Senators ask federal ethics officials for assessment of EPA nominee’s involvement with secretive, tax-exempt groups

Washington, D.C. – Members of the Senate Environment and Public Works Committee sent letters to the Office of Government Ethics and the lead ethics official at the Environmental Protection Agency (EPA) today asking a series of questions related to the ethics review of President-elect Donald Trump’s nominee for EPA Administrator, Oklahoma Attorney General Scott Pruitt.  In their letter to the Office of Government Ethics, the Senators ask about Pruitt’s obligation to disclose critical information on his close ties to “dark money” and political spending groups connected to the fossil fuel industry—an industry Pruitt would regulate should he be confirmed.  In their letter to the EPA’s Designated Agency Ethics Official, the Senators ask about the numerous legal challenges Pruitt, in his capacity as Oklahoma Attorney General, has either led or joined against the EPA that also involve entities from whom Pruitt has solicited money.  Both letters request responses in advance of the Committee’s confirmation hearings on Pruitt’s nomination scheduled for January 18.  Senators Sheldon Whitehouse (D-RI), Tom Carper (D-DE), Ben Cardin (D-MD), Bernie Sanders (I-VT), Jeff Merkley (D-OR), Kirsten Gillibrand (D-NY), Cory Booker (D-NJ), Edward Markey (D-MA), and Tammy Duckworth (D-IL) signed the letters.

Several Committee members sent a letter to Pruitt on December 27th requesting further information on his political and dark money activities in advance of the hearing.  Pruitt has yet to respond.

Full text of the letters is below and PDF copies are available here and here.

January 12, 2017 

Walter M. Shaub, Jr.

Director

U.S. Office of Government Ethics

1201 New York Avenue, NW

Washington, D.C. 20005

Dear Mr. Shaub: 

Thank you for your continuing efforts to ensure Senate committees, like the Senate Environment and Public Works Committee [EPW] on which we serve, have the information we need to review potential conflicts of interest faced by nominees of President-elect Trump.

We are in receipt of the Office of Government Ethics [OGE] certified financial disclosure report [Form 278] of Edward Scott Pruitt, nominee to be the Administrator of the Environmental Protection Agency [EPA].  After reviewing Mr. Pruitt’s information, we are concerned that the record presented may not provide a complete picture of ethical issues faced by this nominee. 

Since the Supreme Court’s decision in Citizens United, we have entered into an unprecedented and dangerous time in which massive and often anonymous corporate political spending threatens to corrupt our government.  OGE’s ethics review focuses primarily on a nominee’s personal financial interests, and appears not to address a nominee’s history of political solicitations and activity.  Corporations spend their money to get results, so it is now more important than ever that we have a full disclosure of a nominee’s ties to the industries he or she will be charged with regulating.  This is particularly important where a nominee may have solicited or raised “dark money” from interests to which they thus may be beholden.   

During his tenure as Attorney General of Oklahoma, Mr. Pruitt has blurred the distinction between official and political actions, often at the behest of corporations he will regulate if confirmed to lead EPA.  While the disclosures Mr. Pruitt made to OGE may be sufficient to ascertain his personal financial conflicts of interest, they do not document conflicts he may have as a result of political activities.  Public reporting based on documents produced by Freedom of Information Act requests illustrate how Mr. Pruitt and members of his staff have worked closely with fossil fuel lobbyists to craft his office’s official positions.  Public reporting has also identified numerous potential conflicts of interest not disclosed on his Form 278 or addressed in his ethics agreement.  For example:

