Representative Charles B. Rangel has earned more than $75,000 in rental income from a villa he has owned in the Dominican Republic since 1988, but never reported it on his federal or state tax returns, according to a lawyer for the congressman and documents from the resort.It might be tough to argue that he doesn't use it as a vacation home since he wrote about it in his autobiography.
Mr. Rangel, chairman of the House Ways and Means Committee, which writes the federal tax code, bought the beachfront villa at the Punta Cana Yacht Club and has received twice-yearly payments from the resort, which rents the property for $500 or more per night.
Records from the development, now called the Punta Cana Resort and Club, indicated that Mr. Rangel’s rental profits varied from year to year, from $2,700 in 2004 to $7,600 in 1994.
A lawyer for Mr. Rangel, Lanny Davis, said on Thursday that the congressman would most likely file amendments to his tax returns for the years in question.
But Mr. Rangel will probably have no federal tax liability, Mr. Davis said, because he considered the villa an investment rather than a vacation home, and was therefore entitled to deduct depreciation on the property, as well as taxes the resort management paid to the Dominican Republic.
In his memoir, “And I Haven’t Had a Bad Day Since,” Mr. Rangel described his deep affection for the Dominican retreat.And what is his excuse? He blames his wife.
“As I’ve spent time basking in the sun on the beach at Punta Cana in the Dominican Republic, where I have a little house facing a big ocean, and beholding the beauty of the Caribbean Sea in total relaxation, I’ve thought of telling God not to worry about me if it turns out there’s an overbooking or backlog on people waiting to get into heaven,” the congressman wrote. “I’ll be okay right here until it’s time for me to come.”
Mr. Davis said the congressman did not realize he had to declare the money as income, and was unaware of the semiannual payments from the resort because his wife, Alma, handled the family finances and conferred with their accountant, John Viardi, on tax matters.Yes, of course the House Ethics Committee won't think that it's a problem that the chairman of the House Ways and Means Committee is not paying taxes on a property he owns. He's been able to skate away from his violation of New York's strict rent control laws.
The money was never sent to the Rangels directly, according to Mr. Davis and resort records, but was used to defray the mortgage the company gave them when they bought the villa and $23,000 in subsequent construction costs in 2003.
The confusion was magnified, Mr. Davis said, by the fact that the statements from the resort were sent only intermittently. The congressman declined to be interviewed, but issued a brief written statement.
“I have asked my accountant to review all the data recently made available to me by the Punta Cana Hotel in the Dominican Republic concerning my investment 20 or so years ago in purchasing a unit in that hotel for occasional use over the years,” the statement said. “Once my accountant obtains and verifies the facts, I will follow his recommendations.”
Mr. Davis said that Mr. Rangel had paid scant attention to the villa’s finances until Sunday, when The New York Post reported that the congressman had failed to declare the rental income for 2006 and 2007 on his Congressional financial disclosure forms. “This is all news to him,” Mr. Davis said. A review by The New York Times of the records dating back to 1996 showed that the congressman also did not report the income in 1996 through 2000. Mr. Davis said on Thursday that Mr. Rangel would most likely file amendments to the disclosure forms as well.
The disclosure is a sworn statement, and intentionally filing a false report is a felony that carries a possible five-year prison sentence, but in most cases the House ethics committee does not punish members for errors or omissions.
His finances have been under scrutiny since July, after news reports that a major real estate developer had allowed him to lease four rent-stabilized apartments, including one he had used as a campaign office. Mr. Rangel announced he would give up the campaign office, but keep the other three, and asked the House ethics committee to investigate whether the landlord’s decision to charge him below-market rent should be restricted under the Congressional gift ban.And this is the guy who funneled federal money to create his own little monument to himself.
Millions of your tax dollars are going for a new program at The City College of New York in the heart of Harlem. The mission is to get more minority and poor students into politics.Perhaps in his center they'll teach about how not to use your position of power to evade the laws that are good enough for the rest of us.
"This is an effort to make sure that America's government looks like America," says City College spokeswoman Mary Lou Edmondson.
Nobody's taking issue with that. What they are griping about is that one member of Congress funneled $2 million in tax dollars into the project through a special "earmark" and the whole thing is named after him.
As CBS News correspondent Sharyl Attkisson reports, that member of Congress is Rep. Charles Rangel - one of the most powerful Democrats on Capitol Hill.