Inspector General: HHS Failing to Conduct Due Diligence Over $402 Billion in Annual Grants

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Posted by Alexander Hendrie on Wednesday, September 2nd, 2015, 3:11 PM PERMALINK


The Department of Health and Human Services (HHS) is failing to share grant information in order to assess risk and mitigate misuse of federal dollars, according to a recent report by HHS Office of Inspector General (OIG).

In 2014, 13 agencies within HHS awarded nearly $402 billion in grants. The Centers for Medicare and Medicaid Services (CMS), the agency responsible for administering Obamacare, awarded 77 percent of grants, or nearly $310 billion.

As the report notes, officials responsible for grants use various tracking methods in order to mitigate risk of misuse. Nevertheless, in many cases agencies are failing to properly track funds and mitigate risk:

“Grant officials review reports to mitigate grantee risks, but these reports may be late and do not include descriptive information.”

In addition, many agencies do not share grantee information with other agencies, which creates further barriers to ensuring responsible use of taxpayer dollars:

“Less than half of awarding agencies share grantee information with other agencies; however grant officials report that they would like to receive information.”

Since 2010, CMS has awarded $5.4 billion in grants to states to construct Obamacare exchanges. Many states have misused these funds and failed to build a working exchange. Oregon and Massachusetts are under investigation for misuse of funds, Hawaii has shut its exchange down, and Vermont’s exchange remains unfinished.

In addition, a Government Accountability Office (GAO) draft report obtained by Reason Magazine found that CMS failed to track billions of dollars in grants given to state exchanges. As a result, neither the federal government nor the states are able to say how much of the $2.78 billion in Medicaid matching funds were improperly used to construct state exchanges.

The HHS OIG audit reviewed department directives available at the time and not information on specific grants. As a result, the report could not conclude to what extent grant funds were spent inappropriately. However, given the lack of controls present it seems likely that significant waste occurred.

 

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Congress Must Put A Stop to IRS Assault on Political Speech

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Posted by Alexander Hendrie on Wednesday, September 2nd, 2015, 1:37 PM PERMALINK


In the past few years, the IRS has failed time and time again to serve the American people. The agency has been caught red-handed targeting conservative non-profits, has struggled to properly implement and distribute Obamacare tax credits, and failed to protect 330,000 taxpayers from hackers. While these are the most well-documented cases of misconduct and ineptitude in the agency, the IRS has also taken aim at First Amendment rights by attempting to curtail political speech through intimidation. In the aftermath of these troubling revelations, it is clear that Congress needs to implement reforms that hold the agency accountable to the American people.

As a recently released bipartisan report by the Senate Finance Committee notes, the IRS targeting of conservative non-profits was part of a larger effort to restrict political speech at the urging of the White House:

 “Political pressure from the White House following the Supreme Court’s Citizens United decision unduly influenced the IRS and other government agencies, most notably the Department of Justice and the Federal Election Commission, to scrutinize political spending by 501(c) organizations. These agencies coordinated with each other on initiatives targeting conservative tax-exempt organizations.”

In addition to applying untoward scrutiny to certain non-profits, the IRS has also worked to restrict political speech through a twisted interpretation of the law that designates 501(c)(4) social welfare organizations as “persons” under the tax code. The agency has used this interpretation to justify subjecting individuals that have donated to a non-profit to the gift tax, in a clear attempt to harass taxpayers based on their ideology. No serious tax expert would agree with this interpretation, but that has not stopped the IRS.

Even after countless scandals, reform is nowhere to be found when it comes to the IRS. As the Senate Finance Committee report notes, the agency is yet to address many of the underlying problems that led to the targeting of non-profits:

 “The IRS has failed to correct many of the fundamental problems that led to the inappropriate targeting of Tea Party groups.”

Given the agency’s repeated refusal to fix these problems, it is contingent on Congress to step in and implement reform. To address the issue of political speech, Ways and Means Oversight Chairman Peter Roskam (R-Ill.) has introduced H.R. 1104, the “Fair Treatment for All Donations Act,” which explicitly puts a stop to this practice of targeting donors.

This commonsense proposal passed the House unanimously back in April but has since stalled in the Senate. With Congress preparing to return from its August recess, members should quickly pass this noncontroversial legislation. 

Investigations into the Obama IRS have made it clear that the agency, and the administration as a whole worked to curtail political speech. With these findings now public, it is time for strong reform to ensure the protection of First Amendment rights. Congress must protect free speech and make it clear that it is unacceptable for government bureaucrats to intimidate taxpayers based on voluntarily donations to political non-profits.