• Pruitt indicated on his Form 278 that he has served in various positions, including Chairman, of the Rule of Law Defense Fund [RLDF] since 2014.  Because RLDF is organized under section 501(c)(4) of the Internal Revenue Code, it can receive unlimited contributions from individuals, corporations, and partnerships and need not disclose the identities of its donors, donors who may have been solicited directly by Mr. Pruitt in exchange for the RLDF advocating certain positions.
• Although Mr. Pruitt served as Chairman of the Republican Attorney Generals Association [RAGA] for two terms, his affiliation was not listed on his OGE disclosures.  Since 2014, RAGA has received nearly $4 million from fossil fuel-related entities, many of which are either companies regulated by EPA or industry trade associations.[1]  According to campaign finance records and the RLDF’s 990s, hundreds of thousands of dollars have passed between the RLDF and RAGA.  Recently released emails show that RAGA has provided services such as chartered airplane flights to its members.  Mr. Pruitt’s OGE disclosures do not include information about any gifts or in-kind donations Mr. Pruitt received from RAGA or other groups with which he’s been involved.
• It has been reported that Mr. Pruitt is, or has been, affiliated with at least three other political action committees [PACs]:  Liberty 2.0, Oklahoma Strong Leadership, and Scott Pruitt for Attorney General.  These PACs have received contributions from numerous corporations that are regulated by EPA.[2]  Many of these are challenging EPA standards in court along with Mr. Pruitt.  Mr. Pruitt’s OGE disclosures do not include any of this information. [3]

To better understand the types of information Mr. Pruitt is required to disclose and the potential conflicts of interest that may remain outstanding, we would appreciate answers to the following questions:

• Did Mr. Pruitt provide OGE any information about the identity of RLDF donors, amounts contributed, and any promises made or actions taken by him or the RLDF in exchange for donations made to it? 
• Did Mr. Pruitt provide OGE any information about his positions with RAGA, any role he played soliciting money for RAGA, what resulted from those solicitations, or any promises made or actions taken by him or RAGA in exchange for donations made to it? 
• Did Mr. Pruitt provide OGE with any information about gifts, such as any RAGA-sponsored chartered flights he may have been on?
• Did Mr. Pruitt disclose contributions to section 527 PACs operating on his behalf?
• Does OGE require nominees to provide information about the types of groups described above as part of its vetting process?  If so, is OGE satisfied that it has received complete disclosures from Mr. Pruitt?  Is OGE aware of any other avenues that will require Mr. Pruitt to disclose this information to EPA’s Designated Agency Ethics Official during his tenure as Administrator, if confirmed? 

For your information, attached to this letter is a letter we are sending today to EPA requesting additional information on its recusal and waiver process.  The EPW Committee has scheduled Mr. Pruitt’s confirmation hearing for January 18th.  Accordingly, we respectfully request responses to these questions prior to the date of the hearing.

January 12, 2017

Kevin Minoli

Designated Agency Ethics Official

U.S. Environmental Protection Agency

1200 Pennsylvania Avenue, NW

Washington, D.C. 20460

Dear Mr. Minoli: 

We are in receipt of the Office of Government Ethics [OGE] certified financial disclosure report [Form 278] of Edward Scott Pruitt, and Mr. Pruitt’s letter to you outlining the steps he will take to avoid conflicts of interest should he be confirmed as Administrator of the Environmental Protection Agency [EPA].  We are concerned that his representations to date have been incomplete.  Without a fuller disclosure of financial and political relationships, EPA may not have sufficient information to evaluate whether Mr. Pruitt should be recused from many matters about which a reasonable person would question his impartiality.  We are also concerned that his ethics agreement does not fully address how legal conflicts of interest arising from his representation of the State of Oklahoma in litigation against EPA will be resolved. 

With respect to Mr. Pruitt’s financial conflicts of interest and his Form 278 disclosures, Mr. Pruitt represents he will not participate personally and substantially in particular matters involving:  Southern Baptists Theological Seminary, the Windows Ministry Incorporated, and the Rule of Law Defense Fund [RLDF].  In the attached letter we are sending today to OGE, we have raised concerns that this accounting does not include sufficient detail to allow OGE or EPA to fully assess conflicts of interest arising from his solicitation of funds for 527 and 501(c)(4) organizations, some of which may continue to operate during his tenure as EPA Administrator, should he be confirmed. 

For example, RLDF can receive unlimited contributions from individuals, corporations, or partnerships and need not disclose the identity of its donors because it is organized under section 501(c)(4) of the Internal Revenue Code.  The RLDF has previously contributed to section 527 political action committees [PACs] like the Republican Attorney Generals Association, effectively laundering the identity of donors whose money ended up funding overtly political purposes.  What safeguards will EPA put in place to guard against Mr. Pruitt’s involvement in matters involving regulated entities that contribute either publicly or anonymously to PACs and 501(c)(4) organizations with which he has had a prior relationship?  In other words, what assurances will we have that regulated entities did not and will not make political contributions in exchange for favorable treatment by him as Administrator?  Reporting in the New York Times and elsewhere has documented the real risk of pay-to-play arrangements with this nominee. 

