Seward County’s sheriff misspent federal money, the government says. For months, he didn’t tell county leaders.

At a June meeting, Seward County Sheriff Mike Vance delivered grim financial news to county board members: The Sheriff’s Office was on the verge of a budget shortfall. If county leaders didn’t help, he wouldn’t be able to pay three deputies in a matter of weeks. 

During his plea, Vance blamed the delay in funding on the Biden administration. At a subsequent meeting, he said that once the Big Beautiful Bill passed, clogged federal funding would again flow to Seward County. “… They have to give it to us,” Vance said during that meeting. “I’m not worried about them not giving it to us.” 

What Vance didn’t tell county leaders: The government had recently halted the sheriff’s use of federal dollars after a U.S. Department of Treasury review found that the Seward County Sheriff’s Office had spent $762,000 on “impermissible” spending on salaries over three years.   

Some $729,000 in expected federal funding was canceled. The Sheriff’s Office still owes at least $33,000 to the federal government. 

This money was supposed to be the Sheriff’s Office’s share of the millions in cash seized every year by Seward deputies along Interstate 80. As the Flatwater Free Press previously reported, one out of every three civil forfeiture cases in Nebraska’s state courts happens in Seward County. The county’s forfeitures in federal court were second only to Lancaster County, which has nearly 20 times the population of Seward County, in 2023. 

The misspending was all “a misunderstanding,” Vance said in an interview. Not getting that money won’t impact the county, he said. 

“We don’t actually budget for that money, because you never know when you’re going to get it,” Vance said. “It was going to have to be paid back either way it goes. It wasn’t worth arguing about.” 

In September, the County Board ended up rerouting $480,000 into the sheriff’s general fund to pay the three deputies. The U.S. Treasury Department is still looking into more years of the county’s spending, a review that it has said should be done by December. 

“We don’t know if they’re going to continue to withhold shared funds, or if the county is going to be responsible for paying those funds back,” said Raegan Hain, a Seward County commissioner with whom Vance has publicly sparred in the past. “Honestly, I don’t know what the county may potentially be on the hook for.”

***

The Seward County Sheriff’s Office is prolific for seizing money, drugs and weapons from drivers along I-80. 

The team of deputies assigned to highway interdiction has won national awards. The county is part of a Department of Homeland Security task force, with two deputies exclusively focused on forfeiture. 

Forfeiture can stem from criminal cases — when a person has drugs or guns in the car and is eventually convicted. But it can also stem from a practice called civil asset forfeiture — when law enforcement seizes money without anyone being charged with a crime. 

In Seward County, this often happens when drivers sign a form relinquishing ownership of  money found in their cars.

The national average for dollars forfeited is $3.40 per capita, an analysis by the Institute for Justice found. Seward County is tied for the fourth highest nationally, seizing $195 per capita. 

Vance and other proponents of civil forfeiture say it’s an important tool to take money, drugs and weapons out of the hands of criminals. Interdiction stops have led to the rescue of human trafficking victims, he said. Deputies have pulled over murder suspects. In Vance’s nearly seven years as sheriff, deputies have seized nearly $19 million and thousands of pounds of drugs, he told commissioners at a September meeting.

But to defense attorneys and advocates, civil asset forfeiture violates motorists’ rights. It’s a money grab that motivates law enforcement to make more and more stops, said Dan Alban, senior attorney with the Institute for Justice. 

“The agency has strong incentives to stop cars and confiscate cash because it helps them offset their budget and lower their salary costs,” Alban said. “They’re supposed to be acting in the public interest, not in their own personal financial interest.” 

The money that Seward County seizes flows to the U.S. Department of Treasury and U.S. Department of Justice. Then up to 80% of that gets shared back with the Sheriff’s Office. 

The Treasury Department notified the Sheriff’s Office of its review in 2022, informing them it would be looking at spending between 2020 and 2022. The Sheriff’s Office did not tell commissioners this was happening, Hain said. 

By 2024, Treasury officials had their initial findings. The compliance review highlighted a slew of accounting issues that violated federal forfeiture guidelines: The Sheriff’s Office used forfeiture funds as advanced payment for expenses that would later be reimbursed by other federal funds and grants. It transferred $31,600 to another law enforcement agency and didn’t properly document the transfer. There were issues with financial documentation and unclear accounting processes. 

And over the course of 2021 and 2022, the Sheriff’s Office used Treasury funds to improperly pay employees, the government says. 

Federal guidelines allow forfeiture money to pay only staff hired to fill vacancies created when a deputy is assigned to a federal task force, like Seward’s Homeland Security task force. 

Seward was using forfeiture money to cover the salaries of staff already employed by the Sheriff’s Office. 

