
and Asset Recovery Section (MLARS). Agencies must also ensure individuals involved in the
administration of Program funds complete training. Once agencies have attended training and MLARS
reviews and accepts the ESAC, the agency is placed into compliance.
All participating agencies must submit an Automated Clearing House (ACH) Vendor form to Justice
and to Treasury per instructions on each Program’s ACH form. Separate accounts or account codes
must be established for Justice and Treasury funds; therefore, agencies must send a separate ACH form
to Justice and to Treasury. ACH forms are available on Justice’s and Treasury’s respective websites. If an
agency’s banking information changes, it must submit an updated ACH form to Justice and to Treasury.
Agencies may only include account and routing information for accounts assigned to their agency.
Agencies must also be registered in the federal government’s System for Award Management (SAM.gov).
SAM.gov assigns the agency a Unique Entity Identication (UEI) number that must be included on the
ACH forms. Equitable sharing distributions cannot be processed without a correct SAM UEI on le with
Justice or Treasury.
Agencies with law enforcement functions but not typically identied as traditional law enforcement
agencies are subject to a separate review to determine their eligibility to participate in the Program. ese
agencies must demonstrate that they fall within the denition of a law enforcement agency, as dened in
Section II.A.1.
B. Compliance
Compliance with state, local, or tribal legislation addressing federal equitable sharing is the responsibility
of the Program participant. Justice and Treasury may suspend agencies where compliance with state,
local, and tribal laws and Program guidelines is not possible.
1. ESAC Compliance
To participate in the Program, eligible agencies must rst submit, and annually resubmit, an ESAC signed
by both the head of the law enforcement agency and the head of the governing body with budgetary
authority over the law enforcement agency. By signing the ESAC, the signatories agree to be bound
by, and comply with, the federal statutes and Justice and Treasury policies—including policies on the
appropriate law enforcement purposes and functions of forfeiture—governing the Program. See
Section VII.A.
Any breach of the ESAC agreement by a state, local, or tribal law enforcement agency may render it non-
compliant or ineligible to receive equitable sharing payments. Participation may be barred on either a
temporary or permanent basis, and in some cases, an agency’s pending equitable sharing distributions
may be permanently extinguished where a requesting agency has failed timely to submit an ESAC or
ACH form or has failed to meet any other requirements as set forth in this Guide. See Section VII. While
federal investigative agencies and U.S. Attorney’s Oces have no armative obligation to monitor an
agency’s eligibility, they are obliged promptly to report to MLARS any information that might aect an
agency’s eligibility to participate in the Program.
To remain compliant, agencies must le the ESAC annually, even if agencies do not receive sharing
during that particular reporting period.
Guide to Equitable Sharing | 9
Program Overview
2. Civil Rights Compliance
Agencies must comply with the applicable nondiscrimination requirements of the following laws and
their implementing regulations: Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq.), Title
IX of the Education Amendments of 1972 (20 U.S.C. § 1681 et seq.), Section 504 of the Rehabilitation
Act of 1973 (29 U.S.C. § 794), and the Age Discrimination Act of 1975 (42 U.S.C. § 6101 et seq.). ese
prohibit discrimination on the basis of race, color, national origin, disability, or age in any federally
assisted program or activity, or on the basis of sex in any federally assisted education program or activity.
Agencies must take reasonable steps to provide meaningful access to their programs and activities for
persons with limited English prociency, consistent with Justice and Treasury requirements. Agencies
also must agree to comply with all federal statutes and regulations permitting federal investigators access
to records and any other sources of information as may be necessary to determine compliance with civil
rights and other applicable statutes and regulations. Further, agencies are required to collect race and
ethnicity data as required by 28 C.F.R. § 42.106(b) and 31 C.F.R. § 22.6(b).
C. Participating in a Federal Forfeiture
To receive an equitable share, an agency must assist in the law enforcement eort resulting in federal
forfeiture. Generally, if a criminal prosecution and forfeiture is legally possible in the jurisdiction
processing the prosecution, the forfeiture action should follow the criminal prosecution, whether
state or federal. See Policy Manual, Chap. 3; Chap. 5. e federal government should pursue federal
administrative or judicial forfeiture where there is a pending federal criminal investigation or
prosecution.
Under certain circumstances, however, a state, local, or tribal law enforcement agency may seize property
under state law, without federal oversight or involvement, and a federal agency later takes the seized
property into its custody and uses a federal forfeiture proceeding to forfeiture the property. is is
known as an “adopted” forfeiture, or an adoption. See Policy Manual, Chap. 3, for a discussion of the
policies governing adoptions. A state or local law enforcement agency transferring property to the
federal government for forfeiture must comply with all applicable state laws and regulations pertaining to
the turnover of assets for adoption or the release of assets from state jurisdiction.
Net equity and value thresholds apply to assets seized for federal forfeiture. See Policy Manual, Chap. 1.
State, local, or tribal law enforcement agencies should consult the federal seizing agency for any agency-
specic minimum monetary or equity thresholds and seizure planning requirements.
10 | Guide to Equitable Sharing
IV. What Is the Process to Apply for and Receive a Share?
A. Requesting an Equitable Share
1. Department of Justice-Led Investigations
If state law permits, a participating state, local, or tribal law enforcement agency may request a share of
federally forfeited assets by electronically submitting a DAG-71 to the federal seizing agency through
Justice’s eShare Portal. e requesting agency must complete a separate DAG-71 for each asset for which
it requests sharing. An agency may not le a DAG-71 on behalf of another agency.
