Real estate auctions usually require a buy in price of several thousand dollars. Cash may not be common at those auctions but not uncommon. Some cash businesses will make that much in a weekend and regularly transport it to their bank
IIRC the late Congressman Henry Hyde shepherded through some reforms which significantly raised the bar for such seizures. If the person is not of interest as a fleeing felon, the state must now show in court with “clear and convincing evidence” (the highest that can be asked by a civil court) that the seized property was illicit before it can be kept. That would seem to free up most money if there is even a shabby excuse for its presence. Vague news articles are less than helpful here.
Back in the 80’s when I was selling real estate we had a guy pay us $80,000 cash for a property we brokered. He wanted to get the money into our account and brought in a grocery sack of $5’s,$10’s and $20’s. Took two of us over an hour to count it all.