HR-1652-117
Became Public Law No: 117-27.
Sponsored by Jerrold Nadler (D-NY)
What it does
This law adds money to the Crime Victims Fund by directing revenues from deferred prosecution and non-prosecution agreements into the fund, rather than into the general Treasury. It raises the formula used to calculate state victim compensation grants from 60% to 75% of prior-year state payments to victims. It also allows states to waive the matching-funds requirement for victim assistance grants during and for one year after a pandemic-related national emergency, and lets states set their own waiver policies going forward.
Who benefits
Crime victims who receive financial compensation or assistance through state programs — including victims of domestic violence, sexual assault, child abuse, and other violent crimes. State victim compensation and assistance programs that receive larger formula grants. Nonprofit organizations and service providers that receive victim assistance grants and would face reduced administrative burden from the matching-fund waiver. States with limited budgets that struggled to meet the prior matching requirement during the COVID-19 pandemic.
Who is hurt
Corporations and individuals who enter deferred prosecution or non-prosecution agreements with the federal government — their payments, previously deposited into the general Treasury, are now redirected, reducing general fund revenues by that amount. Federal programs and spending priorities that compete for general Treasury funds would see a marginal reduction in available revenue. Taxpayers broadly, to the extent that reduced general fund deposits could affect overall federal fiscal capacity, though the scale depends on the volume of such agreements in any given year.
Supporters argue
Supporters argue that the Crime Victims Fund was designed to be self-sustaining through criminal fines and penalties — not taxpayer dollars — and that redirecting deferred and non-prosecution agreement revenues into the fund honors that original intent. They contend that the fund has faced a serious shortfall in recent years as large corporate settlements increasingly used these agreement structures, which bypassed the fund entirely. Raising the compensation formula from 60% to 75% would more accurately reflect what states actually spend helping victims, ensuring grants keep pace with real costs. The matching-fund waiver, supporters say, prevents victim service organizations from losing critical funding during emergencies when their resources are already stretched thin. Overall, they argue the law strengthens a proven, bipartisan program that helps the most vulnerable people in the justice system at no new cost to taxpayers.
Opponents argue
Opponents argue that redirecting deferred and non-prosecution agreement revenues away from the general Treasury sets a problematic precedent of earmarking funds outside normal congressional appropriations oversight, reducing fiscal transparency and flexibility. They contend that the formula increase from 60% to 75% could create an incentive for states to expand compensation payouts in order to draw down larger federal grants, potentially driving up program costs without a corresponding improvement in outcomes for victims. Critics also raise concerns that broad matching-fund waivers — especially those set by state policy rather than tied to a declared emergency — could reduce accountability for how federal grant dollars are spent, making it harder to ensure funds reach actual victims. Some argue that the underlying funding shortfall should be addressed through the regular appropriations process, where Congress can weigh competing priorities, rather than through automatic revenue redirects.
Constitutional context
The Spending Clause (Article I, Section 8) gives Congress broad authority to direct how federal funds are collected and distributed, including earmarking revenues for specific funds like the Crime Victims Fund. The Victims of Crime Act (VOCA) of 1984 established the fund under this authority. No active constitutional challenge is associated with this law. The Fourteenth Amendment's due process protections are tangentially relevant to the rights of crime victims in the justice system, but this bill does not implicate those protections directly. Cases such as Timbs v. Indiana (2019), which addressed the Eighth Amendment's Excessive Fines Clause as applied to asset forfeiture, provide background context for how courts view the use of financial penalties in the criminal justice system.
Checks and balances
The executive branch (specifically the Department of Justice) gains administrative direction over how deferred and non-prosecution agreement revenues are deposited. Congress retains authority over the fund's overall structure through statute. States gain expanded discretion to set their own matching-fund waiver policies, shifting some administrative authority to the state level. The law does not create new regulatory powers for any federal agency.
Historical precedent
The original Victims of Crime Act of 1984 (VOCA) established the Crime Victims Fund using criminal fines and penalties. The Justice for All Act of 2004 and subsequent reauthorizations have periodically adjusted fund formulas and eligibility. The 2015 VOCA Fix Act previously addressed a funding shortfall by expanding eligible depositors into the fund.