Agencies may submit sharing requests at any time following the seizure, but no later than 45 days aer
forfeiture. Agencies must include a waiver request with any sharing requests submitted aer 45 days
following the forfeiture. e lead agency for forfeiture determines whether to grant the waiver.
e agency must include in its DAG-71 both work hours contributed and a detailed narrative of the
agency’s contribution to the law enforcement eort resulting in federal forfeiture of the asset. e agency
is responsible for providing the decision maker enough information to adequately evaluate the qualitative
and quantitative contributions. e decision maker may request additional information or clarication
from the requesting agency. Without adequate information to describe the requesting agency’s
contribution to the forfeiture, the decision maker may not award a share that fully captures the requesting
agency’s contributions, or may deny the request.
A task force duciary agency may submit one DAG-71under its NCIC code on behalf of a task force
that participated in a seizure resulting in federal forfeiture of the asset. e duciary agency’s DAG-71
must include the total work-hour and qualitative contributions of all task force member agencies in the
investigation. e duciary must also submit any memorandum of understanding (MOU) or task force
agreement governing task force members’ pre-arranged sharing agreements. See Section II.B.1.
Agencies must certify that the information they provide on the DAG-71 is true and accurate. Providing
falsied information on the DAG-71 could, among other things, result in the agency’s suspension or
expulsion from the Program.
No sharing decisions will be made until aer the forfeiture is complete. No sharing request will be
accepted and processed aer a sharing decision has been made by the decision maker.
2. Department of the Treasury-Led Investigations
If state law permits, a participating state, local, or tribal law enforcement agency may request a share of
federally forfeited assets by submitting a TD F form to the federal agency processing the forfeiture. An
agency may not le a TD F on behalf of another agency.
If multiple assets are seized in a single investigation, a requesting agency may le one TD F with an
attached listing of all the assets for which the agency requests a share.
Agencies may submit sharing requests at any time following the seizure, but no later than 45 days aer
forfeiture. Agencies must include a waiver request with any sharing requests submitted aer 45 days
following the forfeiture. e lead agency for forfeiture determines whether to grant the waiver.
e agency must include in its TD F both work hours contributed and a detailed narrative of the agency’s
contribution to the law enforcement eort resulting in federal forfeiture of the asset. e agency is
Guide to Equitable Sharing | 11
Program Overview
responsible for providing the decision maker enough information to adequately evaluate the qualitative
and quantitative contributions. e decision maker may request additional information or clarication
from the requesting agency. Without adequate information to describe the requesting agency’s
contribution to the forfeiture, the decision maker may not award a share that fully captures the requesting
agency’s contributions, or may deny the request.
A duciary agency may submit one TD F under its NCIC code on behalf of a task force that participated
in a seizure resulting in federal forfeiture of the asset. e TD F must include the total workhour and
qualitative contributions of all task force member agencies in the investigation. e duciary must
also submit any memorandum of understanding (MOU) or task force agreement governing task force
members’ pre-arranged sharing agreements. Shared funds will be awarded to the duciary agency.
Funds awarded directly to the duciary agency constitute the duciary agency’s funds and must be
maintained by the duciary agency’s jurisdiction. e duciary agency may earmark funds for use in
support of the task force’s operations but may not distribute equitably shared funds to individual task
force member agencies. If a duciary agency submits a TD F on behalf of a task force, task force member
agencies may not submit individual sharing requests.
Agencies must certify that the information they provide on the TD F is a true and accurate statement of
the agency’s activities. Providing falsied information on the TD F could, among other things, result in
the agency’s suspension or expulsion from the Program.
No sharing decisions will be made until aer the forfeiture is complete. No sharing request will be
accepted and processed aer a sharing decision has been made by the decision maker.
B. Calculating Shares
Percentages allocated to a law enforcement agency must bear a reasonable relationship to the agency’s
direct participation in the law enforcement eort resulting in the federal forfeiture. e decision maker
ordinarily determines percentages by comparing the number of work hours expended by each agency
participating in the federal forfeiture, including all federal, state, local, and tribal agency contributions.
Where the work hours alone do not reect the contribution of a law enforcement agency, the decision
maker considers qualitative factors in making adjustments to the sharing percentage. e decision maker
may consider:
• the inherent importance of the contributing activity;
• whether the agency otherwise entitled to an adjustment would already receive a comparatively
large share based on reported work hours;
• whether the agency originated the investigation or information leading to the seizure;
• whether the agency provided and articulated specic unique or indispensable assistance; or
• whether the agency seized one or more assets that were forfeited in non-federal proceedings
during the same investigation.
Any of these qualitative factors may warrant an increase or decrease in the percentage awarded to an
agency. e decision maker has discretion to determine on a case-by-case basis whether and how much
to adjust the sharing allocation.
12 | Guide to Equitable Sharing
No sharing request or recommendation, including shares negotiated in a task force MOU or other
agreement, is nal until the federal decision maker approves it. e decision maker may consider an
agency’s contribution in comparison to hours expended by all investigative agencies, regardless of their
Program participation. Sharing for non-participating agencies is retained in Justice’s AFF or Treasury’s
TFF.
1. Federal Contribution
All forfeitures that result in proceeds available for equitable sharing have federal involvement. e
decision maker must obtain and review the work hours and qualitative contributions of all federal agency
participants when determining the appropriate amount to retain in the AFF or TFF for equitable sharing.
e decision maker will evaluate federal participation in the same manner as state, local, and tribal
participation, using work hours and qualitative contributions to determine the appropriate federal share.
e decision maker may also consider federal prosecutorial contributions when evaluating the federal
share.
e minimum federal share is 20 percent. In most cases, particularly in federally led investigations, the
federal share will exceed 20 percent. e decision maker or federal agency leading the investigation may
have more restrictive internal guidelines on the minimum federal share.
2. State, Local, and Tribal Contribution
e decision maker must review the reported work hours and qualitative contributions of all
participating state, local, and tribal agencies and determine the appropriate share to award to each agency
aer considering all federal, state, local, and tribal agency contributions to the law enforcement eort
resulting in federal forfeiture.
3. Task Force Contribution
Many task forces involving federal, state, local, and tribal law enforcement agencies have pre-arranged,
written equitable sharing MOUs or agreements based upon relative numbers of personnel and other
contributions to the task force operation.
