[House Report 107-768]
[From the U.S. Government Publishing Office]
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-768
_______________________________________________________________________
Union Calendar No. 483
PROBLEMS WITH THE PRESIDENTIAL GIFTS SYSTEM
----------
SEVENTH REPORT
by the
COMMITTEE ON GOVERNMENT REFORM
together with
MINORITY AND ADDITIONAL VIEWS
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-768
_______________________________________________________________________
Union Calendar No. 483
PROBLEMS WITH THE PRESIDENTIAL GIFTS SYSTEM
__________
SEVENTH REPORT
by the
COMMITTEE ON GOVERNMENT REFORM
together with
MINORITY AND ADDITIONAL VIEWS
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
October 28, 2002.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut MAJOR R. OWENS, New York
ILEANA ROS-LEHTINEN, Florida EDOLPHUS TOWNS, New York
JOHN M. McHUGH, New York PAUL E. KANJORSKI, Pennsylvania
STEPHEN HORN, California PATSY T. MINK, Hawaii
JOHN L. MICA, Florida CAROLYN B. MALONEY, New York
THOMAS M. DAVIS, Virginia ELEANOR HOLMES NORTON, Washington,
MARK E. SOUDER, Indiana DC
STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland
BOB BARR, Georgia DENNIS J. KUCINICH, Ohio
DAN MILLER, Florida ROD R. BLAGOJEVICH, Illinois
DOUG OSE, California DANNY K. DAVIS, Illinois
RON LEWIS, Kentucky JOHN F. TIERNEY, Massachusetts
JO ANN DAVIS, Virginia JIM TURNER, Texas
TODD RUSSELL PLATTS, Pennsylvania THOMAS H. ALLEN, Maine
DAVE WELDON, Florida JANICE D. SCHAKOWSKY, Illinois
CHRIS CANNON, Utah WM. LACY CLAY, Missouri
ADAM H. PUTNAM, Florida DIANE E. WATSON, California
C.L. ``BUTCH'' OTTER, Idaho STEPHEN F. LYNCH, Massachusetts
EDWARD L. SCHROCK, Virginia ------
JOHN J. DUNCAN, Jr., Tennessee BERNARD SANDERS, Vermont
JOHN SULLIVAN, Oklahoma (Independent)
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
James C. Wilson, Chief Counsel
Robert A. Briggs, Chief Clerk
Phil Schiliro, Minority Staff Director
Subcommittee on Energy Policy, Natural Resources and Regulatory Affairs
DOUG OSE, California, Chairman
C.L. ``BUTCH'' OTTER, Idaho JOHN F. TIERNEY, Massachusetts
CHRISTOPHER SHAYS, Connecticut TOM LANTOS, California
JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York
STEVEN C. LaTOURETTE, Ohio PATSY T. MINK, Hawaii
CHRIS CANNON, Utah DENNIS J. KUCINICH, Ohio
JOHN J. DUNCAN, Jr., Tennessee ROD R. BLAGOJEVICH, Illinois
JOHN SULLIVAN, Oklahoma
Ex Officio
DAN BURTON, Indiana HENRY A. WAXMAN, California
Dan Skopec, Staff Director
Barbara F. Kahlow, Deputy Staff Director
Allison Freeman, Clerk
Elizabeth Mundinger, Minority Counsel
LETTER OF TRANSMITTAL
----------
House of Representatives,
Washington, DC, October 28, 2002.
Hon. J. Dennis Hastert,
Speaker of the House of Representatives,
Washington, DC.
Dear Mr. Speaker: By direction of the Committee on
Government Reform, I submit herewith the committee's seventh
report to the 107th Congress. The committee's report is based
on a study conducted by its Subcommittee on Energy Policy,
Natural Resources and Regulatory Affairs.
Dan Burton,
Chairman.
(iii)
C O N T E N T S
Page
I. Summary of oversight findings....................................1
II. Report on the committee's oversight..............................2
Chart I-A.--Disclosure of retained gifts valued by White 10
House at $260 or more.
Chart I-B.--Gifts from Borsheim's Fine Jewelry and Gifts. 30
Chart II.--Undisclosed retained gifts valued by White 48
House at $240-$259.
Chart III-A.--26 examples of undervalued fair trade gift 58
items.
Chart III-B.--109 Baccarat, Cartier, Ferragamo, Gucci, 70
Hermes, Steuben, Tiffany and Waterford gifts retained
by the Clintons.
Chart III-C.--Examples of probably undervalued non-fair 79
trade gift items.
Chart IV-A.--All gifts in the White House Database from 83
Monica Lewinsky.
Chart IV-B.--30 examples of ``misplaced'' or ``lost'' 85
gift items.
Chart V.--Some White House gifts rulings by White House 91
counsel: 1993-2000.
Chart VI.--Status of 45 furniture gifts valued by the 100
White House at $260 or more.
Chart VII.--Total gifts disclosed by Presidents George 115
H.W. Bush and William Clinton: 1989-2000.
Chart VIII.--22 of 125 gift certificate gifts............ 117
Chart IX.--Gifts to the Clintons from selective sources.. 125
Chart X.--Some of the large gifts (each valued over 137
$5,000) to the archives for the Presidential Library.
Chart XI.--Gifts valued at $250 or more which were sent 154
to GSA for disposition.
III. Conclusions....................................................161
Appendixes
Appendix A.--Selected press reports about gifts to the Clintons.. 162
Appendix B.--The subcommittee's February 2001 to January 2002 185
correspondence to the agencies, the former head of the White
House Gifts Unit, and former President Clinton, and some agency
replies.
Appendix C.--President Clinton's eight Financial Disclosure 197
Reports.
Appendix D.--GSA's noncompetitive hiring and then detail of Lori 246
Krause to head the White House Gifts Unit.
Appendix E.--Letter to NARA to ensure IRS tax deduction for gift 294
to White House craft collection and sample NPS letter
acknowledging gift of furniture to the Executive residence.
Appendix F.--Selected e-mail between NARA and Lori Krause........ 296
Appendix G.--White House counsel's 1993, 1994 and 2000 memoranda 298
about furniture gifts.
Appendix H.--Chairman Ose's February 2002 referral to the Justice 306
Department.
Appendix I.--NARA's June 2002 ``newest'' procedures.............. 308
Views
Views of Hon. Henry A. Waxman, Hon. John F. Tierney, Hon. Tom 312
Lantos, Hon. Major R. Owens, Hon. Edolphus Towns, Hon. Carolyn
B. Maloney, Hon. Eleanor Holmes Norton, Hon. Elijah E.
Cummings, Hon. Dennis J. Kucinich, Hon. Rod R. Blagojevich,
Hon. Danny K. Davis, Hon. Jim Turner, Hon. Thomas H. Allen,
Hon. Janice D. Schakowsky, Hon. Wm. Lacy Clay, and Hon. Diane
E. Watson.
Additional views of Hon. Doug Ose................................ 314
(v)
ABBREVIATIONS
__________
DOI Department of the Interior
DOJ Department of Justice
DOS Department of State
GSA General Services Administration
IRS Internal Revenue Service
NARA National Archives and Records
Administration
NPS National Park Service
OGE Office of Government Ethics
(vii)
Union Calendar No. 483
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-768
======================================================================
PROBLEMS WITH THE PRESIDENTIAL GIFTS SYSTEM
_______
October 28, 2002.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Burton, from the Committee on Government Reform submitted the
following
SEVENTH REPORT
together with
MINORITY AND ADDITIONAL VIEWS
On October 9, 2002, the Committee on Government Reform
approved and adopted a report entitled ``Problems with the
Presidential Gifts System.'' The chairman was directed to
transmit a copy to the Speaker of the House.
I. Summary of Oversight Findings
Several laws, involving six Federal offices and agencies,
govern the current system for the receipt, valuation, and
disposition of Presidential gifts. Consequently, no single
agency is ultimately responsible for tracking Presidential
gifts.
