Donald Trump is about to become both landlord and tenant of the luxury hotel he leases from the federal government.

Legal experts agree it’s a clear and immediate conflict of interest, but there’s probably no way to force him out of it.


Two top lawyers made waves this week with the suggestion that Trump will have to unload the hotel because a line in his contract with the General Services Administration says the lease can’t benefit a government official. But other contracting experts say that argument isn’t a slam dunk, and if the GSA declines to fight Trump over it, no one else has the ability to intervene.

“This is a horrible outcome that can only be resolved by the president doing the right thing,” said David Drabkin, a former GSA senior procurement executive. “And I don’t know how you force him to do the right thing if he doesn’t choose to do it.”

Trump is facing bipartisan calls to sell his businesses to address the fear that he might use the presidency to enrich himself. Democrats are already plotting to harangue the incoming administration over the billionaire’s sprawling conflicts of interest.

But the case of the Trump International Hotel Washington, towering over Pennsylvania Avenue between the White House and the Capitol, symbolizes how Trump’s critics are short on legal options.

Trump has defied the calls to divest his holdings, going so far as to claim “the president can’t have a conflict of interest.” He tweeted this week that his lawyers are drawing up a plan to remove himself from his “business operations.” But ethics experts — and even the nonpartisan Office of Government Ethics — say that won’t fix the problem unless Trump stops owning the properties too.

The conflicts are not theoretical. Foreign dignitaries have already discussed patronizing the Washington hotel to curry favor with the next president. The Middle Eastern country of Bahrain has booked a reception there.

Trump and his three adult children own the project through a Delaware LLC. They won the bid in 2012 to redevelop the historic Old Post Office on a 60-year lease from the GSA, beating out proposals from companies including Hilton, Hyatt and Marriott.

The lease contains a provision that says no U.S. official “shall be admitted to any share or part of this Lease or to any benefit that may arise therefrom.”

That means Trump will break his lease when he takes office, argues Steve Schooner, a George Washington University law professor and former federal procurement official. It’s longstanding policy that federal officials can’t hold government contracts, so the credibility of the entire system is at stake, Schooner told POLITICO.

“Would they have awarded the contract to a team that included the president? The answer is no,” he said. “The principle is much more important than money here. The whole world is watching.”

Rep. Elijah Cummings, the ranking member on the House Committee on Oversight and Government Reform, and three other House Democrats adopted Schooner’s reading of the contract in a letter to the GSA demanding to know what action it’s taking to protect taxpayers from this conflict of interest.

“We do not see this as an ambiguous provision, but as a strict and categorical ban,” Cummings said in the letter. “There is a clear and very real conflict that will be triggered the moment Mr. Trump is sworn in as President of the United States unless concrete steps are taken now to avert it.”

But not everyone agrees with Schooner’s interpretation of the contract’s wording. According to Drabkin, the word “admitted” means that while a government official couldn’t join the lease, Trump’s becoming president doesn’t preclude him from holding onto it.

“The president-elect isn’t going to be ‘admitted’ to the lease, he’s already the tenant,” Drabkin said. “That clause is inartfully written, but the way that it is written talks about admitting someone to the lease after the lease was entered into.”

The contract’s ban on government officials is typical in large GSA leases to prevent politically connected people from tainting the bid process, according to Matt Elawady, a former GSA official.

Kevin Fullington, co-chairman of the Government Relations practice at Herrick Feinstein in New York, vouched for Drabkin’s reading.

“It’s not 100 percent clear Trump’s becoming president violates the contract,” he said. “It’s a close call whether or not that argument would be successful.”

But the argument is tenable enough that Trump could sue if the GSA tries to use that provision to end the lease. And that threat — combined with the fact that Trump oversees the agency — could lead it to favor the interpretation that sidesteps the problem.

In a statement, the GSA said it “plans to coordinate with the president-elect’s team to address any issues that may be related to the Old Post Office building.”

If the GSA decides not to regard Trump’s presidency as a violation of the contract or otherwise not to enforce the contract, it’s unlikely a third party would be able to come up with a legitimate cause to sue.

Still, watchdog groups are scraping around for ways to sue if the GSA doesn’t stop Trump.

“It didn’t occur to us until this week that it might not be taken care of” by the GSA, said Allison Zieve, the director of litigation at Public Citizen. “We may come up with a theory, but it will not be as straightforward as the GSA enforcing its own contract.”

Courts generally don’t recognize ordinary taxpayers’ ability to sue over government contracts, according to Paul S. Ryan, the vice president of policy and litigation at Common Cause. There are some exceptions, such as whistleblowers revealing fraud.

“We’ll be looking into whether there’s any exception that might apply in this context,” Ryan said. “It’s a bad way to start a president’s administration.”

The other companies that sought the lease couldn’t successfully sue over the alleged breach because it involves how the contract is being administered, not how it was awarded, according to Tom Papson, who has represented unsuccessful bidders for 35 years.

Competing bidders for the Old Post Office contacted by POLITICO declined to comment or didn’t answer requests for comment.

As part of his deal with the GSA, Trump is awaiting final certification from another federal agency, the National Park Service, on tax credits for historic preservation worth millions of dollars.

And Trump is already in litigation with the District of Columbia over the hotel’s tax bills. A spokesman for the District’s attorney general said the city has no stake in the lease itself.

Josh Gerstein contributed reporting.