Justice and Treasury will generally honor written sharing MOUs or agreements that were in place prior
to the onset of the law enforcement eort resulting in federal forfeiture. e agreement must be current,
in writing, and signed by the head of each agency that participates in the task force, and must contain
the pre-arranged sharing percentages that reect overall agency investigative, nancial, or administrative
contributions to the task force. e decision maker will not honor any verbal sharing agreements. If an
agency requests sharing pursuant to a task force agreement or MOU, the agreement must be submitted to
the decision maker along with the DAG-71 or TD F. Approved sharing will be disbursed directly to the
member agencies unless the task force has appointed a duciary agency. If the task force has appointed a
duciary agency, approved sharing will be disbursed directly to the duciary agency.
Funds awarded directly to the duciary agency constitute the duciary agency’s funds and must be
maintained by the duciary agency’s jurisdiction. e duciary agency may earmark funds for use in
support of the task force’s operations but may not distribute equitably shared funds to individual task
force member agencies. If a duciary agency submits a DAG-71 on behalf of a task force, task force
member agencies may not submit individual sharing requests.
Guide to Equitable Sharing | 13
Using Shared Funds
e decision maker may allocate percentages to the individual member agencies based on the agencies’
participation in the task force rather than any specic ocer’s participation in the law enforcement eort
leading to forfeiture. Funds awarded to each individual agency will be the individual agency’s funds and
must be maintained by the individual agency’s jurisdictions.
If a federal law enforcement agency is a member of a task force, and the task force chooses to include
the federal agency in its pre-arranged sharing percentages, the MOU must reect the work hours and
contributions of the federal agency and the federal share. Regardless of whether any federal agency is
included in pre-arranged sharing percentages, the minimum federal share is 20 percent.
4. Spin-o Investigations
Agencies may share intelligence information that leads to spin-o investigations and additional federal
forfeitures. In limited instances, on a case-by-case basis, the decision maker may approve sharing to
an agency that provided critical intelligence information essential to that forfeiture but did not actively
participate in the subsequent law enforcement eort resulting in federal forfeiture.
5. Distribution Cap
An agency may receive up to $10 million in Justice funds and $10 million in Treasury funds each federal
government scal year. Calculated sharing in excess of this cap will remain in the appropriate federal
forfeiture fund to support nationwide law enforcement eorts.
C. Department of Justice Equitable Sharing Deciding Authorities
All decision makers must exercise due diligence when reviewing and considering work hours and
qualitative factors to ensure consistency and uniformity Program-wide when determining shares.
1. Federal Investigative Agency
If the total appraised value of all the assets forfeited in a single administrative declaration of forfeiture is
less than $1 million, the investigative agency determines the appropriate equitable share for each asset
and requesting agency.
2. United States Attorney
If the total appraised value of all the assets forfeited in a single judicial forfeiture order is less than $1
million, the United States Attorney, or a designee, determines the appropriate equitable share for each
asset and requesting agency.
3. Department of Justice, Criminal Division
In multi-district cases or cases where the total appraised value of all the assets forfeited in a single
administrative or judicial forfeiture is equal to or greater than $1 million, the Criminal Division
determines the appropriate equitable share of each asset. Property forfeited under a single judicial order
cannot be split up or separated for sharing decisions. is means, for example, it is not permissible
that only those individual assets with values equal to or greater than $1 million are sent to the Criminal
Division for sharing decisions. See Policy Manual, Chap. 15.
14 | Guide to Equitable Sharing
D. Department of the Treasury Equitable Sharing Deciding Authorities
1. Federal Investigative Agency
In all forfeiture cases, whether judicial or administrative, where the total appraised value of the assets in a
single forfeiture order or declaration is less than $1 million, the federal investigative agency exercises the
authority to approve equitable sharing.
Forfeited assets valued at less than $1 million that involve foreign sharing require approval from the
Director of the Treasury Executive Oce for Asset Forfeiture (TEOAF).
2. Department of the Treasury, Treasury Executive Oce for Asset Forfeiture
Where the total appraised value of all assets contained in a single forfeiture order or declaration is equal
to or greater than $1 million, the Director of TEOAF must approve the amount of the equitable share.
In all judicial forfeitures, regardless of value, the United States Attorney’s Oce pursuing the forfeiture
shall be given the opportunity to provide input on all recommendations for equitable sharing.
E. Common Causes of Sharing Payment Delay
Equitable sharing occurs only aer the federal forfeiture has been completed, the United States has taken
clear title to the property, the property has been sold or otherwise disposed of as provided by law, third
parties and victims have been fully compensated, any international sharing has been approved, and
a nal sharing decision has been made by the appropriate decision maker. Certain factors may delay
sharing:
1. If the agency submits an incomplete or decient DAG-71 or TD F, the agency must provide the
missing or additional information before the decision maker renders a decision on sharing. e
decision maker cannot evaluate the sharing request without adequate information.
2. If the agency is not registered in SAM.gov, or if the agency has incomplete or incorrect banking
information on le with Justice or Treasury, Justice and Treasury cannot process sharing
payments.
3. If the agency is required to certify it is eligible to receive a federal equitable sharing payment and
fails to certify, Justice and Treasury cannot process the sharing payment.
4. Distribution in equitable sharing cases involving forfeited assets with a total value of $1 million or
more requires the approval of the Criminal Division for Justice forfeitures or TEOAF for Treasury
forfeitures. ese additional levels of approval extend the review time.