In early 2001, there were numerous press accounts regarding
President Clinton's decision to accept close to $200,000 in
gifts during his final year in office, as revealed in his last
financial disclosure report. There was also a great deal of
press attention focused on furniture gifts returned by the
Clintons to the White House residence. To prevent future
abuses, the Government Reform Subcommittee on Energy Policy,
Natural Resources and Regulatory Affairs spent 11 months
conducting oversight and gathering empirical data. The
subcommittee investigated how the current system works and what
legislative changes, if any, are needed to prevent future
abuses of the Presidential gifts process.
In March 2001, Chairman Ose introduced H.R. 1081,
``Accountability for Presidential Gifts Act.'' This bill
establishes responsibility in one agency for the receipt,
valuation and disposition of Presidential gifts.
In February 2002, the subcommittee released a 55-page
document summarizing the subcommittee's findings. The
subcommittee identified a host of problems with the
Presidential gifts system, such as consistently undervalued
gifts and questionable White House counsel rulings. Since the
current system is subject to abuse and political interference,
there is a need for centralized accountability in one agency
staffed by career employees.
II. Report on the Committee's Oversight
Current System
Several laws, involving six Federal offices and agencies,
govern the current system for the receipt, valuation, and
disposition of Presidential gifts. The White House Gifts Unit
is responsible for recording all domestic and foreign gifts
received by the First Family and White House employees,
including the valuation and disposition of gifts. Under the
Presidential Records Act of 1978 (44 U.S.C. Sec. 2201-2207),
the National Archives and Records Administration [NARA] accepts
gifts for Presidential archival depositories (libraries) and
provides courtesy storage for Presidential gifts that are not
immediately retained by the President but which can be recalled
for possible retention by the President.
Under a second law (3 U.S.C. Sec. 109), the Department of
the Interior's [DOI] National Park Service [NPS] annually
prepares a snapshot inventory of public property in or
belonging to the White House residence. In addition, NPS
officially accepts gifts for the White House residence.
Under a third law (5 U.S.C. Sec. 7432(f)), the Office of
Protocol in the Department of State [DOS] annually publishes a
listing of all gifts (both tangible and monetary) from a
foreign government to a Federal employee, including to the
First Family. The listing includes gifts to the President and
Members of Congress.
Under a fourth law (5 U.S.C. App. Sec. 103(b) and 5 U.S.C.
Sec. 102(a)(2)(A)), the Office of Government Ethics [OGE]
receives annual financial disclosure reports--which are
publicly available--from the President for gifts retained over
a reporting threshold from any source other than a relative.
The threshold is currently set at $260 but it will be raised to
$285, retroactive to January 1, 2002.
Last, the General Services Administration [GSA] has
detailed career staff to the White House Gifts Unit and is
responsible for updating the reporting threshold for gifts
(e.g., from $250 to $260) and for disposing of some gifts which
are not retained by the President or sent to NARA. GSA's
regulations require a commercial appraisal for foreign gifts
over a reporting threshold that a Federal employee (including
the President) wishes to retain (41 C.F.R. Sec. 102-42.40(a)).
A recipient may purchase a foreign gift at the appraised value
plus the cost of the appraisal (41 C.F.R. Sec. 102-42.140). In
contrast, there is no statutory requirement for a commercial
appraisal for domestic gifts over a reporting threshold.
Press Reports
In early 2001, there were numerous press accounts detailing
gifts retained by the First Family during calendar year 2000
and January 1-20, 2001. These gifts, valued by the White House
at $190,027, were made public in President Clinton's last
financial disclosure report, filed on January 20, 2001. For
example, a January 25th New York Daily News article included a
listing of the gifts disclosed for this nearly 13-month period.
The article stated,
A friend of Sen. Hillary Rodham Clinton helped solicit
donors to buy the pricey gifts that the former First
Family took with them as they exited the White House,
NBC News said last night. Clinton had registered her
choices for gifts in November, just like a bride. NBC
said Clinton contributor Rita Pynoos of Beverly Hills,
Calif., then urged potential contributors to send a
$5,000 check to the store quickly, before a Senate
ethics deadline that bans senators from receiving
gifts. . . . The former First Lady was registered at
Omaha-based Borsheim's Fine Jewelry and Gifts, a
subsidiary of Warren Buffett's Bershire Hathaway, an
aide confirmed earlier (1/25/01, New York Daily News,
see Appendix A).
Another example was an article entitled, ``A Shower of
Gifts for Hillary and Bill; Why did the Clintons troll for
freebies they can surely afford?,'' in the February 5, 2001
edition of Time magazine. This article also stated that
potential donors ``had been contacted by political supporter
Rita Pynoos, who is married to a California developer, to send
the gift registry a $5,000 check'' (2/5/01, Time, see Appendix
A).
There was another string of press reports in February 2001
about gifts of furniture removed from the White House by the
Clintons, which were later returned to the U.S. Government. For
example, from February 5th to 10th, the Washington Post ran
five stories and one editorial (see Appendix A). Two of these
articles were captioned ``Gifts Were Not Meant for Clintons,
Some Donors Say'' and ``Clintons Shipped Furniture Year Ago;
White House Usher Doubted Ownership.'' In the former, a
previous Commissioner of the Internal Revenue Service [IRS] was
quoted as saying, ``If someone gave something of value to the
White House as the White House and not to the president, that
is a gift to the government of the United States . . . a
charitable contribution'' and the Clintons ``have no business
taking it with them. That is conversion of government property
and income to them.'' The latter begins by stating,
President Bill Clinton and his wife started shipping
furniture from the White House to the Clintons' newly
purchased home in New York more than a year ago,
despite questions at the time by the chief usher about
whether they were entitled to remove the items. The day
before the items were shipped out, White House chief
usher Gary J. Walters said he asked whether the
Clintons should be taking the furnishings because he
believed that they were government property donated as
part of a White House redecoration project in 1993.
Investigation
In February 2001, the subcommittee began an inquiry into
this matter to determine if legislative changes were needed to
curb abuses. This section briefly details steps taken by the
subcommittee to gather information.
On February 13, 2001, Subcommittee Chairman Ose faxed a
draft letter to the Acting Director of NPS (see Appendix B).
This letter stated:
The Subcommittee on Energy Policy, Natural Resources,
and Regulatory Affairs is conducting oversight of the
National Park Service's (NPS's) implementation of 3
U.S.C. Sec. Sec. 109-110 relating to public property--
including furniture and furnishings--belonging to the
Executive Residence at the White House. The law
requires NPS to annually inventory all such public
property, including when purchased, its costs,
condition, and final disposition. Since the 1948
enactment of these provisions, the Department of the
Interior (DOI) appears to have not issued codified
regulations governing implementation.
. . . please provide the Subcommittee with each of the
annual NPS inventories from June 1992 to present and
any non-codified guidance issued by DOI governing
implementation, including internal and external DOI
guidance documents. In addition, please provide all
correspondence (including e-mails) relating to any
furniture and furnishings which former President
Clinton removed from the Executive Residence at any
time since January 20, 1993 and all correspondence
(including e-mails) relating to gifts received by the
Clintons from November 3, 1992 to January 20, 2001.
On February 22, 2001, subcommittee staff visited NPS to
inspect its annual inventory. There is only one copy of this
inventory, which NPS protects and will not copy. For example,
NPS staff used white gloves to turn pages. NPS had established
its own numbering system and its own electronic database, which
is not linked to any other agency's database.
On February 27, 2001, the subcommittee requested by
telephone that OGE provide a copy of each of the eight
financial disclosure reports filed by President Clinton with
OGE. Later that day, OGE was only able to provide seven of the
eight reports due to its 6-year record retention requirement
(see relevant parts of these reports in Appendix C). As a
consequence, on October 29, 2001, Subcommittee Chairman Ose
sent a followup letter to the Archivist, specifically
requesting the remaining, first financial disclosure statement
filed by President Clinton with OGE (see Appendixes B and C,
respectively).
