Home Legislative Action Congressional Testimony Internal Revenue Service Budget for FY 2009

Internal Revenue Service Budget for FY 2009

4/16/2008

Senate Appropriations Subcommittee on Financial Services and General Government

---

Chairman Durbin, Ranking Member Brownback, and distinguished members of the Subcommittee, I would like to thank you for allowing me to provide comments on the Administration’s FY ’09 budget request for the Internal Revenue Service (IRS). As President of the National Treasury Employees Union (NTEU), I have the honor of representing over 150,000 federal workers in 31 agencies, including the men and women at the IRS.

IRS FY ’09 Budget Request

Mr. Chairman, as you know, the IRS budget forms the foundation for what the IRS can provide to taxpayers in terms of customer service and how the agency can best fulfill its tax enforcement mission. Without an adequate budget, the IRS cannot expect to continue providing taxpayers with top quality service and will be hampered in its effort to enhance taxpayer compliance and close the tax gap.

While acknowledging that IRS employees continue to provide world class customer service and are more efficient than ever in collecting taxes and enforcing tax law, the Administration continues to put forth insufficient and unrealistic budget requests that fail to allow the service to meet its customer service and enforcement challenges.

Staffing levels are dramatically below 1995 levels.

The decline in IRS personnel, particularly enforcement staff, can be attributed to unrealistic budget requests, which since 2003, have contemplated internally generated savings or “efficiency savings” to help fund proposed increased staffing for enforcement. For FY ’09, the budget request identifies “efficiency savings” of more than $94 million at the cost of almost 976 FTEs. If, as sometimes has been the case in previous years, IRS fails to realize all expected savings then the funds available for new enforcement personnel would be further reduced.

And although it’s widely recognized that additional funding for enforcement provides a great return on the investment, the IRS has repeatedly told Congress that the IRS does not need any additional funding above the President’ budget request.

Employee productivity is not the issue. Despite the significant decline in enforcement staff over the past ten years, enforcement revenue has increased significantly, reaching $59.2 billion in 2007, up from $48.7 billion in 2006 and an increase of $46 billion since 2000. The $59.2 billion in collections in 2007 represents a 5.6 to 1 return on investment for all IRS activities. In addition, earlier this year the IRS Data Book for 2007 was released which demonstrated that the IRS is one of the most efficient tax collection systems in the world, spending only 40 cents to collect $100.

Yet, between 1995 and 2007, the total number of employees has shrunk from 114,064 to 86,638. Even more alarming is that during that period, revenue officers and revenue agents – two groups critical to reducing the tax gap – have shrunk by 33 and 20 percent respectively. Revenue officers went from 8,139 to 5,468 and revenue agents fell from 16,078 to 13,026. These drastic cuts have come at a time when the IRS workload has increased dramatically. According to IRS’s own annual reports and data, taxpayers filed 114.6 million returns in 1995. After a steady annual climb, eleven years later, the Service saw 134.4 million returns filed. In addition, between 1997 and 2007, the number of individual tax returns with $100,000 in reported income, which are generally more complex returns, increased by 103 percent.

Unfortunately, instead of recognizing that the dramatic cuts to the IRS workforce are straining the ability of IRS employees to handle the increasing workload, the IRS has continued to reduce its workforce. Further exacerbating the dire staffing situation at the Service is the aging of the IRS workforce. Approximately 4,000 of its employees are retiring annually presenting the Service with the difficult challenge of replacing a large portion of its workforce each year and the institutional knowledge they take with them. These retirements of some of the Services’ most experienced personnel will only further stress the current IRS workforce already straining under a rising workload.

Amazingly, IRS efforts to reduce the overall workforce have targeted some of the Service’s most productive employees. These include the recent re-organization of the Estate and Gift Tax Program which sought the elimination of 157 of the agency’s 345 estate and gift tax attorneys – almost half of the agency’s estate tax lawyers—who audit some of the wealthiest Americans. The Service pursued this drastic course of action despite internal data showing that estate and gift attorneys are among the most productive enforcement personnel at the IRS, collecting $2,200 in taxes for each hour of work. It is difficult to understand why the IRS sought the elimination of key workforce positions in an area that could produce significant revenue to the general treasury.

