[Congressional Record Volume 142, Number 140 (Wednesday, October 2, 1996)]
[Senate]
[Pages S12163-S12164]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            IRS WORKERS AND THE OMNIBUS APPROPRIATIONS BILL

  Mr. DORGAN. Mr President, I rise to comment briefly on an aspect of 
the omnibus fiscal year 1997 appropriations bill that the Senate just 
passed.
  My Senate colleagues will recall that the Internal Revenue Service 
has proposed a field office reorganization that would cut 2,490 
employees, many of them from front-line taxpayer assistance jobs. These 
employees are now in field offices, where they provide needed services 
to taxpayers in North Dakota and other rural States. The IRS proposes 
to hire 1,500 new employees in its regional headquarters to do some of 
the same work now carried out at the field office level.
  This IRS proposal puzzles me for a number of reasons.
  First, we all know that taxpayers too often have trouble getting 
straight answers out of the IRS. The proposed reorganization would make 
it even more difficult for North Dakotans to have access to advice and 
assistance on how to comply with Federal tax law. I often hear from 
constituents who are frustrated at their inability to get sound tax 
advice from this agency. A 1-800 number, which may or may not be 
answered, is no substitute for the ability to walk into an IRS field 
office and receive advice in person.
  Second, if the IRS is trying to save money, it could start by 
examining its personnel policies on the rotation of managers. My State 
staff tells me that no other Federal agency changes its management 
staff as constantly as does the IRS. Sometimes the North Dakota State 
director stays for only a year or so before moving on to the regional 
office in Saint Paul, or elsewhere. Besides harming institutional 
memory about tax matters in North Dakota, this rapid turnover means 
that the IRS must spend more on moving expenses. The IRS also has an 
arrangement with local real estate firms to buy managers' homes so that 
those leaving North Dakota do not suffer any loss as they leave. I am 
told that the IRS district that includes North and South Dakota and 
Minnesota has spent $300,000 on managerial moves in the past few years. 
None of the front-line employees who may be fired will be eligible for 
this sort of moving assistance.

  Third, by moving jobs from North Dakota to St. Paul, the IRS will 
actually be increasing its payroll costs. A salary of $30,000 will go 
much further in a small city than in a large metropolitan area. The IRS 
is therefore likely to be able to attract more qualified people in my 
State than in the Twin Cities with the same salary level.
  Given my concern with this IRS proposal, I am pleased that the 
omnibus

[[Page S12164]]

appropriations bill contains a provision that would delay the 
reorganization plan until March 1997, at the earliest. In addition, 
before implementing its reorganization, the IRS will have to submit a 
report to the Congress justifying its plan on cost-benefit grounds.
  This provision is not a perfect solution to this problem. I would 
have preferred the original language offered by Senator Kerrey of 
Nebraska to the freestanding Treasury-Postal appropriations bill. That 
language would have delayed the reorganization until the National 
Commission on Restructuring the Internal Revenue Service had a chance 
to issue its final report.
  Nevertheless, this provision buys us time to try to understand the 
proposed reorganization and to see whether the IRS can justify its 
plan. I look forward to working with the distinguished minority leader, 
Senator Daschle, and the ranking member of the Treasury-Postal 
Appropriations Subcommittee, Senator Kerrey, to ensure that the IRS 
does not abandon rural States in a misguided attempt to achieve phantom 
savings.
  Thank you, Mr. President. I yield the floor.

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