Trump New York Estate Focus Of Criminal, Civil Probes
Donald Trump’s century-old Seven Springs estate in New York’s Westchester County doesn’t look like anything else in his real estate portfolio. The 28,322-square-foot Georgian-style mansion boasts more than a dozen bedrooms, an indoor swimming pool, a bowling alley and a tennis court. It sits in the middle of 213 acres of hilly, mature forest land about an hour north of New York City.
Trump hasn’t been there in about four years but now he’s going to have to pay a lot of attention to the property as it has become the focus of a criminal investigation by Manhattan District Attorney Cyrus Vance Jr. and a civil inquiry by New York Attorney General Letitia James. Both investigations are looking into whether Trump manipulated the property’s value to reap greater tax benefits from an environmental conservation arrangement he made at the end of 2015.
“While a tax issue related to a conservation arrangement might not be as sexy as a hush-money payment, prosecutors are likely to focus on any violation of law that they find,” said Duncan Levin, a former Manhattan prosecutor. “Remember, the authorities got Al Capone on tax evasion.”
Trump bought the property in 1995 for $7.5 million, which about $2.25 million under the asking price at the time so he got quite a bargain. He initially envisioned transforming the property into a championship level golf course and charging huge membership fees that would guarantee a very exclusive clientele. But local residents objected, concerned that chemicals used to maintain the golf course would pollute a nearby lake that is a local source of drinking water in the community of Mt. Kisco.
With that plan dashed he proposed building 46 single-family homes. Again the community said no, so he then proposed building 15 mansions “the likes of which has never been seen on the East Coast.” That effort got tied up in litigation for years and nothing was ever built.
That’s when Trump decided to try the tax gambit by granting an easement to a conservation land trust to preserve 158 acres of the property. Trump took a $21 million income tax deduction, based on an appraisal he paid for that put the value of the entire estate at $56.5 million. The problem is that local government assessors valued the estate at just $20 million. That discrepancy is what Vance and James are examining.
Michael Colangelo, a lawyer in the New York attorney general’s office, outlined the central questions of the investigations. “If the value of the easement was improperly inflated, who obtained the benefit from that improper inflation and in what amounts?” Colangelo said. “It goes without saying that the attorney general needs to see the records that would reflect the value of that deduction, as it flowed up to intermediate entities, and ultimately to Mr. Trump, personally.”