On March 1, 2001, at a full committee hearing, entitled,
``The Controversial Pardon of International Fugitive Marc
Rich--Day 2,'' Subcommittee Chairman Ose questioned former
White House officials about their role in the process of
receiving and disposing of gifts. For instance, he asked former
counsel to the President Beth Nolan, ``in your role as counsel,
Ms. Nolan, have you ever been involved in judgment calls on any
of these gifts or setting the policy or determining . . .
what's a personal gift and what's for archives? Have you ever
played a part in that?'' She replied, ``It's not normally a
legal question.'' Later, Chairman Ose asked, ``How is the value
of the gift that's received determined?'' Former White House
chief of staff John Podesta replied, ``By the Gifts Unit, which
is staffed by a career employee, I believe of the General
Services Administration, who's detailed to the White House.''
Mr. Ose continued, ``is there a check on these valuations?''
Mr. Podesta replied, ``I don't believe there's any re-review of
the career employee's decision about what a gift is worth.''
On March 5, 2001, Subcommittee Chairman Ose sent a letter
to the Archivist of the United States who is head of NARA (see
Appendix B). This letter stated:
The Subcommittee on Energy Policy, Natural Resources
and Regulatory Affairs is conducting an investigation
of the laws, codified rules, and noncodified guidance
documents governing gifts for the Executive Residence
at the White House, the President, and the Presidential
archival depositories. Under various authorities, the
National Archives and Records Administration (NARA)
accepts for deposit certain material (familiarly known
as ``courtesy storage''), accepts gifts for
Presidential archival depositories, and deposits
Presidential records in Presidential archival
depositories.
. . . please provide the subcommittee by March 20, 2001
with: (a) access to all existing databases (including
but not limited to NARA's read-only database and the
White House Gifts Unit's database) about gifts for the
President, Executive Mansion, or The William J. Clinton
Presidential Center (including the Clinton Presidential
Library) processed by the White House Gifts Unit from
January 20, 1993 to January 20, 2001; (b) copies of the
``green sheets'' for all items not yet included in
these databases; (c) copies of the deeds of gifts to
NARA for all items in the White House Craft Collection
or any other gifts (such as gowns) accepted by NARA for
the Clinton Presidential archival depository and any
information related to any of these items that may have
been removed (including loans to the Clintons); (d)
copies of the ``green sheets'' for all items recalled
from November 1, 1999 to January 20, 2001 and any
information related to the return of any items to the
White House by the Clintons after January 20, 2001; and
(e) any inventories, correspondence, e-mail or other
information about any Clinton personal material for
which NARA provided courtesy storage since January 20,
1993.
In addition, please provide the Subcommittee by April
5, 2001 with: (f) all correspondence and e-mail
relating to gifts received by the Clintons from January
20, 1993 to January 20, 2001.
In a March 7, 2001 e-mail, the subcommittee requested
certain information from GSA (see Appendix B). The e-mail
stated:
The House Government Reform Subcommittee on Energy
Policy, Natural Resources and Regulatory Affairs is
conducting an investigation of the laws, codified
rules, and noncodified guidance documents governing
gifts for the Executive Residence at the White House
and the President. Using special regulatory authority
(5 C.F.R. Sec. 315.602), the General Services
Administration (GSA) hired non-competitively an
employee working both in the White House Travel Office
and the White House Gift Unit and then detailed her to
the White House Gift Unit. She became Director of the
Unit and, thus, she was responsible for the operations
of the Unit, including its receipt, administration, and
disposition of the gifts. . . . please provide by March
22, 2001, the Subcommittee with all GSA documents,
correspondence and e-mail relating to gifts received
for the Executive Residence at the White House and the
President from January 20, 1993 to January 20, 2001,
including but not limited to the following: all GSA
records (including any authored, received or mentioning
GSA employee Lori Krause), including any relating to
receipt, administration (including evaluation and
appraisal) and disposition of gifts for the Executive
Residence at the White House and the President.
Non-Competitive Hiring of Political Appointee for Career
Job
In response to the subcommittee's inquiry, GSA provided
information about the May 24, 1998, non-competitive hiring of
Lori Krause as a career employee and the subsequent detail of
her by GSA to the White House Gifts Unit. Ms. Krause's prior
work experience included only political positions. At the March
1, 2001, hearing, noted above, former White House chief of
staff John Podesta assured the committee that a career employee
made the gift valuations.
Ms. Krause's resume shows no prior experience in gift
valuations. It shows that she served as: (a) a staff member in
the Correspondence Department in the Clinton/Gore Presidential
Transition (from November 1992 to January 1993); (b) a writer
in Presidential correspondence (from January to February 1993);
(c) an unspecified position in the White House Volunteer Office
(from March to April 1993); (d) director of the Presidential
Correspondence Intern Program (from March 1993 to March 1997);
(e) an unspecified position doing advance work for the White
House Travel Office (from October 1994 until her hiring by
GSA); and (f) an unspecified position in the White House Gifts
Unit (from April 1995 until her hiring by GSA).
Appendix D includes: GSA's posted announcement for intended
competitive hiring of a career employee to be detailed to the
White House Gifts Unit, GSA's cancellation notice for a
competitive selection, Ms. Krause's resume, and a March 9,
2001, internal GSA routing slip. This document stated, ``Ms.
Krause did not apply for any announcement. She was
noncompetitively appointed on a special hiring authority.''
In response to Chairman Ose's March 5, 2001, letter, on
March 22, 2001, NARA provided the subcommittee with 73
``Acknowledgment of Gift and Nonexclusive License'' agreements
(also known as deeds of gift) for items in the White House
craft collection. All 73 craft objects were by living artists.
NARA's cover letter states, ``These are the only items that
were donated in this manner to the National Archives and
Records Administration (NARA).''
NARA's letter also stated, ``With respect to the remainder
of your request, we believe that it would be useful to meet
with you to discuss facilitating access to items (a), (b), (d)
and (e) and to discuss narrowing your request for item (f).
Responding to item (f) as written, would place an enormous
burden on NARA'' (see Appendix B).
NARA orally informed the subcommittee that NARA provided 8
years of free ``courtesy'' storage for personal property owned
by the Clintons prior to the start of the Clinton Presidency.
In response to Chairman Ose's March 5th letter, on April 3,
2001, NARA provided the subcommittee with a copy of the
``Deposit Agreement regarding the Administration of Personal
Materials of President William J. Clinton, Hillary Rodham
Clinton and Chelsea Clinton In the President William J. Clinton
Library,'' which was signed by President Clinton on January 16,
2001 (i.e., at the end of the Presidency) and then co-signed by
the Archivist on March 1st. The agreement provides that NARA
``shall arrange for and bear the expense of shipping the
Personal Property from Washington, D.C. to the temporary
library storage facility in Little Rock, Arkansas, and
thereafter, to the Clinton Library once it is constructed,''
``Personal Property may be conveyed to the United States at
some future time,'' and ``The Owners may from time to time,
with permission of the National Archives, deposit additional
Personal Property to be held and maintained by the National
Archives.''
A 14-page list of personal property items, entitled,
``Curatorial Inventory of Clinton Gubernatorial Boxes,'' was
attached to this agreement. The list, with the names of each
``donor,'' included art objects and other miscellaneous items
but no furniture items. NARA told the subcommittee staff that
this list constituted a small subset of all of the items
covered by the agreement.
Also on April 3, 2001, NARA provided the subcommittee with
backup information about the White House craft collection,
including a July 28, 1996, letter to NARA sent on behalf of one
of the donors. This letter sought to ensure that the gift was
recognized by the IRS as a tax deductible contribution to the
U.S. Government. It stated, ``I must provide the IRS with a
completed form in order to document the donation'' (see
Appendix E).