In addition, the Service continues to move forward with its plan to close five of its ten paper tax return submission facilities by 2011. The IRS originally sought the closings of the five paper return submission centers due to the rise in the use of electronic filing (e-filing) and in order to comply with the IRS Restructuring and Reform Act of 1998 (RRA 98) which established a goal for the IRS to have 80 percent of Federal tax and information returns filed electronically by 2007. But the IRS recently reported that in 2007 just 57 percent of Federal tax returns were filed electronically and has previously acknowledged that it is getting harder to convert additional taxpayers to e-filing as those that might convert most readily have already done so.

The continued slow migration of taxpayers to e-filing recently caused the IRS Oversight Board to call on Congress to extend the 80 percent deadline to 2012 in its recent report to Congress on e-filing.

In addition, while the IRS has stated that it will achieve millions of dollars in cost savings as a result of the paper submission consolidation effort, an August 2007 report by the Treasury Inspector General for Tax Administration (TIGTA) found that the agency’s business decision to consolidate sites did not even include a cost-benefit analysis (TIGTA Report Number: 2007-40-165). Furthermore, the report found that the IRS had not adequately updated or monitored financial information on the personnel costs of consolidations and had included savings not attributable to site consolidation in some of its analyses. What is most disturbing is that while the IRS acknowledged some of the assumptions used to determine the consolidation plan may have changed, they refused to complete a cost-benefit analysis to determine if the existing plan is optimal or if alternatives need to be considered.

Mr. Chairman, while overall use of e-filing may be on the rise, it is clear that the number of taxpayers opting to use this type of return is not increasing as rapidly as the IRS had originally projected. Combined with the fact that the IRS consolidation strategy rests on an incomplete business plan which did not include any type of cost-benefit analysis, NTEU believes that the IRS should immediately postpone further site consolidations until a comprehensive cost-benefit analysis can be completed to ensure that the existing plan is optimal in terms of cost savings and benefits.

It is clear that drastic reductions in some of the agency’s most productive tax law enforcement employees directly contradict the Service’s stated enforcement priority to discourage and deter non-compliance. In addition, we believe these staffing cuts have greatly undermined agency efforts to close the tax gap which the IRS recently estimated at $345 billion. As Nina Olson, the National Taxpayer Advocate noted, this amounts to a per-taxpayer “surtax” of some $2,000 per year to subsidize noncompliance. And while the agency has made small inroads and the overall compliance rate through the voluntary compliance system remains high, much more can and should be done. NTEU believes that in order to close the tax gap and handle a rising workload, the IRS needs additional employees on the frontlines of tax compliance and customer service. In addition, we believe Congress should establish a dedicated funding stream to provide adequate resources for those employees.

NTEU Staffing Proposal

In order to address the staffing shortage at the IRS, NTEU believes the workforce should be gradually increased to its pre-1996 levels. Specifically, we support a 3 percent annual net increase in staffing (roughly 2,600 positions per year) over a five-year period to gradually rebuild the depleted IRS workforce to its pre-1996 levels from its current level of 86,638. Because it takes time and careful management to hire, train, and deploy qualified professional staff, consistent but modest annual increases are necessary. A similar idea was proposed by former IRS Commissioner Charles Rossotti in a 2002 report to the IRS Oversight Board. In the report, Rossotti quantified the workload gap in non-compliance, that is, the number of cases that should have been, but could not be acted upon because of resource limitations. Rossotti pointed out that in the area of known tax debts, assigning additional employees to collection work could bring in roughly $30 for every $1 spent. The Rossotti report recognized the importance of increased IRS staffing noting that due to the continued growth in IRS’ workload (averaging about 1.5 to 2.0 percent per year) and the large accumulated increase in work that should be done but could not be, even aggressive productivity growth could not possibly close the compliance gap. Rossotti also recognized that for this approach to work, the budget must provide for a net increase in staffing on a sustained yearly basis and not take a “one time approach.”

Adding staff to handle an increasing workload at the IRS is not a new concept. In its 2001 budget request, IRS asked for funding for the Staffing Tax Administration for Balance and Equity program (STABLE), an initiative aimed at restoring IRS staffing to mid-1990s levels and strengthening the Service's tax compliance and customer service functions.The STABLE initiative envisioned hiring nearly 4,000 new employees to help increase compliance and improve customer service. The proposal sought to boost staff in Field Offices, where IRS employees provide direct, in-person service to taxpayers, and Service Center/Call Sites, where service is typically provided via telephone and correspondence. Hiring requirements for the Field Offices was to be determined based on projected workload in the office´s geographic area, and existing staff capabilities. Conversely, Service Center/Call Site workload would be planned on a nationwide basis due to the nature of the work, and staffing allocations based upon physical space and local labor market conditions around the center in question.

