In a letter Wednesday, lawmakers said Michael Gelber, the deputy commissioner of the General Services Administration’s Public Buildings Service, informed them Trump will be in breach of his lease as soon as he is sworn in on Jan. 20, 2017. The hotel lease specifically 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.”
The GSA, however, pushed back on this conclusion Wednesday.
“GSA does not have a position that the lease provision requires the President-elect to divest of his financial interests. We can make no definitive statement at this time about what would constitute a breach of the agreement, and to do so now would be premature. In fact, no determination regarding the Old Post Office can be completed until the full circumstances surrounding the President-elect’s business arrangements have been finalized and he has assumed office,” a spokesperson said, referring to the GSA-owned building that Trump’s D.C. hotel occupies. “GSA is committed to responsibly administering all of the leases to which it is a party.”
A spokesperson told BuzzFeed News that there was no difference between “the agency’s latest statement and what the GSA had told the lawmakers.”
House Oversight & Government Reform Committee ranking member Elijah Cummings (D-Md.) addressed the conflicting reports later Wednesday.
“We understand GSA’s position that this breach has not yet occurred, will not occur until Donald Trump is sworn in as president, and is officially viewed as a ‘hypothetical’ issue until that time,” Cummings said in a statement. “We also share GSA’s hope that the agency will not have to address this issue if President-elect Trump divests his ownership in the lease before then. But the simple fact is that GSA informed our staffs that they interpret this lease provision as prohibiting any elected official from having any ownership interest in the lease, and we stand 100% behind our letter.”
House Democrats had previously penned a letter to the GSA expressing concerns about Trump’s lease. They say Gelber responded to lawmakers, including Cummings, Transportation & Infrastructure Committee ranking member Peter DeFazio (D-Ore.) and Rep. Andre Carson (D-Ind.), stating that the only way to avoid a violation of contract would be if Trump fully divests his ownership interest in the hotel. He would still be in breach, lawmakers said, if he simply transfers management control to his two adult sons, Donald Jr. and Eric, as he has said he would do.
The Trump International Hotel in D.C. is just one of the many conflicts of interest facing the president-elect before he takes office, but it is one of the most glaring. Beyond the issue of whether he will be in violation of his contract with the government, upon assuming office Trump would be able to appoint a new head of the GSA, which would have to renegotiate terms of his lease with his children every year. This would put any GSA employee in a terribly uncomfortable and compromised position.
As Steve Schooner, a procurement law professor at George Washington University Law School and former government contracting official, previously told The Huffington Post: “There’s an imbalance of power. In a 60-year, complicated contract, we’re going to ask a civil servant at GSA to negotiate annually with the president’s children.”
He called the situation “mind-boggling.”
The hotel has already emerged as a hotspot for foreign governments who want to influence the new regime. The Embassy of Bahrain and the government of Azerbaijan rented out ballrooms for their annual end-of-year parties in the capital. Hotel staff held a briefing for foreign governments to sell them on renting the luxury rooms as a means of getting in the good graces of the incoming president.
The conservative Heritage Foundation and the Republican National Committee have also booked space for their parties.
According to Wednesday’s follow-up letter from House Democrats that details their communications with GSA on this issue, neither Trump nor his company contacted the GSA at any point during the campaign to discuss the terms of their lease and the possibility of a breach of contract if he won the White House.
Further, the letter states, “the Deputy Commissioner stated that GSA informed the Trump transition team about concerns raised by us and others about the imminent breach, but that GSA heard nothing to date.”
GSA stated that their main contact with the Trump Organization when the lease was agreed upon was Ivanka Trump, the president-elect’s eldest daughter. Ivanka Trump currently serves in multiple capacities across the Trump Organization and her father’s transition team, completely blurring the line between business and government.
Trump was supposed to announce a plan Thursday for how, if at all, he will disentangle himself from his business, but canceled. He has set some undefined date in January, perhaps before he takes office, to inform the public about how he will avoid his many existing conflicts of interest. Trump transition spokesman Jason Miller said on a press call Wednesday morning that Trump will address the hotel lease next month.
The president-elect stated on Twitter that he will hand his company off to his two oldest sons, but they are also on his transition team. In fact, Donald Trump Jr. helped select Rep. Ryan Zinke (R-Mont.) as the nominee for interior secretary.
Cummings has been leading the Democratic push for Congress to hold hearings on Trump’s business conflicts before he takes office. House Republicans have almost uniformly dismissed such concerns. Rep. Jason Chaffetz (R-Utah), chairman of the Oversight & Government Reform Committee, says that Congress doesn’t need to hold hearings until after Trump is in office ― when he’ll already be in violation of his lease.
This article has been updated to reflect that the GSA says House Democrats mischaracterized its assessment.