Tuesday, July 29, 2008

Knollenberg Significantly Underreporting Value of DC Home

Bad Joe. From Roll Call today-

Since 2003, Rep. Joe Knollenberg (R-Mich.) has underreported the value of his Capitol Hill townhouse by hundreds of thousands of dollars each year in his personal financial disclosure forms, an apparent violation of House rules.

On the most recent disclosure forms, Knollenberg reported the value of the property at $50,000 to $100,000, down from the $100,000 to $250,000 range he reported the year before, despite the fact that District of Columbia tax records indicate a current assessed value of $781,840.

"The Congressman has always striven to go above and beyond the required financial disclosure requirements," Knollenberg spokesman Nate Bailey said. "He has nothing to hide. It appears that his accountant has made a clerical error, and that inadvertent mistake will be corrected immediately."

Yes, it was a clerical error that went on for five years. Bailey is trying to claim that they were reporting the value of the rental unit, but couldn't explain why that value decreased last year. Members of Congress are not required to report their personal residence or mortgages on properties unless those properties generate income. At that point, the rules kick in-

The instruction manual provided by the House Committee on Standards of Official Conduct for filling out financial disclosure forms requires that when a property provides rental income, "the gross value of the entire property should be reported even if only part of the property (e.g. the basement of a residence) is used for rental purposes."

Seems pretty clear to me, and I'm not an accountant.

Mark Brewer had this to say-

"It looks like the sub-prime lenders weren't the only ones using shady accounting practices. Joe Knollenberg's failure to report the value of his home in Washington is just another example of the broken ethics that pass for normal behavior inside the Beltway. Congressman Knollenberg needs to explain to families who are losing their homes back in Oakland County, Michigan why he has been hiding the true value of his home in Washington, DC."

Indeed. But something tells me that Joe won't be forthcoming with an explanation for Oakland County - he will just pass the blame as usual.