September 25, 2019

Chairs DeFazio, Titus Statements from Hearing on “Landlord and Tenant: The Trump Administration’s Oversight of the Trump International Hotel Lease”

Washington, D.C. — The following are opening remarks, as prepared for delivery, from Chair of the House Committee on Transportation and Infrastructure Peter DeFazio (D-OR), and Chair of the Subcommittee on Economic Development, Public Buildings, and Emergency Management Dina Titus (D-NV) during today’s hearing titled: “Landlord and Tenant: The Trump Administration’s Oversight of the Trump International Hotel Lease.”

Chair DeFazio:

I have been pursuing issues related to the leasing of the federally owned Old Post Office building to the Trump International Hotel for years. Since October 2016, I have written seven letters to the General Services Administration (GSA) seeking records and asking questions about this lease and the agency’s legal justification for not terminating this lease in order to comply with the terms of the lease and the U.S. Constitution’s Emoluments Clauses.

Those clauses protect the country against efforts to corrupt the President. They also bar the President of the United States from profiting from any “King, Prince, or foreign State” without congressional consent or from being financially compensated from state governments or the federal government, with the exception of receiving his or her salary.

Because the President has refused to divest his interest in the Trump Old Post Office LLC, GSA needs to take action to prevent the U.S. Constitution from being violated.

As Ranking Member of this committee, GSA ignored my requests for information about the Old Post Office lease for years. They only began complying with my records requests once I became Chairman. And as Chairman of the Transportation and Infrastructure Committee, the first oversight letter I wrote with Ms. Titus on January 22, 2019, was to GSA requesting records on the Old Post Office Building lease.

Since then, we have received more than 3,000 documents amounting to more than 10,000 pages from GSA. However, eight months later GSA is still refusing to provide certain categories of documents to the committee including legal memos and opinions regarding this lease and monthly financial statements from the Trump International Hotel.

This is unacceptable. It is also deeply troubling to me that GSA on one hand has said they respect the committee’s oversight authority and on the other hand they have relied on the Trump Old Post Office LLC’s attorney – let me repeat that GSA has relied on the Trump Old Post Office LLC’s attorney – to question the committee’s legislative authority in seeking to obtain these records.

I would like to remind GSA that they are a federal agency and not an arm of the Trump Organization and that they have a fundamental obligation to provide the committee with the records it needs to conduct appropriate oversight of the leases the GSA manages, programs they create and policies they enact. And last time I checked, GSA has its own Office of General Counsel.

Congress’s oversight authority is broad and this Committee’s oversight of GSA leasing arrangements is clear. Our legislative jurisdiction over GSA and public buildings, including the Old Post Office Building, which is currently being leased to the Trump International Hotel, is well established.  Our ability to conduct robust oversight ensuring the public is aware of how federal agencies are being managed and how their contracts with private entities are being enforced is paramount.

This oversight should not be a partisan issue. Previous Republican and Democratic Ranking Members and Chairs of the Transportation and Infrastructure Committee and its subcommittees have routinely investigated GSA’s management of its leases.

Suggestions that the committee does not have oversight authority to look into the Old Post Office lease to the Trump International Hotel or that somehow business records of a company leasing a federally owned government building are sacrosanct and should not be reviewed as part of Congress’s long-standing and legitimate investigative process is frankly ridiculous and appears to be a well-orchestrated distraction from the core issues surrounding GSA’s apparent disregard of the Emoluments Clauses expressly laid out in the U.S. Constitution.

This hearing is focused on the Old Post Office Building lease and the GSA’s failure to properly account for the Emoluments provisions in the U.S. Constitution, as a result of President Trump’s refusal to divest from his financial stake in the Trump International Hotel. Unfortunately, this is only part of a pattern of government employees under this administration brazenly violating these provisions.

In the past few days it has been reported that a senior aide to the President of Ukraine met a State Department employee for breakfast at the Trump International Hotel in an alleged effort to seek help connecting with President Trump’s lawyer, Rudolph Guiliani. Regardless of whether the foreign or federal U.S. official paid for this encounter, if they were there on government business it would implicate the Emoluments Clauses to the Constitution.

 It has also been reported that Trump administration officials spent taxpayer funds to stay at Trump’s golf club in Ireland and U.S. Air Force crews have used federal funds to stay at Trump’s resort in Scotland. In addition, the Attorney General of the United States has apparently booked his private holiday party at the Trump International Hotel and the press has reported on patronage of the Trump Hotel in D.C. by foreign governments as well as at least one state government. Although not all of these acts may violate the law or the U.S. Constitution they all raise serious ethical concerns.

President Trump could have simply divested from his investments when he took office. He did not. He has not. It seems he will not. And GSA must now deal with the consequences and stop shirking its constitutional obligations.

Our Founding Fathers knew well the risk of unscrupulous individuals, both foreign and domestic, attempting to corrupt our presidents. And they knew this would have detrimental and wide-ranging negative consequences on our democracy and the public’s perception of our government and its institutions.

