Chief performance officer nominee withdraws for tax reasons

President Obama's pick for chief performance officer and deputy director for management at the Office of Management and Budget on Tuesday withdrew her name from consideration, saying her tax problems could cause a distraction.

"I recognize that your agenda and the duties facing your chief performance officer are urgent," nominee Nancy Killefer wrote in a letter to the president. "I have also come to realize in the current environment that my personal tax issue of D.C. unemployment tax could be used to create exactly the kind of distraction and delay those duties must avoid."

Obama named the senior director at the management consulting firm McKinsey & Co. to the position on Jan. 7. When Killefer's selection was announced, the Associated Press reported that in 2005, the District of Columbia government had filed a more than $900 tax lien on her home for failure to pay unemployment compensation tax on household help.

Killefer, a former assistant Treasury secretary, is the third of Obama's senior nominees to face scrutiny over taxes and the third to withdraw. Former Senate Majority Leader Tom Daschle, Obama's choice for secretary of Health and Human Services, similarly stepped aside on Tuesday. Daschle failed to pay more than $100,000 in taxes.

"We're at a critical juncture in our nation's history and at a crossroads economically and the president has a robust agenda to deal with many of those problems," White House press secretary Robert Gibbs said. Daschle "didn't want to be a distraction … and the same is true for Ms. Killefer," Gibbs said.

Max Stier, president of the nonprofit Partnership for Public Service, where Killefer sits on the board of directors, said her withdrawal was "a shame."

"She's a very talented person with an unusual set of experiences that would have made her great at an incredibly challenging job," Stier said. "The atmospherics around tax issues right now are incredibly charged … but she had great potential to address some massive challenges."

Gibbs said both Daschle and Killefer withdrew their nominations without pressure from the White House, having each decided individually not to draw attention away from the president's agenda.

"The agenda is bigger than them, it's bigger than me, it's bigger than any of us who serve at the pleasure of the president," Gibbs said.

The spokesman said the administration is actively looking for new nominees for the Health and Human Services and chief performance officer positions. When it comes to finding another potential performance czar, however, Stier said it will be an uphill battle.

"Unfortunately there are all too few people with great management experience in both the public and private sectors," Stier said. "You can find great candidates in different packages, but it's certainly very appealing to have someone with experience in both sectors."