On April 20, 2001, GSA sent an e-mail to the subcommittee
(see Appendix B). It stated:
. . . in response to your request for the disposition
of National Park Service (NPS) property that is excess
to its needs, including property within its
jurisdiction at the White House, the Department of
Interior (NPS) would report property excess to its
needs to GSA for normal disposition. Once the property
is reported to GSA as excess to the Department's needs,
GSA screens the property for Federal use by other
agencies. If no agency has a need for the property then
the property is declared surplus and undergoes donation
screening by the State Agencies for Surplus Property
(SASP). If no SASP claims the property then the
property is sold.
GSA plays no role in the acceptance of gifts by the NPS
under their authorities. GSA recommends that you
contact the NPS directly with any questions you have
with respect to that process.
After officially requesting Presidential records under the
Presidential Records Act by a March 5, 2001 letter to NARA, as
noted above, after a May 8th meeting with the former
President's representatives, on May 9, 2001, the subcommittee
finally received access to Presidential gift records and the
White House Gifts Unit's database (see Appendix B). Also, NARA
informed the subcommittee that its March 5th request for ``all
correspondence and e-mail relating to gifts received by the
Clintons from January 20, 1993 to January 20, 2001'' could not
be processed for many months, if not years, due to other
pending congressional requests. However, on May 9th, NARA did
provide a few e-mails from NARA to the White House Gifts Unit.
Two of the NARA e-mail exchanges with Lori Krause, head of
the White House Gifts Unit, are provided in Appendix F. They
are indicative of a multi-agency system which has problems in
tracking gifts. A January 3, 2000 e-mail from NARA to Ms.
Krause says, ``Im afraid we havn't turned up the clothing from
#32 or the sweats from #131--we had a look again in the boxes
indicated, and in adjacent boxes to see if it might have been
an easy misfile. No luck. And they dont show up at all any more
in our Domestic database (records used to be completely deleted
when stuff was recalled), so we have no additional clues as to
where they might be.'' A September 1, 2000 e-mail from NARA to
Ms. Krause says about one two-part gift item that it ``got lost
in our mounting craziness.''
As a result of the access restriction noted above, the
subcommittee was only able to examine NPS's annual inventory
and other records for the White House residence, the financial
disclosure reports still in OGE's files and the additional one
provided by NARA, NARA's database for the former
administration, and the White House Gifts Unit's database for
the former administration.
Findings
The White House gifts system had 94,178 gift records (many
of which included multiple gift items) to the former First
Family during the two-term Presidency. The former First Family
retained one or more gift items in 16 percent (14,770) of these
gift records. The former President disclosed on his annual
financial statements less than 2 percent of these retained
gifts (227 of 14,770), each valued at $260 or more. These 227
gifts totaled $361,968. Of that total, $190,027 in gifts were
accepted in the final year of the Clinton Presidency.
Some Gifts Over the Reporting Threshold Were Not Disclosed
Several charts reveal details of these and other findings.
The law requires the President to disclose each retained gift
of $260 or more on his annual financial statements submitted to
OGE. Chart I-A shows details of the 227 retained gifts valued
at $260 or more which were disclosed. This chart also includes
an additional 26 retained gifts of $260 or more which were not
disclosed; some of these were gifts which the Clintons intended
to purchase from the U.S. Government. 61 retained gifts of $260
or more were not appraised or otherwise independently valued.
Two examples of gift records (with one donor's address redacted
for privacy) for undisclosed retained gifts over the $260
threshold are provided. They include: a Palm VII palm pilot,
which was valued at $449 and for which no donor name was
indicated; and gift of a Baccarat crystal sculpture and a
shirt, which were valued at $255 and $40, respectively.
[Chart I-A and gift records referred to follow:]
Retained gifts of $260 or more included a variety of items,
ranging from a $38,000 glass sculpture and a $25,350 Lenox
crystal bowl to $172,926 in art objects and books, $68,770 in
furniture (sofas, chairs, carpets, etc.), and $39,875 in china
and silver to $25,955 in golf items, $23,798 in clothing,
$5,975 in jewelry, and other types of items.
Some Gifts Were Solicited
OGE's rules state that a Federal employee \1\ shall not
solicit a gift (5 C.F.R. Sec. 2635.202(c)(2)). Nonetheless, in
December 2000 (i.e., after the former First Lady was elected a
U.S. Senator but before her term began), the former First Lady
received $38,617 in china and sterling silver gifts purchased
from Borsheim's in Omaha, NE (see Chart I-B).
---------------------------------------------------------------------------
\1\ In the litigation surrounding the President's Task Force on
National Health Care Reform, which was chaired by the First Lady, the
Clinton administration's Department of Justice argued that the First
Lady was a de facto full-time Federal employee (Association of American
Physicians and Surgeons, Inc. et al. v. Hillary Rodham Clinton, et al.,
989 F. Supp. 8, D.D.C. 1997). In reaching its decision, the District
Court relied upon a 1993 decision of the D.C. Circuit Court of Appeals
that found that the First Lady was the ``functional equivalent'' of a
full-time Federal officer or employee and that the Task Force was,
therefore, exempt from the Federal Advisory Committee Act (AAPS v.
Clinton, 997 F.2d 898, D.C. Cir. 1993). In its opinion, the Court of
Appeals concurred with the Justice Department's assertion that, ``the
traditional, if informal, status and `duties' of the President's wife
as `First Lady' gives her de facto officer or employee status'' (Id. at
904).
---------------------------------------------------------------------------
[Chart I-B follows:]
March 10, 2000 press report revealed that the First Lady
was in Omaha, NE the day before (on March 9th) and that
``[Warren] Buffett spent two hours with HRC [Hillary Rodman
Clinton] during her 5 1/2 hour visit, most of it at his store
[Borsheim's] where she shopped for china and silverware for her
new home'' (3/10/00, the National Journal's Hotline, see
Appendix A). In a December 24, 2000 op-ed, Maureen Dowd stated
in the New York Times, ``Lissa Muscatine, Mrs. Clinton's
spokeswoman, says that the first lady's silver and china
patterns can be found at Borsheim's. Hillary shopped there when
she was in Omaha last March to raise campaign money, with Mr.
Buffett's help. I clicked onto Borsheim's bridal registry on
the Web to sample the merchandise. What would Mrs. Clinton
like? Just some basics to get her started. Place settings for
40, including oyster forks and marmalade spoons?'' (12/24/00,
the New York Times, see Appendix A).
It is clear that the former First Lady was registered at
Borsheim's and that she solicited these gifts because, unlike
gifts from Tiffany's, Neiman Marcus and other fancy retailers
which only require the name of the intended gift recipient to
see his or her gift registry, Borsheim's Web site says
``Friend's Wish List--View a friend's wish list (You will need
their e-mail address and wish list password).'' Three Web pages
from the Tiffany's and Borsheim's Web sites reveal how their
respective gift selection processes work (see three graphics).
This means that the 11 donors who purchased these gifts from
Borsheim's needed to know both the former First Lady's personal
e-mail address and personal password to purchase items from her
``wish list.'' All 11 of these gift records (with the donors'
addresses redacted for privacy) are provided.
[The graphics and gift records referred to follow:]
Many Gifts Were Undervalued \2\
In addition, the former First Family retained thousands of
other gifts valued at less than $260, which were not required
to be disclosed. Chart II includes an additional $24,012 of
retained gifts, which were each valued at $240 to $259, which
is just below the threshold. 49 percent of these gifts were not
appraised or otherwise independently valued. Two examples of
gift records (with the donors' addresses redacted for privacy)
are provided. They include a Yves Saint Laurent men's suit,
which the White House ``estimated'' at $249, and a framed John
Quincy Adams signed original land grant from 1826, which the
White House ``estimated'' at $240. Both appear to be
significantly undervalued.
