One Reason for GSA’s Silence on Trump Hotel: It’s Complicated

Despite howls from ethicists, contract specialists and Democratic lawmakers, the General Services Administration has yet to issue a ruling on whether its three-year-old lease to President Trump’s company for Washington’s Trump International Hotel presents Trump with a conflict of interest.

Given the broader context of Trump’s controversial plan to turn his vast business holdings over to his adult children, the hotel issue is especially difficult because the nation’s top elected official is exempt from many of the ethics rules that apply to federal employees. There’s clearly no easy solution for the agency known as the government’s landlord to defuse a unique and highly politicized situation in which Trump is both landlord and tenant of a major property near the White House.

Government Executive interviews with past GSA officials on ins and outs of the process give some notion of the complications. (GSA itself did not respond to multiple inquiries.)

“Anything the outgoing administration would have done would have been viewed as political, and anything the current administration does is viewed as political,” said a former GSA high-level official who spoke on condition of anonymity. “It’s an unprecedented position, that’s the underlying issue,” this official said. “There isn’t any playbook go back to look at it, and I don’t think this position has ever been triggered.” Some speculate that folks are waiting for a senior Trump official or the Justice Department to get involved.

There is also a large and moving cast of characters.

“The Office of the General Counsel, which reports directly to the administrator, would make the decision/recommendation regarding the legality of any contract situation,” said Martha Johnson, who was administrator from 2010 to 2012 and worked there for five years in the Clinton administration. (The acting general counsel, pending Trump’s naming of a new GSA administrator, is Lennard Loewentritt. Tim Horne is currently acting as GSA’s top administrator following the Inauguration Day departure of Denise Turner Roth.)

The Trump hotel falls under the jurisdiction of the GSA’s National Capital Region, which has its own legal staff reporting to the GSA general counsel. The regional administrator, Johnson said, “is traditionally a political appointee.”

The current legal counsel of the D.C. region is Paula DeMuth, who recently was named to serve simultaneously as acting regional administrator and is not a political appointee.

To further muddy the waters, the point person on the Trump hotel question, according to Capitol Hill sources, has been Michael Gelber, deputy commissioner of the Public Buildings Service. He’s the one Rep. Elijah Cummings, D-Md., cited in December for a statement saying Trump’s lease was in violation of contract law—a position later disavowed by GSA’s top officials.

Robert Peck, an attorney who was commissioner of Public Buildings at GSA from 2009 to 2012, said it’s possible the acting general counsel could render an opinion interpreting the standard government lease’s contract clauses but not make it public due to its sensitivity. “Some people think the clause was put in especially for a situation like this,” said Peck, who now works at Gensler, a consulting firm.

The White House may already be involved, he added, and the issue could be referred to the Justice Department: “Anytime there’s a question of potential litigation in U.S. courts, the DOJ gets involved. The question is, who will the courts decide has standing?”

“With a lease in place like this, who goes to court is some interested group” that believes the lease is a violation, Peck said. So the court asks, “What do you have to do with it? And if the government has a lease that is not being followed, the government files suit, or it may choose not to.”

Peck speculated that if GSA attorneys conclude that Trump’s actions have been insufficient, the White House might try to work out a solution.

In the meantime, GSA’s silence prompted House Oversight and Government Reform Committee Chairman Jason Chaffetz on Thursday to send his own letter to acting GSA chief Horne asking for documents on the Trump hotel lease.