[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.
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    \1\ Clintons Set to Return Some Gifts, Wall Street Journal (Feb. 6, 
2001).
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    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:]
    
    
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