---------------------------------------------------------------------------
\2\ There is no evidence of a standard protocol in use by the White
House to determine when a gift needs to be commercially appraised to
ensure proper valuation.
---------------------------------------------------------------------------
[Chart II and gift records referred to follow:]
Charts I and II account for about 2 percent of all gifts
retained by the former First Family. The remaining 98 percent
of the retained gifts (14,445 gift records) were each valued by
the White House at $239 or less.
From calls to retailers and Web searches, the subcommittee
found that 69 percent of certain fair-trade gifts (i.e., brand
name goods widely sold) were undervalued. Many fair-trade items
were not appraised or otherwise independently valued. Many were
valued by the White House at less than $260 and, thus, not
subject to disclosure. Chart III-A includes 26 examples of
undervalued items. Some of these gifts, if properly valued
(i.e., valued at or over $260), should have been included in
the former President's annual financial disclosure reports or
increased in value.
[Chart III-A follows:]
Five examples of gift records (with the donors' addresses
redacted for privacy) are provided. These include: a Ferragamo
coat, which the White House valued at $800 but which is
actually valued at $1,600 to $2,000; a Coach large leather
travel bag, which the White House ``estimated'' at $200 but
which is actually valued at $498 to $698; a Tiffany 16 inch
silver link necklace, which the White House valued at $150 but
which Tiffany's valued at $450 to $1,000; a Tiffany engraved 7
inch by 8 inch silver frame, which the White House
``estimated'' at $40 but which Tiffany's valued at $250 to $375
plus engraving; and a Steuben crystal heart, which the White
House ``estimated'' at $185 but which is actually valued at
$245 to $495.
[Gift records referred to follow:]
Chart III-B includes information about 109 Baccarat,
Cartier, Ferragamo, Gucci, Hermes, Steuben, Tiffany and
Waterford gifts retained by the former First Family. 50 percent
were not appraised or otherwise independently valued. 69
percent were, in fact, undervalued. Examples include the
Ferragamo coat, Tiffany 16 inch silver link necklace, Tiffany
engraved 7 inch by 8 inch silver frame, and Steuben crystal
heart.
[Chart III-B follows:]
Chart III-C includes examples of non-fair trade items which
were probably undervalued, such as various collector's items.
Two examples of gift records (with the donors' addresses
redacted for privacy) are provided. They include a French coin
circa 1793, which the White House ``estimated'' at $10, and a
1815 bronze collector's coin from Great Britain, which the
White House ``estimated'' at $22.
[Chart III-C and gift records referred to follow:]
Some Gifts Were Not Included in the White House Database
Some known gifts to the First Family were not included in
the White House gifts database. Therefore, the database is
incomplete. For example, the independent counsel's report
stated, ``By her estimate, [Monica Lewinsky] gave [President
Clinton] about 30 items.'' Chart IV-A includes the only three
gift records in the database for gifts from Monica Lewinsky.
[Chart IV-A follows:]
Some Gifts Were Lost
Some gifts were ``misplaced'' or ``lost.'' Chart IV-B
includes 30 examples of them, including a 7 foot 3 inches by 6
foot 2 inches oriental rug (valued at $1,200) and an inscribed
Tiffany silver box (valued at $271), both of which were ``on
loan in the Residence'' but later ``Misplaced by Staff Member,
Never Conveyed to the President.'' Even though both gifts were
physically in the Executive residence, they were never
officially accepted by NPS for the Executive residence so
neither appears on any NPS annual inventory. An example of a
gift record (with the donor's address redacted for privacy) is
provided.
[Chart IV-B and the gift record referred to follow:]
Questionable White House Counsel Rulings
Despite former counsel to the President Beth Nolan's March
1, 2001 testimony, noted above, that treatment of gifts is not
usually a legal question, the White House counsel made some
unusual rulings relating to gifts, which were oddly reflected
in the treatment of gifts (see Chart V). For example, in 2000,
counsel advised ``it would be a bad idea to accept'' 10 shares
of General Electric stock and thus the gift was returned to the
sender. However, the former First Family retained a 1997 gift
of 15 shares of Coca-Cola stock, valued at $1,027. Both of
these gift records (with the donors' addresses redacted for
privacy) are provided. Publicly-traded stocks are cash
equivalents. Cash gifts cannot be accepted.\3\
---------------------------------------------------------------------------
\3\ OGE's regulations, entitled, ``Standards of Ethical Conduct for
Employees of the Executive Branch,'' govern all Federal employees,
including the President (see 5 C.F.R. Part 2635). Subpart B, Gifts From
Outside Sources, details General Standards and Exceptions.
---------------------------------------------------------------------------
[Chart V and gift records referred to follow:]
Furniture
The former First Family received 45 furniture gifts, valued
at $94,365. Six of these gifts were never disclosed in the
former President's annual financial disclosure reports. The
accounting of the 45 furniture gifts is remarkable in its
complexity (see Chart VI). Usually, the chief usher for the
Executive residence decides if items should be accepted for the
Executive residence and then NPS sends an official thank you
letter as proof for the donor of his or her contribution to the
Federal Government. However, on March 24, 1993 (i.e., 2 months
after the inauguration), deputy counsel to the President, Vince
Foster, directed the chief usher that certain items already
received by the White House and certain items not yet received
(such as two sofas valued at $8,750 each and a $4,600 coffee
table) were to be accepted by NPS for the Executive residence
(see Appendix G). As noted above, Appendix E included a letter
which sought to ensure that a gift to the U.S. Government was
recognized by the IRS as a tax deductible contribution. Mr.
Foster's memorandum ensured that the noted furniture gifts for
the Executive residence could be recognized by the IRS as tax
deductible contributions to the U.S. Government. A sample NPS
letter acknowledging one of these furniture gifts--sent in July
1993 for the two sofas not yet received when Mr. Foster
directed their acceptance in March 1993--is also provided in
Appendix E.
[Chart VI follows:]
Then, on April 22, 1994, associate counsel to the
President, Cheryl Mills, contradictingly wrote the director of
the White House Gifts Unit about the three items discussed
above and many others (see Appendix G). Ms. Mills stated:
The National Park Service initially thought these gifts
to the President were to be accepted for the permanent
White House collection; it therefore sent thank you
letters to each of the donors. Upon discovering that
the President had indicated a desire to have these
items go to the Clinton Presidential library, the
National Park Service elected not to accept these
items; therefore, the Park Service never declared these
gifts as accepted for the permanent White House
collection.
All three of the furniture items in this example were taken
from the White House Residence by the former First Family and
then returned to the NPS in February-March 2001.
Some U.S. Property Was Taken
It is illegal to remove U.S. Government property.
Therefore, after unfavorable press reports, in February-March
2001, the former First Family returned 25 furniture items to
NPS. However, in September 2001, NPS apparently returned two of
these items (a $1,725 easy chair and a $675 ottoman) back to
the former First Family since neither had been officially
accepted by NPS for the White House Residence. A copy of the
gift record (with the donor's address redacted for privacy),
which includes these two items, is provided. Also, four
furniture gifts (such as a $9,600 TV armoire and a $3,895
gaming table) were never disclosed on the former President's
annual financial disclosure reports since the White House
counsel's office in a January 3, 2000, memorandum stated that
they were ``accepted'' prior to the inauguration even though
they were not received in the White House until July 20, 1993
(i.e., 6 months after the inauguration) (see Appendix G). How
can you ``accept'' a gift not yet in hand? And, why did the
White House counsel opine in 2000 on gifts received 7 years
before? A copy of the four gift records (with the donors'
addresses redacted for privacy), which include these four
items, are provided.
[Gift records referred to follow:]
The former First Family still has 21 more furniture items,
none of which ever appeared in NPS's White House annual June
snapshot inventory. 19 of these items, valued at $38,328, were
received on December 1, 2000, i.e., after the former First Lady
was elected a U.S. Senator but before her term began on January
3, 2001. A graphic revealing the history of the furniture gifts
to the Clintons is provided.
