Donald Trump to hand back Russian compounds in New York and Maryland seized after election

Diplomatic officials were ejected from properties by then-President Barack Obama in December over fears they were being used for 'intelligence-related purposes'

The Russian Embassy’s compound near Centreville, Maryland (NBC4/WRC-TV/Reuters)

The Trump administration is moving toward handing back to Russia two diplomatic compounds, near New York City and on Maryland's Eastern Shore, from which its officials were ejected in late December as punishment for Moscow's interference in the 2016 presidential election.

Then-President Barack Obama said 29 December that the compounds were being “used by Russian personnel for intelligence-related purposes,” and gave Russia 24 hours to vacate them. Separately, Obama expelled from the United States what he said were 35 Russian “intelligence operatives.”

Early last month, the Trump administration told the Russians it would consider turning the properties back over to them if Moscow would lift its freeze, imposed in 2014 in retaliation for US sanctions related to Ukraine, on construction of a new US consulate on a certain parcel of land in St. Petersburg.

Two days later, the US position changed. Secretary of State Rex Tillerson told Russian Foreign Minister Sergei Lavrov and Russian Ambassador Sergey Kislyak at a meeting in Washington, that the United States had dropped any linkage between the compounds and the consulate, according to several people with knowledge of the exchanges.

In Moscow on Wednesday, Kremlin aide Yury Ushakov said Russia was “taking into account the difficult internal political situation for the current administration,” but retained the option to reciprocate for what he called the “expropriation” of Russian property, “if these steps are not somehow adjusted by the US side,” the news outlet Sputnik reported.

Senior Tillerson adviser R.C. Hammond said that “the US and Russia have reached no agreements.” He said the next senior level meeting between the two governments, below the secretary of state level, will be in June in St. Petersburg.

Before making a final decision on allowing the Russians to reoccupy the compounds, the administration is examining possible restrictions on Russian activities there, including removing the diplomatic immunity the properties previously enjoyed. Without immunity, the facilities would be treated as any other buildings in the United States and would not be barred to entry by US law enforcement, according to people who spoke on the condition anonymity to discuss sensitive diplomatic matters.

Any concessions to Moscow could prove controversial while administration and former Trump campaign officials are under congressional and special counsel investigation for alleged ties to Russia.

Changes in the administration's official posture toward the compounds come as Russian media recently suggested that Kislyak, about to leave Washington after serving as ambassador since 2008, may be proposed by the Kremlin to head a new position as UN undersecretary general for counter-terrorism.

Kislyak, who met and spoke during the campaign and transition with President Donald Trump's former national security adviser Michael Flynn, Trump's White House adviser and son-in-law Jared Kushner, Attorney General Jeff Sessions and others, is known to be interested in the post. His replacement as ambassador, current Deputy Foreign Minister Anatoly Antonov, was confirmed last month by the Russian Duma, or parliament. Officials in Moscow said Russian President Vladimir Putin will officially inform Trump of the new ambassador when the two meet in July, at the Group of 20 summit in Hamburg. It will be Trump's first meeting with Putin as president.

The UN General Assembly must first approve establishment of the counter-terrorism slot, part of a larger UN reorganisation and the first new post at that level for decades.

Russia will almost certainly claim the slot as the only member of the five permanent members of the Security Council without one of its nationals in a senior UN position. Jeffrey Feltman, a former senior US diplomat, is currently undersecretary-general for political affairs; comparable jobs for peacekeeping, humanitarian affairs and economic affairs are held, respectively, by nationals from France, Britain and China.

Secretary General António Guterres will decide who fills the new job, although both Russia and the United States are expected to make their views known.

Kislyak has repeatedly rejected descriptions of him in the US media as a spy. Asked whether US intelligence considered him to be one, James Clapper Jr, the former director of national intelligence, told CNN Sunday that, “Given the fact that he oversees a very aggressive intelligence operation in this country - the Russians have more intelligence operatives than any other nation that is represented in this country, still even after we got rid of 35 of them - and so to suggest that he is somehow separate or oblivious to that is a bit much.”

