The townhouse that served as a cut-rate rental pad for EPA Administrator Scott Pruitt doubled as a veritable campaign headquarters for one of the most powerful chairman in the U.S. Senate.
Over the course of four years, Sen. Mike Crapo (R-ID) held 78 campaign-related events at 223 C Street N.E., according to a new filing with the Federal Election Commission. The condo, which is where Pruitt stayed while getting his bearings in Washington, D.C., is owned by Vicki Hart, a prominent lobbyist with clients who had business before committees on which Crapo serves. Her husband, Stephen Hart, the now-ex chairman of the firm Williams & Jensen, had his own set of clients before a separate committee that Crapo chairs.
Crapo’s campaign said in a statement to The Daily Beast that they had reimbursed Hart for use of the townhouse in order to be in complete compliance with election law. And it stressed that, unlike Pruitt, the townhouse was never used for boarding purposes.
“No one from the campaign or Freedom Fund ever used the townhouse for an overnight stay,” said Sam Neel, an associate with the firm McDermott Will & Emery LLP, in a statement. “Both committees have disclosed to the FEC the date and purpose of each use of the space, as well as the corresponding reimbursements.”
But the arrangement struck watchdogs as falling decidedly over the line of sound government ethics.
“This arrangement raises all sorts of red flags,” said Brendan Fischer, the director of federal and FEC reform programs at the Campaign Legal Center. “The Harts gave Pruitt a cut-rate rental deal and gave Sen. Crapo a place to hold fundraisers, and meanwhile, their lobbying clients may have been asking Pruitt and Crapo for favors.”
“I’d also like to know what the agreement was between the Harts and Crapo’s campaign,” he added in an email. “Did Crapo and his staff call the Harts every time they used the condo to get let in, or did they have a key or access code to come and go as they pleased?”
From 2014 to present, Crapo held dozens of fundraisers, campaign meetings, phone-banking events, and political strategy sessions at the Harts’ Capitol Hill condo, which is owned, through an LLC. Of the 78 total events, 33 were fundraisers, according to the FEC filing. (Neel said that Crapo’s leadership PAC, Freedom Fund, held three additional events.)
One GOP lobbyist said it wasn’t unusual for staffers (often from around the country) to gather that frequently in D.C. But usually such meetings take place at restaurants or the National Republican Senatorial Campaign offices and not a lobbyist-owned rowhouse
“[It’s] not really smart to do it at a lobbyist’s townhouse,” the lobbyist said.
Crapo took over the chairmanship of the Senate Banking committee in 2017. And Williams & Jensen has numerous clients with interests under his jurisdiction. The firm has disclosed work on at least ten pieces of legislation considered by the committee since Crapo received the gavel.
The senator himself sponsored two of those bills. One of them was a relatively esoteric measure to extend the term of a key federal insurance regulator. Insurance companies pushed hard for the bill, and Williams & Jensen reported pressing Congress on the legislation on behalf of the American Council of Life Insurers. President Trump signed the bill into law in September.
The other was a sweeping rollback of Dodd-Frank financial regulations passed by the Senate in March. Williams & Jensen had lobbied Congress on that bill on behalf of at least seven clients, including ACLI, Visa, securities market OTC, and banking law firm Luse Gorman.
A spokesman for Williams & Jensen declined to comment.
Though Crapo’s work on the Banking Committee overlapped considerably with the interests of Williams & Jensen’s clients, the more interesting intersection of financial and political interests likely involved Vicki Hart, according the GOP lobbyist.
The president and founder of Hart Health Strategies, Inc, Hart has numerous clients in the health care sector. They include Johnson & Johnson, the Pharmaceutical Research Manufacturers of America, the American Society of Plastic Surgery, and the American Urological Association.
Among the committees with the most jurisdiction over the healthcare industry, few, if any, have more power than Senate Finance. And in the next Congress, Crapo could end up being that committee’s chair. Congress’ current top financial overseer, Orrin Hatch (R-UT), is retiring and current finance committee member Sen. Chuck Grassley—who is more senior—may not give up his post atop the Judiciary Committee.
Should that happen, Hart would have a lobbyists’ dream scenario: incredibly tight ties to one of the most powerful committee chairs in Washington, D.C. Hart herself is already a Crapo donor. She gave the senator $2,000 on May 12, 2015, a day on which Crapo’s campaign reported holding a fundraising dinner at Hart’s home. The fundraiser’s other attendees aren’t known, but a host of health care and financial services companies and executives reported donating four-figure sums to Crapo within 24 hours of the event.
“The fact that he is spending so much time with one lobbyist and is so dependent on their townhouse for fundraising raises serious questions about his independence from big money interests,” said David Donnelly, President and CEO of the good government group Every Voice and Every Voice Action. “It is very clear that he has a special relationship with this lobbyist.”
Other lobbying shops make use of Capitol Hill townhouses to host fundraisers and get-togethers for lawmakers. But few, if any, of locations have gained as much notoriety as the condo at 223 C Street, NE. The Harts also rented out that townhouse to Pruitt for a period of several months in 2017 when the then-EPA director was looking for places to stay in Washington, D.C. That arrangement raised numerous ethical questions for Pruitt; chief among them, whether he did any favors in exchange for the $50-per-night lease. Both Stephen Hart and Williams & Jensen had clients with business before the EPA at the time Pruitt stayed there.
The condo has also been the sight for fundraisers for lawmakers other than Crapo. As The Daily Beast previously reported, Rep. Bill Huizenga (R-MI) and Sen. Jim Risch (R-ID), held events there. Rep. John Katko (R-NY), had a “cigar night” reception at the townhouse, while Sens. Ted Cruz (R-TX) and former Sen. David Vitter (R-LA) also held receptions there.
Crapo’s use of the location appears to have far surpassed that of any other member of Congress, however. His campaign ultimately reimbursed Hart’s company $7,800 for each the events—for which, Hart told the campaign, she charges $100. Crapo’s joint fundraising committee previously paid out $300 for three events at the condo. Both entities told the FEC that they were not aware that the home was owned by an LLC, which, under federal law, is prohibited from giving in-kind donations—such as a free fundraising venue—to a campaign committee.
Though Crapo’s campaign says its revisions are efforts to ensure compliance, its letter to the FEC indicates that it may have been accepting illicit contributions from Hart even before ownership became an issue. The campaign told the FEC that it held 67 events at the condo during the 2016 election cycle, and reimbursed the LLC for the resulting $6,700 that it initially considered in-kind contributions from Hart herself. That sum is significantly more than the $5,400 any individual can legally donate to a political campaign in a single election cycle.
In admitting its errors, in other words, Crapo’s campaign appears to have copped to another fundraising shenanigan.
Neel did not address this matter.