Report: ‘Within IRS, Union Exerts Extreme Influence on Employees;’ ‘Makes It Difficult for Agency to Remain Apolitical’

By CNSNews.com Staff | August 6, 2015 | 5:21pm EDT
IRS Commissioner John Koskinen (AP Photo)

(CNSNews.com) - When the Senate Finance Committee on Wednesday released a bipartisan report on its investigation into the Internal Revenue Service’s treatment of Tea Party and other organizations applying for tax-exempt status, Sen. Orrin Hatch, the committee’s chairman, released a companion report prepared by the committee's majority staff that presented Hatch's additional views on the investigation.

In these additional views, Hatch was highly critical of the influence that the National Treasury Employees Union has on the IRS and the ability of IRS workers to do their job administering the nation’s tax laws in a fair and impartial way.

“We found that within the IRS, the union exerts extreme influence on employees in nearly every facet of their employment,” Hatch and the majority staff said in their executive summary. “The union itself favors the Democratic Party and contributes money almost exclusively to its candidates, which makes it difficult for the agency to remain apolitical.

“These influences are borne out in the number of IRS employees who have violated Federal laws designed to prevent government employees from exerting personal political bias while on the job,” they said.

In a section of their report that focused specifically on union influence, Hatch and the majority staff argued that the union presence at the IRS that makes it “virtually impossible for the IRS to maintain the reality, much less the appearance, of neutrality and fairness to all taxpayers.”

“The only way to completely eliminate the appearance of any bias is to add the IRS to the list of agencies where union membership is prohibited,” they said.

Here are two excerpts from the report prepared by the Senate Finance Committee’s majority staff that presented Hatch’s additional views:

Second, our investigation revealed an environment within the IRS where the political bias of individual employees like Lois Lerner can, and sometimes does, influence decisions.

Structurally, the IRS is a bureau within the Treasury Department, which precludes the IRS from being truly independent of the governing administration. We found that within the IRS, the union exerts extreme influence on employees in nearly every facet of their employment. The union itself favors the Democratic Party and contributes money almost exclusively to its candidates, which makes it difficult for the agency to remain apolitical.

These influences are borne out in the number of IRS employees who have violated Federal laws designed to prevent government employees from exerting personal political bias while on the job.

Within this atmosphere, IRS upper management gave the Director of Exempt Organizations Lois Lerner free rein to manage applications for tax-exempt status.

We found evidence that Lerner’s personal political views directly resulted in disparate treatment for applicants affiliated with Tea Party and other conservative causes. Lerner orchestrated a process that subjected these applicants to multiple levels of review by numerous components within the IRS, thereby ensuring that they would suffer long delays and be required to answer burdensome and unnecessary questions. Lerner showed little concern for conservative applicants, even when members of Congress inquired on their behalf, allowing them to languish in the IRS bureaucracy for as long as two years with little or no action.

The IRS began to resolve these applications only after some of the problems became public in 2012. By that time, the damage had been done.

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B. UNION INFLUENCE WITHIN THE IRS HAS CREATED AN ATMOSPHERE OF POLITICAL BIAS

It is virtually impossible for the IRS to maintain the reality, much less the appearance, of neutrality and fairness to all taxpayers, when a substantial number of IRS employees are members of the highly partisan and left-leaning National Treasury Employees Union (NTEU).

The NTEU is one of the largest and most powerful federal employee unions in the federal government. Currently the union represents about 150,000 employees in 31 government agencies, including the IRS. At the IRS alone there are approximately 48,972 dues-paying union employees, representing 65.5% of the bargaining unit employees at the IRS.

Politically, the NTEU is extremely active and twice endorsed Mr. Obama for President, first in 2008 and again in 2012. NTEU’s current president, Colleen Kelley, was a 14-year IRS revenue agent and is now both union president and an Obama administration appointee to the Federal Salary Council, whose function is to recommend raises for IRS and other federal employees.

During the 2010 election cycle, when the IRS targeting of Tea Party groups began, the NTEU raised $613,633 through its political action committee (PAC), donating approximately 98% of that amount to Democrats. In 2012, $729,708--or 94% of NTEU PAC contributions--went to anti-Tea Party Democrats.

Of further note is that as of 2011, at least 201 IRS employees worked full time on union issues. For that year, 625,704 hours of official employee time within Treasury Department (including the IRS) was spent on union duties. These union activities cost taxpayers an estimated $27 million.

Although IRS employees are career civil servants, many of them are political partisans. For example, in the past three election cycles, the Center for Responsive Politics’ database shows about $474,000 in political donations by individuals listing “IRS” or “Internal Revenue Service” as their employer. This money heavily favors Democrats: $247,000 to $145,000. IRS employees also gave $67,000 to the NTEU political action committee, which in turn gave more than 96 percent of its contributions to Democrats. When NTEU political action committee contributions are added to the donations by individual IRS employees, those contributions favor Democrats 2 to 1.

The IRS office in Cincinnati involved in the targeting of Tea Party applications is even more partisan than the IRS as a whole, judging by FEC filings. More than 75 percent of the campaign contributions from that office in the past three elections went to Democrats. In 2012, every donation traceable to employees at that office went to either President Obama or a particular Democratic Senator.

These figures indicate that IRS employees are primarily paying for efforts to elect anti-Republican candidates, both through their union membership and by their direct contributions. Moreover, IRS employees are beholden to the NTEU, as it has negotiated favorable labor agreements with the IRS on their behalf that affect virtually every aspect of work life, such as “alternative work schedules, flexi-place, transit subsidies, performance awards and much more.” These labor agreements also make it more difficult for IRS management to discipline and terminate employees who are failing to perform their jobs.

In addition to the NTEU’s leanings towards the Democratic Party is the fact that the Tea Party’s anti-IRS views are well documented. These factors together create an atmosphere that may foster an outright bias against Tea Party groups by IRS employees in the performance of their duties; or, at least one that may color their perspective to a degree that could cause them to administer the tax laws unfairly to the detriment of the Tea Party.

Under current law, most federal employees are permitted representation by a union. The major exception to this rule is Federal employees who work in national security or other agencies where the nature of their work requires them to be completely apolitical. The Federal Labor-Management Relations Statute provides that employees at the following agencies are not entitled to union representation: Government Accountability Office, Federal Bureau of Investigation, Central Intelligence Agency, National Security Agency, Tennessee Valley Authority, Federal Labor Relations Authority, Federal Service Impasses Panel, and U.S. Secret Service and U.S. Secret Service Uniformed Division.

The IRS is currently not one of the exempted entities, but the issues and facts brought forth by this investigation make a compelling case of why they should be exempted. The charge of the IRS is to administer the tax law in a fair and impartial manner. It is difficult, if not impossible, for that to occur when the union presence is so pervasive. The only way to completely eliminate the appearance of any bias is to add the IRS to the list of agencies where union membership is prohibited.

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