Trump's campaign paid his businesses $8.2 millionThe GOP presidential candidate draws on his own companies to an unprecedented degree.
By KENNETH P. VOGEL and ISAAC ARNSDORF 09/22/16 05:13 AM EDT
Donald Trump’s presidential campaign has paid his family's businesses more than $8.2 million, according to a POLITICO analysis of campaign finance filings, which reveals an integrated business and political operation without precedent in national politics.
The GOP presidential nominee’s campaign has paid his various businesses for services including rent for his campaign offices ($1.3 million), food and facilities for events and meetings ($544,000) and payroll for Trump corporate staffers ($333,000) who helped with everything from his traveling security to his wife’s convention speech.
In all, the Trump campaign’s payments to Trump-owned businesses account for about 7 percent of its $119 million spending total, the analysis found.
That’s an unprecedented amount of self-dealing in federal politics. Even the wealthiest of candidates have refrained from tapping their businesses’ resources to such an extensive degree, either because their businesses are structured in a manner that doesn’t legally allow them to do it with flexibility, or because they’re leery of the allegations of pocket-padding that inevitably arise when politicians use their campaigns or committees to pay their businesses or families.
Trump, on the other hand, appears to have structured his businesses in a way that lets the campaign use them without legal restriction. And he certainly doesn’t appear to feel any embarrassment about flouting political norms that typically compel candidates to distance themselves from their businesses during campaigns.
Quite to the contrary, Trump has used the campaign itself as a marketing platform to promote everything from the difficult-to-find Trump Steaks to his golf courses and a new Washington hotel.
Trump’s tangle of businesses has raised concerns about the potential for conflicts of interest should he win the presidency, while the Trump-branded campaign has drawn mockery and allegations of pocket-padding from Trump’s critics. His Democratic rival Hillary Clinton in July accused Trump of “spending his meager campaign resources on … himself.”
Trump, who in 2000 predicted “I could be the first presidential candidate to run and make money on it,” declined to comment through a spokesman. But he has compounded the criticism lately, boasting this week that “there’s nothing like doing things with other people’s money,” in response to a report that his charity used donations to cover business-related legal costs.
But the degree to which Trump or his corporations may be benefiting from his campaign is unclear, partly because the financial and legal structures of his businesses — and their relationships with his campaign — remain opaque. Trump has stubbornly refused to release his taxes, which could shed light on the issue.
Additionally, the campaign’s payments to Trump-owned businesses are dwarfed by the $54 million Trump has pumped into his campaign.
In fact, reports filed with the Federal Election Commission show that more than $500,000 in services such as rent, software and staff from Trump-owned businesses were donated to the campaign — including some of the salary paid to Trump’s head of security Keith Schiller, who travels everywhere with the candidate. In those situations, Trump likely either wrote off the cost of services rendered by his companies to his campaign, or he personally reimbursed the campaign for the costs of the services.
While federal election law prohibits corporations from donating cash, goods or services to campaigns, the regulations do include an exception — and it’s the one that election law experts interviewed for this story say Trump is most likely using. It allows people who own certain types of companies — including LLCs or sole proprietorships — to donate from those entities to campaigns and have those donations be considered to have come from the person.
It’s unclear precisely how Trump’s various businesses are structured, but he likely would have to be the sole owner of the ones that are donating services to the campaign in order for those donations to pass legal muster.
“Most wealthy candidates separate their businesses from their campaign organizations, and that’s partly because their companies are either publicly owned or owned by multiple people,” said GOP election lawyer Jason Torchinsky. He represented Rudy Giuliani’s 2008 presidential campaign, which paid the former New York mayor’s companies for office space, security and legal consulting, but finished the campaign owing money to them.
“It’s unique to have somebody who is independently wealthy and is able to so thoroughly integrate a privately held company into their campaign,” Torchinsky said of Trump.
Regardless of how Trump’s corporate entities are structured, the campaign is legally required to charge them fair-market rates for goods or services received, even if Trump ultimately writes off the bills as donations.
There have been allegations that the campaign failed to pay Trump’s companies fair-market value for some services, including for the Trump corporate staffer who helped write Melania Trump's convention speech (the campaign paid her $356.01 through Trump Tower Commercial LLC), and the corporate lawyer who penned threatening letters to a donor and PAC supporting Jeb Bush.
Among the goods and services that Trump has paid his companies for are $34,500 for lodging and event staging at Trump National Doral golf course, $48,200 for room rental and catering from the Trump National Golf Club in Westchester, N.Y., and $142,000 to Trump Restaurants for rent, utilities, meals and office supplies. It paid more than $1 million to Trump Tower to rent office space for its main campaign headquarters. Trump Ice, his bottled water company, got $1,300, while his son Eric Trump's Virginia winery was paid almost $5,000 for catering and event space.
The bulk of the spending, almost $6 million, went to a company called TAG Air for use of Trump’s private plane.
The campaign has also paid $432,000 to Mar-a-Lago, Trump’s club in Palm Beach, Fla., for lodging, facility rental and catering.
And Trump continues to simultaneously use and promote facilitates he owns, even sometimes using misdirection to do so.
One of Trump’s primary election victory speeches in March, held at Mar-a-Lago, was widely lampooned as an infomercial for Trump-branded steaks, water, magazines and wine.
And last week, he lured the political press corp to his new Washington hotel by promising a revelation about his longstanding allegations that President Obama was born overseas, which he finally disavowed. Before getting to that, though, he took the opportunity to promote the hotel on Pennsylvania Avenue in the Old Post Office.
Whatever the campaign paid to use the ballroom in the Old Post Office that day won’t be disclosed until next month’s FEC report. But back in January, the campaign spent $5,000 to rent space in the hotel.
During a March tour of the hotel, Trump boasted to the press that the hotel would have “one of the biggest ballrooms in Washington, and by far the most luxurious ballroom."
He also quipped that the completion of the hotel would mean he will wind up with a presence on Pennsylvania Avenue “one way or the other."
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