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July 31, 2014
Tax Analysts Exclusive: Conversations: John Koskinen
by William Hoffman

Full Text Published by Tax Analysts®


IRS Commissioner John Koskinen (Tax Analysts/Derek Squires)John Koskinen was sworn in as IRS commissioner on December 23, 2013. Koskinen, who came to the IRS with a reputation as an organizational turnaround expert, was nominated by President Obama to take charge of the agency in the wake of the controversy over the IRS's mishandling of conservative groups' applications for tax-exempt status that first erupted in May 2013. Koskinen has spent much of his time as commissioner testifying at congressional hearings on the matter and defending the agency's response to the ongoing congressional investigations, all while calling for more funding for the Service.

Koskinen recently spoke with Tax Analysts' William Hoffman regarding the IRS exempt organizations targeting controversy, new exempt organization forms, the challenges of retaining talented personnel, and the agency's ongoing budget problems.

The following is a complete transcript of the conversation. (Related coverage.)


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Tax Analysts: You've stated to congressional committees investigating the targeting controversy that you want to assemble complete information before passing it along for their review, because otherwise, in your own words, "people sometimes tend to leap to the wrong conclusion."

Yet every congressional hearing seems to bring to light new information that contradicts something you said in previous testimony. Given the reception that this "complete information" strategy has gotten, especially from Republicans, why shouldn't you reconsider that strategy?

John Koskinen: Well, because a lot of the "inconsistencies" turn out to be not inconsistent. I mean, they're characterized, as well, we've just discovered -- for instance, Tom Kane says, "Well, yeah, there may be tapes that have information on it." So that's a big inconsistency. But they don't know, until somebody pointed it out to them, that Tom also said, "But on June 13, when we published that report, that was what everybody knew. That was what we had confirmed at that time."

So the fact that something new has come up -- and it's not quite clear whether that new has anything to do with more e-mails -- I mean, I'm delighted with the [Treasury Inspector General of Tax Administration] to take a look at any of the materials or tapes they want to. Thus far, there's been no indication there are e-mails on it. But that inconsistency is not an inconsistency. A report came out, and that was accurate.

The question about -- and the last hearings are the ones I remember best -- the criminal investigation press release said, recommended, that we go outside. Well, it turns out when you read the transcript, he provided information. If you wanted to go outside, you could go talk to these people. He was not saying, "Gee, this is what you ought to do." And in fact they'd already gone to more extraordinary lengths than they normally would do.

So part of the issue is, those releases, together with -- my favorite example is when the staff was briefed on that Monday morning, on June 16, that all we knew as of that morning was in response to my request to look at custodians -- was that six or seven custodians had had hard drive problems. The next morning, you get a release that says all the e-mails are lost from all of those people, including Nikole Flax, who's a very central figure.

Well, it turns out, a little more time, Nikole Flax doesn't appear to have lost any e-mails. One of the other custodians turned out to have his hard drive crash in February 2014, well after any of this was relevant. And it wasn't clear at that point, of the other five, whether any of them had lost e-mails. You can have a hard drive crash without losing e-mails.

Now then, I get asked a lot of questions at the last hearing -- well, is it five, 10? Tom Kane says it could be as many as 18 or 19. You know, what's the answer? Well, the answer is we don't know the answer, because, in fact, we told the inspector general we won't pursue it. But we don't know the answer and didn't know the answer at the time because we hadn't completed the work.

So whether we're delaying it for the IG or any other purpose -- had we, in April, said, "Well, now we have determined that there was a hard drive crash that affected e-mails, but we don't know how many e-mails there are," we would've had a hearing the next day, and people would've been cross-examined: "How many were lost? What's going on?"

And the assumption, even having told them, that we have found 24,000 -- rarely does that show up anywhere. The discussion is that all the e-mails disappeared.

And then in the context of that, it's as if we were somehow hiding this, and keeping it a secret until the end. I've tried to be careful and not blame anybody or throw them under the bus, but I have stated more clearly each time -- to no avail -- the committee ignores the issue, and it hasn't gotten very far otherwise, either.

All of the e-mails we're talking about, with regard to Lois's hard drive crash or lost e-mails, have been provided in the ordinary course of the production. So if the investigators, across the board, had read the documents they've been insisting we provide, they would've known about the hard drive crash about the same time we did.

So last fall, there are e-mails from Lois saying, "I had a problem with my computer, and I'm sorry, but I've lost e-mails." In April we provided the taxwriters -- I went back and asked people to check -- the e-mail train about -- a trail about IT trying to fix the hard drive, and Criminal Investigations saying, "We can't fix it. We can't get any of the e-mails off that." Taxwriters had that in April. The Oversight Committee had that the first week of May.

So the idea that nobody knew any of this until we got forced to put out a report in June isn't consistent with the facts. We weren't hiding. If we're hiding it, we would've gone through and not produced those e-mails in the ordinary course.

So the goal was -- we started it primarily to explain what the goal was -- to produce the report with the last Lois Lerner e-mails, which we effectively got done by mid- to late June, which we ultimately did for the taxwriters -- to explain why it took so long to produce those e-mails.

So the first four pages or five pages of that report are the description of how the production process works and why it's so arcane. It's not, you push a button and you get anybody's e-mail. You go to each hard drive, and each computer, and BlackBerrys, and you pull all this stuff together, put it into a search engine -- you're talking about large volumes.

And it's a clear description of exactly what happened with Lois Lerner e-mails, and how many we've been able to find, and what the situation was, in terms of the attempts to restore it.

