Union is right to fight against hiring of tax contractor

[Omaha Steve]

http://www.mercurynews.com/opinion/ci_8829571

By Dan Walters
Article Launched: 04/06/2008 01:39:53 AM PDT

A California employee union is complaining about an embryonic scheme in the state Board of Equalization to hire one or more private collection firms to track down those who owe taxes to the state.

The Service Employees International Union says the state's own tax collectors could do the job just as well, for far less cost, if they were equipped with up-to-date tracking tools.

SEIU obviously wants to bolster civil service worker ranks and stave off privatization. But in this instance, given the identity of the tax collection firm that is most aggressive in seeking a contract, the union's concerns appear to be well placed.

A Texas-based law firm called Linebarger, Goggan, Blair and Sampson (LGBS) has hired a veteran politician and former Board of Equalization member, Johan Klehs, to lobby his former colleagues and, it hopes, secure a contract that would give it a juicy piece of the state's estimated $8 billion in uncollected taxes.

LGBS is huge, with operations in dozens of states and contracts, it says, with 1,800 state and local government agencies to collect taxes, parking fines and other overdue accounts. It even had a collection contract with the Internal Revenue Service, one of three firms to receive the business under an experimental IRS program. However, a year ago the feds dropped LGBS for reasons they never would specify, while retaining the other two private tax collectors.

Although the IRS case has received the most national attention, a perusal of the firm's dealings with state and local governments reveals a pattern of using political persuasion to secure lucrative collection deals, some of which have devolved into scandal.

FULL story at link.