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| From left, Jenny Beth Martin, cofounder of the Tea Party Patriots, Jo Anne Livingston, and Darcy Crisp, all of Atlanta, applaud after House Ways and Means Committee member Rep. Aaron Schock, R-Ill. said the IRS was discriminating, Tuesday, June 4, 2013, on Capitol Hill in Washington, during the committee's hearing of organizations that say they were unfairly targeted by the Internal Revenue Service while seeking tax-exempt status. |
WASHINGTON
(AP) -- Already heavily criticized for targeting conservative groups,
the Internal Revenue Service absorbed another blow Tuesday as new
details emerged about senior officials enjoying luxury hotel rooms, free
drinks and free food at a $4.1 million training conference. It was one
of many expensive gatherings the agency held for employees over a
three-year period.
One top official stayed
five nights in a room that regularly goes for $3,500 a night. Another
official, Faris Fink, stayed four nights in a room that regularly goes
for $1,499.
Fink was later promoted to head
the IRS division that staged the 2010 conference in Anaheim, Calif., a
position he still holds. He also has the distinction of playing Mr.
Spock in a cheesy but slickly-produced "Star Trek" video that IRS
employees filmed for the conference.
A total
of 132 IRS officials received room upgrades at the conference, according
to a report by J. Russell George, the Treasury Department inspector
general for tax administration. The tax agency paid a flat daily fee of
$135 per hotel room, the report said, but the upgrades were part of a
package deal that added to the overall cost of the conference.
The
report was made public on the same day leaders of six conservative
groups testified at a congressional hearing, where they told lawmakers
they had endured abuse from IRS agents as they spent years trying to
qualify for tax-exempt status.
In
often-emotional testimony, the conservatives described IRS demands for
details about employees' and group officials' political activities and
backgrounds, for comments they'd posted on websites, for videos of
meetings and information on whether speakers at such sessions voiced
political views. Some said it took three years to get their tax-exempt
status; others said they were still waiting.
"I'm
a born-free American woman," Becky Gerritson, president of the Wetumpka
Tea Party of Alabama, tearfully told the lawmakers. "I'm telling my
government, `You've forgotten your place.'"
Federal
regulations say that tax-exempt social welfare organizations can engage
in some political activity but the activity cannot be their primary
mission. It is up to the IRS to make that determination of their level
of political activity, and some Democrats at Tuesday's House Ways and
Means Committee hearing noted that some liberal groups also have had a
hard time winning tax-exempt status from the IRS.
However,
revelations about IRS agents improperly targeting tea party and other
groups have led to investigations by three congressional committees and
the Justice Department. One top IRS official was forced to resign,
another retired and a third was placed on paid administrative leave.
Tuesday's
report by the inspector general suggests the agency has struggled with
management issues beyond the division that handles tax-exempt
applications. According to the report, expensive employee conferences
were approved with few restraints or safeguards until new rules were
imposed in 2011.
In all, the IRS held 225
employee conferences from 2010 through 2012, at a total cost of $49
million, the report said. The Anaheim conference was the most expensive,
but others were costly, too.
In 2010, the
agency held a conference in Philadelphia that cost $2.9 million, one in
San Diego that cost $1.2 million and another in Atlanta that also cost
$1.2 million.
All of these conferences would
violate new rules imposed by the White House budget office in 2012 that
cap expenses for a single conference at $500,000. In 2010 alone, the IRS
had 13 conferences that cost more than that.
By comparison, the General Services Administration was widely criticized for a 2010 conference in Las Vegas that cost $823,000.
Spending
on IRS conferences dropped substantially, from $37.6 million in the
2010 budget year to $6.2
million in 2011 and then to $4.9 million last
year, according to the IRS.
Acting IRS
Commissioner Danny Werfel called the conferences "an unfortunate vestige
from a prior era." Werfel took over the agency about two weeks ago,
after President Barack Obama forced the previous acting commissioner to
resign.
"Taxpayers should take comfort that a conference like this would not take place today," Werfel said in a statement.
The
inspector general's report focused on the Anaheim conference, which was
held for 2,609 managers in the agency's small business and
self-employed division.
At the conference, the
commissioner of the tax-exemption division, Christopher Wagner, stayed
in a presidential suite that normally cost $3,500 a night. Wagner became
chief of the IRS office of appeals in 2011 and retired this year.
His
deputy, Fink, stayed in a room that normally cost $1,499 a night, the
report said. Fink was promoted to commissioner of the small business and
self-employed division in 2011.
Fink is among the witnesses scheduled to testify Thursday at a congressional hearing about the inspector general's report.
The
IRS paid two event planners a total of $133,000 to organize the Anaheim
conference. The planners were paid a percentage of the hotel room
costs, which removed incentives for them to negotiate lower fees, the
report said.
Fifteen outside speakers were
paid a total of $135,350. One was paid $27,500 for two one-hour
speeches; another was paid $17,000.
The IRS
also spent more than $50,000 to produce three videos that were shown at
the conference, the report said, including the "Star Trek" parody that
featured Fink and other IRS employees.
The IRS
said in a statement, "Many of the issues raised in the report, such as
the use of event planners, the receipt of room upgrades and the welcome
reception and breakfast provided by the hotel, were complimentary and
did not entail the use of any additional government resources."
However,
the report said the inspector general "believes that the costs for the
conference could have been reduced if the IRS had not requested the
numerous concessions from the Anaheim hotels and had instead negotiated
for a lower room rate."
The IRS has been under
heavy criticism since last month, when a previous inspector general's
report showed that agents in a Cincinnati office had singled out tea
party and other conservative groups for additional scrutiny when they
sought tax-exempt status during the 2010 and 2012 election campaigns.
At
Tuesday's hearing, Ways and Means Committee Chairman Dave Camp,
R-Mich., said such an IRS focus was creating a "culture of political
intimidation and discrimination." He said the agency's targets were
"Americans who did what we ask people to do every day - add their voice
to the dialogue that defines our country."
John
Eastman of the National Organization for Marriage said that in 2012,
confidential donor information that he said came from his group's tax
returns was posted on the website of a political opponent, the Human
Rights Campaign. Eastman's group, which is tax exempt, opposes same-sex
marriage, which the Human Rights Campaign supports.
"You can imagine our shock and disgust over this," Eastman said.
Sue
Martinek, president of the anti-abortion Coalition for Life of Iowa,
said an IRS agent told her the group's application for tax-exempt status
would be granted if it sent a letter promising not to stage protests
outside the offices of Planned Parenthood.
She said the IRS relented a week after her group retained an attorney who sent the agency a letter defending its efforts.
"As
Christians, we knew we needed to pray for a better solution to
unplanned pregnancy than abortion. Why not at the source?" Martinek told
the committee.
Rep. Earl Blumenauer, D-Ore., said many of the conservative groups have taken positions on highly charged political issues.
"Let's
stop this charade of pretending to be just social welfare
organizations. Admit they are political and treat them as such,"
Blumenauer said.
That prompted an angry
response from Eastman, who said that to say "defending traditional
marriage doesn't qualify for defense of the public good is beyond
preposterous."