Even having that full description out there, it hasn't kept the issue from going off in a lot of different directions. But as I say, when the Ways and Means Committee, on a Monday, gets told, "We've got six or seven custodians we just, over this weekend, have discovered had a problem," and the next morning, it's -- people have leapt to the wrong conclusion -- it does tell you -- and again, the same press releases about Tom Kane -- that it's a little inconsistent to say, "Well, you know, if we got the information, it would help. It would move things along."

But my view is, I'm a big believer in transparency. I thought at the time, the most transparent thing was to say, "Here's the whole picture. Here's how our process works. Here's what we discovered about Lois Lerner. Here's all the e-mails we know we have, and here's, therefore, what we don't know we don't have."

As I say, (a) they had the e-mails themselves. If they wanted, they would've found that out if they'd been reading the documents; (b) it's not clear what difference it made whether you knew it at the end of April or the first part of June, in terms of, this is all what went on three years ago. Nothing has changed. You know, no documents have disappeared -- or hidden or anything else.

So the implication that, somehow, if people would either read the documents to know or we had told them in mid- to late April, that would've been important -- it's not quite clear what would've been different.

The hearings would've come earlier. The hearings would've been less factual in terms of what we know. But in terms of the investigative process, it's not clear to me it made any difference.

So the next time I testify, I'm probably going to say, "If you read the documents we provided, you would've known," because I've tried to say it every other way, and they have a great way of just ignoring it thus far. And so I do think -- and I say that only not to be defensive, because if we had to do it over again, I'd do it the same way, because I do think it was important to get as much of the information together as we could.

But I say it because I don't want people to -- the implication has been that somehow, all of this was hidden -- that we were not producing the information that we were trying to -- I loved, at the last hearing, Congressman [Jim] Jordan's [R-Ohio] point: "Well, if they hadn't sent us a letter on June 9 asking for the Lois Lerner e-mail for Justice, we never would've put the report out at all."

And as I told him, clearly he doesn't understand how a big-organization bureaucracy works. The idea that we could produce that report in four days -- we can't get a response to a senator in four days.

And so, you know, that story line is, it seems to me, incorrect, and not the way we've approached this. We have produced this stuff as fast as we can. We've been hoping to -- there's been [as many] hearings as anybody wants to hold. We've encouraged the inspector general -- one of the reasons I've told him that we would honor his request to be a priority is so that it wouldn't look as if we were interfering with it.

In fact, I got asked early on in my tenure, what kind of investigation was I going to run? What had I found out? And I said, well, first -- because the investigations are ongoing -- I don't want to look like I'm out there trying to get people to line up their stories or whatever; make sure they'd say the right thing.

Secondly, with six investigations going on, they've got more people investigating this than I have the capacity to turn around, in the sense of all the other work we're going to do.

So my view from the start has been, I'm delighted to see whatever they produce. I am anxious for somebody to write a report, say what they think the facts were, what their findings are, and what their recommendations are, because we've taken the IG's recommendation.

And if somebody else has got a good idea, we're happy to have it, because, in fact, people do need to be comfortable that they're going to get treated fairly. And if there's a problem in the process, we'll find out about it and fix it.

TA: You said a couple times in congressional testimony earlier this summer that Lerner's hard drive crashed, that attempts were made to recover the data, that those attempts failed, and the data was deemed unrecoverable. This was at the time, of course.

Koskinen: Right.

TA: You've since amended that testimony. We now know that TIGTA and others are still trying to get the data back.

Koskinen: All right. Well, I haven't amended the testimony in the sense that TIGTA -- as far as we knew then and still know, there's no dispute about whether the hard drive at that time -- a determination was made that you could recover or not recover those e-mails. TIGTA's looking at backup tapes to see if any of them have any information from that time that would be e-mails.

But nobody said, and nobody has -- I mean, there've been people saying, "Well, if we had the hard drive, we could send it to a wizard somewhere, and they would actually be able to get e-mails off of it," which may or may not be true. CI guys are pretty good at this.

But there's been no dispute that the hard drive, at that time, was deemed unrecoverable, the e-mails unrecoverable -- and that it was recycled in the normal course and doesn't exist anymore.

TA: So I stand corrected, as far as that goes, and I appreciate the clarification. But the thing is, even to me -- and I've been -- and to some of our other reporters, and we've been covering this, as you know, kind of like paint -- it is hard to get the story straight, and to get a consistent answer, to get a consistent story on what happened to the hard drives and to Lerner's e-mail.

Why has it proved so hard for the IRS to get out a straight and consistent story on what happened here?

Koskinen: Well, I think our story has been straight and consistent. The problem is that anytime anybody has any piece of information that might take you down a different track, people say, "Aha" -- as you started -- in effect, you know, reflecting what some on the last hearing would say were inconsistencies. They'd say, "Well, OK, if, in effect, all the information anybody has right now is that" -- and nobody has contradicted the fact that the hard drive was reviewed, extraordinary steps were taken by the IRS, which normally doesn't ask the [Criminal Investigation division] to take a look at every hard drive -- and that the hard drive has been, as a result, recycled.

Now people keep raising in the background, "Well, maybe it isn't recycled yet. You have the CD. You have the ID number. Maybe we should look around, and, you know, maybe you stuck it in the trash somewhere" -- who knows what else. But nobody has -- so, you know, it's always possible. Who knows? Anything is possible, to some extent. But there's been no indication of any evidence that the hard drive exists.

