Authority to Transfer Forfeited Property to the General Services Administration for Potential Sale to a Municipality ( 1985 )

Authority to Transfer Forfeited Property to the General
Services Administration for Potential Sale to a Municipality
T he A ttorney General has authority under 21 U.S.C. § 8 8 1(e)(3) to transfer to the General
Services A dm inistration real property forfeited to the United States Pursuant to the drug laws.
U nder 40 U.S.C. §484(k)(2), if G SA determines that the property is needed to carry out
neither its own responsibilities nor the responsibilities of any other federal agency, it may
assign the property to the Secretary o f the Interior upon the Secretary’s recommendation that
the property be used as a public park. This statute also allows the Secretary to sell the land for
public park or recreational purposes to a m unicipality. If warranted by the public benefit that
w ould accrue from use o f the land as a park or recreation area, the sales price might be so
heavily discounted as to be normal.
December 19, 1985
M em orandum O p in io n for th e A ttorney G eneral
I. Introduction and Summary
This memorandum responds to your request for our opinion on the following
questions: (1) whether you have authority to transfer certain forfeited real
property to the General Services Administration (GSA); and (2) whether,
assuming that GSA and the Secretary of the Interior (Secretary) choose to
exercise their discretion in certain statutorily authorized ways, the land may be
sold at a discounted price to a county in Florida for use as a park.
As we understand the facts underlying this request, on March 16, 1984,
agents of the United States Marshals Service (USMS) seized 167 acres of
Florida land. The land was liable to forfeiture under 21 U.S.C. § 881(a)(6)
because it represented “proceeds traceable to an exchange for a controlled
substance.” On June 14, 1984, a judicial decree of forfeiture was entered,
ordering the USMS to deliver the property to the United States of America “for
disposition according to law.” United States v. One (1) One Hundred Ninety-
Seven A cre P arcel o f Property Situation in Alachua County, Florida, No.
GCA-84-0027 (N.D. Fla. June 14, 1984). On August 21, 1984, the United
States Attorney for the Northern District of Florida directed the transfer of the
property from the USMS to GSA pursuant to the Controlled Substances Act,
which permits the Attorney General to transfer forfeited property to GSA “for
disposition according to law.” 21 U.S.C. § 881(e)(3).1
1 G SA , how ever, appears to have treated this disposition as a request that it sell the property o f behalf o f the
D epartm ent o f Justice pursuant to 21 U .S .C . § 881(e)(2). A t the request o f the D epartm ent, GSA has not yet
pub licly advertised th e property.
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The forfeited land is adjacent to a state park and is considered to be ecologi­
cally valuable. Alachua County, Florida has therefore expressed an interest in
acquiring the land from the federal government at nominal cost for use as a
park. The County, however, is willing to satisfy the liens and local back taxes
that burden the land in the amount of approximately $100,000.
We conclude that 21 U.S.C. § 881(e)(3) authorizes the Attorney General to
transfer forfeited property to GSA. If GSA determines that the property is
needed to carry out neither its own responsibilities nor the responsibilities of
any other federal agency, GSA may declare the property surplus and dispose of
it under the Federal Property and Administrative Services Act of 1949 (FPASA),
40 U.S.C. §§ 471-544, a statute that vests GSA with considerable discretion
over the final disposition of surplus property.
One of FPASA’s provisions, id. § 484(k)(2), permits GSA to assign to the
Secretary land that the latter recommends for use as a public park. If the
Secretary does make such a recommendation and if GSA does assign the land
to the Secretary, the Secretary has authority under § 484(k)(2)(B) to sell the
land to Alachua County at a discounted price in consideration of the public
benefits that will accrue to the citizens of the United States through the use of
the land as a park.2
II. Analysis
A. Legal Authority to Classify Land as “Excess P roperty” Under the Federal
Property and Adm inistrative Services A ct o f 1949
Section 511(e)(3) of the Controlled Substances Act, 21 U.S.C. § 881(e)(3)
provides: “Whenever property is forfeited under this subchapter the Attorney
General may . . . require that the General Services Administration take custody
of the property and remove it for disposition according to law.”3 The plain
2 We have no view , o f course, concerning: (1) w hether the Secretary should recommend that this Florida
land be sold to A lachua C ounty for use as a park; (2) w hether GSA should exercise its discretion under
g 484(k)(2) to assign the land to the Secretary; or (3) w hether the Secretary should exercise his discretion
under § 484(k)(2)(B ) to determ ine that the land should be sold to the C ounty at a discounted price reflecting
the public benefit derived from use o f this land as a park.
