Gregg has investment in revamped air base

Says he violated no ethics rules

Senator Judd Gregg (right), with Representative Paul Ryan of Wisconsin, spoke to reporters about the budget Thursday. (Susan Walsh/Associated Press)

WASHINGTON - US Senator Judd Gregg, who withdrew as President Obama's nominee for commerce secretary, won taxpayer money for redevelopment of a closed Air Force base where he and his brother had invested in commercial property, an Associated Press investigation found.

Gregg, a Republican from New Hampshire, 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.

The senator 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.

Gregg said he violated no laws or Senate rules. In a conference call with New Hampshire reporters yesterday, he said most of the federal money he steered to Pease had been requested by the National Guard or the city of Portsmouth. "None of these in any way have benefited me personally," Gregg said.

But the senator's mixture of personal and professional business would have been difficult to square with Obama's campaign promise to impose greater transparency and integrity over federal budget earmarks - funding for lawmakers' pet projects.

Gregg abruptly announced earlier this month that he was stepping aside from consideration for the Cabinet post, citing philosophical differences with Obama. The senator said his withdrawal had nothing to do with anything the White House uncovered in his background and "to somehow imply anything else is totally false." A White House spokesman, Ben LaBolt, declined to discuss the matter.

Under new Senate ethics rules, 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," Gregg said.

The head of a watchdog group, Melanie Sloan of Citizens for Responsibility and Ethics in Washington, said Gregg's actions have the appearance of a conflict of interest, even if they did not fall under the Senate's narrow definition of an actual conflict.

"He increased the value of the property, which caused his own investment to increase in value," she said. "So, it appears that he earmarked and then financially benefited from his own earmark." Sloan noted that Gregg secured earmarks for Pease beyond those sought for the National Guard and city.