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VOL. 128 | NO. 109 | Wednesday, June 05, 2013

Watchdog: IRS Enjoy Luxury Rooms at Conference

ALAN FRAM & STEPHEN OHLEMACHER | Associated Press

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WASHINGTON (AP) – Already under siege, the Internal Revenue Service was cited by a government watchdog for a $4.1 million training conference featuring luxury rooms and free drinks, even as conservative figures told Congress Tuesday they had been abused for years while seeking tax-exempt status.

A total of 132 IRS officials received room upgrades at the 2010 conference in Anaheim, Calif., according to the report being released by J. Russell George, the Treasury inspector general for tax administration.

One official stayed five nights in a room that regularly goes for $3,500 a night, George's report said, and another stayed four nights in a room that regularly goes for $1,499 a night. The agency paid a flat daily fee of $135 per hotel room, it said, but the upgrades were part of a package deal that added to the overall cost of the conference. Without the upgrades, the IRS could have negotiated a lower room rate, as required by agency procedures.

The inspector general's report was surfacing as the IRS came under fire again in connection with its targeting of conservative groups during the 2010 and 2012 elections.

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, for instance, the agency held a conference in Philadelphia that cost $2.9 million, one in San Diego that cost $1.2 million, and one in Atlanta that also cost $1.2 million.

Acting IRS Commissioner Danny Werfel has 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.

For more than 18 months during the 2010 and 2012 election campaigns, IRS agents in a Cincinnati office singled out tea party and other conservative groups for additional scrutiny when they sought tax-exempt status, according to a previous report by George.

The report issued last month said tea party groups were asked inappropriate questions about their donors, their political affiliations and their positions on political issues. The additional scrutiny delayed applications for an average of nearly two years, making it difficult for many of the groups to raise money.

On Tuesday, leaders of conservative groups complained to Congress that they were abused by the Internal Revenue Service for years as they sought tax-exempt status, including questions one Iowa anti-abortion group said it got about prayer meetings.

The testimony of the tea party and other conservative organizations before the House Ways and Means Committee was the first time groups complaining about the IRS's treatment have appeared directly before lawmakers since the IRS revealed the problem – and apologized for it – last month. They talked about applications for tax-exempt status that took three years for approval – or in some cases haven't yet been approved – and queries from the agency about the identity of their donors, video of meetings and whether speakers at such gatherings expressed political views.

"I'm a born-free American woman," Becky Gerritson, president of the Wetumpka Tea Party in Alabama, tearfully told the committee, adding, "I'm telling my government, you've forgotten your place."

Sue Martinek, president of the Coalition for Life of Iowa, an anti-abortion group, said the IRS asked them about "the content of our prayers."

"As Christians, we know we needed to pray for better solutions for unplanned pregnancies," she said.

The president of another group, the National Organization for Marriage, said the IRS publicly disclosed confidential information about donors. George Eastman said he thought the IRS's release of that information was designed to intimidate contributors to the group – which opposes same-sex marriage – "to chill them from donating again."

In a written statement, Werfel, the acting IRS chief, said the stories the witnesses told at Tuesday's hearing highlight agency actions that were "inappropriate and unacceptable, and we owe it to the nation to do better." He said he has ordered his agency to quickly review the cases involved.

At Tuesday's Ways and Means hearing, committee Chairman Dave Camp, R-Mich., said the conservative groups were being singled out for their beliefs.

"They are Americans who did what we ask people to do every day – add their voice to the dialogue that defines our country," Camp said. "And for pursuing that passion, for simply exercising their First Amendment rights – the freedoms of association, expression and religion – the IRS singled them out."

The committee's top Democrat, Rep. Sander Levin, said it was time to correct the IRS's problems.

"You are owed an apology," Levin, from Michigan, told the witnesses. "We say to you that each of us is committed to doing our part to ensure that."

But even as they joined in expressing criticism of the IRS's behavior and sympathy for how witnesses' groups were treated, some Democrats tempered that. They noted that the IRS is responsible for seeing if organizations qualify for tax-exempt status – which includes not approving requests by groups that primarily engage in election campaigns.

"None of you were kept from organizing, or were silenced," said Rep. Jim McDermott, D-Wash. "We're talking about whether or not American taxpayers will subsidize your work. We're talking about a tax break."

Rep. John Lewis, D-Ga., noted that IRS commissioners over the past decade were appointed by President George W. Bush, a Republican, and said, "This has nothing do with red versus blue."

At one point, Rep. Earl Blumenauer, D-Ore., said many of the conservative groups have taken positions on highly-charged political issues like President Barack Obama's health care overhaul and said, "Let's stop this charade of pretending to be just social welfare organizations. Admit they are political and treat them as such."

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."

Earlier, the leader of a small South Carolina tea party group said her organization first applied for tax-exempt status in 2010 – and is still waiting for the application to be processed.

"Nearly three years in waiting for an answer is totally unacceptable," said Dianne Belsom, president of the Laurens County Tea Party. "The IRS needs to be fully investigated and held accountable for its incompetence harassment and targeting of conservative groups."

Belsom said her group in rural South Carolina has about 60 members and "seeks to educate ourselves and fellow citizens on various issues pertinent to living in a free country." The group also holds candidate forums in election years, she said.

"I'd like to note that our group is a small-time operation with very little money and this represents a complete waste of time by the IRS in terms of any money they would collect if we were not tax-exempt," Belsom said.

Follow Stephen Ohlemacher on Twitter: www.twitter.com/stephenatap

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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