 

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Watchdog: Obamacare Exchanges Failing to Provide Data Vital to Determining Tax Credit Eligibility

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Posted by Alexander Hendrie on Tuesday, September 1st, 2015, 3:20 PM PERMALINK


Obamacare exchanges are failing to provide adequate enrollment information to the IRS for the payment and verification of tax credits, according to a new report released by the Treasury Inspector General for Tax Administration (TIGTA).

In order for the IRS to properly administer Obamacare, exchanges are required to provide monthly enrollment data, known as “Exchange Periodic Data.” As part of the law, Obamacare enrollees may elect to have their estimated tax credit sent directly to their insurance provider as partial payment for monthly premiums. But because this is only an estimate based on expected income, the IRS relies on Exchange Periodic Data to ensure that individuals have received the proper tax credit, or if they were eligible at all.

However, as the report notes, both the federal exchange and many of the 15 state exchanges have failed to provide this data:

“The IRS did not receive the required Exchange Periodic Data from all of the Exchanges as of the start of the filing season (January 20, 2015).  For example, the IRS did not receive Exchange Periodic Data for approximately 1.7 million (40 percent) of the approximately 4.2 million Federal Exchange enrollment records and did not receive the Exchange Periodic Data from six of the 15 State Exchanges.”

The report did not say which of the 15 state exchanges had failed to provided Exchange Periodic Data.

This is not the first time watchdog groups have raised concerns over Obamacare tax credits. In the past few months, at least four reports have found flaws in the system:

  • A August 2015 report by the Health and Human Services Office of Inspector General (HHS OIG) found that the federal exchange is failing to verify Social Security numbers, citizenship, and household income of Obamacare applicants. As a result, the exchange is unable to verify whether applicants are properly receiving tax credits.

 

  • A July 16, 2015 audit by the Government Accountability Office (GAO) found that 11 of 12 fake 'test' applicants received coverage for the entire 2014 coverage period despite many using fraudulent documents, and others providing no documentation at all. From these 11 applicants alone, Healthcare.gov paid $30,000 in tax credits.

 

  • A June 16, 2015 report released by the HHS OIG found that $2.8 billion worth of Obamacare subsidies and payments had been made in 2014 without verification.

 

  • A May 11, 2015 report by TIGTA found that the IRS was failing to verify whether individuals had even bought health insurance before distributing tax credits.

 

HHS OIG is continuing to evaluate the effectiveness of Obamacare tax credit controls, according to the latest TIGTA report. However, TIGTA issued no recommendations in the report because it was intended to provide interim information only.

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Taxpayers Crown Winner of America’s Biggest Loser: New York

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Posted by Paul Blair on Tuesday, September 1st, 2015, 12:42 PM PERMALINK


Newly released IRS migration data from 2013 shows that New York lost more taxpayers than any other state in the nation. That year, nearly 115,000 residents left the Empire State, taking with them $5.65 billion in adjusted gross income (AGI) to spend elsewhere.

This new data shows that New York will remain America’s “Biggest Loser,” having lost nearly 1.6 million taxpayers between 1985 and 2013. Those residents took with them more than $80.8 billion in annual AGI.

The phenomenal failure of New York to retain taxpayers and businesses is directly related to its uncompetitive tax and business climates. By some measures, New Yorkers face the greatest tax burden of any state in the nation. The personal income tax system consists of eight brackets and a top rate of 8.82%. The corporate tax of 7.1% and property tax collections are $2435 per person. The Tax Foundation ranked New York 50th until this year after a set of minor tax reductions.

In 2013, New York had the largest population losses to the following states:

  • Florida -20,465 (-$1.35 billion)
  • New Jersey -16,223 (-$1.1 billion)
  • Texas -10,784 (-$354 million)
  • North Carolina -9,070 ($294 million)
  • California -7,849 (-$200 million)

 

Even Democrat Governor Andrew Cuomo acknowledged that the status quo has “cost us dearly” being the “highest tax state in the nation.”

In an attempt to edge out some bottom-of the-list competitors, Cuomo has enacted minor property tax caps, corporate tax relief, and attempted to lure G.E. from Connecticut in the midst of that state’s massive tax hikes this year.

Who was the biggest winner in 2013? Click here to find out. 

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Bobby Jindal Signs Taxpayer Protection Pledge to the American People

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Posted by ATR on Tuesday, September 1st, 2015, 7:00 AM PERMALINK


Governor Bobby Jindal (R-La.), a candidate for the presidency of the United States, has signed the Taxpayer Protection Pledge to the American people. The pledge is a written commitment to the American people to “oppose and veto any and all efforts to increase taxes.”

