- The Washington Times - Saturday, February 28, 2009

President Obama’s former nominee to become commerce secretary, Republican Sen. Judd Gregg, steered taxpayer money to his home state’s redevelopment of a former Air Force base even as he and his brother engaged in real estate deals there, an Associated Press investigation found.

The New Hampshire Republican has personally invested hundreds of thousands of dollars in Cyrus Gregg’s office projects at the Pease International Tradeport, a Portsmouth business park built at the defunct Pease Air Force Base, once home to nuclear bombers. Judd Gregg has collected at least $240,017 to $651,801 from his investments there, Senate records show, while helping to arrange at least $66 million in federal aid for the former base.

Mr. Gregg said he violated no laws or Senate rules. In a statement Friday, he said that all the federal money he steered to Pease had been requested by the National Guard, the city of Portsmouth or its mayor or other public officials “and did not involve my initiative but only my support of the requests.”

But the senator’s mixture of personal and professional business would have been difficult to square with President Obama’s campaign promise to impose greater transparency and integrity over federal budget earmarks - funding for lawmakers’ pet projects. Mr. Gregg said that during his consideration for the Cabinet job, the White House did not know about his Pease earmarks, although the administration knew about his investments at Pease.

Under new Senate ethics rules, Mr. Gregg had to certify that federal aid he directed to specific projects was not intended solely to enrich him or his immediate family, including siblings. Senators are also supposed to avoid even the appearance of a conflict of interest, though the Senate ethics committee seldom investigates or disciplines senators when questions are raised about their activities.

“I am absolutely sure that in every way I’ve complied with the ethics rules of the Senate both literally and in their spirit relative to any investment that I’ve made anywhere,” Mr. Gregg told the AP. “These earmarks do not benefit me in any way, shape, manner financially, personally or in any other manner other than the fact that I’m a citizen of New Hampshire.”

Mr. Gregg abruptly announced earlier this month that he was stepping aside from consideration for the Cabinet post, citing philosophical differences with Mr. Obama.

The senator has said his withdrawal had nothing to do with anything the White House uncovered in his background. A White House spokesman, Ben LaBolt, declined to discuss the matter with the AP.

AP began looking into Mr. Gregg’s activities at Pease before then but had not yet contacted him or the White House before he withdrew.

“My decision to withdraw my nomination to be secretary of commerce was made solely due to differences in political ideology with the administration and the concern that I could not properly serve the president in his Cabinet with full support for his initiatives at all times due to these differences,” Mr. Gregg said in his statement Friday. “To somehow imply anything else is totally false.”

Mr. Obama’s administration has wrestled in recent weeks with embarrassing revelations about his choices for the Cabinet and other high-profile jobs, including the Treasury secretary’s failure to pay $34,000 in income taxes on time. Mr. Obama’s first choice for commerce secretary, New Mexico Gov. Bill Richardson, withdrew due to the disclosure that a grand jury was investigating the awarding of a state contract to one of his major political donors.

Mr. Gregg told the AP the White House expressed no concerns about his involvement at Pease. He said he does not believe his investments there or his role in obtaining federal aid would have affected his consideration for the job.

The Greggs have long been a wealthy and powerful New Hampshire family. Mr. Gregg’s selection by Mr. Obama gave him national prominence, and he was among Republican lawmakers the president invited to a meeting earlier this week on the nation’s financial health.

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