Guide to Equitable Sharing | 15
Using Shared Funds
F. Sharing Is Always Based on Net Proceeds
Equitable sharing is always based on the net proceeds of the forfeiture. Certain amounts must be
deducted from the gross receipts to calculate net proceeds:
Gross Receipts From forfeiture or the sale of forfeited property
Less Qualied third-party interests (e.g., valid liens or mortgages)
Payments to victims
Federal case-related expenses (e.g., advertising costs, out-of-pocket
investigative or litigation expenses)
Federal property management and disposition expenses (e.g., appraisal,
storage, security, sale)
Awards paid to federal informants
Payments for the services of experts and consultants hired to assist in asset
identication, seizure, management, forfeiture, or disposition
International sharing
Reimbursements relating to the seizure from the Justice Assets Forfeiture Fund
or the Treasury Forfeiture Fund to the requesting agency (e.g., overtime, leased
space)
Equals Net proceeds of the forfeiture
Federal law provides that sharing is discretionary. erefore, any equitable sharing payments to be
disbursed to state, local, or tribal law enforcement agencies that would amount to less than $500 will be
extinguished and the funds will remain in the appropriate forfeiture fund.
In addition, federal budgetary constraints such as sequestration and rescissions may aect equitable
sharing disbursements, regardless of any calculation of net proceeds or sharing percentages of a specic
forfeiture.
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V. What Are the Uses of Equitably Shared Funds?
Equitable sharing can provide valuable resources that may not have otherwise been available to state,
local, and tribal law enforcement agencies. Equitably shared funds must be used in accordance with
governing law and policy, this Guide, and all applicable federal laws, rules, regulations, and Executive
Orders. Agencies may use equitably shared funds only for law enforcement purposes that directly
supplement the agency’s appropriated resources. State, local, or tribal law enforcement agencies will not
receive equitable sharing if the governing body or state, local, or tribal law, regulation, or policy requires
or directs (1) specic expenditures of shared funds, (2) the transfer of federal equitable sharing funds to
non-participating law enforcement agencies, or (3) expenditures for non-law enforcement purposes.
Equitably shared funds constitute federal nancial assistance and are subject to the provisions of the
Code of Federal Regulations (CFR) applicable to a Direct Payment for Specied Use. Agencies must use
equitable sharing funds in a reasonable and necessary manner, and must not create the appearance of or
actual waste, extravagance, or impropriety.
To avoid a conict of interest or the appearance of a conict of interest, no jurisdiction or agency, or
personnel of the jurisdiction or agency or immediate family members of such personnel, may purchase,
either directly or indirectly, federally forfeited property if the jurisdiction, agency, or personnel were
involved in a law enforcement eort that led to the forfeiture of the property.
A. General Guidance on Supplantation and Budgeting
1. Supplantation
Equitably shared funds must be used to increase or supplement the resources of the receiving state, local,
or tribal law enforcement agency. Shared funds shall not be used to replace or supplant the agency’s
appropriated resources. e recipient agency must benet directly from the sharing. In determining
whether supplantation has occurred or could occur, Justice or Treasury will examine the law enforcement
agency’s budget as a whole and allow agencies to use equitable sharing funds for any permissible purpose
as long as shared funds increase the entire law enforcement budget. Justice or Treasury may terminate
sharing with law enforcement agencies that are not permitted by their governing body to benet directly
from equitable sharing.
Example of Improper Supplantation: A police department receives $100,000 in federal equitable sharing
only to have its budget cut $100,000 by the city council. In this instance, the police department has
received no direct benet from equitable sharing whatsoever. Rather, the city as a whole has received the
benet of the sharing.
2. Anticipated equitably shared funds should not be budgeted
Agencies should not obligate or budget anticipated equitable sharing receipts. Agencies may not commit
to spending shared funds in advance. For example, if a local law enforcement agency les a DAG-71 or
TD F and anticipates a 50 percent share of $100,000, the anticipated $50,000 should not be obligated or
budgeted. Reasons for this include litigation and policy uncertainties, such as: (1) whether the forfeiture
will be perfected; (2) what amount of equitable sharing the decision maker will approve, if any; and (3)
when the forfeiture, decision, and ultimate payment will occur. In contrast, agencies may earmark, create
spending plans for, and budget equitable sharing funds already received.
Guide to Equitable Sharing | 17
Using Shared Funds
B. Use of Shared Funds
Except as noted in this Guide, Program participants shall use equitably shared funds for law enforcement
purposes only (“permissible uses”). If an agency is unsure whether a proposed expenditure is
permissible, it should email mlars.ESProgram@usdoj.gov for Justice fund expenditures or
treas.aca@treasury.gov for Treasury fund expenditures.
Agencies may use equitably shared funds for any permissible agency expenditure, and both sworn and
non-sworn law enforcement personnel may use them. e fact that equitable sharing derives from
property forfeited by a particular agency unit or as a result of a particular federal violation does not
limit its use to purchases only for that unit or to further investigations only for that particular federal
violation. If an agency wishes to support a multi-agency expenditure, such as a new payroll system or
city municipal building, with a non-law enforcement agency, the law enforcement agency’s costs based on
its use may be calculated on a pro rata basis.
1. Permissible Uses
a. Law enforcement administrative costs—Administrative costs that further the agency’s
law enforcement goals or missions. Examples include recruitment and advertisement
costs, agency accreditation, banking and equitable sharing account maintenance fees, or
agency membership dues. Memberships and dues for an individual are impermissible. See
Section V.B.2.d.
b. Law enforcement training and education—Training of agency personnel, including
investigators, prosecutors, and sworn and non-sworn law enforcement personnel, in any
area necessary to perform ocial law enforcement duties, provided that the employees’
regular duties require knowledge of these topics. Examples include training and conference
registration fees, tuition, speaker fees, or costs to produce training curricula on topics such as
serving as a canine handler, narcotics detection, defensive tactics, criminal justice, languages,
constitutional law, accounting and nance, or forensics. Agencies may not pay for training
expenses of non-agency personnel. See Section V.B.2.i.
Agencies may not donate or transfer funds to associations or organizations providing training.
c. Law enforcement, public safety, and detention facilities—Purchase, lease, or operation of
law enforcement, public safety, or detention facilities used or managed by the recipient agency.
