Capitol Alert

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A second California Democrat (the first was Rep. Jane Harman) is the subject of a Washington report questioning recent activities this week.

Today's Washington Times reports on Sen. Dianne Feinstein:

On the day the new Congress convened this year, Sen. Dianne Feinstein introduced legislation to route $25 billion in taxpayer money to a government agency that had just awarded her husband's real estate firm a lucrative contract to sell foreclosed properties at compensation rates higher than the industry norms.


Mrs. Feinstein's intervention on behalf of the Federal Deposit Insurance Corp. was unusual: the California Democrat isn't a member of the Senate Committee on Banking, Housing and Urban Affairs with jurisdiction over FDIC; and the agency is supposed to operate from money it raises from bank-paid insurance payments -- not direct federal dollars.

Documents reviewed by The Washington Times show Mrs. Feinstein first offered Oct. 30 to help the FDIC secure money for its effort to stem the rise of home foreclosures. Her letter was sent just days before the agency determined that CB Richard Ellis Group (CBRE) -- the commercial real estate firm that her husband Richard Blum heads as board chairman -- had won the competitive bidding for a contract to sell foreclosed properties that FDIC had inherited from failed banks.

Feinstein's office has since released a statement responding to the story. It reads, "There is no evidence of any conflict of interest -- or any connection -- between the Senator's foreclosure relief bill and CB Richard Ellis winning a competitively bid contract, which was awarded -- unbeknownst to her -- by non-political career staff."

Political impact: Calbuzz calls the story an example of one more reason why Feinstein won't be running for governor.

Should Feinstein choose to abandon the comforts of Georgetown for the rigors of the California campaign trail and run for governor next year, this and every other of the myriad deals Blum has consummated while she's held high office ... will immediately become fodder for every mad dog opposition researcher, investigative gunslinger, skeptical political writer and tin-foil-hat blogger in the state.


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