IRS board members confirmed as restructuring proceeds

The Senate finally gave its approval last week to the members of a new review board designed to oversee the operations of the Internal Revenue Service.

The approval of the seven members of the controversial oversight board advances what has been a two-year process of restructuring and modernizing the IRS.

The new panel, made up of private citizens, will be responsible for overseeing agency operations, including the selection, evaluation and compensation of senior managers. The board must approve the IRS budget before it is sent to the Treasury Department. Civilian boards are rarely granted such sweeping authority over an executive branch agency.

The members of the board, appointed by President Clinton, are:

  • George L. Farr, former vice chairman of American Express.
  • Charles L. Kolbe, an Iowa cattle rancher.
  • Nancy Killefer, a former Treasury Department official.
  • Larry R. Levitan, former partner at Arthur
    Andersen & Co.
  • Steve Nickles, law professor at Wake Forest University.
  • Robert Tobias, former president of the National Treasury Employees Union.
  • Karen Hastie Williams, a partner at the law firm Crowell & Moring.
The IRS Restructuring and Reform Act of 1998 that created the oversight board requires members to have expertise in areas such as managing large service organizations, customer service, federal tax laws, information technology, organization development and small business administration. Their terms are staggered and none of the appointments exceeds five years.

IRS Commissioner Charles O. Rossotti said he was "extremely pleased by the Senate's action."

"This is a talented group of people who will bring many skills to the nation's tax agency," Rossotti said. "The Oversight Board is an important part of our efforts to modernize the IRS. I look forward to working closely with the members."

Delayed for months in the administration and later the Senate, the board confirmations came just weeks before a deadline for the congressionally mandated reorganization efforts to take effect.

Under the reform act, the IRS is shifting its organizational structure from one that is geographically based to one that is centered around customer service. The agency is in the process of creating four new divisions based on customer segments: tax-exempt entities, large and mid-sized businesses, wage and investment, and small businesses and the self-employed.

The first two divisions are already in operation; the latter two are scheduled to go into effect Oct. 1. An IRS spokesman said, however, that it could be well into 2001 before the new divisions are running at 100 percent.

"It will take time before these divisions are completely up," the spokesman said. "We're a large agency and we have a lot of things to do."

Under the reorganization, IRS employees have been given the opportunity to apply for new positions in the new divisions. But the agency has not conducted layoffs and employees are guaranteed that their pay won't be cut as a result of restructuring.

"There are some positions today that will not exist in the future, so we are helping employees who have the opportunity to move into new jobs that will support the structure," said Colleen Kelley, president of the National Treasury Employees Union. The restructuring creates new career tracks, Kelley said, and training is available to help employees make the transition to new jobs.

"There are a lot of positions in the new organization that will be outreach type of positions to make contact with different groups of taxpayers and set up whatever informational vehicle that they need to make it very easy to use and to make taxpayers comfortable with what is available from the IRS," Kelley said.

The process "has been a very busy and very uncertain time for employees," Kelley said, because the new design and implementation had to be done while maintaining the old IRS structure. Getting Congress to fund the changes it had mandated was a challenge as well.

"It was a very positive experience for everyone because we all have the same interest, which is for the IRS to be successful and to provide the services to the American taxpayers that they need and want," said Kelley.

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