Cummings, Jeffries Raise Concerns Over Conflicts of Interest Created by President Trump’s Starrett City Ownership

Jul 10, 2017
Press Release

Cummings, Jeffries Raise Concerns Over Conflicts of Interest Created by President Trump’s Starrett City Ownership

 

Request Documents from Trump Trustees and HUD

 

Washington, DC (July 10, 2017)— Reps. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, and Hakeem Jeffries (D-NY), sent a letter to the President’s Trustees and the Department of Housing and Urban Development (HUD) requesting documents relating to President Donald J. Trump’s apparent conflicts of interest arising from his ownership of a stake in the nation’s largest government-subsidized residential property, Starrett City.

“The President has rejected the advice of ethics experts from across the political spectrum by refusing to divest his ownership in his personal businesses which creates numerous conflicts of interest,” Cummings and Jeffries wrote. “The President’s decision to maintain a 4% ownership stake in Starrett City means that his administration oversees Department of Housing and Urban Development (HUD) programs that pay the President millions of dollars annually.”
“Many real estate companies receive government subsidies to support affordable housing but unique conflicts exist with regard to Starrett City because the President is on both sides of the negotiation—he oversees the government entity providing taxpayer funds and he pockets some of that money himself,” Cummings and Jeffries wrote.

Cummings and Jeffries raised grave concerns about the numerous actions that the President or his administration could take to financially benefit himself, his family members, and his business associates in Starrett City. For example:  

  • HUD approves the amount of rent that Starrett City’s owners can charge and determines how often to readjust the rent subsidies.  HUD officials could approve unusually favorable marked-up rents, ensuring an increase in the federal subsidies flowing to Starrett City’s owners.
  • The Trump Administration could approve a sale of Starrett City—something that would grant a windfall in profit to the property owners and something that HUD has previously refused to do. 
  • The administration could assist the President, his siblings, and his business partners in obtaining more cash equity out of the Starrett City project, as part of a refinancing deal currently being negotiated. 
  • The President’s budget proposal seeks to impose steep cuts to most housing aid programs, but would leave the type of federal aid that flows to the owners of Starrett City mostly intact.

Cummings and Jeffries also expressed concern with his appointment of Lynne Patton—an event planner without housing experience and a self-described loyalist to the Trump family—to be the HUD regional administrator for New York and New Jersey.

“Not only do we have concerns regarding Ms. Patton’s qualifications and fitness for her new role with HUD, but we have serious concerns that her self-described loyalty to the President and his family could influence HUD’s discretion on issues related to Starrett City,” the Members wrote.

Cummings and Jeffries requested multiple documents relating to Starrett City, including the partnership agreement, and all communications between the Trump Organization, HUD, the White House, and any bank or lender.  

 

Click here to read today’s letter.

115th Congress