Examples include the costs of leasing, furnishing, and paying utilities for law enforcement
facilities.
Treasury shared funds may also be used to pay costs associated with the construction,
expansion, or improvement of law enforcement facilities, regardless of the size or scope of the
project. Examples include new HVAC equipment, paving projects, security fencing, paint and
carpeting, or construction materials related to construction projects.
Justice shared funds may NOT be used to pay costs associated with the construction,
expansion, or improvement of law enforcement facilities, regardless of the size or scope of the
project. See Section V.B.2.m.
18 | Guide to Equitable Sharing
d. Law enforcement equipment—Costs associated with the purchase, lease, maintenance
(including repairs or service agreements), or operation of law enforcement equipment for use
by law enforcement personnel that supports law enforcement activities. Examples include
furniture, audio-visual equipment, oce supplies, telecommunications equipment, copiers,
safes, tness equipment, computers, computer accessories and soware, body armor, body-
worn cameras, cloud data storage, uniforms, rearms and related equipment, ammunition,
radios, cellular telephones, electronic surveillance equipment, vehicles (e.g., patrol and
unmarked vehicles), and animals and animal-care-related expenses.
e. Joint law enforcement and public safety operations—Costs associated with the purchase of
multi-use equipment and operations used by both law enforcement and non-law enforcement
personnel. Examples include 911 call center equipment, debrillators, Naloxone, search
and rescue boats, aircra, and diving equipment. ese expenditures are exempt from the
pro-rata calculation of law-enforcement-related costs. ere must be a law enforcement use;
the equipment cannot be solely for non-law enforcement operations, such as re and EMS
vehicles.
f. Contracts for services—Costs associated with a contract for a specic service that supports
or enhances law enforcement. Examples include translation and language assistance services,
outsourced laboratory testing, stang and feasibility studies, auditing of equitable sharing
funds, Employee Assistance Program services, subject matter expert consultations, grant
writing, or soware development.
Employment-related contracts or contracts involving inherently law enforcement functions
are prohibited. Examples include hiring an attorney, investigator, or civilian personnel to
perform tasks typically or previously performed by agency or jurisdiction personnel.
Under no circumstances should any agency enter a contract that bases payment on a
percentage of the seizures and forfeitures of the law enforcement agency.
g. Law enforcement travel and per diem—Costs associated with travel and transportation
for law enforcement agency personnel to perform or support law enforcement duties and
activities. Travel and per diem for personnel from other agencies is not permitted. All related
costs must be in accordance with the jurisdiction’s travel and per diem policies and must not
create actual or the appearance of extravagance, waste, or impropriety.
h. Law enforcement awards and memorials—Costs associated with the purchase of plaques,
certicates, commemorative badges, and challenge coins in recognition of a law enforcement
achievement, activity, or training. Shared funds may not be used to pay monetary awards in
any form, including cash, cash equivalents, or stored value cards.
Shared funds may be used to pay the costs for commemorative plaques, displays, or
memorials on law enforcement property to recognize or memorialize a law enforcement
ocer’s contributions, such as a memorial plaque or stone in honor of an agency’s ocers
killed in the line of duty. e plaque, display, or memorial must not create actual or the
appearance of extravagance, waste, or impropriety. Justice shared funds may not be used for
memorials involving construction. See Section V.B.2.m.
Guide to Equitable Sharing | 19
Reporting/Compliance
i. Drug, gang, and other prevention or awareness programs—Costs associated with
conducting law enforcement agency awareness programs. Examples include public service
announcements, meeting costs, motivational speakers, and items used or distributed by the
agency such as child identication kits and anti-crime items, literature, or soware.
j. Law enforcement initiatives that further investigations—Costs associated with furthering
law enforcement investigations. Examples include reward money paid by the agency or a
crime tip organization for information on a completed crime or annual dues paid to a crime
tip organization (informant payments excluded, see Section V.B.2.o.), victim or witness
expenses (travel or temporary housing), or reimbursement to the jurisdiction for buy-back
programs. Agencies are prohibited from having direct access to funds. See Section V.B.2.g.
Equitable sharing funds may not directly fund petty cash or secondary accounts, or any other
nancial instruments to which ocers and employees have direct access.
k. Overtime—Costs for overtime and related benets of current sworn and non-sworn law
enforcement agency personnel performing ocial law enforcement duties. Overtime for
personnel from other agencies is not permitted.
l. Salaries—Payment of salary and benets of a new ocer hired to replace an ocer assigned
to a federal task force or school resource or drug abuse resistance education ocer with
certain pre-approvals as detailed below. To protect the integrity of the Asset Forfeiture and
Equitable Sharing Programs so that the prospect of receiving equitable sharing funds does not
inuence or appear to inuence law enforcement decisions, equitable sharing funds may not
be used to pay the salaries and benets of sworn or non-sworn law enforcement personnel
except in these limited situations:
Type Justice Program Funds Treasury Program Funds
Task Force Replacement Ocer
7
Permissible, with annual
pre-approval
Impermissible
School Resource Ocer (SRO)
or Drug Abuse Resistance
Education (DARE) Ocer
8
Permissible, with annual
pre-approval
Permissible
To obtain approval to pay the salaries of task force replacement and SRO or DARE ocers
with Justice equitable sharing funds, agencies must obtain approval annually from MLARS
prior to the commencement of the scal year in which the salary will be paid. To obtain
approval, agencies must submit to MLARS:
7
The replacement ocer cannot engage in any duties related to the seizure or forfeiture of assets.
8
DARE and SRO ocer positions can only be funded for the time performing those duties. For example, if an SRO only performs those
duties nine months of the year, only the time performing that function may be paid with shared funds.