The next question is about backup tapes. So our people looked, I'm told -- because that's why we wrote the report -- went back and -- because when we were looking for her e-mails, people looked everywhere, you know. Congressman [Darrell E.] Issa [R-Calif.], said, "Well, you were looking under cookie jars." Am I responsible? We looked under every cookie jar we could imagine to find the materials.

So our people look and say, the process is, you save the tapes for six months, and then you recycle them and keep using them. One question I got at the previous hearing was, you know, at some point, they wear out. And I said, "That's right, and you throw them out."

And that's all the information we had -- that they were recycled. There were no other -- people looked, and they couldn't find any.

The IG comes in -- actually, it's interesting -- he tells the committee and us that he's going to take a look at these tapes. They found some that were used at that time and then had been reused. Most of them were used. Some of them may not have been. So he tells the committee, and he tells us -- and he asks, you know, to not make anything out of this until they know more -- and also, because they're doing the investigation, and, you know, if something interesting turns out, they'd like to be able to talk to witnesses without there being a big issue.

So the committee manages to get that out. And what do we know? We know the IG has found -- got some tapes. And they're going to go look and see if there's any information on them. It may turn out that there is no information on them, because, in fact, they were recycled or they're from the wrong database. I don't know which tapes they've got. I told the IG in response to our discussion that I wasn't going to go out now and try to figure out who gave them to him, or where they found them, or why we didn't find them earlier, because at this point, nobody knows whether there's any utility in them at all.

My position has been, if you find any Lois Lerner e-mails, it would be terrific, because what makes the story interesting now is, while people have looked at 24,000 of them and haven't seemed to find anything interesting, it's the ones that aren't there that always potentially could be more interesting. So if they could find every Lois Lerner e-mail, it would be spectacular, because I think they'd look just like the 24,000.

But at this point, on the straight story, the straight story is, nobody has found a backup tape that has any information on it that we know. The fact that now somebody else, independently -- which we support, and it's -- I told the IG from the start when he called me and told me he'd been asked by Congress to do this, I said, "Terrific." So I explained to Congressman Issa, he's not my IG. He works through the Treasury Department -- Inspector General for Tax Administration. I said, "Great." And I said, "And we'll stay out of your way as you do it."

So the fact that he's now looking at some tapes is not inconsistent with the fact that the tapes were recycled and there's no information. If it turns out, however he got whatever information he's going to get off whatever tapes he has -- as I say, if he gets more e-mails, that would be great. But at the time, as Tom Kane said -- in charge of production -- people looked for them. Nobody could find anything that looked like a tape that was relevant. And it may turn out that they were right.

So right now, what we've got is the possibility that some tape out of the thousands of them we've got turns out to have something on it -- which would be great, as I say. But that's just a possibility, and nobody -- IG has not said that he's got tapes, and he's not going to find information.

So part of the problem is -- it's part of the problem of -- goes back to, why did I want to do a complete report on custodians? The more information we have about this process, the fewer uncertainties there are that we can't answer -- because people always say, "Well, why don't you know?" And the answer is, "Well, if I just told the front end of the story, and I don't know the back end, I don't know, because I haven't had any time to look at it."

I'd like to know more about the custodian. That's why I asked in May for people to look at it, to find out, OK, how many custodians had a hard drive crash? What was the impact on any of it? And then people would know what it means as we go.

So it's part of the problem of -- back to your straight story -- I think we've had a consistent straight story, but part of the problem of that story unfolding in the middle of a set of kind of contentious hearings is that you can -- the water gets muddy. And if people want to continue to reach the conclusion that, well, you're not being forthcoming, it's taking too long, you're stonewalling -- if you say that often enough, you know, people will say, "Well, that must be right. Otherwise, why do they keep saying it?"

So it's -- again, it's my point about they had the e-mails all along. You know, if you keep saying, "Well, you didn't tell us for two months. You didn't tell the Justice Department for two months," as if you were somehow hiding it and hoping nobody would know about it, that's not the story. That's not what happened, and that's not the way it unfolded. So --

TA: Well, I think that Lois Lerner's hard drives and e-mails are actually a window into what is perceived, at least, as a wider problem, which goes back to the beginning of this whole controversy in May of last year.

Koskinen: Right, right.

TA: Well, that's when it broke out into the open -- is that the whole story keeps coming out in pieces, in little dribs and drabs, to use that phrase we heard at the last hearing.

Koskinen: Right. I might've said that.

TA: And that as a result, you have these pieces strewn all over the table, like a giant jigsaw puzzle, and then it's getting left to other people to put it together, where the people who threw the pieces out in the first place -- the IRS, in this case -- is standing back, saying, "Well, you know, put it together."

I mean, is part of the problem the fact that the IRS doesn't have its own narrative on this? And I'm not just talking about Lois Lerner's hard drive.

Koskinen: I think, yeah, the issue is -- I mean, the Lois Lerner hard drive crash -- first, the crash is an important issue.

TA: Yes.

Koskinen: I mean, as I've said, I've been around Washington long enough to know -- and even if you're not in Washington -- if you're running a review in an investigation, and it turns out some of the information isn't available, everybody goes back to Nixon and Watergate. Everybody says, "OK, what's missing? What could it have said? What would it have looked like?" And I have never said people were looking at the wrong -- at an unimportant issue. We've given all the information we have about it, in a straightforward story.

But part of it, you know, is -- your point about the pieces -- is, first of all -- and I understand the congressional view well. It's been 14 months now, and we're still -- we're running out of stuff to produce, but we're still producing evidence. But, you know, then the only reason I keep mentioning 960,000 pages and 770,000 is, it's not as if there hasn't been a lot of information, and it's not as if we can produce it overnight.

