House committee OKs bill to decimate IRS spending power

While Capitol Hill budgeteers fight over funding and contract management for the IRS'
Tax Systems Modernization program, a new commission chaired by two congressmen will
consider ways to restructure the service.

The commission, created at Congress' behest as part of the Treasury Department's 1996
appropriations, met for its first organizational meeting last month. At the meeting, the
group chose Sen. Bob Kerrey (D-Neb.) and Rep. Rob Portman (R-Ohio) as its co-chairmen.

The National Commission on Restructuring the Internal Revenue Service, which Kerrey
proposed [GCN, Dec. 11, 1996, Page 1], has a broad charter to examine IRS
operations, including information systems and the troubled $8 billion TSM program.

"Our mission is not an easy one. We are setting out to change an organization that
has traditionally been averse to change," Kerrey said. "The American taxpayers
deserve a more efficient tax-collecting entity, and it is our aim to provide them with

The commission begins its work just as Congress is debating a proposal from Rep. Jim
Lightfoot (R-Iowa) to halve TSM funding next year and to shift contracting responsibility
for the program to the Defense Department (see related story, Page XX).

TSM will be an integral part of the new commission's study as will the evaluation of
IRS' organizational structure, its paper processing and return processing activities, and
its infrastructure and collection process. The group must present its findings to Congress
by next June.

The commission also plans to look at improving the modernization of IRS operations, the
management of taxpayer accounts, the accuracy of information requested by taxpayers, and
the possiblity of making return processing paperless.

Congress directed the commission to look at "whether the IRS could be replaced
with a quasi-governmental agency with tangible incentives" for managing its programs
better and modernizing its activities.

The president, along with House and Senate leaders, selected the 17 members of the
commission, which includes officials from government and industry. IRS Commissioner
Margaret Milner Richardson also will participate as an ex-officio member.

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