3 Section 881(e) also provides that the A ttorney General may:
(1) retain the [forfeited] property for official use or transfer the custody or ow nership or any
forfeited property to any Federal, State, o r local agency pursuant to [19 U.S.C. §1616];
(2) sell any forfeited property which is not required to be destroyed by law and w hich is not
harmful to the public; [or]
* * *
(4) forward it to the Drug Enforcement Administration for disposition (including delivery for
medical or scientific use to any Federal or State agency under the regulations of the Attorney General).
None o f these o th er authorities are available to transfer the land directly to A lachua C ounty at a nom inal
price. The property may not be transferred directly to a state or local agency under § 881(e)(1) in this instance
because no state o r local enforcem ent agency directly participated “in any o f the acts which led to the seizure
or forfeiture o f the property." See 19 U.S.C. § 1616(a)(2). The authority under § 881(e)(2) to sell forfeited property
clearly carries with it the requirement that the property be sold in an arm 's length transaction at a reasonable rather
than a below-market price. Section 881(e)(4) is inapplicable by its terms. We therefore believe that § 881(e)(3)
provides the only means by which Alachua County may legally receive this land at a discounted price.
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meaning of this provision is that the Attorney General may transfer forfeited
property to GSA for disposition pursuant to any legal authority applicable to
the property.4
One such authority is the FPASA, which vests GSA with discretion to
dispose of “surplus property” in a variety of ways. 40 U.S.C. § 484. The FPSA
defines “surplus property” as “excess property not required for the needs and
discharge of the responsibilities of all Federal agencies, as determined by
[GSA].” Id. § 472(g). “Excess property,” in turn, is defined as “any property
under the control of any Federal agency which is not required for its needs and
the discharge of its responsibilities, as determined by the head thereof.” Id.
§ 472(e). Accordingly, a two-step process is required before property may be
disposed of as surplus under the FPASA. First, the head of the agency that
controls the property must declare it excess with respect to the needs of the
agency. GSA then must determine that the property is excess with respect to the
needs of other federal agencies.
We conclude that GSA, which presently controls the forfeited land, may
designate it as excess property under 40 U.S.C. § 472(e) if it determines in the
exercise of its discretion that the property is not required for the needs of GSA
or the discharge of its responsibilities. Nothing in the FPASA nor, to our
knowledge, in any other statute, prevents forfeited property from being classi­
fied as “excess” property, assuming that it otherwise meets the statutory
definition of “excess.”5
GSA, however, in both oral and written communications with the Depart­
ment, has stated that in its view, forfeited property cannot be classified as
excess property for purposes o f disposal under the FPASA.6 The only rationale
4 The legislative history o f th is provision is w holly consistent w ith its plain language. See H.R. Rep. No.
1444, 9 1 st C ong., 2d Sess. 56 (1970) (statin g that th e section perm its the A ttorney G eneral, at his option, to
dispose o f forfeited property in a variety o f ways).
5 The C om prehensive C rim e Control A ct o f 1984 established a D epartm ent o f Justice Assets Forfeiture
Fund into w hich “ [t]here shall be deposited . . . all am ounts from the forfeiture o f property under any law
enforced o r ad m inistered by the Department o f Justice rem aining after the paym ent o f expenses for forfeiture
and sale authorized by law .” 28 U.S.C. § 524(c). T he legislative history o f the 1984 Act discusses only tw o
options available to the A ttorney General w ith respect to forfeited property: to retain the property or sell it.