So one of the reasons I've said yeah, we need -- and it would be great to have -- an e-mail system of record that actually allowed you to easily search and easily retain documents, is we should be able to do this without spending $18 million. We ought to be able to push a button or two and be able to say, "You tell me the e-mails you want, and within a reasonable period of time, I can get them to you." Taxwriters, we could give it to immediately; others, I've got to sanitize and take out the [section] 6103 information.

So we're captured by that archaic system, which means it comes out in pieces like this.

But then you have a multifaceted story. You know, our story at the front end was (a) improper criteria reviews. Nobody's disagreed with the IG's report. We took the IG's investigation. The claims that this is a conspiracy between the White House and the IRS, Treasury and the White House, Justice and the White House, are not claims that we've had. Our consistent narrative has been, we have no evidence that anybody outside the IRS was influencing things.

So then piecemeal of a story comes out -- well, Treasury produces e-mails, and it turns out it doesn't look like there's much there. White House says they don't have any e-mails. Justice produces information, and it has some relevance to earlier times, when they asked for public information. And so the pieces come out because those are in response -- mostly knocking down premises that were put out to begin with.

And so we've moved from -- part of what's happened -- so now there's still some generic discussion: "Well, it must've been orchestrated, even if no other reason than in response to the fact that the president didn't like Citizens United."

So we move away from that, and then we get into, OK, so it's Lois Lerner. And now we've got a hard drive crash and e-mails missing. So the story's "Well, she must've destroyed them."

So the new story line is, she destroyed them -- not totally consistent with somebody who (a) when you look at 24,000 e-mails, don't indicate that there's somebody destroying them but somebody who kept writing e-mails. You know, if she were really good at it, she would've not written all 43,000 of them, and they wouldn't contain the information in them that the committees have been using to say, "See, Lois was involved in all of this," as we go forward.

So now, we've shifted there. And then the great thing about April and June -- the reason I'm going to be even more straightforward about the fact that they've had this is, well, and then, somehow, the IRS has been -- the claim was that we slow-rolled them from last June, and now it's still clear that, you know, you're not revealing the information.

So I take the frustration point, but my point is we've had a pretty consistent story the whole time. What you've got is all the other claims that keep being made that then get knocked down, and then we move to the next claim and the next issue.

And I will not be surprised, but I'm open to -- because I'm not doing the investigation -- I will not be surprised if people will determine that actually, the hard drive did crash -- that the fact that they tried to restore it -- nobody -- in the interview with the Criminal Investigation guy -- I'm not seeing his testimony, but I'm confident if he said they didn't really try to restore them -- or it looked like Lois had tried to, you know, destroy the hard drive, any indication that that had been said, it would've been in the press release the next morning.

So thus far, the questions they've asked seem to have been consistent with, they tried to restore the hard drive, and they tried to get the e-mails back.

So it's not going to surprise me to find out that when you get done with it all -- it would be great if they found more e-mails -- there's not going to be any evidence that anybody tried three years ago to destroy anything.

Now, when that turns out to be true, it will be like there's nothing to show the White House was involved, we'll move on. You know, the committee is very quick and they'll go to something else. They won't concede error. They'll say it was worth pursuing, which it is whether it was worth making a federal case out of it or not is another issue.

But then it gets to your point, "Well, gee, we somehow seem to be having all of these discussions. Why couldn't we do it all at once?" And the answer is, you know, we're producing the documents. We're trying to chase the story down as much as we can, but we've actually, when the dust settles -- it will sooner or later, probably later -- I'm reasonably comfortable with what I know now and what I've seen, is that this story will in fact, from the IRS, the story will be true, that inappropriate criteria were used. We solved that problem. We produced all of these e-mails. It's taken us far too long because of the system, but when you get done with them all, we're not going to find that there was a conspiracy because there doesn't seem to have been a conspiracy.

Lois's hard drive, there were over 300 of them. That spring, 5,000 concerns about hardware that we don't know how many of those were hard drives, that some of the custodians probably lost some e-mails. I don't know. But probably a lot of them didn't. And that that didn't have much impact on this and nobody lost them purposely.

And so it's going to be like a lot of things. The core issue is an important issue. People ought to be treated fairly. The chase down a lot of different rabbit holes is going to turn out to be nonproductive. But when we get done with it all, my concern is the reference point won't be back to "Well, see the IRS people were right and they produced all the documents and nothing was wrong," will be your point.

Well, there were all these things we could never quite get a straight story, to some extent because there are some people who don't want a straight story. They don't want this to end.

You know, the idea in some ways of whether there ought to be a special prosecutor, you know, I'm not sure if people really want a special prosecutor, because that would shut everything down. The special prosecutor then would have sole domain over this and so you wouldn't be holding all these fun hearings every week or two.

So I think it's an important question, but I do think the IRS has had a consistent story, which is (a) we're going to give you all the material we can as fast as we can, and we've been doing that and produced volumes of it. And the response to that is well, don't keep telling me how much volume's produced, you know, what about Lois's hard drive. But the volumes are not irrelevant. Up until about three or four months ago, the question was, there wasn't enough volume. And so that's again the issue. We're kind of going like this, but the train is going down the track on a fairly straight track.

TA: What percentage of your time so far, recognizing you only started in December, has been devoted to cleanup of this controversy?

