This agency needs to toughen up on Trump's business deals
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More than a month after the shocking presidential election, Washington is slowly starting to piece together its response to the array of competing interests that Donald TrumpDonald John TrumpAmash responds to 'Send her back' chants at Trump rally: 'This is how history's worst episodes begin' McConnell: Trump 'on to something' with attacks on Dem congresswomen Trump blasts 'corrupt' Puerto Rico's leaders amid political crisis MORE is dragging into office. For now, Trump's response to decades of opaque real estate deals, massive debts to troubled entities like Deutsche Bank and an international business that stands to profit from foreign officials currying favor hasn’t gone beyond tweeted promises that his children will take over the Trump Organization.

The quandary of Trump’s leasing agreement for the Old Post Office Building is an early test of what will be acceptable. Last week, House Democrats including Elijah Cummings of Maryland and Gerry ConnollyGerald (Gerry) Edward ConnollyHillicon Valley: Lawmakers struggle to understand Facebook's Libra project | EU hits Amazon with antitrust probe | New cybersecurity concerns over census | Robocall, election security bills head to House floor | Privacy questions over FaceApp House panel advances bill to protect elections from foreign interference Four heated moments from House hearing on conditions at border facilities MORE of Virginia wrote to Denise Turner Roth, the head of the General Services Administration (GSA).

According to the lawmakers, her deputy commissioner agreed with them that Trump would be in direct violation of the 60-year lease agreement he and his daughter Ivanka signed with the GSA, Trump’s landlord at the building, the moment he takes office. The lease specifically says that no elected official (like the president, for example) can be part of it. With that in mind, the two sides were apparently on the same page: Trump needs to divest himself of all control and “ownership interest” in the hotel.

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The only problem? The deputy commissioner supposedly spoke on behalf of the GSA, but the agency doesn’t agree. After the letter from the House Democrats became public, the GSA released a statement to deny it had a position on the lease provision. Digging itself in even deeper, the GSA insisted it could not even make a decision on the matter until after Trump has taken office. The statement says it would be “premature” to speak to what would constitute a breach, as if Trump’s presidency were still up for debate.

Ethics experts have already made abundantly clear why the GSA needs to terminate the lease, so insisting that the agency’s hands are tied looks awfully like stalling. For his part, the President-elect doesn’t seem concerned. The Trump International Hotel in Washington opened less than a month before the election. Trump took full advantage of the presidential debates and campaign coverage to finagle some free advertising. He was supposed to address the Old Post Office questions in a press conference last week, but then he pushed it back to January to make room for a meeting with Kanye West.

A poor agency track record

Unfortunately, the GSA’s track record raises doubts about whether the agency is truly prepared to handle this kind of dicey ethical question. The 2012 Western Regions scandal and its bonanza of wasteful Las Vegas spending, improper contracts, management and cost oversight failures has left a blight on the agency’s reputation that it has yet to shake off. GSA contracting officer Kevin Terry, the shepherd of Trump’s post office deal from end to end, deflected criticisms of competing bidders five years ago and fielded questions about his own disclosures, financial dealings and ethical obligations.

The GSA’s lapses don’t just include high-profile scandals but also behind-the-scenes mismanagement of data, budgeting and contracts. The agency is struggling to keep up in implementing the Digital Accountability and Transparency Act (DATA), meaning that it lacks the capacity to track spending and certify the accuracy of its records to the Treasury Department and the Office of Management and Budget.

It’s no wonder that GSA vendors like communications equipment company Plantronics have been allowed to continue to supply the federal government despite operating in clear breach of the GSA’s own rules. In the Plantronics case, the company’s senior vice president of sales ordered employees to delete emails relevant to an ongoing antitrust suit, and a U.S. district court fined the company $3 million for destroying evidence.

Both antitrust violations and destroying records are grounds for a government vendor to lose eligibility for GSA contracts, but the agency has yet to take any action more than 100 days after the ruling. This pattern of oversights in oversight has surfaced in relation to Trump’s hotel deal as well. When Gizmodo filed a Freedom of Information Act request with the GSA to seek out internal reports on potential conflicts of interest related to Trump and the Old Post Office Building, they came back empty handed.

The confusion over whether or not the agency plans on enforce its lease provisions with Trump as president seems to confirm what Gizmodo suspected a few weeks ago: The GSA either mishandled the FOIA request or failed to prepare for this scenario entirely.

The next ethical crisis?

Sprawling government bodies struggle to maintain a high level of integrity in the best of times, but the GSA could soon become the vehicle for far more serious executive meddling in government contracting decisions. Soon after Trump appointees take over the agency, it will be making decisions over the $2 billion FBI headquarters project that some of Trump’s associates have been trying to land.

Those associates, billionaire New York City developers Steven Roth and Larry Silverstein, are among those bidding on the project and have known Trump for more than 30 years. The new FBI building which will be financed by $834 million in federal funds, and there is more than just the new building at stake. Whoever wins the contract will also receive the old J. Edgar Hoover Building and its prime downtown real estate. Congress is currently reviewing the funding, which got the green light from the House transportation and infrastructure committee this month. The GSA has scheduled its decisions on developer and location for March.

Trump has previously said he was interested in watching the process, and he will now be a direct participant. Come January, he will also be appointing the agency’s new administrator and filling many of its top leadership positions. Considering that his own real estate career has been marked by court battles and bankruptcies, will the Trump-era GSA follow the same lead?

Samuel Guzman is a policy analyst based in Washington, DC.


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