20 | Guide to Equitable Sharing
• Description of position to be paid with Justice equitable sharing funds, estimated cost
of position, and proof of stang levels;
• Documentation demonstrating sucient Justice equitable sharing funds on hand to
pay the estimated annual costs;
• If task force replacement ocer: Documentation demonstrating sucient alternate
funds to support the replacement position or a commitment to terminate the
replacement position should the TFO leave the federal task force and return to his or
her agency;
• If DARE or SRO ocer: Documentation demonstrating sucient alternate funds to
support the SRO or DARE ocer if the ocer does not perform these specialized
duties for all 12 months of the year;
• Certication that the agency agrees to abide by all Guide provisions and other
applicable policies and guidance related to payment of salaries with shared funds.
Fa
ilure to receive approval as detailed above prior to the use of these salary provisions will
result in the repayment of funds and denial of any future requests to pay salaries of a DARE,
SRO, or task force replacement ocer with Justice shared funds.
2. Impermissible Uses
a. Use of forfeited property by non-law enforcement personnel—Personnel from non-law
enforcement agencies may not use items purchased with shared funds unless the property is
purchased for joint law enforcement and public safety use. See Sections V.B.1.c. and V.B.1.e.
for joint public safety facilities and equipment.
b. Creation of endowments, scholarships, or grants—Shared funds may not be used to create
or establish endowments, scholarships, or grants.
c. Uses contrary to state, local, or tribal laws—Shared funds and property may not be used
for any purpose that would constitute an illegal or improper use of state, local, or tribal law
enforcement funds or property under the laws, rules, regulations, and orders of the state,
local, or tribal jurisdiction of which the agency is a part. Statutes, policies, and regulations
applicable to state forfeiture or sharing do not apply to federal forfeiture or sharing.
d. Personal or political use of shared assets—Shared funds may not be used for any purpose
that creates the appearance that shared funds are being used for political gain or personal
benet. Examples include campaign advertisement or paraphernalia, gym memberships,
personal professional liability insurance, commercial driver’s licenses, passports, non-uniform
clothing, and bar, union, or other individual dues or membership fees.
e. Purchase of food and beverages—Shared funds may not be used to pay for food and
beverages (alcoholic and non-alcoholic) except for meals for ocers engaged in local
emergency operations such as during an earthquake or hurricane. is does not apply to food
and beverage included in per diem for ocial travel. See Section V.B.1.g.
Guide to Equitable Sharing | 21
Reporting/Compliance
f. Extravagant or wasteful expenditures and entertainment—Shared funds must be used
prudently and in a manner that avoids any actual or appearance of extravagance, waste, or
impropriety. In addition, shared funds may not be used for entertainment expenditures.
Examples include tickets to social events, hospitality suites at conferences, entertainers, or
meals or travel in excess of per diem.
g. Cash on hand, secondary accounts, and stored value cards—Agencies are prohibited from
having access to funds or maintaining cash on-hand. Agencies may not maintain shared
funds in multiple accounts, including separate investment or petty cash accounts; purchase
prepaid credit cards, stored value cards, or other nancial instruments; or engage in any
transaction where expenditures are not managed or monitored by the jurisdiction and tracked
to ensure permissibility in accordance with this Guide. See Section VI.A.1.
h. Transfers to other agencies—Shared funds may not be transferred to any another agency.
i. Purchase of items for other agencies—Agencies may not use shared funds to purchase
equipment or pay other permissible costs for other agencies. e purchasing agency must
retain title to and maintain in its inventory any equipment purchased for use by ocers
assigned to a task force. See Section II.B.1. for task force operations.
j. Payment of expenses for employees of other agencies—Agencies may not use shared funds
to pay expenses for permissible costs for employees of other agencies. Examples include
overtime, travel and per diem, and other non-tangible expenses.
k. Costs related to lawsuits—Shared funds may not be used to pay attorneys’ fees, settlement
payments, or any other related costs of lawsuits involving the agency, its governing body, or its
employees.
l. Loans and reimbursements—Shared funds may not be used as advance payment for
expenditures being reimbursed or paid by other funds, or to reimburse the jurisdiction
for expenses already purchased with general funds. Examples include task force overtime
reimbursements or reimbursements for items purchased or paid for with appropriated
funds before the agency received sharing funds. If an agency receives an unanticipated
reimbursement, such as a rebate or unexpected grant, please consult MLARS or TEOAF for
reporting guidance.
m. Construction projects—Justice sharing funds may not be used to pay costs associated with
the construction, expansion, or improvement of law enforcement facilities, regardless of
the size or scope of the project. Examples include new HVAC equipment, paving projects,
security fencing, paint and carpeting, ring ranges, or construction materials related to
construction projects. See Section V.B.1.c. for the use of Treasury funds for construction,
expansion, or improvement of law enforcement facilities.
n. Donations to community-based organizations—Shared funds may not be donated to or
used to purchase items for community-based organizations.
22 | Guide to Equitable Sharing
o. Buy or ash money and informant payments—Shared funds may not be used to pay
informants or for ash or buy money. Reward money other than informant payments and
payments to Crime Stoppers organizations are permitted. See Section V.B.1.j.
p. Money laundering operations—Shared funds may not be used to support state, local, or
tribal undercover money laundering operations that are not part of an approved federal
undercover money laundering investigation.
q. Salaries—Shared funds may not be used to pay the salaries and benets of sworn or non-
sworn law enforcement personnel, except as noted in Sections V.B.1.k. or V.B.1.l.
C. Return of Equitably Shared Funds
On occasion, a criminal conviction or forfeiture order may be vacated, or victims and third parties—who
must be paid in full prior to any equitable sharing—may be identied aer equitable sharing payments
have been disbursed. In those instances, MLARS and TEOAF require agencies to return previously
disbursed equitable sharing. If the agency has approved sharing that has not yet been disbursed, MLARS
or TEOAF may permit the agency to oset the amount due against future sharing.
