ELIANA JOHNSON: OVERSIGHT FROM WASHINGTON ALL ALONG
http://www.nationalreview.com/article/348983/oversight-washington-all-along-eliana-johnson
IRS specialists in Washington were closely involved in the Cincinnati office’s scandalous behavior.
From the outset, Internal Revenue Service lawyers based in Washington, D.C., provided important guidance on the handling of tea-party groups’ applications for tax-exempt status, according to both IRS sources and the inspector general’s report released in mid May.
Officials in the Technical Unit of the IRS’s Rulings and Agreements office played an integral role in determining how the targeted applications were treated, provided general guidelines to Cincinnati case workers, briefed other agency employees on the status of the special cases, and reviewed all those intrusive requests demanding “more information” from tea-party groups. At times, the Technical Unit lawyers seemed to exercise tight control over these applications, creating both a backlog in application processing and frustration among Cincinnati agents waiting for direction.
An IRS employee who asked not to be identified tells National Review Online that all members of the agency’s Technical Unit are based in Washington, D.C. A current list of Technical Unit managers provided by another IRS employee shows that all such managers are based at the agency’s headquarters on Constitution Avenue in the District of Columbia, and the IRS confirmed, in a testy exchange with National Review Online, that the Technical Unit is “based in Washington.”
According to the IRS source, who is based in Cincinnati, complex cases are routinely elevated to the Technical Unit for guidance. Many of the questions that agents sent to groups most likely came “from Tax Law Specialists — lawyers — in D.C.,” the Cincinnati employee explains. “With tea-party cases, questions from the Tax Law Specialists were way too aggressive,” he says. The Washington Post described these lawyers as parsing “the murkier, more complex applications” — including those of tea-party groups.
This account comports with the one laid out in the inspector general’s report, although this aspect of the report has been neglected in much of the press coverage. On May 17, 2010, according to the IG report, Determinations Unit specialists in Cincinnati handling tea-party applications were instructed to “send additional information request letters to the Technical Unit for review prior to issuance.” Ten days later, the Technical Unit “began reviewing additional information request letters prepared by the Determinations Unit.”
The IG report indicates this became a source of frustration, and specialists in Cincinnati pressed for a streamlined approach. “Why does the Technical Unit need to review every additional information request letter when a template letter could be approved and used on all the cases?” they asked via e-mail. The Washington unit rejected this approach and, in February 2011, was developing individualized letters itself. According to the IG report, an update from the Technical Unit acting manager to the Determinations Unit manager indicated, “Letters were being developed and would be reviewed shortly.”
We now know that such letters asked for lists of groups’ reading materials and volunteers, copies of fliers, and printouts of Facebook pages.
This close and consistent involvement of Washington bureaucrats contradicts testimony offered May 17 by Treasury Department inspector general J. Russell George and acting IRS commissioner Steven Miller, who said that the scandal resulted from poor management and a lack of oversight. George told the House Ways and Means Committee that Determinations Unit specialists in Cincinnati sent letters to tea-party groups “with little or no supervisory review.” Yet the IG report itself indicates in its timeline that the letters were often written and reviewed by the Technical Unit.
Washington’s involvement with the tea-party cases began in March 2010, just two weeks after a manager in Cincinnati flagged tea-party groups as a potential source of problems. At the time, no formal guidelines for filtering their applications had yet been drawn up. According to the IG report, after just ten tea-party cases were identified by an agent in the Cincinnati office at the request of the Determinations Unit group manager, “the Acting Manager, Technical Unit, requested two more cases be transferred to Washington, D.C.” An organizational flow chart included in the IG report indicates that the manager of the Technical Unit, who lodged the request, is based in Washington.
The following month, according to the IG investigation, the Technical Unit in Washington drew up a “Sensitive Case Report” on the Tea Party. One IRS source described it as “a list that tracks different cases, the issue(s), what is being done or will be done, the responsible official, and an estimate of when the issue(s) will be resolved.” That report was shared with other high-level officials in Washington: the director of Rulings and Agreements and the director of Exempt Organizations.
Delays caused by the Technical Unit in Washington contributed to the long waits described by tea-party groups, whose applications often languished in IRS offices for over a year. The IG report explains that, in October of 2010, a tax-exempt-organizations specialist in Cincinnati charged with working the tea-party cases was hamstrung as he sat waiting for direction from Washington: He “did not work on the cases while waiting for guidance from the Technical Unit.” The New York Times noted one Cincinnati manager’s complaint that “the ‘technical unit’ — lawyers, chiefly in Washington, who advise the specialists on the tax law — had been slow in providing guidance on the applications,” and the Washington Post said they “did not provide guidance on some cases for many months, if at all.”
The Technical Unit also worked to develop a list of general criteria that Cincinnati case workers could use to flag so-called political cases for further review. This occurred both before and after the Cincinnati office’s inappropriate criteria were brought to the attention of Lois Lerner, the director of Exempt Organizations, in June 2011.
After Lerner demanded that the notorious “Be On The Lookout” listing of conservative keywords be changed, the Technical Unit was charged with developing another set of criteria for flagging political cases. The IG report notes that Cincinnati specialists deemed the Technical Unit’s proposals “too lawyerly,” and reverted to the old, objectionable “Be On The Lookout” listing. But even after that, the Technical Unit remained involved, in March 2012 establishing procedures for reviewing letters from the Cincinnati office.
This level of involvement from Washington confirms what many have suspected all along. “Those questions could not have been originated by a few rogue agents,” says Jay Sekulow, chief counsel of the American Center for Law and Justice, which is suing the IRS on behalf of 17 tea-party groups whose applications were allegedly singled out by the IRS. Sekulow tells me he received a letter from a D.C.-based Tax Law Specialist in connection with his tea-party cases.
Cleta Mitchell, the attorney representing a Texas-based group, True the Vote, dedicated to combating voter fraud, says its application — which has been delayed for three years now — is being handled in Washington, too. “The IRS agent in Cincinnati told me in October of 2011 that the True the Vote application was being directed from Washington,” Mitchell recounts. “When I called him back in December of 2011 to inquire as to the status, he informed me that the case had been transferred to a special task force at the IRS offices in Washington. I have understood for more than 18 months that the D.C. offices of the IRS were responsible for calling the shots on these applications related to my conservative issue-group clients.” On Tuesday, True the Vote filed suit against the IRS and is seeking damages for the delay in the processing of its application.
Tea-party groups on Tuesday will protest in front of IRS offices in Cincinnati, Washington, and around the country. Perhaps they are right to cast their net wide, given that their persecution was carried out carefully and programmatically from the nation’s capital — not, as the IRS and the Obama administration would have us believe, sloppily and haphazardly by a handful of reprobate employees in the Midwest.
— Eliana Johnson is media editor of National Review Online.
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