[EL] BOLOs, TAGs, and Drums
Legal Works of Marc Greidinger
mpoweru4 at gmail.com
Thu Aug 8 09:24:27 PDT 2013
Several years ago, an organization beginning to put together local farmers
markets I was on the Board of applied for 501(c)(3) status. It had been
specifically encouraged to do this under a Department of Agriculture program
designed to promote farmers markets as a boon to local farmers, local
economies, and nutrition. The IRS apparently had not gotten the memo from
the Department of Agriculture, and papered the organization to death with
hundreds of written interrogatories and requests for production under tight
deadlines. We found out that the IRS was also doing this to many other
similar farmers market organizations, apparently out of some unknown IRS
official's misguided belief that Farmers' Market organizations were
inherently businesses posing as non-profits.
The IRS's unofficial attitude toward farmers markets in general caused the
Farmer's Market organization I was involved with to abandon its effort to
organize under 501(c)(3), even though, as far as I could tell, the
organization was of the kind that 501(c)(3) status was designed to help, and
was doing things consistent with public policies promoted by the Department
of Agriculture.
These BOLOs and "IRSgate" have always impressed me as similar stupidity to
the above, not conspiracy. The Republicans must be getting rather frustrated
at this point, having invested so much time and effort into trying to
connect the Obama Administration to a juicy scandal - hopefully against the
right - c to be foiled by a mundane explanation at every turn. But even in
the absence of conspiracy, if we are going to have (c)(4)s involved in issue
advocacy, it should not matter what type of organizations the "key words"
screening pulls out: any such screening is likely to chill, and will
disadvantage someone's voice which is likely representing an interest, or
competing with someone elses. If we are going to maintain the advantages
organizations benefit from under (c)(4) there should be no such screening. A
more interesting question is whether in general it makes sense anymore for
issue advocacy organizations to enjoy the advantages available to them under
(c)(4), and whether issue advocacy orgs posing as (c)(3)s should continue to
benefit from tax advantages with so little critical IRS scrutiny.
Marc Greidinger
Attorney at Law
https://www.facebook.com/GreidingerLegalWorks?ref=br_tf
(703) 323-4661
From: law-election-bounces at department-lists.uci.edu
[mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Trevor
Potter
Sent: Thursday, August 08, 2013 10:40 AM
To: Joe La Rue; Smith, Brad
Cc: law-election at department-lists.uci.edu
Subject: Re: [EL] BOLOs, TAGs, and Drums
The scandal was supposed to be that IRS employees targeted conservative
groups because of their political beliefs. That is in fact a scandalous
accusation for what is supposed to be a non-partisan agency strictly above
politics and which needs the trust of the American people to function.
Joe LaRue says:
"And I continue to beat my drum and say: it doesn't matter whether it was
all conservative groups, or all progressive ones, or a mixture of each that
was targetted."
I disagree. If it turns out that the IRS challenged both progressive and
conservative groups, delayed their c4 applications, put them in dead-end
piles, audited them after complaints were received, and general poorly
managed their status, then we have a completely different issue. If this
turns out to be the case-whether through "BOLOS" or "emergent issues"-then
the question becomes why did this happen. Was it from mismanagement,
understaffing, poor training or leadership, or an inability of the IRS to
address the status of highly political c4s under current rules and in the
midst of a partisan battleground where members of Congress of both parties
are regularly attacking the agency for favoring the other party? In other
words, have they just frozen in the midst of battle? That would be a scandal
of maladministration, not the political vendetta that has been alleged.
Because, after all, the IRS does HAVE to determine whether groups qualify
for 501 c 4 status, and then whether they are in compliance with c 4
standards of conduct-that is the agencies job, whether the groups are
progressive or conservative.
