Bill Includes Slots for Public on Review Panel

Someone new is likely to be looking over the shoulder of the Internal Revenue Service.

Private citizens.

The IRS reform bill passed by the Senate on Thursday calls for setting up a nine-member oversight board to supervise the troubled agency--and reserves six of the chairs for private citizens.

The board, which would set policy and long-term strategy for the IRS, also would include the Treasury secretary, the IRS commissioner and an IRS labor union representative.

So crucial is the panel to the future of the agency that much of the Senate debate over the IRS legislation amounted to a fistfight over who gets a seat at the table.

Conservative Republicans tried, but failed, to eliminate the union representative, saying that workers face a conflict of interest if they are overseeing their own agency. Republicans also tried, but failed, to dump the Treasury secretary, saying such a person is just the kind of Washington insider they do not want on the panel.

But everyone has the same basic idea: The IRS needs some outside supervision to bring a fresh eye to management of a notoriously cumbersome agency.

“The purpose of the IRS board is to reform the IRS from the outside,” said Sen. Connie Mack (R-Fla.).

The IRS now is headed by a commissioner who is chosen by the president, confirmed by the Senate and reports to the secretary of the Treasury.

The IRS legislation, for the first time, would install an oversight board that has few other parallels in the federal bureaucracy.

The six private-sector members of the panel would be chosen by the president for five-year terms subject to approval by the Senate. The president would have broad latitude to choose board members but the bill encourages him to choose people with expertise in management, customer services, federal tax law and other relevant administrative skills, as well as those in touch with the concerns of ordinary taxpayers.

The purpose of the board is not to micromanage day-to-day tax policy and enforcement. It would have no power to intervene in disputes involving individual taxpayers.

But it would have vast reach in overseeing agency operations. The panel would review and approve agency budget requests, reorganization plans and other elements of long-term strategy. It also would recommend to the president candidates for IRS commissioner but the power to name the agency head would remain with the White House.