“I commend Governor Jindal for signing the Taxpayer Protection Pledge to the hard working taxpayers of this country,” said Grover Norquist, President of Americans for Tax Reform. “Governor Jindal understands that government should be reformed so that it takes and spends less of the taxpayers’ money, and will oppose tax increases that paper over and continue the failures of the past."

Of the 17 GOP Presidential candidates, nine have experience serving as chief executive of a state. A study by Dan Clifton, head of policy research at Strategas Research Partners, provides an apples-to-apples comparison of their record on government spending. The chart below compares the average annual increase in general fund spending during each Governor’s term. During his time in office, Gov. Jindal has the most aggressive anti-spending record:

ATR has shared the Pledge with all candidates for federal office since 1986. In the 114th Congress, 49 U.S. Senators and 218 members of the U.S. House of Representatives have signed the Pledge. Pledge signers include Senate Majority Leader Mitch McConnell, House Speaker John Boehner, House Majority Leader Kevin McCarthy, House Majority Whip Steve Scalise, and GOP Conference Chair Cathy McMorris Rodgers. Senate Finance Committee Chairman Orrin Hatch and House Ways and Means Committee Chairman Paul Ryan are also pledge signers. On the state level, 13 incumbent governors and approximately 1,000 incumbent state legislators have signed the Pledge.

Though it is still early in the 2016 nominating process, most of the GOP candidates have already made a written commitment to the American people that they will oppose and veto any tax increase in the event they are elected to the White House. Along with Jindal, these candidates include Marco Rubio, Rand Paul, Ted Cruz, Chris Christie, Rick Perry, Carly Fiorina, Dr. Ben Carson, Rick Santorum, Mike Huckabee, and Jim Gilmore.

In 2012, all candidates for the Republican nomination for president signed the Taxpayer Protection Pledge, with the lone exception of former Utah Gov. Jon Huntsman. Huntsman finished seventh in Iowa and third in New Hampshire before dropping out of the race.

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Mr. Right

It's a real travesty that Jindal isn't doing better in the polls.


New IRS Data: Florida Biggest Beneficiary of Wealth From Other States

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Posted by Caroline Anderegg on Tuesday, September 1st, 2015, 7:00 AM PERMALINK


Newly released IRS migration data from 2013 shows that Florida was the greatest recipient of new wealth of any other state in the nation. That year, more than 74,000 new residents brought with them $8.34 billion in adjusted gross income (AGI) to spend in the Sunshine State.

Between 1985 and 2013, nearly 1.8 million new residents brought with them more than $116.36 billion in annual AGI. Taxes likely have played a large role in this mass migration to the Sunshine State. Florida is one of nine states that do not tax earned income, and one of only seven that do not tax any form of personal income. On top of that, Republican Governor Rick Scott has worked with the Republican legislature to provide an additional $2.6 billion in tax relief since taking office in 2011.

In 2013, Florida had the largest population gains from the following states:

New York  20,465 ($1.35 billion)

New Jersey  12,457  ($945 million)

Pennsylvania  9,092 ($644 million)

Illinois  7,749  ($1.1 billion)

Connecticut  5,686  ($1.09 billion)

Not only has the Florida legislature worked with Gov. Scott to aggressively reduce the tax burden in Florida, Scott has worked to poach businesses like General Electric and Hertz from other high-tax states like Connecticut and New Jersey. Hertz, which relocated their world headquarters to Florida in 2013 planned to bring 700 jobs paying an average of $102,000 to Florida that year, data that will be reflected in the 2014 tax filings.

Corporate income taxes have also faced significant reductions, with the exemption increasing from $5,000 to $50,000 between 2011 and 2012.

This June, Gov. Scott signed a $427 million tax cut for the upcoming fiscal year. This most recent tax proposal cut cell phone and TV taxes, reduced business taxes, eliminated sales tax on textbooks for college students, and implemented a 10-day sales tax holiday for school supplies.

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theGOONIES

Fleeing like real hellholes. Just wish it wasn't those same loser liberals bringing that mentality with them .


"Tremendous Pressure" from White House Costs Taxpayers $535 Million

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Posted by Timothy Wilt on Monday, August 31st, 2015, 3:05 PM PERMALINK


A new report from the Department of Energy’s Inspector General has acknowledged that White House officials placed “tremendous pressure” on DOE employees to process loan guarantee applications. This pressure played a crucial role in the calamitous approval of the 2009 Solyndra loan that cost taxpayers more than $500 million.

Solyndra, a solar-panel manufacture, was approved for a $535 million loan from the DOE under the Obama administration’s American Recovery and Reinvestment Act of 2009. In 2011, just 2 years after receiving the loan, Solyndra laid-off its 1,100 employees and filed for Chapter 11 bankruptcy protection. The political desire for a success-case in Obama’s new program, resulted in negligent loan practices, which tanked the company, cost thousands of jobs and millions of taxpayer dollars.

