January 24, 2020
The Trump Organization charged the Trump inaugural committee an abnormally high rate for blocks of rooms and suites in the hotel around the inauguration, netting Trump’s business almost six times the current average cost for the most basic rooms available in the hotel and eight times the current average cost for higher tiered rooms, according to documents released in a lawsuit this week. While it’s typical for Washington area hotels to charge guests more around a presidential inauguration, in this case, the exorbitant prices paid by the incoming president’s political supporters went into that president’s pocket.
On Wednesday, DC Attorney General Karl Racine sued the Trump Inaugural Committee for violating its nonprofit status by paying more than market rate (over $1 million) to use a ballroom at Trump’s DC hotel. Documents included with the suit revealed more than was previously known about the costs at the Trump Hotel around his inauguration.
Reserving rooms in a block would typically mean that the costs would be reduced, but emails released with the suit show that rates were actually many times more expensive than the current normal rate. The most basic rooms available at Trump’s hotel cost the inaugural committee $2,000 per night per room, while the current cost for the least expensive room is $340, according to the hotel’s website. Not only that, but the rooms were only available if booked for 5 nights or more, which meant that the hotel was guaranteed at least $10,000 in revenue from guests willing to book one.
According to the documents, hotel executives also discussed selling the hotel’s suites for up to five times the current costs—in one case a difference of tens of thousands of dollars. According to the hotel’s website, the Franklin Suite starts at $8,340. The hotel discussed billing the inaugural committee $35,000 for the same suite. The Postmaster Suite starts at $4,340 per night. Hotel executives discussed billing the inaugural $17,000. If you were to book a Pennsylvania suite today, it would cost you $1,940, whereas $10,000 was discussed as a price for that room.
The fact that Trump’s DC hotel sold out at high rates for inauguration was reported in the Washington Post in November 2016, but the hotel’s manager did not appear to acknowledge the full extent of the rate spike, saying that rooms were selling for only five times the normal rate.
We know at least one purchaser of the pricey suites, and it’s someone with long-standing business ties to Trump. Phil Ruffin was apparently one of the buyers for the Capitol Suite, and paid $15,000 to rent it, according to the emails. Ruffin is Trump’s business partner, and is the co-owner of Trump’s Las Vegas hotel.
Another email shows that Rick Gates, the inaugural committee deputy chairman, raised concerns with Ivanka Trump about the optics around the cost of using the hotel for the inauguration being “quite high.” It appears not to have changed anyone’s mind about the opportunity to cash in. In December, Gates was sentenced to 45 days in jail for conspiracy and lying to the FBI in the Mueller probe.
CREW previously reported on how room rates at Trump’s DC hotel spike around Trump-related events and political fundraisers, but this new lawsuit shows that the hotel’s dramatic price increases may actually violate the law. Racine’s complaint alleges that the inaugural committee was used to personally benefit Trump, engaging in private inurement which is against the law for nonprofit groups.
Despite legal and ethical concerns, there’s no sign that rate spikes at Trump’s DC hotel will stop anytime soon. In fact, CREW found that 10 months in advance of election night, the hotel is apparently fully booked, and the night after, the rate is nearly five times the normal rate. Trump’s political position continues to result in a massive payouts—but now we know the pattern started even in the earliest planning stages of Trump’s presidency.