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Federal Diary

In Tales of the IRS, Rossotti Comes to the Rescue

By Stephen Barr
Friday, April 15, 2005; Page B02

When visitors met with Charles O. Rossotti in his office at the Internal Revenue Service, his forebears looked down from the walls. In his book on his five years at the IRS, Rossotti includes a family photograph and recounts how his grandparents and parents instilled a love of business.

"Everything in my parents' businesses was based on relationships with people who did business together for a long time," Rossotti writes. "I learned that, even if you wanted to, you couldn't fool people you dealt with for decades."

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Rossotti went on to have a successful business career, and he brought that experience and his ability to build relationships, one at a time, with him to the IRS in 1997, when he became commissioner. He arrived at one of the lowest points in the agency's history. The IRS had been accused of taxpayer abuse in Senate Finance Committee hearings and had been launched on its largest reorganization in 50 years.

"Many Unhappy Returns: One Man's Quest to Turn Around the Most Unpopular Organization in America" is Rossotti's effort to show that leaders can rebuild trust, get control of runaway technology and reach out to employees and unions to accomplish major change.

His account makes for interesting reading -- if you've ever wondered what life is like at the top of the controversial agency that demands that we file our tax returns every April 15. The book is also timely reading -- the departments of Defense and Homeland Security are undertaking similar, large-scale changes.

Throughout the book, Rossotti offers insights into what works and what does not.

He recounts how the IRS bungled its initial explanation of "the 10 deadly sins" -- set forth in a 1998 directive from Congress to fire employees for broadly defined offenses, such as harassment of taxpayers. As a result of what Rossotti calls "this damaging, ill-considered micromandate," IRS employees "reacted with intense confusion and fear. It didn't comfort people to tell them that they were safe if they followed all the rules and procedures in 83,000 pages of manuals."

Although the IRS has moved to reassure employees that they won't be fired just because a cranky taxpayer accuses them of some wrong, the deadly sins remain a sensitive matter inside the agency.

Now, Defense and Homeland Security are looking at creating their own lists of sins -- "mandatory removal offenses" -- that employees dare not commit. The firing offenses have not been defined, but they are already causing angst in the workforce, according to unions.

The two departments also are installing new performance management systems, which will rate employees and help determine pay raises.

In the book and in an appearance this week at a luncheon sponsored by the nonprofit Partnership for Public Service, Rossotti has recounted how performance measures caused problems for the IRS. Revenue agents, for example, looked for ways to inflate their statistics, sometimes by unnecessarily seizing property or starting audits.

"In terms of measurement systems, you've got to be very careful to be sure you're measuring what you really want to measure rather than just what's easy to measure," Rossotti said at the Partnership luncheon.

Rossotti's book also offers glimpses of the pressures that face agency leaders. He describes how a congressional aide tried to bully the IRS in 2001, threatening the agency with inspector general audits if he did not get his way. He tells of "nearly mindless" budget meetings at the Office of Management and Budget that over numerous years, forced the IRS to operate on a shoestring budget rather than provide for investments in technology and staff.

Despite all the problems he faced, Rossotti takes comfort in efforts that improved services to taxpayers, such as answering phone calls, and made the IRS more efficient.

"It is wrong to assume that a big, entrenched institution that gets into deep trouble cannot be changed for the better," he writes. "The crisis can be turned into an opportunity. If it is important enough to do, it can be done."

Talk Shows

Mike Causey, a commentator with Federal News Radio, will be the guest on "FEDtalk" at 11 a.m. today on federalnewsradio.com.

Richard W. White, chief executive officer and general manager of Metro, will be the guest on the "IBM Business of Government Hour" at 9 a.m. tomorrow on WJFK radio (106.7 FM).

"Are You Married to Your Job?" will be the topic of discussion on the Imagene B. Stewart call-in program at 8 a.m. Sunday on WOL radio (1450 AM).

E-mail: barrs@washpost.com

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