The new report has found that although Solyndra is blameworthy for providing misleading evidence to DOE officials, political pressure from the Administration and Department leadership, unnecessarily expedited the approval process, resulting in oversight directly related to the loan’s failure. This report corroborates a 2012 oversight report from the House Committee on Energy and Commerce. The E&C committee’s report found that intense political pressure placed on employees at the DOE and Office of Management and Budget (OMB), resulted in clear neglect of procedural elements that would have exposed Solyndra’s duplicitous financials.

In 2009 President Barack Obama signed the Americans Recovery and Reinvestment Act, a massive expansion of the 2005 Energy Policy Act. The new initiative sought to inject billions of taxpayer dollars specifically into renewable energy resources. Solyndra was intended to be a poster-child for the merits of the new program.

In many ways, a poster-child is exactly what Solyndra has become. However, instead of one representing the glory and success of the President’s plan, it signifies the unflattering underbelly of “clean energy” politics, and is drawing attention to the likelihood of these policies creating a “solar bubble” within the economy.

A recent Wall Street Journal Op-Ed, has outlined the disturbing relationship between government subsidies for Big Solar, and the investment interests that are taking advantage of this lucrative opportunity. The uncouth relationship is distorting the energy economy in the U.S., and placing large solar companies on track to becoming “too big to fail”.

The neglect and waste of the Solyndra failure, has clearly not diminished Obama’s willingness to undermine the American economy by picking winners and losers in the private sector. The government created “solar bubble” is speeding to a bursting point. When it bursts, the Administration’s complicit involvement, will make another government bail-out simply too much for the public to swallow. 

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Activ Solar https://www.flickr.com/photos/activsolar/

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Why Gov. Wolf is Holding Pennsylvania Budget Hostage

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Posted by Hal Smith on Monday, August 31st, 2015, 11:44 AM PERMALINK


Nearly two months into Pennsylvania’s budget stalemate, Governor Tom Wolf (D) is still holding the state budget hostage while he demands more spending and billions in higher taxes.

Gov. Wolf vetoed the tax hike-free budget approved by the legislature in July and continues to stick by his own proposal which calls for $4 billion in higher taxes and nearly $5 billion in new spending. The week before last, Gov. Wolf offered a phony pension reform proposal structured to protect fat payouts. In response Senate Majority leader Jake Corman (R-Centre), referred to Wolf’s offer as “an alternative proposal, one that falls far, far short of anything that we would accept.”

Since his veto, no real progress has been made to pass the budget. Gov. Wolf and fellow democrats have refused to budge on education funding and the natural gas extraction tax. Last Tuesday, in response to Republican’s impasse-breaking offer which included a $400 million dollar increase in basic education funding, Wolf simply canceled the meeting. He explained his avoidance as a result of Republicans not discussing his proposed severance tax on natural gas.

It is clear through the 0-193 rejection of Gov. Wolf’s tax hike-laden budget that, despite bluster from Wolf’s fellow Democrats, there is simply no support in the legislature for what would be the largest tax hike in the nation. Given the apparent stalemate, Republican legislators have been looking at the possibility of overriding Gov. Wolf’s budget veto. Speaker Mike Turzai, (R-Allegheny), has already stated that “we have to look at overriding if we're not going to have a substantive discussion.”

When Speaker Turzai argues Pennsylvanians already pay enough taxes and that the problem is on the spending side of the ledger, the facts are on his side. Pennsylvania already has the 10th highest state and local tax burden in the nation. In the decade from 1989 to 2009, had Keystone State lawmakers kept spending in line with inflation and population growth, they would’ve spent $302 billion less than they did. That’s a significant amount of taxpayer dollars that could’ve been put in a rainy day fund, returned to taxpayers, or both.

Pennsylvanians already contend with some of the highest taxes in the country and have been hit with over 20 federal tax increases since President Obama took office. The last thing they need are higher taxes imposed by Gov. Wolf. 

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Lois Lerner, AKA ‘Toby Miles,’ in Trouble Again, Networks Censor

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Posted by Geoffrey Dickens on Friday, August 28th, 2015, 4:09 PM PERMALINK


Editor's Note: This article was originally posted on NewsBusters and was republished here with permission.