Koskinen: So I've had 10 hearings that take most of the day. It takes a while to prepare for those hearings. I get updates about how we're doing. So what have I got? Seven months, five days a week, 20 a month, 140 days, I got 10 days, 20 days -- 15 percent? Fifteen to 20. It's probably 20 percent of my time.

TA: The IRS recently approved a new Form 1023-EZ to speed small charities through the application process for tax-exempt status. There's been a lot of criticism on this process and an alleged lack of follow-up procedures to verify these new tax exempts are following the rules. Is it setting up the IRS for problems in the future? Why are the critics wrong?

Koskinen: Wrong for several reasons. First of all, the present process and the resource constraints have set us up for an existing problem. We don't have to go to the future. Our existing problem is, it takes these organizations of any size, and certainly small ones, up to a year, over a year, to get approved. And I was concerned when I started and discovered we had a backlog of over 60,000. I was surprised that hadn't become a bigger issue, because that is a big problem.

It's unfair to people who actually want to get through the process. It puts a lot of pressure on people. When they finally get the application -- we get 60,000 a year -- then the question is, how much time are we spending? Are we actually going through them quickly to try and get the backlog down so that we're doing bigger organizations quickly as well? So it's unfair to people to begin with.

Secondly, it's our process of saying, even if you're going to have a small PTA or somebody, we're going to give you the same fun-filled examination that Bill Gates has when he puts up his -- it doesn't make any sense. The risk to the public is much greater, and larger organizations are going to be much more complicated and allegedly doing more. And the benefit to the public is deprived by people not being able to get running and do things.

That seems to me on balance is the wrong balance, if you can do it well. So the question is then, OK, well, you're going to, instead of a 26-page form, you got a three-page form. That can't be good. And so what we're doing is, we've spent a lot of time designing that form to make sure we collect the information that we need.

It will be for the first time, digital, online, so we can actually screen the applications and the answers, to pick up ones that we want to take a look at before we give approval to because we'll know which answers are inconsistent, which ones raise questions, even though they answer them or are supposed to answer them in a way that allows you to get through without more review. So that we will have, for the first time, these applications as opposed to the old forms, we'll be electronic and we'll be able to screen them and analyze, as I say, of the 60,000, probably 45,000 are small. We'll have a lot more control over the 45,000, by simply being able to screen them.

The second thing we're going to do, because in some ways it's a pilot project, is we're going to take a statistical sampling of the applications and put them through the more rigorous process, to see if they've answered the questions correctly, or whether they've, in fact, if they'd gone through the 26-page questionnaire, would have been not qualified, whereas that looks like they're qualified. So we'll actually do -- I don't know how many hundred we'll do, but we'll take a reasonable number of them at the front end and just put them through the process and see how accurate is the short form.

We also are going to spend -- take another statistical sample, once they're out a year, and go out and audit how they're doing and what are they doing. So they won't be the same people we know are doing the right thing, because we've put them through the 26-page. There will be another set of people who we say, OK, this is what they said they were going to do. They filled out this form. What are they actually doing? And we'll actually spend more time finding out what they're actually doing than we do for a lot of them. You know, we have a million, six hundred thousand, 501(c) organizations out there up and running.

And so part of the theory is that (a) we'll be much more efficient at the front end with the 80 percent of applications that are small, and be able to screen them out more effectively than we have, and we're going to actually look at them at the front end and look at them a year later, and adjust accordingly. If it turns out, you know, there've been suggestions of -- well, we should ask them to give us more detail about what they're going to do so if they have to write it down, you could surface it more, and that may or may not turn out to be true.

And there are issues of, you know, originally we were -- the original design that came through was to be at $200,000 of estimated revenues, and we dropped it to $50,000 because people had been concerned and $200,000 did seem bigger than $50,000. And the idea was, when we analyzed it, we didn't lose -- there aren't that many organizations in the 50 to 200 [range], so putting them back in the 26-page thing isn't going to affect that many.

The bulk of the organizations are small ones. What happens with small ones is revealed. You know, the Congress passed a law that said if you didn't file a [Form] 990 for three years, it got revoked. So we revoked 550,000. And 46,000 asked for reinstatement. So that means that what happens with the bulk of these -- well, we're down to a million six, we used to have two million. The bulk of what happens with these people, not surprisingly, is they start up and they are running whatever they're doing and they don't get a lot of funding or somebody decides to move and they just go away. And in fact, one of the advantages of that program -- and then we got to streamline a way of getting people back in if they want to -- has been, part of the problem, I've discovered, with the risk and the problem we have now, is that because it takes so long and costs so much, there's a gray market in old 501(c)(3)s.

So the easiest thing to do is go find somebody else's 501(c)(3) they're not using, or even if they are, kind of take over, and turn it into your 501(c)(3), and it may have been a local whatever and you could turn it into something that's doing healthcare research or whatever it might be, and you're qualified, until we go out and audit and find out that you're not the same group.

But with all our resources historically at the front end, we haven't done as much at the back end as we should. And obviously we're constrained by resources like everybody else. We've lost 15 percent of the people in this organization on top of it all. So I think when you get done with it, as I say, we're looking for the risks in trying to make sure that there is a problem that we'll know. We're also monitoring volume. You know, the theory was we're going to go over everybody and his uncle who is now going to be a 501(c)(3). Thus far, the pace of applications is consistently the pace in the past. We've seen no uptick. But we're monitoring that as well. But say, OK, are we now getting a lot more -- suddenly everybody's becoming more charitable, and they've got new organizations or not. And so we'll find that.