Although such a staffing initiative would require a substantial financial commitment, the potential for increasing revenues, enhancing compliance and shrinking the tax gap makes it very sound budget policy. One option for funding a new staffing initiative would be to allow the IRS to hire personnel off-budget, or outside of the ordinary budget process. This is not unprecedented. In fact, Congress took exactly the same approach to funding in 1994 when Congress provided funding for the Administration’s IRS Tax Compliance Initiative which sought the addition of 5,000 compliance positions for the IRS. The initiative was expected to generate in excess of $9 billion in new revenue over five years while spending only about $2 billion during the same period. Because of the initiative’s potential to dramatically increase federal revenue, spending for the positions was not considered in calculating appropriations that must come within annual caps.

A second option for providing funding to hire additional IRS personnel outside the ordinary budget process could be to allow IRS to retain a small portion of the revenue it collects. The statute that gives the IRS the authority to use private collection companies to collect taxes allows 25 percent of collected revenue to be returned to the companies as payment, thereby circumventing the appropriations process altogether. Clearly, there is nothing magical about revenues collected by private collection companies. If those revenues can be dedicated directly to contract payments, there is no reason some small portion of other revenues collected by the IRS could not be dedicated to funding additional staff positions to strengthen enforcement.

While NTEU agrees with IRS’ stated goal of enhancing tax compliance and enforcement, we don’t agree with the approach of sacrificing taxpayer service in order to pay for additional compliance efforts. That is why we were disappointed to see that the President’s proposed budget calls for a $31 million cut in funding for Taxpayer Assistance Center (TACs) at a cost of 262 FTEs. NTEU believes providing quality services to taxpayers is an important part of any overall strategy to improve compliance and that reducing the number of employees dedicated to assisting taxpayers meet their obligations will only hurt those efforts. It is clear that IRS employees are continuing to provide quality customer service to American taxpayers. 2007 year end data from the IRS shows that IRS’ customer assistance centers met the 82 percent level of service goal, with an accuracy rate of 91 percent for tax law questions. And while these numbers show that employees providing taxpayer services are helping taxpayers understand and meet their tax responsibilities, more can and should be done.

Mr. Chairman, in order to continue to make improvements in taxpayer services while handling a growing workload and increasing collections, it is imperative to reverse the severe cuts in IRS staffing levels and begin providing adequate resources to meet these challenges. With the future workload only expected to continue to rise, the IRS will be under a great deal of pressure to improve customer service standards while simultaneously enforcing the nation’s tax laws. NTEU strongly believes that providing additional staffing resources would permit IRS to meet the rising workload level, stabilize and strengthen tax compliance and customer service programs and allow the Service to address the tax gap in a serious and meaningful way.

Private Tax Collection

Mr. Chairman, as stated previously, if provided the necessary resources, IRS employees have the expertise and knowledge to ensure taxpayers are complying with their tax obligations. That is why NTEU continues to strongly oppose the Administration’s private tax collection program. NTEU believes this misguided proposal is a waste of taxpayer’s dollars, invites overly aggressive collection techniques, jeopardizes the financial privacy of American taxpayers and may ultimately serve to undermine efforts to close the tax gap.

NTEU strongly believes the collection of taxes is an inherently governmental function that should be restricted to properly trained and proficient IRS personnel. When supported with the tools and resources they need to do their jobs, there is no one who is more reliable and who can do the work of the IRS better than IRS employees.

As you know, in September 2006, the IRS began turning over delinquent taxpayer accounts to private collection agencies (PCAs) who are permitted to keep up to 24 percent of the money they collect. NTEU strongly believes the collection of taxes is an inherently governmental function that should be restricted to properly trained and proficient IRS personnel.

NTEU believes this misguided proposal is a waste of taxpayer’s dollars, invites overly aggressive collection techniques, jeopardizes the financial privacy of American taxpayers and may ultimately serve to undermine efforts to close the tax gap.

According to the IRS, in FY '07, the PCAs brought in just $32 million in gross revenue, far below original projections of up to $65 million. After deducting commission payments to the PCAs, the true net revenue from PCA (non-IRS) collection activity was just $20 million. Therefore, after spending $71 million in start up and ongoing maintenance costs through the end of FY '07, the IRS private tax collection program lost more than $50 million.

