Charles Rangel won’t step down from tax-writing post despite unreported income WASHINGTON - Rep. Charles Rangel will not step down as chairman of a powerful tax-writing committee as he undergoes an ethics investigation by fellow lawmakers, his lawyer said Tuesday.
The New York Democrat has faced increasing questions about his future, as Republicans urge his removal from the House Ways and Means Committee over his personal finances, including unreported income on a vacation home in the Dominican Republic that has led to his owing an estimated $5,000 in back taxes.
After 38 years in Congress, Rangel is something of an institution in Washington and his home district of Harlem. Republicans are seeking to highlight the controversy over his finances in the coming election, after Democrats have pounded them on issues of ethics and corruption.
House Speaker Nancy Pelosi rejected those calls.
"I see no reason why Mr. Rangel should step down," she said Tuesday.
Rangel plans to hire a "nationally renowned forensic accounting firm," to independently review his finances for the past 20 years, and issue a report on their findings directly to the House ethics committee that is scrutinizing Rangel, his lawyer Lanny Davis said.
"Mr. Rangel has not considered, nor has it ever been on the table, that he would step aside from his current position as chairman of the House Ways and Means Committee," said Davis. "He has no intention of leaving that position, even on a temporary basis."
Asked if that meant Rangel would stay on as chairman no matter the outcome of the House ethics committee’s probe, Davis said that was too far in the future to discuss.
Davis said that, contrary to demands from some for his ouster, "the chairman believes that facts should prevail, not innuendo or editorial opinion or the partisan actions of the House Republican leadership, and his colleagues agree with that judgment."
The lawyer said he plans to enlist the accounting firm sometime this week. When the review of the congressman’s finances is complete, the report will be released publicly, along with 20 years of Rangel’s tax returns, Davis said.
Asked how long such a review would take, Davis could not say, but added that Rangel’s paperwork, whatever the omissions or errors, isn’t particularly complicated.
"Mr. Rangel is a simple man. He has not had complicated partnerships, investments, investment strategies. He has a relatively simple financial life and not a lot of wealth," the lawyer said.
Ken Spain, spokesman for the House GOP campaign effort, said the decision to keep Rangel in his high-profile position shows Pelosi and House Democrats have "officially abandoned their promise to run the most ethical congress in history and instead embraced the politics of corruption with open arms."
Rangel has come under scrutiny on a number of issues, but the one that has proven most embarrassing to him as chairman with great say over tax matters is the beach house in the Dominican Republic.
The lawmaker concedes he did not report some $75,000 in rental income on the property over the past two decades, did not know he received a no-interest mortgage from the resort’s developers for at least a decade, and owes $5,000 in back taxes to the U.S. and somewhat less to state and city tax collectors.
Rangel met privately Tuesday morning with House Speaker Nancy Pelosi, his second such meeting in two days. He emerged tightlipped, refusing to discuss the matter.
"People believe that this is so sensitive that the last person in the world that should be discussing it is me. So I love you guys but what can I tell ya?" Rangel said as he walked out of the meeting.
His lawyer said Pelosi told Rangel "she was pleased at the initiative he’s taken to, in effect, authorize an investigation of himself with full transparency and direct reporting to the ethics committee and she also expressed her appreciation that he is allowing the House ethics committee to complete its process."
In addition to the vacation home, the ethics committee is examining Rangel’s use of congressional stationery to try to drum up financial support for an education center named after the lawmaker, as well as his use of three rent-stabilized apartments in his home district of Harlem.
Article URL:
http://www.bostonherald.com/news/national/politics/general/view.bg?articleid=1119512 [/i]]http://www.bostonherald.com/news/national/politics/general/view.bg?articleid=1119512 Charles Rangel mangles facts in his tax messWASHINGTON - Even when Rep. Charles Rangel, D-N.Y., tries to explain how he got into his tax mess, he mangles the facts so much it’s easy to see how his accounts — and accountants — are muddled. And this from the lawmaker who has such a big say in determining who pays taxes and how much.
The chairman of the tax-writing House Ways and Means Committee spent the past week reeling from a series of embarrassing revelations: He failed to report about $75,000 in rental income over two decades from a beach villa he owns in the Dominican Republic; he owes about $5,000 in back taxes to the government; he never knew he paid no interest on the villa’s mortgage for more than a decade.
The New York Democrat is resisting calls from Republicans that he should lose his committee post, among the most coveted on Capitol Hill. The House ethics committee has begun inspecting Rangel’s personal and professional life.
Rangel, 78, was elected to Congress in 1970, running as a reformer against the prominent Adam Clayton Powell Jr. and Powell’s questionable behavior. Since then, Rangel has sailed to re-election in a district where the political center of gravity is the historic black neighborhood of Harlem.
The district today has far more Hispanics and saw major gentrification in the past decade. Not everyone is willing to let the ethics problems slide.
"He should have known better. He did know better," said Eulalia Brooks, 34, who works for a Harlem job-training organization.
"It’s sad to see it happen. He’s done some good things in the community but he can’t use what he’s done in the past to explain his taxation problems," she said. "If he’s that careless in his personal dealings, then he’s probably equally careless in his chairmanship."
Asked if the congressman had a firm grasp of his finances, his lawyer. Lanny Davis, said, "He has learned important lessons."
Rangel has acknowledged "irresponsible" errors, then gone ahead and committed some more blunders:
—He repeatedly referred to his three New York City apartments as "rent subsidized." They are not; they are rent stabilized, a big difference. A subsidy means the government pays part of the rent. New York rent stabilization laws put a cap on how much rents are raised.
In the full House, when Republican leader John Boehner of Ohio mentioned "rent subsidized" apartments, Rangel angrily interrupted, hollering, "They’re not subsidies, it’s stabilization." The source of Boehner’s confusion was most likely Rangel’s own words earlier in the day.
—At a news conference, Rangel said language difficulties with the Spanish-speaking operators of the beach resort contributed to his confusion about the finances of the beach villa. Equally confusing is his version of the facts.
He and his lawyers repeatedly said the price of the beach villa was $82,750. Yet, in a letter to House Speaker Nancy Pelosi, D-Calif., Rangel cited a price of $88,900. Asked about the discrepancy a day later, aides said they were not sure of the origin of the higher figure.
—The villa issue surfaced because some years, Rangel reported income from the property in congressional paperwork. Other years he did not. In recent years, Rangel is usually late filing his financial records to Congress.
Rangel’s basic defense is that he paid little or no attention to a building he bought, the mortgage he got to buy it or the rent it earned to pay the mortgage. Or the taxes due on someone else paying his mortgage. He claims to have no idea what the house is even worth.
Davis says that will change now that he has hired a second lawyer to monitor "all his tax and financial statements going forward and be sure they are meticulously correct."
Republicans say Rangel had to have known exactly what he was doing.
"It is a sick irony that the top legislator on tax policy in the House is circumventing the very tax laws that he himself has authored," said Ken Spain, spokesman for the GOP’s House campaign committee.
Bill Perkins, a Harlem state senator, said he wants to take Rangel at his word that it was an honest mistake, but the pressure from now on will be to perform perfectly.
"There’s no room for error. Otherwise it will be unforgivable," said Perkins. "He has to be able to move forward and prove he’s up to the role of being the chair of one of the most powerful committees in the Congress."
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