Trevor Potter
From: law-election-bounces at department-lists.uci.edu
[mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Joe La
Rue
Sent: Thursday, August 08, 2013 10:15 AM
To: Smith, Brad
Cc: law-election at department-lists.uci.edu
Subject: Re: [EL] BOLOs, TAGs, and Drums
Brad, Brad, Brad. Didn't you hear? The IRS only targeted progressive,
liberal groups. Or perhaps it is that no group was targeted; the IRS was
just doing its job. Regardless, there was no targeting of conservative
groups. The extra scrutiny applied to them, as well as the delays they
experienced, was all warranted. It doesn't matter what the IRS says. After
all, if we're going to revise history, and ignore the IRS's admissions
against interest (which is what some are doing), then we might as well do it
on a large scale. Go big or go home, right? So let's beat the drum together
that the IRS got it all wrong when it admitted it had improperly targeted
conservative groups.
My only question, I guess, is why is that a drum that anyone would want to
beat? Are some so politically driven that we cannot acknowledge that
something dreadfully wrong happened here, simply because it happened to the
other side? If the IRS can do it to conservative groups in the mid-2010s,
then they can do it to progressive groups if the White House (or even just
the IRS) becomes more conservative. And I continue to beat my drum and say:
it doesn't matter whether it was all conservative groups, or all progressive
ones, or a mixture of each that was targetted. What happened was wrong. And
I remain shocked that that is not something that we can all agree on.
Joe
Joe
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On Wed, Aug 7, 2013 at 9:31 PM, Smith, Brad <BSmith at law.capital.edu> wrote:
Where does this idea come from that they were evenly distributed? That's not
what the IRS says.
Bradley A. Smith
Josiah H. Blackmore II/Shirley M. Nault
Professor of Law
Capital University Law School
303 E. Broad St.
Columbus, OH 43215
614.236.6317
http://law.capital.edu/faculty/bios/bsmith.aspx
_____
From: law-election-bounces at department-lists.uci.edu
[law-election-bounces at department-lists.uci.edu] on behalf of Mark Schmitt
[schmitt.mark at gmail.com]
Sent: Wednesday, August 07, 2013 10:54 PM
To: law-election at department-lists.uci.edu
Subject: Re: [EL] BOLOs, TAGs, and Drums
This seems like a very new drum indeed. You seem to be saying that the very
idea of a "BOLO" list, or what I've also heard called an "emerging issues"
list, is illegitimate. I don't have the knowledge of IRS procedures that you
do, but this is not an argument I've heard before.
It really doesn't seem complicated. Groups with the word "progressive" in
their names or descriptions were getting some extra scrutiny based on
long-established practice. That makes sense: The Progressive Policy
Institute was established in 1991. Center for American Progress and the c(4)
American Progress Action Fund in 2003. Progressive States Network, Progress
Now and a bunch of "Progress [state]" c(4)s in 2005-2007, continuing to
recent years. Those are the ones that jump to my mind, but there are others.
The IRS had a lot of time to absorb and consider those groups, and still
their applications took many months. "Tea Party," as we know, was not a term
that organizations were using before 2009-2010. And rather than the slow
growth curve of "progressive" c(4)'s, a lot of groups using Tea Party and
related but also new terms were created quite rapidly. Hence, it was an
"emerging issue," or something to look out for, on which a formal protocol
had not yet been established, but might need to be.
What am I missing here? Both "progressive" and "Tea Party" groups were
flagged for scrutiny, One term was old, the other was new. Both faced
delays, questions and obstacles. Maybe those delays were themselves "wrong,"
as some have alleged, or maybe not, but they were evenly distributed. If one
came from one kind of list, and the other from another list, why do we
care?