According to Nina Olson the National Taxpayer Advocate, the dismal performance of the private collectors is forcing the IRS to downwardly revise its original ten-year projections for the program. For FY ’08, the IRS is now projecting gross revenues of just $23 million, despite projections as recently as last May indicating the program would bring in up to $127 million. In addition, despite assurances that the program would recover all start-up and maintenance costs by April of this year, the IRS is now projecting the program will not break even until late FY 2010.

NTEU also believes that sky high commission payments to the private contractors for work on the easiest to collect cases is unjustified and unnecessary. Under current contracts, private collection firms are eligible to retain 21% to 24% of what they collect. The legislation authorizing the program actually allows PCAs to retain up to 25% of amounts collected. These commission rates were never put up for competition. Before the initial bid solicitations went out, the IRS set commission rates at 21 to 24 percent of the revenue collected by contractors, denying bidders an opportunity to make offers on terms that would have resulted in the IRS getting a greater share of the collected revenue. Consequently, one of the companies that lost its bid for a contract filed a protest with GAO and noted in its bid protest that “offerors were given no credit for proposing lower fees than the 'target' percentages recommended by the IRS.”

The problem of excessive commission rates was recently addressed by Congress in legislation overhauling the Department of Education's student loan program, which the IRS has consistently held up as a model for the IRS private collection program. Amid charges that student aid lenders have engaged in abusive and potentially illegal collection tactics including charging excessively high collection fees, coercing consumers into payment plans they could not afford and misrepresenting themselves as Department of Education employees, the House and Senate approved H.R. 2669, the "Higher Education Access Act of 2007," which lowers from 23 percent to 16 percent the amount of recovered money that private guaranty agencies contracted by the government can retain on defaulted loans.

Mr. Chairman, in addition to being fiscally unsound, the idea of allowing PCAs to collect tax debt on a commission basis also flies in the face of the tenets of the IRS Restructuring and Reform Act of 1998 (RRA 98) which specifically prevents employees or supervisors at the IRS from being evaluated on the amount of collections they bring in. But now, the IRS has agreed to pay PCAs out of their tax collection proceeds, which will clearly encourage overly aggressive tax collection techniques, the exact dynamic the 1998 law sought to avoid.

The fear that allowing PCAs to collect tax debt on a commission basis would lead to contractor abuse was realized when the IRS recently confirmed that that the agency had received more than five dozen taxpayer complaints against the PCAs, including violations of the taxpayer privacy laws under Code section 6103. At least one of those complaints was confirmed by an IRS Complaint Panel to be a serious violation of law. In addition, penalties totaling $10,000 have been imposed by the IRS on the PCAs for taxpayer violations. In one instance, private collectors made 150 calls to the elderly parents of a taxpayer after the collection agency was notified he was no longer at that address. And one of the three private contractors was dropped by the IRS for dubious practices despite the Service’s previous assurance that its oversight would prevent abuse.

Mr. Chairman, NTEU is not alone in our opposition to the private tax collection program. Opposition to the IRS tax debt collection program has also been voiced by a growing number of major public interest groups, tax experts, two former IRS Commissioners as well as the National Taxpayer Advocacy Panel, whose members are appointed by the Internal Revenue Service (IRS) and the Treasury Department. In addition, the National Taxpayer Advocate, an independent official within the IRS previously identified the IRS private tax collection initiative as one of the most serious problems facing taxpayers and recently renewed her prior call for Congress to immediately repeal the IRS’ authority to outsource tax collection work to private debt collectors.

Opposition to the program has also been growing within Congress. Since granting IRS the authority to use PCAs in the American Jobs Creation Act of 2004, the House of Representatives, with bi-partisan support, has twice passed language prohibiting the IRS from moving forward with its private collection initiative. In addition, last session, the House overwhelmingly approved two separate tax bills (H.R. 3056, the "Tax Collection Responsibility Act of 2007" & H.R. 3996, the "Temporary Tax Relief Act of 2007") that contain language that would repeal IRS' authority to use private debt collectors to pursue tax debts.

In the Senate, stand alone legislation (S. 335) introduced by Senator Byron Dorgan (D-ND) that would force the IRS to immediately and permanently suspend its plan to outsource part of its tax debt collection responsibilities to PCAs and prohibit the use of any IRS funds for that purpose has 24 co-sponsors.

