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Grijalva says Benson developer, former U.S. Interior secretary involved in criminal bribery plot

U.S. Rep. Raúl Grijalva has asked the Justice Department to investigate a former Trump administration Cabinet member, saying he engaged in a quid-pro-quo relationship with a real estate developer, seeking campaign funds in exchange for a water permit needed for the construction of massive housing project outside of Benson, Ariz., southeast of Tucson.

Grijalva, as the chair of the House Natural Resources Committee, said Wednesday that former Interior Secretary David Bernhardt and developer Michael Ingram were involved in a scheme that was likely a violation of federal law. Ingram, the owner of El Dorado Holdings, is seeking to build the Villages at Vigneto, a 28,000-unit housing and commercial development that spans more than 12,000 acres, including 75 miles affecting the San Pedro River — one of the last "free-flowing rivers" in the U.S — and its tributaries in Cochise County.

Grijalva and U.S. Rep. Katie Porter, chair of the Investigations Subcommittee of Natural Resources, sent a letter to Attorney General Merrick Garland, warning him of "potentially criminal conduct" between Bernhardt and Ingram.

They noted that since 2019, Natural Resources Committee has "conducted an extensive investigation into the circumstances surrounding" the decision by U.S. Fish and Wildlife to reverse "its longstanding position regarding the proposed Villages at Vigneto development in Benson, Ariz."

"Evidence strongly suggests the decision was the result of a quid pro quo between Vigneto’s developer, Michael Ingram, and senior level officials in the Trump administration, potentially including then–DOI Deputy Secretary David Bernhardt," the Democrats wrote, asking the Justice Department to investigate the manner, and consider whether criminal charges should be brought against either man.

"The findings of this investigation show us yet again that the previous administration cast career staff expertise aside while they handed out federal agency decisions to Trump’s buddies and big donors on a pay-to-play basis," Grijalva said in a statement.

“The Villages at Vigneto may not be a household name for many Americans, but to Arizonans, it’s been a looming threat to our fragile desert ecosystem for years," he said. "Allowing the development of 28,000 homes, golf courses, resorts, and other commercial buildings to suck the San Pedro River dry during a time of unprecedented drought is nonsensical on its face and agency staff were right to be concerned."

Bernhardt was nominated to become the secretary of the Interior Department, which oversees most federal lands, by President Donald Trump in February 2019. He was confirmed as a Cabinet member by the Senate that April. His predecessor, Ryan Zinke, was dogged by investigations into his travel expenditures, and in February, the Interior Department’s own watchdog found that Zinke had dozens of contact with developers about real estate deals in his hometown and lied about it. However, the Justice Department ultimately declined to charge Zinke with a crime.

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"It seems Vigneto’s developer figured backroom deals with top Trump officials would be a more fruitful avenue for getting his way—it’s a shame he wasn’t wrong," Grijalva said." I strongly urge the Justice Department to take up this investigation and make sure the right people are held accountable for what they’ve done and how they’ve betrayed the trust of the American people."

Porter called the exchange of money for a "specific government action" the "clearest form of corruption there is, and Americans—Democrats, Republicans, and Independents—share an understanding that this kind of quid pro quo erodes our democracy."

She said that the committee uncovered signs that Bernhardt and other members of the Trump administration "overruled local career professionals and reversed a longstanding position on environmental review requirements, just weeks after politically connected donors made nearly a quarter of a million dollars’ worth of contributions benefiting the Trump campaign."

This concerning fact pattern demands additional fact finding, at a minimum, so the American people have answers on whether the Trump administration was acting in the public’s interest or the interests of the highest bidder," Porter said.

Federal water permit suspended

Described as a "Tuscan-style" complex, the Vigneto development comes with major concerns how a new city of 70,000 people will affect the San Pedro River, and the aquifers that supply water to Sierra Vista and the neighboring communities of Tombstone, Benson, Cascabel, Pomerene and St. David.

In 2006, federal officials granted a Clean Water Act permit for Vigneto, but it was suspended in 2016. A year later, under the Trump administration the permit was re-evaluated under what Grijalva and Porter called "unusual circumstances."

In 2019, the Trump administration attempted to gut new protections to American waterways implemented by the Obama administration in 2015 known as Waters of the United States rule. It was one of a salvo of attacks on environmental rules, including the elimination of restrictions on fossil fuel pollution, including coal-fired power plants, automobile emissions, methane emissions, as well as asbestos and pesticides.

By Aug. 2017, Fish and Wildlife Supervisor Supervisor Steve Spangle was called by an attorney from the Interior Departments, who "directed him to reverse his longstanding decision" over the water permit. Spangle had said that the Army Corps of Engineers need to "formally consult" with FWS under the Endangered Species Act, regarding the suspended Clean Water Act permit for Vigneto. 