D. Treasury Oset Program
e Treasury Oset Program (TOP) osets and levies federal payments, including equitable sharing
payments, to collect delinquent debts owed to the United States and to states as required by the Debt
Collection Improvement Act of 1996 and other laws. On occasion, a Program participant may have one
or more equitable sharing payments oset to satisfy a debt owed by them or by another entity within its
jurisdiction sharing its Tax Identication Number (TIN). Agencies whose funds have been oset should
rst contact the USMS or Treasury to determine the TIN that was oset. Next, agencies should contact
the TOP call center at 800-304-3107 to determine the amount of and reason for the debt. Agencies with
oset funds should seek reimbursement from the delinquent entity within the jurisdiction responsible
for the debt, not from the AFF or the TFF, to ensure that funds are used for law enforcement purposes in
accordance with this Guide. Any unreimbursed oset funds must be reported on the ESAC as a non-
categorized expenditure.
Guide to Equitable Sharing | 23
Reporting/Compliance
VI. What Are the Accounting Procedures and Requirements for Shared Proceeds?
All participating state, local, and tribal law enforcement agencies must implement standard accounting
procedures and internal controls that are consistent with this Guide to track equitably shared funds
and items purchased with shared funds. At any time, Justice or Treasury may request documents
related to equitable sharing, conduct an audit or compliance review, or implement additional reporting
requirements and spending plans. Agencies must track and maintain separately equitable sharing funds
received from Justice and Treasury.
A. Bookkeeping Procedures and Internal Controls
A state, local, or tribal Program participant must:
1. Maintaining and Administering Funds: Maintain equitable sharing funds with the jurisdiction
and administer funds in the same manner as the jurisdiction’s appropriated funds. Funds must
follow all jurisdiction policies and procedures regarding procurement and approvals. e
jurisdiction must administer and maintain bank accounts, accounting codes, and other nancial
documents in the same manner as appropriated funds. Agencies are prohibited from maintaining
or having direct access to federally shared funds.
2. Accounts/Accounting Codes: Establish separate Justice and Treasury accounts or accounting
codes within the jurisdiction’s nancial management system to track both revenues and
expenditures, and interest if interest-bearing, for each respective Program. No other funds may be
commingled in these accounts or with these accounting codes.
3. Procurement: Process all expenditures and payments in the same manner as appropriated funds,
including procurement and payment transactions.
4. Interest Income: Deposit all interest earned on equitable sharing funds into the respective
account or accounting code. All interest is subject to the same use restrictions as equitable
sharing funds. Losses to funds maintained in investment accounts in accordance with the
jurisdiction’s policies may not be allocated to or deducted from the equitable sharing account.
5. Standard Operating Procedures: Maintain and follow written policies for accounting,
bookkeeping, inventory control, and procurement that comply with the applicable provisions
of the OMB Uniform Administrative Requirements, Costs, Principles, and Audit Requirements
for Federal Awards or any subsequent updates and jurisdiction policies. Ensure distribution of
relevant policies to all appropriate personnel.
6. Inventory Tracking: Inventory and track all items purchased with equitable sharing funds.
All items with serial numbers must be tracked, regardless of jurisdiction value thresholds for
inventory tracking. Property purchased by duciary agencies for a task force remains the
purchasing agency’s equipment and must be tracked in the purchasing agency’s inventory
management system.
7. Records: Maintain records of all revenue and expenditures posted to the account or accounting
code, including bank and ledger statements, invoices, receipts, required jurisdiction approvals, or
any other documents used or created during the procurement process.
24 | Guide to Equitable Sharing
8. Agency Approvals: Ensure the law enforcement agency head, or designee, authorizes all
expenditures from the sharing accounts.
9. Jurisdiction Approvals: Obtain approval for expenditures from the governing body, such as the
board of commissioners or city council, in accordance with jurisdiction policy.
10. ESAC Reporting: Record and report all transactions consistent with the jurisdiction’s reporting
methods, whether reporting as cash, accrual, or modied accrual-based accounting.
11. Disposal and Sales Proceeds: Dispose of items purchased with shared funds in accordance
with the agency’s disposal policies. To the extent practicable and if consistent with the agency’s
procurement and disposal policies, deposit proceeds or insurance reimbursements from the sale
or disposal of such property into the agency’s sharing account or accounting code.
12. Vendor Registration: Ensure vendors for all qualied purchases are registered in SAM.gov and
are not suspended or debarred.
13. Agency Registration: Maintain an active registration in SAM.gov.
14. Banking Information: Ensure bank account information on le with USMS and TEOAF remains
current.
Guide to Equitable Sharing | 25
Reporting/Compliance
VII. What Are the Reporting and Audit Requirements?
To ensure eective management, promote public condence in the integrity of the Program, and protect
the Justice and Treasury Asset Forfeiture Programs against potential waste, fraud, and abuse, Justice
and Treasury have established reporting requirements that include the annual submission of the ESAC.
e ESAC includes the agency’s annual adavit and details an agency’s receipts and expenditures of
equitably shared funds for the Program. In addition to complying with other governing law, regulation,
and policy, a state, local, or tribal law enforcement agency must be compliant with the use and reporting
requirements set forth in this Guide to receive any distribution of funds. An agency is considered
compliant once MLARS receives, reviews, and approves the ESAC. Because the ESAC captures both
Justice and Treasury equitable sharing receipts and expenditures, submission of the ESAC to MLARS
constitutes submission to both Justice and Treasury.
e eShare Portal is a Justice online tool that allows agencies to obtain information regarding equitable
sharing requests and distributions made by Justice. is information assists with reconciling deposits
to the agency’s Justice equitable sharing account, as well as tracking and obtaining the status of pending
Justice sharing requests. At this time, Treasury does not have a similar online tool; however, distribution
reports are available by contacting TEOAF.