The Russian compounds - a 14-acre estate on Long Island, and several buildings on secluded acreage along the Corsica River on Maryland's Eastern Shore - have been in Russian possession since the days of the Soviet Union. According to a Maryland deed in 1995, the former USSR transferred ownership of the Maryland property to the Russian Federation in 1995, for a payment of one dollar.

Russia said it used the facilities, both of which had diplomatic immunity, for rest and recreation for embassy and UN, employees, and to hold official events. But US officials dating back to the Reagan administration, based on aerial and other surveillance, had long believed they were also being used for intelligence purposes.

Last year, when Russian security services began harassing US officials in Moscow - including slashed tyres, home break-ins and, at one point tackling and throwing to the ground a US embassy official entering through the front of the embassy - the Obama administration threatened to close the compounds, former Obama officials said.

In meetings to protest the treatment, the Obama administration said that it would do so unless the harassment stopped, and Moscow dropped its freeze on construction of a new consulate to replace the one in St. Petersburg, considered largely unusable because of Russian spying equipment installed there. Russia had earlier blocked US use of a parcel of land and construction guarantees in the city when sanctions were imposed after its military intervention in Ukraine and annexation of Crimea.

The threat of closing the compounds was not pursued. In late December, after US intelligence said there had been election meddling, and in response to the ongoing harassment in Moscow, Obama ordered the compounds closed and diplomats expelled. “We had no intention of ever giving them back,” a former senior Obama official said of the compounds.

Trump, then at his Mar-a-Lago estate in Florida, appeared to disparage the Obama administration sanctions, telling reporters, “I think we ought to get on with our lives.”

Surprisingly, Russia did not respond. It later emerged that Flynn, in a phone conversation with Kislyak, had advised against retaliation and indicated that US policy would change under the Trump administration.

The Kremlin made clear that the compound issue was at the top of its bilateral agenda. Russia repeatedly denounced what it called the “seizure” of the properties as an illegal violation of diplomatic treaties.

On 8 May, the US undersecretary of state for political affairs, Thomas Shannon, traveled to New York to meet with his Russian counterpart, Deputy Foreign Minister Sergei Ryabkov on what the State Department described as “a range of bilateral issues” and what Russia called “irritants” and “grievances.”

Ryabkov brought up the compounds, while Shannon raised St. Petersburg and harassment, suggesting that they deal with the operation of their diplomats and facilities in each others' countries separate from policy issues such as Syria, and proposing that they clear the decks with a compromise.

Russia refused, saying that the compound issue was a hostile act that deserved no reciprocal action to resolve, and had to be dealt with before other diplomatic problems could be addressed. In an interview with Tass, Ryabkov said Moscow was alarmed that Washington “carries on working out certain issues in its traditional manner, particularly concerning Russia's diplomatic property in the states of Maryland and New York.”

Two days later in Washington, Tillerson told Lavrov that the United States would no longer link the compounds to the issue of St. Petersburg.

Immediately after their 10 May meeting at the State Department, Tillerson escorted Lavrov and Kislyak to the Oval Office. There, they held a private meeting with Trump. The night before the President had fired FBI Director James Comey, who was then heading an FBI investigation of the Russia ties.

Comey, Trump told the Russians, was a “real nut job,” and his removal had “taken off” the Russia-related pressure the president was under, the New York Times reported. Later in May, the Justice Department appointed former FBI director Robert Mueller III as special counsel to oversee the federal investigation.

In a news conference at the Russian Embassy after his meetings with Tillerson and Trump, Lavrov said of the compound closures, “Everyone, in particular the Trump administration, is aware that those actions were illegal.”

“The dialogue between Russia and the US is now free from the ideology that characterised it under the Barack Obama administration,” he said.

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