See H .R . Rep. No. 1030, 98th Cong., 2 d Sess. 1940 & n.16 (1984). Therefore, an argum ent could be
c on stru cted from the legislative history an d structure o f the 1984 Act that Congress understood that the
D epartm ent o f Justice w ould sell at m arket value any forfeited property not retained.
T he fo rfeiture provisions o f the 1984 A ct, how ever, apply only to property that was in the custody o f the
D epartm ent o f Ju stice on o r after O ctober 12, 1984, the effective date o f these provision. See 28 U.S.C.
§ 524(c)(7). T he forfeited land in Alachua C ounty, how ever, w as transferred to the custody of GSA pursuant
to $ 881 (e)(3) on A ugust 2 1 ,1 9 8 4 , and th u s is not covered by these provisions. M oreover, even i f the property
had b een transferred a fte r the effective d a te o f the forfeiture provisions, w e w ould not be inclined to conclude
that it co u ld not be transferred under $ 881(e)(3). In the 1984 A ct, C ongress did not explicitly repeal the clear
auth o rity u n d er § 881 (e)(3) fo r the A ttorney G eneral to transfer the property to GSA fo r disposition under any
app licab le legal authority, including authorities such as 40 U .S.C. § 484(k)(2), even if the transfer does not
bring the D epartm ent m arket value for th e forfeited property. A ccordingly, we believe that it is wholly legal
fo r th e A ttorney G eneral to continue to exercise his authority under § 881(e)(3), particularly in light o f the
venerable d o ctrin e that repeals by im plication are disfavored. See United States v. United Continental Tuna
Corp., 425 U .S. 164, 168 (1976).
6 In support o f its position, GSA cites th e “ A greem ent Betw een U nited States M arshals Service and G eneral
Services A dm inistration” (June 24, 1985) and a docum ent entitled “Real Property Forfeitures Q uestions and
Continued
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offered by GSA for this analysis is that forfeited property is not acquired for the
mission of the Department, but in rather connection with law enforcement, and
it therefore cannot be deemed excess property.
An agency is entitled to deference in its interpretation of a statute it adminis­
ters when the statue is unclear. See U dall v. Tallman, 380 U.S. 1, 16 (1965).
GSA’s interpretation of “excess property,” however, is at odds with the plain
language of the FPASA. The definition of excess property does not focus on
the means by which or the purpose for which the property at issue was
originally acquired, but instead considers only whether the property is required
for the needs and the discharge of responsibilities of an agency. If the forfeited
property is not so required, therefore, it may be classified as excess. GSA has
not cited, and we have not found, any legislative history of the FPASA that
casts doubt on this plain language.7
For the foregoing reasons, we conclude that the Attorney General has the
statutory authority to transfer the land to GSA pursuant to § 881(e)(3) and that
the property may then be classified as “excess property” by GSA.8
6 ( . . . continued)
A nsw ers.” GSA apparently uses the latter docum ent in connection w ith the training o f em ployees involved in
this area. The first tw o questions and answ ers read*
Q. Is seized or forfeited property disposed o f under the Federal Property and A dm inistrative
Services Act o f 1949, as am ended (FPASA)?
A. No. Property is seized and forfeited pursuant to the Com prehensive Forfeiture A ct o f 1984.
Certain properties are then disposed o f pursuant to our mem orandum o f understanding w ith the
U.S. M arshals Service.
Q. Is forfeited property excess o r surplus?
A. See previous question and answer.
A nother one o f the questions and answ ers seems to address specifically the question w hether forfeited
property can be disposed in a public discount conveyance o f the kind contemplated in 40 U.S.C. § 484(k)(2)(B):
Q. Is forfeited property surplus for the purpose o f public discount conveyances9
A. No, it is not surplus Federal real property w ithin the context o f 1949 FPASA. A dditionally, the
USM S Agreement requires that the property will be sold to provide the maximum monetary return to
the government.