[The graphic referred to follows:]
Most Furniture Gifts Were Coordinated
Last, the gift records reveal that the Clintons' interior
decorator, Kaki Hockersmith from Arkansas, ``coordinated'' 43
of the 45 furniture gifts received during the 8-year
Presidency--largely at the beginning of the administration and
in December 2000. Her coordination ensured that there was only
one dining room table, one chandelier, etc.
Comparison
Chart VII reveals that President George H.W. Bush received
41,779 gifts in 4 years in office, which is an amount similar
in magnitude to President Clinton's 94,178 gifts in 8 years in
office. During George H.W. Bush's Presidency, the reporting
threshold was $100; the threshold increased to $250 before the
start of the Clinton Presidency. As noted above, Chart II
includes an additional $24,012 of gifts to the Clintons valued
just below the new threshold. The value of gifts to the
Clintons from $100 to $240 was not totaled. As a consequence,
it is impossible to directly compare the total value of gifts
retained by these two Presidents. However, it should be noted
that there is no evidence of improper gift acceptance,
valuation or retention by the former Bush administration.
[Chart VII follows:]
The subcommittee's investigation was intended to reveal
whether there is a problem that needs a legislative solution.
Some may ask why the subcommittee chose only to explore in-
depth the 94,178 gift records (many of which included multiple
gifts) from the most recent 8-year period. The subcommittee's
1-year examination clearly demonstrated that the current system
is broken. Examining in-depth 41,779 additional gift records
for the previous 4-year Presidency was unnecessary to
accomplish the purpose of the investigation.
Other Findings
Some Gift Certificates Were Accepted
After the subcommittee's February 12, 2002, hearing, the
subcommittee compiled three additional charts. Chart VIII
includes information about 22 of the 125 gift certificate
gifts. The Clintons retained 11 of these gifts, totaling $940
in estimated value. For example, in a 10-day period at the end
of the second term, four White House staff members (including
assistant to the President and deputy counsel to the President,
Bruce Lindsay, and personal secretary Maggie Williams) each
gave the President a $100 gift certificate to the Sharper
Image, all four of which he retained. These appear to be
``coordinated'' gifts. The four gift records (with the donors'
addresses redacted for privacy) are provided. Chart VIII also
shows that some gift certificates were returned to the donor.
For example, the gift record for a $200 gift certificate to
Casual Corner states, ``return to sender--the White House can
not (sic) accept money as mail.'' Also, the gift record for a
$25 gift certificate to B. Dalton Bookseller confirms that gift
certificates are not allowed to be retained; it states,
``files--Money mail cannot be accepted by the White House.''
[Chart VIII and gift records referred to follow:]
Chart IX includes gifts to the Clintons from selective
sources, including: 13 gifts from Denise Rich; 15 gifts from
Ron and Beth Dozoretz; 44 gifts from Walter and Selma Kaye; 12
gifts from Rita and Morris Pynoos; 11 gifts from Iris, Gerald,
and Rusty Cantor; 5 gifts from Judith Leiber; 3 gifts from
James Riady; 4 gifts from Johnny Chung; 2 gifts from Charlie
Trie; 1 gift via Pauline Kanchanalak; 5 gifts from William
Fugazy; 1 gift from Michael Milken; 1 gift from Global
Crossing; 1 gift from Bernard Schwartz; 1 gift from the Enron
Executive Committee; 1 gift from Bruce Lindsay; 3 gifts from
Harry and Linda Bloodworth-Thomason; 6 gifts from David and
Mark Edwards; 2 gifts from Vernon Jordan; 3 gifts from Terry
McAuliffe; and 2 gifts from officials with Tyson Foods.
[Chart IX follows:]
Denise Rich's former husband Marc Rich received a last-day
(January 20, 2001) pardon from the President. The 44 gifts from
the Kayes totaled $19,255 in estimated value. Denise Rich, the
Dozoretzs, and the Kayes gave furniture gifts to the Clintons
in December 2000. The Pynoos and Cantors gave china/silver
gifts from Borsheim's to the Clintons in December 2000. The
following donors were investigated by this committee in its
campaign fundraising investigation: James Riady, Johnny Chung,
Charlie Trie, and Pauline Kanchanalek. William Fugazy also
received a last-day Presidential pardon.
Huge Gifts to the Presidential Library
Chart X includes some of the large non-monetary gifts (each
valued over $5,000) for the Presidential library. For example,
Malcolm S. Forbes gave a $90,000 framed handwritten letter by
President Truman.\4\ This chart includes gifts which total
nearly $1 million in value.
---------------------------------------------------------------------------
\4\ How can a Truman originally-signed letter be valued at $90,000
but a John Quincy Adams originally-signed land grant (retained by the
President) be ``estimated'' at only $240?
---------------------------------------------------------------------------
[Chart X follows:]
Proposed Legislation and Hearings
On March 15, 2001, Subcommittee Chairman Ose introduced
H.R. 1081, the ``Accountability for Presidential Gifts Act.''
This bill establishes responsibility in one agency for the
receipt, valuation and disposition of Presidential gifts.
On February 12, 2002, the subcommittee held a hearing
entitled, ``Accountability for Presidential Gifts.'' The
subcommittee presented results from its 1-year investigation
and received comments on H.R. 1081. At the hearing, Chairman
Ose released a 55-page document summarizing the subcommittee's
findings. Witnesses included: Scott Harshbarger, president and
chief executive officer, Common Cause; Paul Light, director,
Center for Public Service, the Brookings Institution; Gregory
S. Walden, former associate counsel, White House Counsel's
Office, President George H.W. Bush and former ethics counsel
for President-Elect George W. Bush's transition, currently of
counsel, Patton Boggs LLP; and William H. Taft IV, Legal
Advisor, DOS. Both Bruce R. Lindsey, former assistant to the
President and deputy counsel to the President and current
designated representative for President Clinton, and Lori
Krause, former head of the White House Gifts Unit during the
Clinton administration, declined to testify about the Clinton
administration (see Appendix B for letters inviting them to
testify and the reply from former President Clinton's Office).
Messrs. Harshbarger, Light, and Walden--either in their
written statements or in response to Member questions--all
recommended that Subcommittee Chairman Ose refer this matter
for criminal investigation by the Department of Justice [DOJ].
Therefore, on February 13th, Chairman Ose sent the Attorney
General evidence relating to the solicitation, receipt, failure
to report, or conversion of Presidential gifts by the former
President and First Lady (see Appendix H). One of the documents
forwarded was Mr. Walden's written statement. In a section
captioned ``Evidence of widespread or systemic failures should
be investigated,'' he concluded that such evidence could form
the basis for a DOJ investigation of possible violations of 18
U.S.C. Sec. 1001 (regarding false statements), 18 U.S.C.
Sec. 641 (regarding conversion of Federal property) and 5
C.F.R. Sec. 2635.202(c)(1), (2), (j) (regarding solicitation of
a gratuity).
Additionally, witnesses recommended that H.R. 1081 be
amended to: (a) disclose all gifts received over a minimal
threshold, (b) cap gifts (except personalized, honorific awards
and gifts from relatives or foreign officials) over a certain
threshold, (c) prohibit acceptance of gifts in certain periods,
and (d) prohibit the solicitation or coordination of gifts.
On June 18, 2002, the Government Reform Subcommittee on
Government Efficiency, Financial Management and
Intergovernmental Relations held a hearing on H.R. 1081.
Witnesses included: John W. Carlin, Archivist of the United
States, NARA; P. Daniel Smith, Special Assistant to the
Director, NPS, DOI; and Messrs. Harshbarger, Light, and Walden.
The subcommittee also orally invited the current White House to
have a witness testify at the hearing but the Bush
administration declined to do so.