Mr. Chairman, instead of rushing to privatize tax collection functions which jeopardizes taxpayer information, reduces potential revenue for the federal government and undermines efforts to close the tax gap, NTEU believes the IRS should increase compliance staffing levels at the agency to ensure that the collection of taxes is restricted to properly trained and proficient IRS personnel.

The IRS already has a significant collection infrastructure with thousands of trained employees, including fourteen Automated Collection System (ACS) sites which allow the IRS to contact taxpayers by telephone and collect delinquent taxes. The ACS function is a critical Collection operation, collecting nearly $1.49 million per employee per year. The IRS itself has analogized the use of private collectors to the ACS, where IRS collection representatives interact with taxpayers on the telephone. But unlike the private collectors, ACS personnel are able to analyze financial statement information, research assets, enter into installment agreements, make currently not collectible determinations, and can take lien and/or levy enforcement actions. ACS employees also receive training that is far more comprehensive and rigorous than that of the private collectors. In addition, these employees undergo mandatory annual training on topics such as confidentiality and privacy of taxpayer information, ethics awareness, taxpayer rights and computer security.

Unfortunately, inadequate staffing at ACS sites has prevented the IRS from using its current systems to proactively contact taxpayers by telephone to resolve delinquent accounts. The need for the IRS to expand ACS' use of outbound calls has been recognized by IRS management and at least two recent internal IRS study groups have recommended making more outbound calls as a way to make the ACS operation more effective and efficient.

Mr. Chairman, according to the IRS they will spend $7.65 million to run the private collection program in FY '08. NTEU believes that instead of continuing to expend valuable IRS resources on this failed program, this $7.65 million should instead be used to fund roughly 102 additional ACS employees that could return more than $151 million to the Treasury annually. By comparison, the IRS is now projecting the PCAs to bring in just $23 million in gross revenue in FY ‘08, far less than its original estimate of up to $127 million.

NTEU believes that increasing the number of ACS personnel would allow the IRS to maximize its ability to proactively resolve delinquent accounts by contacting taxpayers directly. This would also help ensure that the high level of customer service to those taxpayers who call the ACS seeking account resolution is preserved. The IRS has acknowledged that ACS employees are already performing admirably noting that in 2006, ACS customer service and quality ranged between 89.5 to 99.5 percent (pg. 54 - IRS response to Olson '06 Report to Congress). These exceptional ratings are all the more impressive when you consider ACS employees generally work on much more complex and often contentious cases than those being worked by the private collectors and that the total number of cases worked by ACS employees dwarfs those worked by the private collectors.

Mr. Chairman, NTEU understands and commends efforts to ensure that all taxpayers pay their fair share of taxes. Without a doubt, rank and file IRS employees are committed to achieving this goal in the most cost-effective manner while providing a high level of customer service to American taxpayers. But the facts make clear that the use of private tax collection companies is not in the best interest of American taxpayers, could potentially undermine future efforts to close the tax gap, and should be terminated immediately.

A number of other issues important to NTEU members are often addressed in the FSGG Appropriations bill and I would like to address some of them here.

Pay Raise

The Federal Employees Pay Comparability Act (FEPCA), enacted in 1990 to close the gap between federal and private sector pay, has never been fully implemented. As a result, there is now a 23% disparity between federal employees and their private sector counterparts. Under the President’s plan, federal employees will fall even further behind the private sector.

The Administration’s budget proposed a 2.9 percent pay raise for federal workers next year. This not only fails to recognize the important role of our Nation’s workforce, it is below the 3.4 percent pay raise the President recommended for the military. The Administration’s recommendation ignores the essential role of federal employees in protecting our nation at the borders, in the domestic and international movement of money, in public health, in nuclear security, and in the collection of revenue among others. Further, it ignores the longstanding principle of pay parity, the recognition that federal civil servants and their brothers and sisters in the military, work side by side and should receive an equal level of pay increase. Importantly, pay parity was just reaffirmed on March 13, 2008, in House of Representatives when it passed H. Con Res. 312, the FY 2009 budget resolution. I urge the subcommittee to report its bill in keeping with this pay parity principle.

For most of the last twenty years, government employees in civil service and military personnel have received the same level of pay increase. Last year, both the military and federal civil servants received a 3.5 percent pay raise in the final FY 2008 bills. That amounted to the annual raise in the Employment Cost Index (ECI) plus one-half percent, the standard pay figure received in every year of the current Administration with the exception of 2007. For 2009, the current raise in the ECI as calculated by the Department of Labor is 3.4 percent, and an extra one-half percent equals 3.9 percent. NTEU urges the subcommittee to follow the precedent of ECI plus one-half percent and report legislation for FY 2009 providing a 3.9 percent raise to federal employees. We will be working with the appropriate committees to enact a military raise of the same level.