W e believe that the agreem ent between GSA and the USM S controls only the procedures for disposition of
properties that the D epartm ent o f Justice decides to sell according to 21 U.S.C. § 881(e)(2), and is irrelevant
to the disposition o f properties transferred by the D epartm ent o f Justice to GSA pursuant to § 881(e)(3).
7 The definitions o f “excess property” and “surplus property” w ere contained in the original Act. See Pub.
L. No. 82 -2 8 8 , § 3, 63 Stat. 377, 3 78-79 (1949). The only legislative history pertaining to these definitions
sim ply repeated their language. See H.R. Rep. No. 670, 81st Cong., 1st Sess. 8 (1949). The definitions have
rem ained unchanged in all subsequent am endm ents o f the statute and have not been the subject o f any
com m ent in the legislative history to these subsequent amendments.
8 We note, how ever, that the current guidelines concerning seized and forfeited property do not appear to
contem plate disposition to G SA under 21 U.S.C. § 881(e)(3). These guidelines provide, in pertinent part:
[Section 881(e) o f 21 U.S.C.] authorizes the A ttorney General to dispose o f forfeited property
by (1) retaining the property fo r official use; (2) transferring custody or ow nership o f the
property to any Federal, State or local agency pursuant to [19 U.S.C. §1616]; or (3) placing the
forfeited cash o r proceeds o f sale o f forfeited property in an appropriation called the D epartm ent
o f Justice A ssets Forfeiture Fund . . . . A decision o f the A ttorney G eneral regarding placing the
forfeited property to another agency is not subject to judicial review.
A ttorney G eneral’s G uidelines on Seized and Forfeited Property, SO Fed. Reg. 24,052, 24,052 (1985).
W hen the U nited States A ttorney transferred this property to G SA on A ugust 21, 1984, how ever, the
D epartm ent, had not yet prom ulgated internal guidelines concerning the disposition o f forfeited property. We
therefore believe, assuming that the United States A ttorney was acting as the Attorney G eneral's delegate,
that his transfer o f property in August 1984 cannot be seen as inconsistent with any guidelines extant at that time.
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B. A uthority o f the Secretary o f the Interior to Sell Land to a Municipality
a t a D iscounted P rice Under 4 0 U.S.C. § 484(k)(2)(B)
Once the land is classified as excess property, GSA would have to determine
that the property “was not required for the needs and the discharge of responsi­
bilities of all federal agencies” before the property can be classified as “sur­
plus.” See 30 U.S.C. § 472(g). Once the land has been classified as surplus
property, it may be disposed of under 40 U.S.C. § 484. Because a variety of
disposal options are available under the section,9 GSA undertakes an analysis
to determine “the estimated best and highest use” of the property. 41 C.F.R.
§ 101-47.303-1. GSA then notifies certain public agencies, including the
Department of the Interior, of the potential availability of the property. See id.§ 101-47.303-2.
The Secretary of the Interior may then submit an application to GSA,
recommending that the land be used as a public park or recreation area. Id.
§ 101-47.308-7. On receipt of such an application, GSA is authorized under 40
U.S.C. § 484(k)(2) to assign the property for use as a park or recreation area.
The Secretary, in turn may “sell or lease” the land “for public park or recre­
ational purposes to any State, political subdivision, instrumentality or munici­
pality” under § 484(k)(2)(A).10 Although the Secretary may not make a gift of
the property to Alachua County,11 he is authorized to sell or lease the land to
the County at a discounted price. Section 484(k)(2)(B) provides:
In fixing the sale or lease value of property to be disposed of
under subparagraph (A) of this paragraph, the Secretary of the
Interior shall take into consideration any benefit which has
accrued or may accrue to the United States from the use of such
property by any such State, political subdivision, instrumental­
ity, or municipality.