The hearing revealed that, to date, only minor changes have
been made by the new Bush administration to address the
problems revealed in February 2002. These include a new
requirement for a statement of intent from the donor for each
furniture gift intended for the White House residence, and some
changes by NARA. NARA's ``newest'' procedures now include
separately tracking each part of a gift record which includes
multiple gifts, and tracking both gifts which are recalled by
the President for additional consideration for retention and
recalled gifts which are returned to NARA after the President's
additional review. A copy of NARA's ``newest'' procedures which
were appended to the Archivist's testimony is provided in
Appendix I (see page 4). It is unclear if they will protect
against other items lost in the transfer from the White House
Gifts Unit to NARA (see Appendix F).
Again, witnesses recommended that H.R. 1081 be amended to:
(a) disclose all gifts received over a minimal threshold--
possibly using the same rules as apply to Members of Congress,
(b) cap gifts (except personalized, honorific awards and gifts
from relatives or foreign officials) over a certain threshold,
(c) prohibit acceptance of gifts in certain periods, and (d)
prohibit the solicitation or coordination of gifts.
Additionally, Mr. Harshbarger recommended that more
information be provided about each donor, including possibly
his employer and occupation. He also stated, ``Reform is
further necessary to preclude White House Counsels from having
too much leeway in interpreting standards (as they do under the
status quo)'' (page 4, written statement). Mr. Light added,
``To the extent possible, valuation should be independent,
consistent, and based on a clearly transparent methodology''
(page 3, written statement). Mr. Walden concurred, stating,
``If there are no written guidelines on how to conduct a
valuation, including when it is necessary to obtain a
commercial or independent appraisal, guidelines could be
written after consultation with other appraisal experts'' (page
3, written statement). Mr. Walden also recommended that the NPS
inventory be a continuing inventory rather than an annual
event, and ``as a first step the Archivist and Park Service
should adopt a common database'' (page 4, Walden's written
statement). He elaborated in his oral statement, saying,
``Perhaps we should explore how the Park Service database and
the Archivist's database and the White House gifts office
database can be harmonized'' (page 59, transcript).
Last, in answer to a question from Chairman Horn (``do you
know what changes the White House gifts office has made to
improve its controls?''), both NARA and NPS were unable to
provide any information (pages 86-87, transcript). The
Archivist stated, ``I cannot speak specifically to exactly what
has gone on . . . It is clear they have made adjustments''
(page 87, transcript).
On July 24, 2002, the subcommittee invited staff from all
six agencies involved in the Presidential gifts system to a
July 31st bi-partisan work session to determine what other
changes, if any, were made by the Bush administration to
address the problems identified by the subcommittee in the
Presidential gifts system. The meeting time was established to
accommodate and ensure the participation of NARA. Nonetheless,
after the White House declined to attend, NARA also decided not
to attend. In the end, three of the six agencies--the White
House, NARA and DOS--chose not to attend. The other three--GSA,
OGE and NPS--attended.
These three agencies revealed only one additional change
since January 20, 2001: GSA has not detailed any staff--career
or otherwise--to the White House Gifts Unit. The agencies also
confirmed that: (a) since January 20, 2001, there has been no
interagency meeting or other coordination (such as via e-mail)
between the six agencies; (b) there is still no unified
database system in use by the six agencies for the receipt,
valuation and disposition of Presidential gifts, i.e., the
White House, NARA, NPS and GSA continue to each have their own
separate electronic systems; (c) there is no single numbering
system for Presidential gifts, i.e., GSA cannot track the
Presidential gifts presented by the White House Gifts Unit to
GSA for disposal; and (d) there is no standard protocol for
uniformity in handling Presidential gifts, including for
valuation and appraisals. In an August 2nd telephone
conversation, NARA confirmed these facts.
Also, after the meeting, GSA confirmed that it only
tracked--using its own numbering system--all or parts of 44 of
the 334 gift records in the White House gifts database with a
disposition as purchased from GSA or with GSA for disposal. All
but two of these gifts were to a White House staff member.
Seven were purchased by the recipient from the Federal
Government, including an $800 gift purchased by the former
President and a $2,800 gift from Yasser Arafat purchased by
Sandy Berger. Four examples of these gift records (with the
domestic donors' addresses redacted for privacy) are provided.
They include these two purchases, a $13,700 gift to a White
House staff member, and a $450 1.2 ounce solid gold coin in a
presentation box from Charlie Trie to Mark Middleton. Chart XI
includes information on the 56 gifts (from the 334) valued at
$250 or more which were sent to GSA for disposition. The chart
reveals that the ultimate disposition is unknown for many of
these gifts.
[Gift records referred to and Chart XI follow:]
III. Conclusions
The committee finds that the American people have the right
to know what gifts were received and retained by their
President. Donors should receive no unfair advantage in the
policymaking process or other governmental benefits.
The committee also finds that the subcommittee's
investigation revealed startling information about retained
gifts, valuation of gifts, missing gifts, legal rulings about
gifts, and other findings.
The total value of gifts retained by the former First
Family creates at least an appearance problem. The fact that so
many gifts were undervalued raises many questions. The fact
that gifts were misplaced or lost shows sloppy management and
maybe more. The fact that U.S. Government property was
improperly taken is troubling. And, the fact that, after the
former First Lady's election to the U.S. Senate and before she
was subject to the Congress' very strict gift acceptance rules,
the former First Family accepted nearly $40,000 in furniture
gifts and the First Lady solicited nearly $40,000 in fine china
and silver is at the very least disturbing. Public servants,
including the President, should not be able to enrich
themselves with lavish gifts.
The current system is clearly broken and needs to be fixed.
APPENDIXES
----------
Appendix A.--Selected Press Reports About Gifts to the Clintons
Appendix B.--The Subcommittee's February 2001 to January 2002
Correspondence to the Agencies, the Former Head of the White House
Gifts Unit, and Former President Clinton, and Some Agency Replies
Appendix C.--President Clinton's Eight Financial Disclosure Reports
Appendix D.--GSA's Noncompetitive Hiring and Then Detail of Lori Krause
to Head the White House Gifts Unit
Appendix E.--Letter to NARA to Ensure IRS Tax Deduction for Gift to
White House Craft Collection and Sample NPS Letter Acknowledging Gift
of Furniture to the Executive Residence
Appendix F.--Selected E-Mail Between NARA and Lori Krause
Appendix G.--White House Counsel's 1993, 1994 and 2000 Memoranda About
Furniture Gifts
Appendix H.--Chairman Ose's February 2002 Referral to the Justice
Department
Appendix I.--NARA's June 2002 ``Newest'' Procedures
VIEWS OF HON. HENRY A. WAXMAN, HON. JOHN F. TIERNEY, HON. TOM LANTOS,
HON. MAJOR R. OWENS, HON. EDOLPHUS TOWNS, HON. CAROLYN B. MALONEY, HON.
ELEANOR HOLMES NORTON, HON. ELIJAH E. CUMMINGS, HON. DENNIS J.
KUCINICH, HON. ROD R. BLAGOJEVICH, HON. DANNY K. DAVIS, HON. JIM
TURNER, HON. THOMAS H. ALLEN, HON. JANICE D. SCHAKOWSKY, HON. WM. LACY
CLAY, AND HON. DIANE E. WATSON
Gifts to Federal employees can give the appearance of
corruption. Even if there is no quid pro quo, confidence in the
government erodes if there is an appearance of influence. For
this reason, reviewing the issue of Presidential gifts is
important. Unfortunately, instead of working to produce a
bipartisan bill, the majority has chosen to produce a partisan
report.
One of the main problems with the report is that it looks
only at gift problems during the Clinton administration. It is
true that President and Mrs. Clinton accepted numerous gifts.
President Clinton accepted gifts totaling an average of $28,093
annually, adjusted for inflation, which is a very large amount
to the average American.