But the net result is that there will be less risk to the public, that people are getting the benefit of tax exemption and contributions for what they're doing because we will spend -- have more resources available. We'll be better at the front end, but we'll have more resources available to check on people at the back end and see are you doing what you said you were going to do. Are you still doing the right thing? Now we'll know.

One of the things we're working on is how we can make better use of the 990s, which are, you know, self-reporting, but they give you some indication of where you are. But the real answer is you need to go out and write people notes and say hey, what are you up to, what are you doing, what's going on? So I think the net result is we'll have less risk to the public by better using our resources.

TA: You've got some big-time losses at Large Business and International. And overall, there's been a great deal of turnover in the senior ranks, partly as a result of the EO controversy and just in general, the problems that the IRS is having with budget. And there's been constant talk in the tax community about the IRS's potential for brain drain, exacerbated by retirements, potential retirements. Put all that together and I'm wondering what kind of incentives you're using or hope to use in the future to bring in the kind of talent both at the bottom that can be developed up, and at the top that you need to manage these large organizations. For example, should Congress renew or extend the critical pay program?

Koskinen: Start with that. Streamlined critical pay is a critical program. It only affects I think the maximum is 40 people, but the 40 people -- and we've never used 40, I think we're at 26 or 28 -- but they are critical. They are the people that run our IT. They're very interesting, great modelers, economic statisticians. They are the people who would -- it's not as if they're getting paid a fortune.

But two things about it, is (a) you can hire them directly, and (b) you can pay them above what the normal pay is, but it's, you know, it's not a million dollars. It's not $300,000. And if it expired and it hasn't been renewed, if it doesn't get renewed, we're going to lose those people, and I think it's going to be hard to replace them.

These are people who come from major consulting firms, major -- we hired our IT guy, Terry Mulholland, from Boeing as the director of IT there. So it's a small pool but it's a critical pool. And I am concerned about that.

In terms of the broader issue of how do we recruit -- to some extent it's a tribute to the dedication of employees to the mission -- is I go around seeing people. All federal agencies, a lot of companies, but all federal agencies have a demographic they've worried about for the last 20 years, which is the brain drain of people retiring. We have a slightly higher percentage than most people, that people have stayed here, made their careers here more often. So we're in the, we think we're getting in a couple of years, we're going to have over a third or about a third of the people eligible to retire. And we have, at this point, I've discovered, in terms of total employees, we have about 5,000 under age 30, only 2,000 of which are permanent.

So we have 5 or 6 percent of the workforce -- the average in the industry is 20 percent. So we have challenges at the entry level and at the top level. At the entry level, we have the same issue in some ways as Freddie Mac, is we're obviously recruiting people, although we're not recruiting many. We're replacing one in every five, so we are shrinking before your very eyes.

So that creates a set of problems of compression and what happens to promotion opportunities and all the rest of it. So sad is that we have a huge turnover in people under 30 because we're not hiring that many. But when we're hiring them, we're obviously not keeping them at the rate that we would like.

Part of that is because our technology is so abysmal. You take people, young people coming in at 23, 25, 27, and they're used to, especially if they're the kind of people you're trying to hire. They're used to stuff that works. You know, they're at the high end and they Twitter and they do all of that stuff. When you come into an organization still moving people onto Windows 7 from Windows XP, that's not exactly a cutting-edge technological group.

Now, on the other hand, we've proved technological, technology people because we are doing great things. We don't have enough resources, and we're way behind what we'd like to do. But, you know, the apps we're doing -- Where's My Refund, Get Transcript, and that -- so we're pushing various state-of-the-art stuff, which is why I refer to our IT as a Model T with a great GPS and wonderful sound system. And then Terry Mulholland tells me, and they got to tell me, we rebuilt the engine, but it's still a Model T.

And so that's some extent, so we've got some state-of-the-art apps and, you know, really ancient -- you know the average age of our IT equipment is 15 years. So we have to be the only serious large organization of a financial institution running with average equipment age of 15 years. So our computers are too old, our servers are too old. You know, we still got stuff in COBOL programming.

So that's the problem at the front end. The problem overall is that if we don't have promotion opportunities, it looks like we're kind of not going anywhere, and the next group we worry about is the five- to 15-year people who are in five to 10 years the people who are the next level of leadership. And they're all people much more likely and akin to move, because they don't have the same ethos people did 20 to 30 years ago. I'm going to go work for this organization; I'm making my career here. So if you're 35 to 45 and you're in the middle of your career and it looks like (a) this group's never going to get resources, (b) it continues to get beat about the head and shoulders, (c) I don't have a lot of promotion opportunities, (d) they're not training me for anything, it's pretty easy to figure out, maybe I'll find something better as the economy gets better.

So what do we do about all that? One of the things we're going to do is we're going to invest in the workforce. You heard I've taken some heat. Well, you know, we're out of money. Why are we training people? Why do we have people -- managers -- traveling to see the people they manage? Why did I agree with the union to in fact pay performance awards? You would think I had paid people, you know -- the total is, I don't know, 40 or 50 million dollars. We have 90,000 employees. The average award is 900 to twelve hundred bucks, and not everybody gets it. Two-thirds of the people get them and one-third didn't, and done by performance. So it's not as if everybody is getting rich. But if you don't give pay raises, as we didn't for a while, and then you start telling people we're not going to give any performance awards and we're not going to train you, you're not going to actually (a) have a workforce up to the task and (b) you're not going to be very attractive.

So we need to have people understand, to the extent we can, when we hire you, we're going to train you, so you're going to learn stuff and it will be a valuable credential. In the old days, people -- accounting firms used to send their people to the IRS to work for two or three years because the training was so good. Then some of them left, some of them stayed. And I'm happy to get back into that position, where we're training. And if we're training people to go work somewhere else, more power to them and us.