Mark Schmitt
Senior Fellow, <http://www.rooseveltinstitute.org/> The Roosevelt Institute
202/246-2350 <tel:202%2F246-2350>
gchat or Skype: schmitt.mark
twitter: mschmitt9
On Wed, Aug 7, 2013 at 2:02 PM, <BZall at aol.com> wrote:
Sigh, not to continue Prof. McDonald's "drum" analogy further, but there
seems to be a continuing error of conflation in these discussions, both on
the Hill and in this thread. If Glenn Kessler ("The FactChecker" from Jeff
Bezos's newspaper) can figure this one out, so can those looking for the
difference between treatments:
"Meanwhile, Democrats have highlighted information that they say undercuts
the thrust of the Inspector general's report. While that report focuses on
scrutiny of "tea party" and related groups - which had been placed on "be on
the lookout" (BOLO) lists - Democrats released documents
<http://democrats.waysandmeans.house.gov/sites/democrats.waysandmeans.house.
gov/files/November%202010%20BOLO%20IRS0000001349-IRS0000001364.pdf> showing
that the term "progressive" had been part of a "TAG [touch-and-go]
Historical" list."
http://www.washingtonpost.com/blogs/fact-checker/post/explainer-sorting-thro
ugh-charges-and-countercharges-in-the-irs-probe/2013/07/02/1cc2f520-e352-11e
2-aef3-339619eab080_blog.html
There is a difference between a BOLO list and a TAG list ("Touch and Go").
See, e.g., http://www.irs.gov/irm/part7/irm_07-020-006.html, explaining
Touch and Go as a standard processing term in many highly-problematic areas.
(Note: the Internal Revenue Manual is the internal description of standard
procedures and can be relied on in certain tax or legal proceedings.) Real
TAG analyses are generally reserved for abusive transactions (many of which
involve exempt organizations) and have a very specific chain of command and
authority, plus review. Potential terrorism issues, for example, are on TAG
reviews. You can imagine the reviews those generate. "Compliance" project
reviews are generally not worthy of the full TAG panoply. IRM 7.20.6.1.2.1.
To the extent we even know what they are/were, BOLOs, on the other hand, are
a new and unreported (and apparently badly supervised) version of TAG lists
that raised many of these issues. Like TAGs, BOLOs use key words in the
database to identify possible transactions, but the differences are in the
structure, supervision, and probably the choice of terms as being recognized
for a particular definition of what the problem is. Who generated the terms?
We don't know. Who reviewed the terms? We don't know. Who reviewed the
selections based on those terms? We don't know. What was the process used
once a selection was made? We don't know. Etc. What we do know is that
everyone passed the buck or said they didn't know.
In other words, TAG reviews are what we expected the IRS to do if there had
really been a problem; BOLOs are not. BOLOs are, for want of a better
description, rogue TAGs, and no one wanted to grab that leash to bring them
under control. THAT is the scandal; not that groups' applications were
scrutinized, but that the process was overwhelmingly one-sided and
unrestrained.
There is no IRM entry for BOLO lists, nor will there be, despite Cong.
McDermott's entreaties.
http://www.realclearpolitics.com/video/2013/06/27/rep_mcdermott_irs_should_k
eep_bolo_lists.html. Having seen them in action, I would be surprised if EO
or any other part of IRS made the term "BOLO list" a routine part of the IRM
in the future.
As I understood the more informed (or less utterly-clueless) of the
discussions, the liberal groups were mostly on TAGs; the conservatives (and
a few unlucky progressive exceptions) were on BOLOs. Note that in the
attachments to the House Dems' complaint, pages 1-9 refer to TAGs; only
after P. 10 is there a reference to BOLOs, but all the listings cited say
they are for BOLOs.
http://democrats.waysandmeans.house.gov/sites/democrats.waysandmeans.house.g
ov/files/August%202010%20IRS0000002503.pdf The same is true through the next
few "BOLO" listings; it's really TAGs and BOLOs without discrimination.
Both inclusions were undoubtedly mistakes, but one was quickly resolved
through a quick look at the TAG rules; the other was not and it grew and
grew and grew.
Doesn't mean Prof. McDonald is wrong, and he'll undoubtedly explain why his
drum still thrums alone, but it does add another beat to the mix.
