By Christopher Lee
Washington Post Staff Writer
Thursday, September 11, 2008
Rep. Charles B. Rangel (D-N.Y.) acknowledged yesterday that he had not lived up to the "higher standard" expected of members of Congress, but he maintained that he should not be punished politically for failing to disclose and pay taxes on rental income from his Caribbean resort property.
The Ways and Means Committee chairman, who is battling three ethics controversies, said he would file amended tax returns and pay federal, state and local taxes he owes -- an amount that his attorney, Lanny Davis, estimated at more than $10,000 for 2004 to 2006. Rangel's accountants are working to determine his tax liability for the rest of the 20 years that he has owned the three-bedroom villa in the Dominican Republic, Davis said.
Rangel, 78, said he regretted his failure to account for the $75,000 in income the property generated, calling the omission "irresponsible." He said he did not know of any income because proceeds from rentals were automatically credited toward his mortgage and because he seldom received financial statements from the resort managers.
"I do hope that my explanation will be sufficient to say that we do make errors, even though we consider ourselves experts in terms of tax policy for the nation," said the Harlem Democrat, whose influential committee helps shape the tax code.
The congressman rejected Republicans' calls for him to step down from his chairmanship while the House ethics committee investigates the villa deal. The ethics panel also is conducting separate inquiries into Rangel's rental of several New York apartments at below-market rates and his fundraising entreaties on congressional stationery to corporations and foundations on behalf of an academic center that bears his name. All the investigations came at Rangel's request after news organizations reported on the issues.
"I really don't believe that making mistakes means that you have to give up your career," Rangel said. Later, he added: "I personally feel that I've done nothing morally wrong."
House Minority Leader John A. Boehner (R-Ohio) said Rangel should step aside while the ethics committee investigates.
"Just because he's my friend doesn't mean that I can excuse him from the rules of the House or the law of the land," Boehner said on the House floor. He added: "The sooner we get this cleaned up, the better."
Republicans have used Rangel's ethical troubles to turn the tables on Democrats, who in winning back control of the House in 2006 argued that the GOP-run Congress was plagued by a "culture of corruption."
House Speaker Nancy Pelosi "continues to blatantly ignore her promise to run the 'most ethical congress in history,' " Ken Spain, spokesman for the National Republican Congressional Committee, said in a statement. "The time has come for Charlie Rangel to go on a permanent vacation and trade his powerful committee chair in for his favorite lounge chair on the beach."
Rangel said he paid $88,900 for the beachfront villa in 1988, financing it with a down payment of $28,900 and a loan from the developer to cover the rest. After two years, he said, the developer decided to waive the interest on loans for Rangel and other early investors. Rangel later borrowed an additional $23,000 -- with interest -- to add the third bedroom to the unit. That mortgage also was paid off with rental proceeds, he said.
Rangel said he uses the villa fewer than 10 days a year and occasionally has allowed friends, House staffers and other members of Congress to stay there. He declined to name them.
The 38-year veteran of the House has drawn criticism not just from the GOP, but also from the advocacy group Citizens for Responsibility and Ethics in Washington, which yesterday included him on its annual list of the "most corrupt" members of Congress.
But Rangel, who has routinely won reelection by large margins, said he does not fear for his political future. "I'm a lucky old son of a gun," he said. "Ain't nothing going to stop me from getting back here next year."