With respect to conflicts of interest arising from his position as Attorney General of the State of Oklahoma, Mr. Pruitt makes little more than pro forma representations that he will seek your authorization for a one-year period of time concerning matters in which the State of Oklahoma is a party or represents a party.  As you may be aware, Mr. Pruitt has brought multiple lawsuits against EPA on behalf of the State of Oklahoma, many of which remain in active litigation with entities that have contributed large sums of money to RAGA and other PACs with which Mr. Pruitt is affiliated. 

• Could you provide us a complete list of matters that in your opinion will require your authorization?  
• What factors will you use to assess whether authorization will be granted?  What factors will you use to determine how broadly any recusal, if required, must be drawn?  For example, Mr. Pruitt has challenged EPA’s carbon pollution standards for power plants. Assuming that a recusal would be required in that matter, would it be limited to decisions regarding the litigation, or to other matters considered by the Office and Air and Radiation?
• Mr. Pruitt has agreed to not participate in any particular matter involving the RLDF without prior authorization.  RLDF’s activities and donors are largely secret.  Without more extensive disclosures about RLDF and Mr. Pruitt’s role in it, how will you determine whether a particular matter involves the RLDF? 
• The ethics agreement entered into by former EPA Administrator Carol Browner included a clear and permanent recusal of her participation in any EPA matter in which the State of Florida was involved as a party and she was involved personally and substantially as Secretary of the Florida Department of Environmental Regulation.  Our understanding of Mr. Pruitt’s ethics agreement is that he has made no such unequivocal pledge.  Why has EPA concluded that a more lenient arrangement for Mr. Pruitt’s conflicts is appropriate? 
• Mr. Pruitt has agreed to seek your authorization for a one-year period of time.  Is it your understanding that any recusal you may require of Mr. Pruitt would be limited to this one-year period?  If so, how will you account for his participation in matters after that one-year period where the conflict still exists, like litigation that he has brought against the agency that has not settled or been decided by that time?
• Mr. Pruitt has sued EPA on behalf of the State of Oklahoma.  Before authorizing him to participate in EPA decisions involving Oklahoma, how will you determine whether Mr. Pruitt has obtained consent from his client to be released from ethical obligations he may have to it?
• Many of Mr. Pruitt’s lawsuits have involved multi-state coalitions.  Presumably he has entered into joint prosecution agreements with his co-plaintiffs.  Have you reviewed, or will you review, these agreements to assess whether Mr. Pruitt has a “covered relationship” with other states or parties in those lawsuits?  Is it your opinion that he would also have to obtain consent from his co-plaintiffs to participate in matters in which EPA’s position is adverse to those states?   
• It is a general principle of legal ethics that an attorney may not disclose privileged information without the client’s consent.  Furthermore, in multi-party litigation when two or more clients with a common interest in litigation agree to exchange otherwise privileged information concerning the matter, the communication is privileged as against third persons.  Have any provisions been put in place to prevent the unauthorized disclosure by Mr. Pruitt of confidential client information, either from the State of Oklahoma or other state-plaintiffs in Mr. Pruitt’s litigation? 
• Pursuant to 42 U.S.C. § 7601(d), the authority of the Administrator to issue rules related to topics listed in 42 U.S.C. § 7607(d) is not delegable.  How will you address a situation where you determine Mr. Pruitt has a conflict of interest with respect to a rule covering one of these topics? 
• If a recusal is determined appropriate in any matter, has the nominee agreed to forgo any briefings during the period of the recusal? 
• Under what obligation is Mr. Pruitt to follow determinations made by you concerning his recusals and waivers?  If he chooses not to follow your determinations, what recourse is available for EPA? 

We are committed to protecting the integrity of the EPA.  All Americans should have confidence that EPA’s decisions are made transparently, without favor to political donors, and by an Administrator who is committed to protecting the prerogatives and mission of the agency, not those suing it.  The EPW Committee has scheduled Mr. Pruitt’s confirmation hearing for January 18th.  Accordingly, we respectfully request responses to these questions prior to the date of the hearing.

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