SEC Pay

NTEU represents the employees of the Securities and Exchange Commission (SEC). We believe that the SEC must be provided with adequate resources to ensure that its performance based pay system can be a viable tool for employee retention and recruitment. While there have been numerous problems with this pay system, adequate funding is essential. From FY2002 to FY2005, the SEC budget included a 3% increase over current compensation levels to fund the performance pay system. However, for the past two years, the SEC’s budget has included only a 2% increase. This year, the President has only requested a 1.5% increase. The continuing performance pay funding crisis has hamstrung SEC managers’ ability to provide meaningful and appropriate performance based salary increases to their employees. As budget shortfalls have shifted the system from being fundamentally performance based, some senior managers at the SEC have sent notices to their employees stating that they are being given lower ratings not for performance reasons but because of budgetary limitations. This state of affairs is having severe and negative impacts on employee morale and retention at SEC, contrary to the stated purpose of the performance pay system. NTEU would ask for an additional $5 million in funding for the SEC for this purpose.

OPM Prescription Drug Subsidy

Mr. Chairman and members of the subcommittee, it is NTEU’s position that OPM should apply for the drug subsidy to which it is entitled under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (P.L. 108-173). Under this law, which created the Medicare Part D prescription drug program, the government, as an employer, is eligible to receive a subsidy payment made available to all employers that provide prescription drug benefits as generous as the Medicare program. The “Medicare employer payment” was designed to encourage employers to retain such benefits.

According to GAO, if OPM had applied for the subsidy, it would have lowered the average 2006 FEHBP premium by 2.6 percent. Some of the individual health plans that serve a high number of retirees could have realized a slowdown in premium growth by as much as 3.5 to 4 percent. These savings could have been passed on to keep the enrollee portion of the premium down. Unfortunately, estimates are that OPM has have left more than $1 billion on the table by forgoing the subsidy. NTEU would support legislative language require OPM to apply for the subsidy, which would help keep FEHBP costs down for millions of federal employees and their families who are enrolled.

Contracting Out

Another issue pertinent to the Subcommittee’s jurisdiction is the contracting out of government positions and responsibilities. I want to commend and thank the subcommittee for incorporating important privatization language in its portion of the FY ‘08 Omnibus Appropriations bill to help level the playing field for federal employees.

Unfortunately, the Administration’s FY ’09 budget request has called for the repeal of these important provisions. We strongly urge congress to oppose any efforts to repeal these important provisions that allow federal employees the ability to fairly compete with the private sector.

In addition, NTEU strongly supports making government wide a number of additional contracting out reforms included in the FY ‘08 Defense Authorization Bill which currently only apply to the Department of Defense. These include provisions that would encourage “insourcing” by providing employees government wide the opportunity to compete for new work or work currently performed by contractors, allow government employees to acquire new work by allowing agencies to bring work in-house without going through the A-76 process, eliminate the automatic recompetition requirement which previously only applied to federal employees and not contractor employees, and establishment of a contractor inventory in every government agency to track the cost and performance of every service contract to help identify contract work that could be converted to performance by federal employees.

By making these important contracting out reforms applicable to the entire federal workforce, congress can help bring fairness and accountability to the entire competitive sourcing process. NTEU firmly believes that federal employees are the best value for taxpayers' dollars and they deserve a fair and level playing field on which to demonstrate their effectiveness and efficiency to the White House, Congress and the American public.

Conclusion

Mr. Chairman, while federal workers, and in particular IRS employees, continue to get mixed signals regarding their value to this Administration, they remain committed to serving the American public to the best of their abilities. With the expected surge in federal retirements in the coming years, it is imperative that the federal government do all it can to retain the hundreds of thousands of talented public servants who have the knowledge and expertise to continue contributing to the federal workforce while at the same time preparing to compete for the best and brightest of the young new workers.

Therefore, NTEU believes it is imperative that the Administration reverse many of its policies that have devalued the role of federal employees and the work that they do including the failure to pay competitive salaries and the constant focus on downsizing and outsourcing. These misguided policies have reduced morale of federal employees government-wide and have put the federal government at a disadvantage when it comes to attracting, developing and retaining qualified employees.