But, so we've got to train them, we've got to give them resources to support it, and we've got to design the work in a way that it's manageable. Part of my concern is that this is a can-do agency that never says it can't do anything, and so you stress people out to the extent that we've got 10,000 fewer people and more work.

So by definition, you can become efficient, and we become more efficient. But at some point you're asking people to do more and more, and there are 24 hours in the day. And if you've got a group that believe in the mission, want to provide good taxpayer service, get unhappy if money is left on the table we should be collecting, they're going to do the best they can, and as much as they can. And at some point, they're going to feel constrained.

I had a meeting yesterday, because I'm big on training. One of our problems in training is people are so committed to get the work done, they don't have time to get trained. And their managers are worried that if they send somebody to training, nobody's answering that phone for that day. So it all goes back to part of the problem with this agency is it's never said we can't do it.

You know, you give us the Affordable Care Act, give us 7 million more taxpayers, and nobody thus far has said, oh we can't do that. Instead, we've said even with less resources, that's OK, we'll get it done. And the way we've done that is creating all these problems, hollowing out the organization, ultimately running a risk that at some point, you're not going to be functional.

So my view is, the reason I keep pushing the Congress, I tell people, we'll play the hand we're dealt. But I want you to know what you're going to get for what you pay, and I want you to know what you're not going to get if you're not paying for it. And I want -- because I don't want a year or two from now, or even next year, at filing season, when we aren't able to do things, I don't want people to say, well, it must be because you forgot about it or you're incompetent. I want them to understand, we told you that that would be the result if you gave us these resources.

So the best example I would say is give us the budget we're talking about and taxpayer service on the phones will be at 80 percent. Keep us at the level we are, let alone cut us, and taxpayer services, with increased calls from the Affordable Care Act, will be in the low fifties -- 53 percent is the last estimate, and almost half the people won't get through. Now, that's not because employees don't care about it.

People who care most about it are our employees who actually work in those call centers, because they get satisfaction out of helping people, and that makes them unhappy when people have to wait half an hour to get on the phone, and then when they have to tell them I can't answer that question -- I know the answer but I can't because it takes too long because I have to move people through the queue.

So anyway, I'm -- it's you or somebody noted, every time you hear from me, it's talking about the impact of the cuts. But it's partially because the Congress has never had to take responsibility for the ramifications of cuts. They -- because we keep showing up, running filing season, and the place looks like it's running; it's just corroding underneath. And my view is if we have enough momentum and we have good enough people that I could probably get through my term without paying too much more attention to it, but you would have a shell, and whoever is next in line would look at it and say, "Wow, people have retired, we don't have new people in, we haven't trained the workforce appropriately. The IT looks crummy. We've run filing season every year, but this place is about to collapse," and my view is, no reason I should do that.

TA: This spring you finished the tour of the top IRS workplaces around the country, and you've also been outspoken about your championing of frontline IRS workers, trying to restore their morale. What was the biggest negative comment that you heard across the IRS workforce, and how do you plan to address it?

Koskinen: Interestingly enough, you would have thought with no pay raises, shutdowns, furloughs, and I expected you'd get a lot of complaints. The common theme -- and it still is true at these places -- is not that they're overworked, although they clearly are; the common theme is they don't have enough people for them to do the work that they want to get done. And I heard it first -- I started in Cincinnati and then I was in Baltimore in a call center -- and the consistent concern is not complaints, it's concern -- and they wanted me to know -- was that we weren't providing taxpayers the services our employees wanted to provide them because we didn't have enough people.

I was in LA, San Diego, Laguna Niguel, last week after I talked to the Tax Forum, and a lot of those are LB&I examiners, revenue officers, and agents. The common theme was that there aren't enough agents to go after the returns where we know where the money is. And what we're trying to do, they said, the concern is we know the cases. And so managers and people are trying to figure out OK, how many more cases can you do? There's like 4,500 fewer agents, revenue agents, than we used to have.

So the complaint wasn't gee, we're overworked. The complaint was if we had more people, we would actually be able to collect all that money. And without people, we're just not going to get to it. And the only way we can deal with it is we're closing cases, and the risk is we're just closing cases because that's symmetric because we can't measure how much money they collect. So you can measure by how many cases they close. So their concern is they're going to close cases without actually collecting all the revenue they could because they're just under pressure again in a can-do agency to close cases.

And across the board it's fascinating to me. I think I was telling you -- I can't remember who I've been telling all this to -- about IT help desks where we don't have enough people. And the net result is we have employees at their computers for two hours or two days waiting for the help desk to come, where we used to have 15 in one of the offices. Now we've got eight. So we've got fewer people, but not that many fewer people.

And so the way I plan to address that is that we're at this point not getting more people because even the Senate mark, if we got the Senate mark, would allow us to sustain ourselves where we are because it's $250 million more than this year's budget, and the information we provided them is it will take $225 million to pay the additional FERS, and retirement benefits and inflationary costs. So we'll stay even with the Senate budget. After what the House did on the floor, whether we'll get anything like the Senate budget or even our present budget remains to be seen.

So we're not going to be able to hire a lot more people, so what we're going to do is be for the first time much more rigorous about what we can do and what we can't do. And I've told people we're no longer going to pretend that we can be all things to all people, no matter how limited the resources.