It is not clear from the language of the statute whether the Secretary is
authorized to sell the land at a wholly nominal price. The legislative history of
§ 484(k)(2)(B) makes clear, however, that Congress intended to authorize the
9 See, e.g., 4 0 U .S.C . § 484(e) (authorizing public sale o f surplus property); id. § 484(h) (authorizing
transfer to the D epartm ent o f Agriculture fo r p nce support reasons); id. § 484(k)(1) (authorizing transfer to
the D epartm ent o f E ducation fo r educational purposes).
10 Section 48 4 (k )(2 ) provides in part:
U n d er such regulations as he m ay prescribe, the A dm inistration [of General Services] is
authorized, h is d iscretio n , to assign to the Secretary o f the Interior for disposal, such surplus real
p ro p erty , including buildings, fixtures, and equipm ent situated thereon, as is recom m ended by
th e Secretary o f the Interior as needed for use as a public park or recreation area.
(A ) Subject to the disapproval o f the A dm inistrator w ithin thirty days after notice to him by
the Secretary o f the Interior o f a proposed transfer o f property for public park of public
recreational use, the Secretary o f the Interior, through such officers or em ployees o f the
D epartm ent o f the Interior as m ay designate, m ay sell o r lease such real property, including
b uildings, fix tu res, and equipm ent situated thereon, for public park or public recreational
purposes to any State, political subdivision, instrum entalities thereof, or municipality.
11 Section 4 8 4(k)(2)(A ) clearly requires th e sale o r lease o f property to be used as a public park. In contrast,
G SA is authorized under the FPASA to donate surplus federal property for certain other purposes. See, e.g.,
4 0 U .S.C . § 4 8 4 (k )(3 ) (perm itting GSA to donate surplus property to states for use as historic m onuments).
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Secretary to convey land to localities for use as public parks at discounts
approaching one-hundred percent. Section 484(k)(2)(B) was added to the
FPASA by the Land and Water Conservation Fund Act Amendments of 1970,
Pub. L. No. 91-485, § 2, 84 Stat. 1084, 1084-85.. At the time the 1970
amendments were enacted, statutory authority already existed to permit a
public use discount of fifty percent on surplus land sold for park and recreation
purposes. The House Report accompanying the 1970 amendments states that
this discount was inadequate. See H.R. Rep. No. 1225, 91st Cong., 2d Sess. 5
(1970). The House Report notes that the “intangible value which attaches to
public outdoor recreation . . . cannot be measured in monetary terms or
comparative appraisals.” Id. at 6. It also quotes approvingly the recommenda­
tion of the Outdoor Recreation Resources Review Committee: “Surplus Fed­
eral Land suitable for outdoor recreation purposes should be made available to
State and local governments at no cost, with appropriate reservation clauses.” I d
Thus, although the language of § 484(k)(2)(B) requires that the Secretary
sell the land for some price and does not authorize an outright donation, it is
clear from the legislative history of the provision that Congress contemplated
that the price might be so heavily discounted as to be nominal if warranted by
the public benefit that would accrue form use of the land as a park or recreation
area.12
Conclusion
We conclude that the Attorney General has authority to direct GSA to take
custody of the forfeited land in Florida under 21 U.S.C. § 881(e)(3). We also
believe that GSA is authorized to dispose of the property as surplus and assign
it to the Secretary of the Interior on the latter’s recommendation that the land be
used as a public park. Finally, the Secretary has authority under 40 U.S.C.
§ 484(k)(2)(B) to sell the land at a discounted price to Alachua County, Florida
for use as a public park.
C harles J. C o oper
Assistant Attorney General
Office o f Legal Counsel
t2As we understand the facts o f th is case, the requirem ent that the Secretary receive at least a nominal price
for land sold pursuant to § 484(k)(2) will be satisfied by the C o u n ty 's discharge o f the liens and back taxes on
the land. There does not seem to be any legal obstacle to accepting the am ount necessary to satisfy these
liabilities as the purchase price o f the land. O ur opinion that such a transaction w ould satisfy the requirem ents
o f § 484(k)(2)(B ), o f course, does not constitute a recom m endation that the Secretary pursue this course of
action.
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