Holding Ex-IRS Official in Contempt Looks Increasingly Unlikely

Former Internal Revenue Service official Lois Lerner Former Internal Revenue Service official Lois Lerner Lauren Victoria Burke/AP

In the latest volley in the investigation of the Internal Revenue Service, the top Democrat on the House Oversight panel has concluded that a procedural error by Chairman Darrell Issa, R-Calif., has compromised any pending effort to hold former IRS official Lois Lerner in contempt of Congress.

Ranking Member Elijah Cummings, D-Md., on Wednesday sent a letter to House Speaker John Boehner, R-Ohio, citing opinions by several legal specialists saying that Issa’s actions on March 5 “abruptly adjourning the hearing without allowing any Democrats to speak” and cutting off Cummings’ microphone in a dramatic 15-minute hearing had reduced the available options for ending the stalemate.

Issa’s action, which came as part of a months-long deliberation on whether to compel Lerner to testify, was followed by his release on Tuesday of a report on emails from Lerner over the past few years.

Lerner, the retired director of the IRS Exempt Organizations Divisions decision considered by many to have been at the center of the inappropriate scrutiny applied to mostly conservative nonprofits seeking tax-exempt status, invoked her Fifth Amendment right at the March 5 hearing not to answer committee questions for the second time on the advice of her attorney.

“By prematurely adjourning the hearing without first overruling Ms. Lerner’s Fifth Amendment assertion or directing her to answer the committee’s questions,” Cummings said, “Issa failed to take the basic -- and constitutionally required -- steps necessary to hold her in contempt,” and by officially “adjourning” a hearing that Issa had kept technically open since last May, the chairman had now “forfeited the ability to recall Lerner under the subpoena he issued for her appearance.”

The experts the Democrat cited include Morton Rosenberg, who worked for 35 years as a specialist in American public law at the Congressional Research Service, and Stan Brand, a former counsel to the House under the late Democratic Speaker Tip O’Neill, D-Mass. “Although I accepted Chairman Issa’s apology,” Cummings said in his letter to Boehner, “it appears that his actions last week in closing down the hearing had significant negative legal consequences that now bar the House of Representatives from successfully pursuing contempt proceedings” against Lerner. “Rather than obtaining hearing testimony directly from Ms. Lerner, all the American people have to show for Chairman Issa’s partisan actions over the past month is a botched contempt proceeding.”

Issa’s staff in an email to Government Executive said, “This analysis, solicited on a partisan basis, is deeply flawed and at odds with the House’s own expert legal counsel to the committee. At the hearing, Chairman Issa specifically informed Ms. Lerner of the committee's formal determination that she had waived her Fifth Amendment right not to answer questions. Before asking a series of questions, he then offered her fair warning that a refusal to answer could lead to a contempt finding, which ultimately must be made by the full House of Representatives.”

On Thursday, Cummings wrote to Boehner again, this time complaining that he had not received a copy of any existing House counsel memorandum on the Lerner case that Issa and Boehner had referred to. 

The Government Reform and Oversight Committee staff’s latest report on Lerner “relies on emails, documents, and other testimony about her cracking down on tax exempt organizations that exercise their rights to free political speech,” Issa said in a statement Tuesday stating that his committee’s investigation continues. “She involved herself in efforts to apply unprecedented scrutiny to new applicants, existing organizations, and to write new rules after President Obama and other prominent Democrats expressed outrage at the Supreme Court’s Citizens United decision….The report presents evidence that Ms. Lerner misled Congress about targeting and her own conduct.”

Highlights of the report include commentary that Lerner:

  • Was pressured by President Obama and other Democrats to find a way to “showcase their scrutiny of a Tea Party applicant for public disclosure;”
  • Spoke of “organizations woven by the fabulously rich and hugely influential Koch brothers” but hedged on the meaning of “political project per se;” 
  • Broke IRs rules by handling protected taxpayer information on her personal email account;
  • Signed off on a response to Congress that “blamed applicants for the heightened scrutiny;”
  • Directed staff in the IRS’s Cincinnati unit to put Tea Party cases through a “multi-tier review;” and
  • Planned all along to retire in October 2013.

The issue of Lerner’s retirement is of concern to Republicans who complained that Lerner was placed on administrative leave and continued to collect a pay check and earn retirement pay while the IRS conducted an internal investigation of the Exempt Organizations Division’s processes beginning in the summer of 2013. Then-Acting IRS Chief Danny Werfel, citing privacy protections of personnel matters, in September declined to discuss the circumstances of her retirement.

Paul Streckfus, a onetime attorney in the Exempt Organizations division now editing a tax journal, told Government Executive his talks with former colleagues indicate that “all have done early retirement planning to crunch the numbers. Years of service, highest years, all go into the calculation, so once folks approach eligibility, they start playing with the numbers and how much they will get. I'm quite sure Lois had her 30 years’ service so she could have retired at any time, but the longer she worked the higher her pension, plus she liked what she was doing, so it appears from the emails she was looking at the numbers to see what she would get.”

Cummings’ staff issued a point-by-point rebuttal to the majority staff’s report on Lerner. “While there is certainly evidence of mismanagement at the IRS, this partisan Republican staff report identifies absolutely no evidence to support the central Republican allegations in this investigation -- that the White House directed this activity or that it was politically motivated,” he said in a statement. “The inspector general already concluded that Lois Lerner did not even know about the inappropriate criteria until 2011. Are Republicans now suggesting that she somehow went back in time to 2010 to orchestrate this entire conspiracy?”

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