Donald Trump must give up stake in Washington DC hotel before inauguration, say authorities

The Trump Organisation negotiated a 60-year lease with the General Services Administration for the hotel in the federally-owned Old Post Office

Feliks Garcia
New York
@feliksjose
Wednesday 14 December 2016 15:03
The Trump International Hotel opened in September amid worries of potential conflicts of interest
The Trump International Hotel opened in September amid worries of potential conflicts of interest

Donald Trump must give up his stake in the Washington-based Trump International Hotel before Inauguration Day, or face breach in government contract.

Mr Trump’s election has stoked concerns of potential conflicts of interest as he intends to hold a stake in much of his company. He had said he planned to hold a press conference – the first since July – to outline how he intends to separate himself from the Trump Organisation, but that meeting was postponed. Mr Trump tweeted that he pushed back the announcement to “focus full time on the presidency”.

But the Trump hotel’s Pennsylvania Avenue location could mean trouble for the President-elect if he fails to fully divest himself from the business before taking his seat in the Oval Office in January.

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The hotel is leased in a government-owned site, the Old Post Office. But the General Services Administration (GSA), who leased out the building to Mr Trump’s company, says that the contract contains a provision that prohibits any elected official from holding the lease, BuzzFeed reported.

Democratic lawmakers addressed a letter to the GSA’s administrator, bringing to attention the potential conflict apparently mentioned to them by a member of that agency.

“[T]he Deputy Commission informed our staff that the GSA assesses that Mr Trump will be in breach of the lease agreement the moment he takes office on 20 January 2017, unless he fully divests himself of all financial interests in the lease for the Washington DC hotel,” states the letter, signed by senior Democrat on the House Oversight and Government Affairs Committee, Elijah Cummings, and others.

“The Deputy Commissioner made clear that Mr Trump must divest himself not only of managerial control, but of all ownership interest as well.”

The letter added that the GSA had not received any communication from Mr Trump since he won the Republican primaries, nor since he became President-elect, “when it became clear that potential breach of this lease agreement was imminent”.

One particular point of concern for the four Democrats who wrote the letter was Ivanka Trump’s role in Trump Organisation, as well as the transition team. According to the letter, Ms Trump was the primary point of contact in lease negotiations with the GSA, and her role on the transition team further complicates how the agency will proceed with handling the potential breach of contract.

“In other words, Ms Trump is all of the following – the President-elect’s daughter, a top presidential transition team official, a lessee under the contract GSA oversees, and the primary contact for GSA on the lease,” the letter said.

“The conflicts of interest are obvious."

However, GSA issued a statement on Wednesday afternoon that seemed to go against what the letter from Democrats had said.

"GSA does not have a position that the lease provision requires the President-elect to divest of his financial interests," they said. "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."

Mr Cummings responded to GSA's statement Wednesday afternoon reaffirming the position taken in the letter.

"We understand GSA's position that this breach 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," he said. "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 per cent behind our letter."