Vigneto’s previous owner, Whetstone, first applied for a Clean Water Act permit from Army Corps and asked to fill 70 acres of desert washes. Under federal law, this would qualify as a change to waters of the United States, requiring a decision from federal officials. Officials with the Environmental Protection Agency warned that the Vigneto development, as a whole, would have “substantial and unacceptable” consequences on the desert landscape.

"The range and severity of environmental consequences resulting from the Whetstone Ranch project are substantial and unacceptable and are contrary to the goals of the Clean Water Act," the EPA wrote.

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Spangle told the Army Corps to review the entire project's effects, including not just the filling of washes, but how the required groundwater pumping could adversely affect native species and critical habitat. The Army Corps ignored Spangle, and issued a permit to Whetstone allowing the company to fill 51 acres of desert washes.

However, the economic downtown meant the project remained on hold until 2014 when Whetstone sold the land to El Dorado, along with the Clean Water Permit. The Army Corps attempted to get a new decision from Spangle, but he argued they should look at the whole project, including 4,100 acres added by El Dorado.

Spangle later told the Arizona Daily Star that he got "rolled" by Trump administration officials to get the Vigneto permit moving, allowing for construction of the huge housing development. As Grijalva and Porter told the Justice Department, that phone call was directed by Bernhardt, and the Secretary of Interior.

Bernhardt met with Vigneto's developer, Ingram, for a private breakfast in Billings, Montana. As Grijalva noted, "the meeting was not disclosed in Dep. Sec. Bernhardt’s official calendar or travel documents."

In fact, during a meeting with the committee, the Interior Department's chief of staff, Todd Willens was "unable or unwilling to explain why the breakfast meeting did not appear" on Bernhardt's "calendars, travel documents, routine scheduling correspondence with the DOI Ethics Department."

And, Spangle did was he was instructed, and "reversed his original decision on Vigneto’s potential adverse effects on endangered and threatened species on Oct. 26, 2017, less than two months after the phone call."

"His reversal would effectively green light the Clean Water Act permit," they told Garland.

Between the first call to Spangle in August 2017, and his decision in October, three incidents occurred, wrote Grijalva and Porter:

"First, the Army Corps formally noticed a re-evaluation of the Clean Water Act permit. Second, Mr. Ingram and several others from Arizona made out-of-cycle donations on October 6, 2017, and the days immediately prior and subsequent, totaling $241,600 to then–President Trump’s joint fundraising committee, the Trump Victory Fund, and to the Republican National Committee. Third, Dep. Sec. Bernhardt held a meeting with a DOI attorney who had been instrumental in directing the reversal of the Vigneto decision."

Donations show links between developer, Trump official

Ingram's first donation came on Oct. 6, the same day the permit re-evaluation was listed. Meanwhile, 13 other donors with links to Ingram, poured money into the Trump Victory Fund. This includes Warren Florkiewicz, a co-owner of El Dorado Benson, the LLC associated with Vigneto, and Arturo "Arte" Moreno, who serves on the board of the genomics research company TGen with Ingram.

Ingram later exceeded the total donations allowed, and received a refund of $5,400 from the Donald J. Trump for President fund.

"This level of donor activity was not typical," wrote Grijalva and Porter. "Throughout the entire 2017–2018 election cycle, there were no other days in which more than three people from Arizona donated $2,700 or more to [Trump Victory Fund.]"

Two weeks after the breakfast meeting, Bernhardt met with Peg Romanik, the lawyer from Interior's solicitor office, and Richard Goeken, the deputy solicitor for Parks and Fish and Wildlife. In emails to Goeken, Romanik specifically referred to the meeting as the "Corps matter." Later, that same day, Spangle received a call from Romanik to change his decision, and then emailed him her legal theories about the issue.

Grijalva and Porter said that Ingram had "frequent access to high-ranking officials across the Trump administration" including former Interior Secretary Ryan Zinke and Bernhardt, as well as EPA Administrator Scott Pruitt, and other political appointees. "This level of personal access to political appointees raises questions about Mr. Ingram’s level of influence in the Trump administration," they said. And, they added there were likely "additional meetings or other engagements remain unknown."

Grijalva and Porter said before Bernhardt intervened, there was "consensus among" career officials that the Army Corps must "consider all direct and indirect effects of the Vigneto development and not just those within the immediate area to be authorized under the Clean Water Act permit." 

Spangle told House Committee staff that it was usual for someone at Bernhardt's level to get involved in what he called a field-level decision, and said "throughout his nearly 30-year career" at FWS, none of his decisions had been elevated "higher than the level of FWS Regional Director," they told the Justice Department.

"Combined, the atypical nature of Dep. Sec. Bernhardt’s involvement in a field-level decision, the subsequent reversal of a decision that was universally backed by the Department’s career staff, and the three incidents occurring on Oct. 6 point to official federal agency decision-making being executed in the interest of private gain rather than the American people," they wrote.

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U.S. Rep. Raúl Grijalva during a press conference in April.

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