Yet, in this instance regarding President Trump’s financial stake in the Trump International Hotel, it seems clear that GSA has failed in its obligation to comply with the Constitution. Ignoring this problem won’t make it disappear. But investigating it can help determine how GSA went so wrong, and how they can take corrective actions so that these mistakes and missteps are not repeated into the future.

Chair DeFazio’s remarks as delivered can be found here.

Chair Titus:

Good morning and welcome to the fourth hearing of the Economic Development, Public Buildings, and Emergency Management Subcommittee.  This morning’s hearing is entitled, “Landlord and Tenant: The Trump Administration’s Oversight of the Trump International Hotel Lease.”

You can tell from the title that today we are investigating an unprecedented situation. The federal government owns the building that houses President Trump’s D.C. hotel. Since President Trump has declined to divest from his business, he is essentially both the landlord and the tenant.

Before I was elected to Congress, I spent over three decades teaching college students about American government and politics. In those classrooms, we had serious discussions about the role of the legislature in holding the executive branch accountable to the highest legal and ethical standards. That’s exactly what we hope to do today.

So let’s start with some facts. First, all federal workers and federally elected officials take an oath to uphold the U.S. Constitution. Of course, that includes the President, the Administration, and all Members of Congress.

Second, the Constitution contains two clauses pertinent to our topic today: One prevents an elected official from receiving “any present [or Emolument] . . . from any King, Prince, or foreign state” . . . “without the Consent of Congress.” To date, Congress has given this President no such consent. A second and related clause that prevents the President from accepting any federal or state taxpayer dollars or emoluments beyond his presidential salary. 

A lot of people may not be familiar with the term “emolument,” but the Founders thought of it broadly as any payment or benefit. They included it in the Constitution to prevent U.S. government officials from accepting bribes from foreign governments or from parts of our own government that could try to curry favor. I hope we can all at least agree that’s a practice the American people will not abide.

Third, the government lease for Trump’s D.C. hotel explicitly states that the tenant may not use the premises to violate federal law “for any purpose or in any way.” That of course includes the Constitution. Moreover, Section 37.19 of the lease states that “No…elected official of the Government of the United States…shall be admitted to any share or part of this lease, or to any benefit that may arise therefrom.” Yet, the President continues to have a personal stake in this hotel.

When people stay at Trump’s D.C. hotel, he directly benefits, yet despite all the legal and ethical issues that arise from this unprecedented arrangement, the agency that oversees the lease – the General Services Administration – has not done a thing about it. In fact, the agency’s independent Inspector General who is here with us today conducted an exhaustive report that found that the GSA “recognized that the President’s business interest in the Old Post Office lease raised issues under the Constitution’s Emoluments Clause that might cause a breach of lease.”

Despite this observation, the Inspector General found that GSA decided not to address those obvious issues. The Inspector General called that “improper” – and I think that description is, if anything, too kind.

When you take an oath to uphold the Constitution, you are bound by that oath. Yet, GSA officials have turned a blind eye to these legal and ethical issues. When called on it, the GSA failed to implement basic recommendations made by the Inspector General. GSA was instructed to conduct a formal legal review that includes consideration of the Constitution’s Emoluments Clauses and the terms of the lease. As far as I know, GSA hasn’t even pretended to do that. GSA was also instructed to revise the language of their leases to make it even clearer that the Constitution is relevant. They haven’t done so in a way that satisfies the Inspector General and they certainly haven’t done so in a way that satisfies this subcommittee.

Finally, in addition to the legal issues, GSA has refused to turn over documents to this subcommittee, which has jurisdiction over GSA, that we have a legitimate purpose to examine. In 2008, Congress directed GSA to lease out the Old Post Office building in order to make a profit. Yet, GSA, relying on the opinion of Trump’s business lawyers, refuses to turn over basic financial documents that would help us determine if the tenant is upholding the terms of the lease.

How can we know that taxpayer investments are being protected if we can’t examine the financial records of the hotel? And how can we ensure national policy is not being swayed by those spending money at a hotel that benefits people at the highest levels of our government? They’re also preventing us from looking at the legal memos that were drafted while the government officials who were supposed to enforce the terms of this lease decided to look the other way. It’s shameful, and yet it’s what we’ve come to expect from an executive branch that stonewalls Congress and rejects transparency at every turn. Few could have ever imagined a situation like the one we have today, but the Founding Fathers were wise enough to put the Emoluments Clauses right in the Constitution. We should be wise enough to enforce them.

In our first panel, we will hear from the agency that oversees the D.C. Trump hotel lease and from the Inspector General who found that the GSA “did not fulfill” its obligations under the Constitution. In the second panel, we will hear from legal scholars who can shed more light on these serious issues.

I want to thank the witnesses for being here today. I look forward to hearing your testimony. I now recognize the Ranking Member, Mr. Meadows, for an opening statement.

Chair Titus’s remarks as delivered can be found here.