Barnaby Zall
Of Counsel
Weinberg, Jacobs & Tolani, LLP
10411 Motor City Drive, Suite 500
Bethesda, MD 20817
301-231-6943 (direct dial)
bzall at aol.com
_____________________________________________________________
U.S. Treasury Circular 230 Notice
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_____________________________________________________________
In a message dated 8/7/2013 1:20:46 P.M. Eastern Daylight Time,
mmcdon at gmu.edu writes:
The IRS issued BOLOs that used the keyword search approach to identify
liberal groups, just as they did conservative groups. Unless, you mean to
say that liberal and conservative groups were flagged as a general course of
business, in which case I am inclined to agree with you. I say "inclined"
since there is an outstanding question as to why more conservative groups
were flagged than liberal (something I am sure someone will say to beat
their drum). A likely non-nefarious explanation is that a greater number of
conservative organizations filed for status, which is my belief until
contradicting evidence comes to light.
The evidence that continues to come to light is entirely consistent with my
initial postings on this matter. I'm in the fortunate position of only ever
needing one drum to beat since I've never had a drum taken away.
============
Dr. Michael P. McDonald
Associate Professor
George Mason University
4400 University Drive - 3F4
Fairfax, VA 22030-4444
phone: 703-993-4191 (office)
e-mail: mmcdon at gmu.edu
web: http://elections.gmu.edu
twitter: @ElectProject
-----Original Message-----
From: law-election-bounces at department-lists.uci.edu
[mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Smith,
Brad
Sent: Wednesday, August 07, 2013 12:45 PM
To: law-election at department-lists.uci.edu
Subject: Re: [EL] Lerner in her own words - "everyone" "screaming"
I'm surprised that Michael keeps thumping this drum since the Inspector
General, and the IRS itself, have said quite clearly that conservative
groups were targeted. The fact that some liberal groups were also snared,
either in the criteria used to scrutinize conservative groups, or in the
general course of business, really doesn't change that, and numerous
analyses the numbers have verified the impact.
But having said that, it doesn't matter. Even if Michael were correct, that
would change only the nature, and not the fact, of the scandal. And that,
again, represents the problem.
Bradley A. Smith
Josiah H. Blackmore II/Shirley M. Nault
Professor of Law
Capital University Law School
303 E. Broad St.
Columbus, OH 43215
614.236.6317
http://law.capital.edu/faculty/bios/bsmith.aspx
________________________________________
From: law-election-bounces at department-lists.uci.edu
[law-election-bounces at department-lists.uci.edu] on behalf of Michael P
McDonald [mmcdon at gmu.edu]
Sent: Wednesday, August 07, 2013 11:43 AM
To: law-election at department-lists.uci.edu
Subject: Re: [EL] Lerner in her own words - "everyone" "screaming"
I remained silent with the "I told you so" when a litany of media reports
finally came out showing how liberal organizations were flagged and treated
the same as conservative organizations. But this is the story that will not
die so here we go...
Where this logic fails is that the IRS included liberal groups in their
treatment such as those advocating for the Affordable Care Act. When did the
president or Democratic members of congress ever indicate that they wanted
the IRS to go after groups advocating for Obama's signature legislative
accomplishment? Or was that Republican members of Congress sounding those
alarms? Perhaps when Lerner says "everyone" she means *everyone* and not
just the president and his congressional allies. And if everyone was
clamoring for action against their political opponents, how could any action
taken by the IRS not be alleged as singling out a political opponent of
someone?
============
Dr. Michael P. McDonald
Associate Professor
George Mason University
4400 University Drive - 3F4
Fairfax, VA 22030-4444
phone: 703-993-4191 (office)
e-mail: mmcdon at gmu.edu
web: http://elections.gmu.edu
twitter: @ElectProject
From: law-election-bounces at department-lists.uci.edu
[mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Smith,
Brad
Sent: Wednesday, August 07, 2013 11:17 AM
To: Trevor Potter; Jason Torchinsky; law-election at department-lists.uci.edu
Subject: Re: [EL] Lerner in her own words - "everyone" "screaming"
And that is, to me, what the scandal has always been about. It's not that
there was some White House order (although that wouldn't overly shock me).