A. Agency Status
Agencies may be designated as compliant, non-compliant, or ineligible to participate in the Program.
e determination of an agency’s status is at the discretion of MLARS and TEOAF.
Compliant: Compliant agencies may receive shared funds and submit requests for future sharing.
Non-Compliant: Non-compliant agencies may not receive funds, but they may submit requests for
future sharing. Shared funds pending distribution may be retained in the AFF or TFF until such time as
the agency returns to compliance.
Ineligible: Ineligible agencies may not receive funds nor submit requests for future sharing. Shared
funds pending distribution will be extinguished and not paid should the agency return to compliance.
B. Equitable Sharing Agreement and Certication (ESAC)
1. When ESACs are Required: Agencies receiving, expending, or maintaining shared funds
during the scal year or with pending sharing must annually submit an ESAC in the eShare
portal to remain compliant. If an agency did not receive, expend, or maintain funds in the
prior scal year, an ESAC is not required to be submitted. However, if the agency does not
have a current ESAC on le it will no longer be a compliant Program participant.
2. Who Must Approve ESACs: e head of the law enforcement agency and a designated
ocial of the governing body must review and approve the ESAC prior to submission. For
the purposes of the Program, the governing body is the governmental entity that allocates
appropriated funding to the law enforcement agency. In no instance can any individual from
the law enforcement agency sign as the governing body head. By approving the ESAC, the
signatories agree to be bound by the statutes, regulations, policies, and guidelines that regulate
the Program and certify that the law enforcement agency will comply with these guidelines
and statutes.
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3. ESAC Submission Deadline: Agencies must submit the ESAC within two months aer the
end of their scal year. No extensions to this deadline will be granted. MLARS reviews
ESACs in the order received, and agencies will remain non-compliant until MLARS approves
the ESAC. For example, if the agency’s scal year ends September 30, the ESAC must be led,
reviewed, and accepted by November 30 for the agency to remain compliant.
Agencies should ensure all agency and jurisdiction nance personnel contact information remains
current. If an agency’s administrator to the eShare portal will no longer serve in that capacity, the
administrator should appoint a new administrator prior to departure. Agency and jurisdiction nance
contact information may be updated at any time in the eShare portal.
C. Extinguishment of Funds
An agency that remains non-compliant for more than one year, or for more than six months with a
balance of $500,000 or more, will be deemed ineligible and MLARS will extinguish all approved sharing
pending disbursement. Extinguishments are nal and the previously approved funds will remain in the
AFF or TFF. Additionally, if an agency required to certify it can receive sharing payments fails to certify,
the sharing payment will be extinguished.
D. Audit Requirements
State, local, and tribal law enforcement agencies that receive equitable sharing must comply with the
applicable Single Audit Act Amendments of 1996 and OMB Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards, any subsequent updates to this guidance, and
other applicable regulations. Per those guidelines, state, local, or tribal governments that expend more
than the applicable threshold in federal funds (e.g., Justice or Treasury equitable sharing funds, grants,
cooperative agreements) per scal year are required to conduct an independent audit.
Justice and Treasury equitable sharing funds are direct payments for specied use. Auditors should
consult the Assistance Listing number 16.922 for Justice equitable sharing funds and 21.016 for Treasury
equitable sharing funds to determine applicable audit guidance. Expenditures of these funds must be
included on the jurisdiction’s Schedule of Expenditures of Federal Awards (SEFA) as federal nancial
assistance.
On occasion, agencies may be selected by the Justice or Treasury Oce of Inspector General, MLARS,
TEOAF, or other federal entities, to undergo an audit or other form of review. Agencies must comply
with all requests for documents and information. Failure to comply with these requests or failure to
implement corrective measures resulting from an audit or other review, may result in temporary or
permanent exclusion from the Program.
E. Record Retention
State, local, and tribal law enforcement agencies must retain all documents and records pertaining
to their participation in the Program for a period of at least ve years. is includes receipts and
procurement documentation for all expenditures of shared funds, bank statements, Forms DAG-71 and
TD F, ESACs, accounting and bookkeeping documents, logs and records, bank records and statements,
and audit reports.
All records may be subject to release under applicable federal, state, and local Freedom of Information
Act laws and regulations.
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VIII. How Does an Agency Terminate Program Participation?
When an agency decides to end its participation in the Program, it must notify MLARS and TEOAF of
its decision. MLARS and TEOAF will coordinate with the agency on the disbursement of the agency’s
remaining funds, if any. e agency will be required to le a nal ESAC showing a zero balance. Any
pending sharing requests will be extinguished, and those funds will be retained by Justice or Treasury in
the AFF or the TFF. If the agency chooses not to spend its remaining funds, the funds must be returned
to the AFF or TFF. Funds shall not be transferred to any other entity or agency.
Guide to Equitable Sharing | 29
Reporting/Compliance
IX. What If Agencies Do Not Comply with Program Requirements?
In addition to laws, regulations, and other policies, this Guide is binding upon all state, local, or tribal
agencies participating in the Program. No equitable sharing funds or property will be distributed to any
state, local, or tribal law enforcement agency that is not a compliant Program participant.
Failure to comply with governing laws, regulations, and policies may subject recipient agencies to
consequences such as:
1. Denial or extinguishment of sharing requests,
2. Temporary or permanent exclusion from the Program,
3. Freeze on receipt or expenditure of shared funds,
4. Return of shared funds,
5. Federal civil enforcement actions; or
6. Federal criminal prosecution for false statements under 18 U.S.C. § 1001, fraud involving the of
federal program funds under 18 U.S.C. § 666, or other federal criminal statutes, as applicable.
MLARS or TEOAF exercises discretion as to the appropriate consequences based on the violation and
circumstances of the violation.
An agency or governing body head, or designee, is required to immediately notify MLARS and TEOAF
of any allegations of the, fraud, waste, or abuse involving the seizure or forfeiture of assets or federal
equitable sharing funds.