First it was a destroyed hard drive, then it was a busted BlackBerry and now we find out Lois Lerner used another personal e-mail account to conduct government business that utilized the alias “Toby Miles.” This IRS targeting scandal has more twists than an old episode of Law and Order, but it’s still not enticing the Big Three networks (ABC, CBS, NBC) to go back to covering it.  On Monday, the Washington Times’s Stephen Dinan reported on Judicial Watch’s latest discovery that “In addition to emails to or from an email account denominated ‘Lois G. Lerner‘ or ‘Lois Home,’ some emails responsive to Judicial Watch’s request may have been sent to or received from a personal email account denominated ‘Toby Miles.’” So far none of the Big Three evening or morning shows have reported on this latest IRS scandal development. 

UPDATE: National Review's Eliana Johnson reported “Toby” is the name of Lerner’s dog and “Miles” is the surname of her husband Michael Miles. 

In the August 24 Washington Times article headlined “IRS finds yet another Lois Lerner email account” Dinan reported the following: 

Lois Lerner had yet another personal email account used to conduct some IRS business, the tax agency confirmed in a new court filing late Monday that further complicates the administration’s efforts to be transparent about Ms. Lerner’s actions during the tea party targeting scandal. The admission came in an open-records lawsuit filed by Judicial Watch, a conservative public interest law firm that has sued to get a look at emails Ms. Lerner sent during the targeting.

IRS lawyer Geoffrey J. Klimas told the court that as the agency was putting together a set of documents to turn over to Judicial Watch, it realized Ms. Lerner had used yet another email account, in addition to her official one and another personal one already known to the agency.

“In addition to emails to or from an email account denominated ‘Lois G. Lerner‘ or ‘Lois Home,’ some emails responsive to Judicial Watch’s request may have been sent to or received from a personal email account denominated ‘Toby Miles,’” Mr. Klimas told Judge Emmet G. Sullivan, who is hearing the case.

It is unclear who Toby Miles is, but Mr. Klimas said the IRS has concluded that was “a personal email account used by Lerner.”

Tom Fitton, president of Judicial Watch, said it was stunning the agency was just now admitting the existence of the address.

“It is simply astonishing that years after this scandal erupted we are learning about an account Lois Lerner used that evidently hadn’t been searched,” he said, accusing the IRS of hiding Lerner-related information throughout — including the existence of the backup tapes of her official email account, which the agency’s inspector general easily found once it went looking for them.

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Obamacare May Cause Flexible Spending Accounts to “Vanish”

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Posted by John Kartch on Friday, August 28th, 2015, 3:36 PM PERMALINK


As a presidential candidate, Barack Obama repeatedly made a “firm pledge” against “any form of tax increase” on any American making less than $250,000:

“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” [Video]

“If your family earns less than $250,000 a year, you will not see your taxes increased a single dime. I repeat: not one single dime.” [Transcript] [Video]

But his promise was shattered when he signed Obamacare into law. Of its 20 new or higher taxes, at least seven directly raise taxes on Americans making less than $250,000 per year. Most of the middle class tax hikes were scheduled to take effect after 2012, once the President was safely re-elected. Among these taxes is Obamacare’s Flexible Spending Account tax which took effect in 2013.

And now, according to an industry analyst quoted by Politico tax reporter Brian Faler, FSAs will be “one of the first things to go” thanks to Obamacare’s final impending tax hike: 2018’s “Cadillac Tax” on comprehensive health insurance plans. Below is an excerpt from Faler’s Politico piece titled “Flexible spending accounts may vanish as result of Cadillac tax”:

A popular middle-class tax benefit could become one of the first casualties of the Affordable Care Act’s so-called Cadillac tax, potentially affecting millions of voters.

Flexible spending accounts, which allow people to save tax free for everything from doctor’s co-pays to eyeglasses, may vanish in coming years as companies scramble to avoid the law’s 40 percent levy on pricey health care benefits.

“They’ll be one of the first things to go,” said Richard Stover, a health care actuary and principal at Buck Consultants, an employee benefits consulting firm. “It’s a death knell for them. If the Cadillac tax doesn’t change, FSAs will go away very quickly.”

That is likely to come as a big surprise to middle-class voters who may be only vaguely aware of the Cadillac tax, and inflame what is already a growing debate over one of Obamacare’s most important and controversial cost-saving provisions.

There are an estimated 30 - 35 million Americans who use a pre-tax FSA at work to pay for their family’s basic medical needs. They already face an Obamacare-imposed cap of $2,500. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) The tax was designed to squeeze $13 billion of tax money from Americans over its first ten years. Parents socking away money to pay for braces for their kids find themselves quickly hitting the new cap, meaning they have to pony up some or all of the cost with after-tax dollars. And now they face the Cadillac Tax and its potential impact on their FSAs. Conveniently for President Obama and his middle class tax pledge, he will be long out of office when things hit the fan.

 

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