It's that the White House and the President publicly and repeatedly sounded
the "alarm," and the need to get after these groups. It's that members of
Congress repeatedly wrote to the IRS to demand that it take action or
inquire why it hadn't (and we know what such an inquiry means). It is that
Democrats held show hearings all over Capitol Hill, wherever any committee
could with any remote legitimacy claim some jurisdiction, to excoriate these
groups. It is that Democrats publicly and private pressured the SEC and the
FCC, as well as the IRS, to take action because the FEC would not and
Congress was unable to pass DISCLOSE.
Of course the IRS responds to such posturing, inquiries, and vilification.
That is the problem. And it continues, as Sen. Whitehouse held a hearing
this spring openly accusing groups of violating the law, with no evidence;
as Senator Levin promised to "investigate" these conservative organizations;
as Senator Durbin sent out mass letters yesterday demanding to know if
various persons and groups had in any way funded ALEC.
There was what reformers would call "an astroturf" campaign, headed up by
prominent Democratic officeholders and aides, to drum an aura of crisis
about the political participation of their political opponents, and then to
demand that the huge federal bureaucracy step in to "do something" about it,
in light of the fact that Congress could not muster the votes.
That is the problem, and it is exactly what we've been warning about for
years would be one of the many problems with campaign finance regulation.
Bradley A. Smith
Josiah H. Blackmore II/Shirley M. Nault
Professor of Law
Capital University Law School
303 E. Broad St.
Columbus, OH 43215
614.236.6317
http://law.capital.edu/faculty/bios/bsmith.aspx
________________________________________
From: law-election-bounces at department-lists.uci.edu
[law-election-bounces at department-lists.uci.edu] on behalf of Trevor Potter
[tpotter at capdale.com]
Sent: Wednesday, August 07, 2013 11:04 AM
To: Jason Torchinsky; law-election at department-lists.uci.edu
Subject: Re: [EL] Lerner in her own words - "everyone" "screaming"
Jason
I know you are relying on a Breitbart piece, and it has an obvious point of
view. However, even that piece does not say that there was any pressure from
the "White House" on the IRS, and Breitbart is fair enough to note that
there was a great deal of press coverage and editorials in 2010 about new
501 c4s which appeared to be doing nothing but huge amounts election
activity in 2010. As the article states:
"TIGTA's report contains a few key redactions which conceal precisely how
the scrutiny of Tea Party groups began. Reading between the lines it seems
media attention played a role. Plans by a Tea Party group to create a new
501(c)(4) were featured in stories at the NY Times and NPR just a couple
weeks after Obama's statements about Citizens United. These stories
apparently caught the attention of the IRS which regularly monitors news
stories to be aware of developing issues."
Thus, the "everyone" wanting the IRS to "do something" in context appears to
refer to the quite public and common outrage reported on in the press that
essentially political entities were using 501 c 4 status to avoid disclosure
of their donors which would be required under election law.
Trevor Potter
From: law-election-bounces at department-lists.uci.edu
[mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Jason
Torchinsky
Sent: Wednesday, August 07, 2013 10:47 AM
To: law-election at department-lists.uci.edu
Subject: [EL] Lerner in her own words - "everyone" "screaming"
http://www.breitbart.com/InstaBlog/2013/08/06/Lois-Lerner-Discusses-Politica
l-Pressure-on-the-IRS-in-2010
In case anyone missed this, here's Lois Lerner in her own words from 2010
explaining that "everyone" wanted the IRS to "do something."
This video according to the report was taken in the fall of 2010.
Implications of this? I thought the IRS and the White House have maintained
there was no pressure on the IRS.
- Jason Torchinsky
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