Trump Calls EPA Chief `Courageous' as Ethics Questions Mount

(Bloomberg) -- President Donald Trump said he still has confidence in embattled EPA Administrator Scott Pruitt, who has been the subject of a cascade of ethics questions in recent days that cast doubt on his future in the job.

“He’s been very courageous. Hasn’t been easy,” Trump told reporters Thursday on Air Force One as he returned from a trip to West Virginia. “I can tell you, at EPA he’s done a fantastic job.”

Trump answered “I do” when reporters asked whether he retained confidence in Pruitt and said “no” in response to reports that he was considering the EPA chief to replace Attorney General Jeff Sessions. Nevertheless, Pruitt’s standing is not secure.

Top administration officials are deeply skeptical of his explanation for tens of thousands of dollars worth of raises awarded to two close aides over the White House’s objections, according to people familiar with the matter. They are also frustrated by the barrage of damaging headlines about Pruitt, from the unconventional housing arrangements with a Washington lobbyist couple to a New York Times report Thursday that aides who questioned his spending were shifted to other jobs.

Pruitt said in a Fox News interview on Wednesday that he didn’t know who approved raises for the two aides. Top White House officials don’t believe him and want to know who approved the salary increases. It’s unclear whether Trump has an opinion in the matter.

The White House said Wednesday it’s conducting its own review of Pruitt’s rental of a condo from the wife of a prominent lobbyist with clients regulated by the EPA. The news of his housing arrangement and the raises for aides have spurred calls for investigations by Congress and the EPA’s inspector general.

New Memo

Meanwhile, the author of an analysis the EPA used to justify Pruitt’s lease arrangement has written a new memo stressing that the review doesn’t clear Pruitt of all ethical questions raised by the arrangement. Kevin Minoli, the designated EPA ethics official who conducted the review, says he only scrutinized whether the condo lease ran afoul of federal ethics regulations prohibiting certain gifts. He concluded it didn’t.

In the new memo, obtained by Bloomberg News, Minoli said he wasn’t asked to and didn’t examine whether the arrangement violated other ethics rules, or “whether the actual use of the space was consistent” with the lease agreement.

“A federal employee must comply with the standards of ethical conduct, including those related to impartiality, at all times,” Minoli wrote in the 24-page memo dated April 4.

Trump has solicited input from lawmakers, asking some on Wednesday to tell him how they think Pruitt is doing politically, without giving any signal he intended to fire the EPA chief, according to two people familiar with the move.

Also on Wednesday, a top Pruitt ally at the EPA, Samantha Dravis, the associate administrator of the agency’s office of policy, resigned, according to an EPA official who asked for anonymity because the departure hadn’t yet been made public. Dravis came to the EPA after serving with Pruitt when she was general counsel of the Republican Attorneys General Association.

Although the move coincides with the swirl of ethical questions surrounding Pruitt, Dravis’ departure is unrelated, said two people who know her and asked not to be identified. She had been seeking a new position for several months, one of the people said.

Pruitt Campaign

Conservative activists and industry allies are mounting an aggressive campaign to keep Pruitt in his job.

A handful of chief executives have asked the president not to dismiss a man they see as a champion of deregulation. Senators have warned that confirming an equally business-friendly replacement won’t be easy. And aides have booked him for a series of interviews with friendly media -- though his interview on Fox News on Wednesday appeared to backfire.

‘Making it Known’

"We are very much in support of him and making it known," said Tom Pyle, who heads the American Energy Alliance, an influential free-market advocacy group. "Obviously, he is an ideal administrator."

The pro-Pruitt message has been amplified by CRC Public Relations, a Virginia-based firm with a roster of conservative clients that’s headed by Greg Mueller, who was communications director for Pat Buchanan when he ran for president.

The PR firm has highlighted favorable opinion pieces and tweets for reporters and pundits. Mueller said in a statement on Thursday night that “CRC has been representing conservatives for almost 30 years and when a conservative leader like Director Pruitt is advancing conservative policies or under attack, we engage.”

The unusual campaign is designed to spare Pruitt from the same fate that has met other administration officials who found themselves out of a job with little warning. Other recent departures -- including Secretary of State Rex Tillerson and Veterans Affairs Secretary David Shulkin -- haven’t benefited from a similarly coordinated outpouring of external support.

On Capitol Hill, Senate Republicans have warned the White House that it would be tough -- if not impossible -- to confirm a replacement. Given bruising confirmation fights expected for Trump’s picks to lead the Central Intelligence Agency, Department of Veterans Affairs and the State Department, there isn’t much appetite for a fourth, said a senior Republican Senate aide who asked for anonymity to discuss strategy.

Pruitt “is likely the bravest and most conservative member of Trump’s cabinet,” Senator Rand Paul of Kentucky tweeted. “We need him to help @realDonaldTrump drain the regulatory swamp.”

At the same time, environmental groups have stepped up opposition research and a “boot Pruitt” campaign on Twitter. The Sierra Club broadcast an anti-Pruitt ad on “Fox and Friends,” which counts the president among its most loyal viewers.

Impartiality Rule

Walter Shaub, the former director of the Office of Government Ethics who resigned last year after clashing with the Trump administration, said that under the impartiality rule cited by the EPA’s ethics chief, Pruitt should have steered clear of all clients of the lobbyists with ownership interests in the condo.

“The impartiality regulation addresses when you must recuse from matters involving a person with whom you have a ‘covered relationship,’” Shaub said on Twitter. “This lease gave him a covered relationship not only with the landlord but also with anyone in the landlord’s firm because the definition of ‘person’ includes both an individual and the individual’s employer.”

Minoli’s latest memo underscores the limitations of the ethics review that Pruitt and his defenders have cast as clearing the administrator of all possible ethical concerns tied to the rental.

The unconventional lease terms permitted Pruitt to pay $50 only on days he actually occupied his bedroom in the condo, located just steps from the Capitol. He paid a total of $6,100 over a roughly six-month period last year, according to documents reviewed by Bloomberg News.

Pruitt told the Washington Times in an interview this week that career ethics officials at the EPA “reviewed the lease and have determined there are no ethical concerns -- that it’s market value.”

Pruitt told the paper he was living out of a suitcase and his access was confined to one room in the condo. Under the lease terms, Pruitt had to leave his bedroom door unlocked and did not have use of common areas, which continued to be a venue for dinner parties and meetings during his stay.

Ethics Review

The EPA’s first ethics review was conducted hastily last week, after initial news reports on Pruitt’s lease with health-care lobbyist Vicki Hart, who co-owns the condo through a limited liability corporation. Her husband, J. Steven Hart, is the president of Williams & Jensen, a firm with a stable of energy industry clients including Oklahoma Gas & Electric Co.

Under federal ethics laws, government employees are required to act impartially and are prohibited from giving preferential treatment to any private organization or individual. They also are barred from accepting gifts or other items of value from people or entities seeking official action or conducting business with the employee’s agency.

In the Fox News interview, Pruitt was indignant when asked if a low-priced rental arrangement with a lobbyist friend was in sync with Trump’s “drain the swamp” campaign vow. “I don’t think that that’s even remotely fair to ask that question,” Pruitt said.

The new EPA memo asserts that there are seven comparable private bedrooms within a six-block radius of Pruitt’s temporary quarters that can be rented for $55 or less per night, a basis for the ethics officer’s conclusion that last year’s rental was fair “market value” and did not constitute a prohibited gift. While Pruitt was allowed under the lease to leave “limited” personal belongings, such as some clothing, at the site even on nights he was not paying $50 to occupy the room, that did not appear to factor into the ethics analysis.

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