But former President Bush accepted $39,614 annually--far
more than President Clinton. Yet there is no examination of
abuses during the first Bush administration. And of course,
there is no examination of the current Bush administration
either.
Former President and Mrs. Reagan accepted a $2.5 million
ranch-style house from friends for their retirement.\1\
President and Mrs. Reagan eventually paid back their friends,
but this report does not even mention the $2.5 million house or
the timing of its purchase, 2 years prior to the Reagans
leaving the White House. Nor does this report address whether
the friends of President and Mrs. Reagan received a benefit for
their generosity.
---------------------------------------------------------------------------
\1\ Clintons Set to Return Some Gifts, Wall Street Journal (Feb. 6,
2001).
---------------------------------------------------------------------------
If the committee wanted to conduct a fair investigation
into the problem of Presidential gifts, it would have looked at
the practices of both Democratic and Republican
administrations.
In addition to failing to review the gift-giving practices
of both Democratic and Republican administrations, this report
strikes a partisan note by singling out President Clinton's
records for disclosure. The majority chose not to disclose the
records of President George W. Bush, former President Reagan,
or former President George H.W. Bush.
The current Bush administration has been justifiably
criticized for applying one standard to the release of
documents from the Clinton administration and another standard
to the release of its own documents and documents from the
Reagan administration.\2\ This committee should not be making
the same mistake.
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\2\ Bush Policy on Releasing Records Differs in Case of Clinton
Ones, New York Times (Feb. 1, 2002).
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Furthermore, this report scrutinizes the employment history
of one Clinton White House employee but fails to review the
resumes of Republican administration employees. The report
emphasizes that a certain Clinton employee's ``prior work
experience included only political positions'' and she had ``no
prior experience in gift valuations.'' \3\ Yet a review of the
resume of President Bush's director of the White House Gifts
Office suggests that just like the Clinton employee discussed
in the report, the Bush employee's ``prior work experience
included only political positions'' and she had ``no prior
experience in gift valuations.'' \4\
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\3\ Majority report, at 6.
\4\ Where are They Now, St. Petersburg Times (Sept. 20, 2001).
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The vast majority of those giving gifts to the President
are well-meaning, honest people: the young schoolboy who wants
the President to have a t-shirt with his elementary school logo
on it, the grandmother who wants the President to have a
needlepoint she made.
Yet some who give gifts want to gain influence and access
to policymakers. That is why reforms to the Presidential gift
process are needed. Two subcommittees held hearings on the
issue of gifts to the President. At those hearings, witnesses
made suggestions such as placing limitations of the value of
gifts to the President, limiting when a President could accept
a gift, and enhancing public disclosure of gifts.
Regrettably, these important reform proposals were not
seriously considered in this report.
Hon. Henry A. Waxman.
Hon. John F. Tierney.
Hon. Tom Lantos.
Hon. Major R. Owens.
Hon. Edolphus Towns.
Hon. Carolyn B. Maloney.
Hon. Eleanor Holmes Norton.
Hon. Elijah E. Cummings.
Hon. Dennis J. Kucinich.
Hon. Rod R. Blagojevich.
Hon. Danny K. Davis.
Hon. Jim Turner.
Hon. Thomas H. Allen.
Hon. Janice D. Schakowsky.
Hon. Wm. Lacy Clay.
Hon. Diane E. Watson
ADDITIONAL VIEWS OF HON. DOUG OSE
The minority views section of this report, unfortunately,
mixes apples and oranges in its comparison of the average-sized
gift retained by Presidents George H.W. Bush and Clinton. Chart
VII reveals that President George H.W. Bush received 41,779
gifts in 4 years in office, which is an amount similar in
magnitude to President Clinton's 94,178 gifts received in 8
years in office. However, gifts retained by the First Family
are only a subset of gifts received by them. There is only
aggregate dollar information on gifts retained by each
President over the reporting threshold established by law at
the time. The report explains that, during George H.W. Bush's
Presidency, the reporting threshold for gifts retained by the
First Family was $100. This threshold increased to $250 before
the start of the Clinton Presidency and was then increased to
$260 for the last 2 years of the Clinton Presidency. The report
explains, ``As a consequence, it is impossible to directly
compare the total value of gifts retained by these two
Presidents.''
In fact, the Clintons retained one or more gifts in 14,770
of the 94,178 gift records. The subcommittee only added the
value of the 227 gift records with a retained gift over the
reporting threshold (totaling $361,968) (Chart I) and the 98
gift records with a retained gift from $240 to the threshold
(totaling $24,012) (Chart II). Added together, these 325 gift
records account for only 2 percent of records with one or more
gifts retained by the Clintons. At the subcommittee's February
12, 2002, hearing, several 10" x 15" x12" boxes were displayed.
These boxes included hundreds of individual gift records for
additional gifts each over $100 which were retained by the
Clintons. The subcommittee did not sum the value of the gifts
retained by the Clintons from $100 to $240. This additional
number would need to be added to the Clinton total to allow a
direct and valid comparison between the two Presidents.
The minority views section also criticizes the
investigation for focusing on Clinton's Presidential records.
The report explains, ``The subcommittee's investigation was
intended to reveal whether there is a problem that needs a
legislative solution. . . . The subcommittee's 1-year
examination clearly demonstrated that the current system is
broken. Examining in-depth 41,779 additional gift records for
the previous 4-year Presidency was unnecessary to accomplish
the purpose of the investigation.''
The minority views section of this report also states,
``Yet some who give gifts want to gain influence and access to
policymakers. That is why reforms to the Presidential gift
process are needed. . . . Regrettably, these important reform
proposals were not seriously considered in this report.'' In
fact, the report presents the results of the subcommittee's
investigation and a summary of the recommendations made by
witnesses at two hearings in 2002 on my bill, H.R. 1081. In
fact, I strongly believe that reform of the Presidential gifts
system is essential; as a result, I intend to introduce a
revised version of my reform proposal early in the next
Congress. This version will be responsive to the thoughtful
suggestions not only by the hearing witnesses but also later by
the minority. I welcome bipartisan support for my initiative.
My legislation will allow my colleagues to match their calls
for reform with action.
Since the committee's October 9, 2002 business meeting,
questions were raised about the status of DOJ's response to
Subcommittee Chairman Ose's February 13th referral (Appendix
H). This referral was recommended by the witnesses in the
subcommittee's February 12th hearing. A copy of DOJ's May 2nd
reply is attached to these additional views. It indicates that
the matter was referred internally within DOJ to the
Department's Criminal Division. DOJ also requested additional
information. Since that time, the subcommittee met with the
Public Integrity Section of DOJ's Criminal Division and
provided additional information.
Since the committee's business meeting, the subcommittee
became aware of two additional factors. First, former
Presidents and their families can borrow gifts from NARA that
were not retained by a First Family but ended up with NARA for
a Presidential archival library. Second, NARA has provided
written acknowledgments to certain donors for use in receiving
tax deductions for Presidential gifts that the First Family did
not choose to retain. Instead, these gifts ended up with NARA
for a Presidential archival library.
As a consequence, on October 15th, Subcommittee Chairman
Ose sent another letter to NARA, a copy of which is attached to
these additional views. In the letter, the subcommittee
requested: (a) copies of NARA's acknowledgments (including on
IRS forms) for gifts since January 20, 1989 that ended up with
NARA for a Presidential archival library, i.e., covering the
Presidencies of George H.W. Bush, Bill Clinton and George W.
Bush; and (b) the identification of all loans (except to
libraries, museums, and Federal agencies) from the 12
Presidential libraries, starting with the Harry S. Truman
Library and ending with the not-yet-open William J. Clinton
Library. This information may shed light on another avenue for
possible influencing by donors of Presidential gifts, i.e.,
gifts that were not retained per se by a First Family but which
ended up in a Presidential library, subject to being used for
indeterminate periods by the President and First Family.
Hon. Doug Ose.
[The letters referred to follow:]