“We moved people into new positions, but they weren’t brand-new employees,” Vance said in an interview. “That’s why we had to repay it.” 

In an undated reply to the Treasury, Vance asked the department to waive the misspending, saying that the error wouldn’t happen again. He also pointed to new staff members whose hiring would follow federal guidelines. 

“If neither of these options are acceptable, we ask that our agencies agree upon a payment plan that would allow the wages to be paid back over a longer period that would be fiscally responsible for the taxpayers of Seward County,” Vance wrote. 

But by May 2025, the federal government had placed the Sheriff’s Office on “do not spend” status. 

Around the same time, Vance was asking county commissioners to spot the Sheriff’s Office to cover salaries of three DARE and school resource officers normally paid by Treasury funds. The money from the feds was coming, he told them. He just didn’t know when. 

Eventually, the county commissioners moved those three positions to the sheriff’s general fund, along with $480,000 in county money to cover salaries and benefits. 

County commissioners didn’t find out about the compliance review or the Sheriff’s Office being placed on do-not-spend status until mid-August, Hain said. The Seward County Independent was first to report the federal spending restriction after Hain brought it up for discussion in an August commissioners meeting.

“(The sheriff) knowingly withheld this information,” Hain said. “It creates this illusion that they’re trying to hide something … with law enforcement being under extreme public scrutiny, now is not the time to withhold information from the board. Because that looks really bad to the public and to the board.”

***

In April, Seward commissioners also hired Lincoln-based Nesbitt & Associates to do its own audit of county drug funds. 

The audit looked at forfeiture spending for both the Sheriff’s and County Attorney’s Offices from July 2023 to April 2025. 

The audit found that the County’s Attorney’s Office was spending money properly. 

But an audit of the Sheriff’s Office flagged some 68% of the federal funds it received — $858,563 in spending — as needing closer review.

The Sheriff’s Office was spending forfeiture funds on equipment and repairs, utilities, membership dues, subscriptions and advertising. Most spending lacked clear documentation linking the expenses back to drug enforcement. 

The audit found “patterns consistent with operating budget substitution,” a practice prohibited by federal forfeiture guidelines. 

Like the Treasury’s compliance review, the audit also found the Sheriff’s Office was using forfeiture funds to pay wages and benefits for three full-time school resource officers.There was no documentation to show the number of hours these officers actually spent on school resource officer duties.

“Interviews indicated most time was spent on regular patrol and interdiction, primarily on I-80,” the report reads. 

The audit said a lack of county commissioner oversight allowed the years of misspending to occur. The level of oversight the commissioners have over forfeiture funds has been a point of contention between the board and Vance for years. 

Hain said that Vance and the Sheriff’s Office often make purchases as they see fit, telling the commissioners after the fact. 

“It’s not a matter of them coming to us and saying, ‘I want to buy a piece of equipment that is $30,000.’ They don’t do that.” 

Vance told the Flatwater Free Press that the board does have oversight over forfeiture spending. They have a copy of the federal guidelines. They approve all monthly invoices.

But Vance himself appeared to test the board’s oversight power in 2022 when he went before the commissioners to discuss buying a new building to headquarter the interdiction task force. The question at hand: Did Vance need commissioners’ permission to use forfeiture funds on that purchase? 

“I as the agency head must approve all purchases from federal accounts,” Vance said during that meeting. “The county commissioners are stewards of the taxpayer dollars. Federal equitable share funds are not taxpayer dollars.” 

The department ended up purchasing the building for $806,000 with forfeiture funds.

Law enforcement financially benefiting from forfeiture makes the practice ripe for abuse, the Institute for Justice’s Alban said. In Seward County, there have been years when the forfeiture funds exceeded the sheriff’s general operating budget. 

“Their external funding is what gives them independence,” Alban said. “If the sheriff can self-fund through forfeiture, then the sheriff doesn’t have to pay much attention to what the county commissioners say.”  

County commissioners are now creating a policy that forces the Sheriff’s Office to get board approval before making future purchases, as recommended by the audit. 

The County Board has also voted to cap the number of deputies the Sheriff’s Office can employ. Vance has said he is considering suing the county over that, pointing to conflicting state statutes on whether the board has that authority. Vance also has said that he does not plan to run for re-election in 2026. 

There have been months of debate over whether the County Board will sign paperwork that, if the feds approve, would allow the Sheriff’s Office to continue to receive seized funds. The report was due Aug. 30. 

On Tuesday, at its first November meeting, commissioners once again did not sign it.

The Seacrest Greater Nebraska reporter covers issues across the state of Nebraska. It is named in honor of philanthropist Rhonda Seacrest and her late husband James, who proudly led several Nebraska newspapers through Western Publishing for 40 years.