Followers of the ecologically dubious and largely pointless Cadiz water project in the Mojave Desert might have pricked up their ears last week at reports of a possible conflict of interest involving Jared Kushner, President Trump’s son-in-law, and the investment firm Apollo Global Management.
That’s because Apollo is a sizable investor in Cadiz, which has received favorable regulatory treatment from the Trump administration after years of thumbs-down rulings under the Obama administration and from local and state officials. Apollo and Cadiz announced the $60-million investment, along with a “conditional” $240 million in construction financing, on May 2.
The New York Times reported on Feb. 28 that the Kushner family’s real estate firm received a $184-million refinancing loan in November from Apollo after meetings at the White House between Kushner and Joshua Harris, an Apollo founder who was advising the administration on infrastructure policy. ABC News followed with a report that the Securities and Exchange Commission had dropped an inquiry into Apollo after the loan. Spokespersons for Kushner and Apollo denied there was a quid pro quo in either case.
Apollo and Cadiz say that’s true in their case too. “Josh Harris never talked with Jared Kushner about the Cadiz Valley Water Conservation, Recovery & Storage Project,” the investment firm told me. “There is no connection whatsoever between Apollo’s business with the Kushner Cos. and any government action regarding the Cadiz Valley project.” Cadiz spokeswoman Courtney Degener also said that “Apollo had nothing to do with” the Interior Department’s regulatory green light for the project.
But the connections between Kushner and Apollo underscore the ethical quagmire of the Trump White House. Because Kushner hasn’t divested his business interests despite holding down a key position in the administration, any decision made by Trump’s White House that affects Kushner’s business partners is automatically suspect. It is unclear what role, if any, Kushner had in moving the Cadiz project forward.
Under Trump, the Interior Department’s Bureau of Land Management began signaling a favorable stance on Cadiz even before Apollo’s investment. The $250-million Cadiz project appeared, apparently at the behest of building trades unions, on a list of proposed infrastructure projects the Trump transition team circulated prior to the inauguration. And the water project, which would traverse an environmentally sensitive portion of the Mojave and a federal ecological preserve, fits in well with what appears to be Interior Secretary Ryan Zinke’s predilection to despoil protected lands coast to coast.