So we're going to have to take a harder look at how many enforcement cases and compliance cases we take. We're going to have to -- there's nothing we can do about taxpayer service. It's going to be abysmal again. We can spend a lot of time -- and Terry and I have talked about it, so we're going to have a full-court press trying to educate the entire world about Affordable Care and how to fill out the forms.

And with the tax forms we're doing -- that and we're going to try and get as many people onto the website as we can, and we're going to get the apps. Our online installment agreement will be such that we will tell you when you call, go to the website. We won't give you transcripts anymore on the phone. Go to the website.

So we're going to move as much as we can to the website and the apps that we've been developing, and that'll help. This year actually the call volume went down, mostly I think because we didn't have any tax law changes, so everybody kind of knew what it was. We're going to have tax extenders on top of it all.

So anyway, as I say, we'll play the hand we're dealt, but part of the way to deal with the morale is that we're going to train people so they feel comfortable and they know what they're doing. New people will get trained. So I'm going to get yelled at: "Gee, if you're out of money, why are you spending all this money on training?" And the answer is if we don't train them, it's not going to be a good result for the taxpayer or the government.

So we're going to train people. Our managers are going to manage their people. We'll do the Affordable Care Act and we'll do FATCA because they're statutory mandates. And we're basically then going to say this is what taxpayer service looks like, and this is what enforcement and compliance looks like. And we'll continue to delay some IT issues.

So I got asked, "Well, gee, for $10 million to $30 million two years ago somebody could have built a new IT system, e-mail system, and that would have been great." And the answer is right, but two years ago look at all the other things that were required. This year there's $300 million of critical IT stuff to be done that's not being done because that's the amount of money we asked for IT for Affordable Care and we got zero. So we moved $300 million out of IT into Affordable Care, and we're going to pull it off. It's a high-wire act. It's a great accomplishment to be able -- you know, the front end didn't go so well. If the back end of it goes well, it'll be a testimony to this agency.

Anyway, so that's what we're going to do. We're going to make it -- my sense is how people feel, it's still a great place to work, if not even a better place to work; that we are investing in the workforce; that we value them; and that we're going to do whatever we can to get them the resources they need to do the job well and to do a job that's manageable.

TA: What is the IRS challenge the least talked about by the media? And besides trying to get the media to talk about it, what are you doing to address it?

Koskinen: Well, you know, I've been on a one-man crusade for six or seven months talking about resources and boring everybody who had to listen to it. But it's a change. The IRS has never done that before.

TA: But the media is talking about it.

Koskinen: And the media is talking about it, so as I say, I've been on that and so I've been successful. Not successful at getting the money, but at least successful that people know it's an issue.

TA: What am I not writing about that's --

Koskinen: I think probably what you're not writing about is the point we discussed earlier about the workforce challenges and what this workforce looks like five to 10 years out. It's related to the budget issue, but even if you have the funding, you still need to address how do I get young people in here? How do I get people in midcareer to have promotion opportunities and then develop opportunities?

And the biggest issue with the brain drain is how do I capture that information as part of the stuff that Mike Danilack [former LB&I deputy commissioner (international) and U.S. competent authority] was doing that we're now going to try and do more of, which is instead of having everybody have the knowledge in their heads, try and figure out how do I kind of create learning centers where people share information, like this is the way I handle these cases.

And we do that with training and that, but to the extent you can have a place you could go that gave you more background information. And part of the reason people love to get together is they share stories about revenue, and this is how I did that or this is how we do this.

So they've set that kind of learning areas up, practice areas, and the goal would be to try to do more of that. And that's modestly a resource issue; it's more a management issue, a structural issue of saying as you get to be older, besides being a mentor to younger people, and throughout your career, how do we capture the best practices? And employees have asked me that question. In probably five or eight of the cities I've gone to they've talked about, worrying about people leaving because they see the experience going out the door. They're not so worried about there isn't somebody to do the work. They're worried that those people know a lot, and they know more than I do.

And so one option is OPM has the ability for a phased retirement that they haven't put into place yet, which would be a terrific way to capture some of that. Have people spend the last six months or a year of their time here developing and perfecting those learning networks, being mentors, passing on the information. If you simply run it as basically the way we've been doing it, then people retire and there goes 30 years of experience. It's hard to replace that. We've done it that way forever, but it's not great, and especially when the demographics are you've got more of those people going, so it's a bigger drain.

So I would say that that's probably -- if you ask me, it goes back to what I said about not hollowing out the organization. It's those issues that underlie -- because everybody knows about refund fraud, identity theft, and (c)(3)s, (c)(4)s, whatever it is. But it is the need to make sure you've got an efficient support process for the workforce and that you deal with it.

I was stunned -- I only learned it [when] we had at an offsite looking at strategic planning -- that of the 90,000 employees, 5,000 are under 30. And 5,000 is a lot until you think it's a very small percentage of a big organization. So we need to deal with those things, and nobody's got much time thinking about it.

TA: Well, I'm going to circle back around then while time permits to the part of the answer a couple of questions ago that you mentioned about the idea that the IRS used to welcome people in to get some training and three years out they would cycle out into the private sector.

Koskinen: Not all of them.

TA: No, not all of them, of course. But the way you described it was interesting because I had a question on here about -- and you come from something of a technology background. You've heard the phrase "it's not a bug, it's a feature." When technology people run into something that they're unfamiliar with and it has unintended consequences, sometimes they'll say, well, that's not a bug, that's a feature, turning a negative into a positive or at least a perceived positive.

And what I'm getting at here is whether the so-called revolving door -- whether at high level going into upper management or upper executive levels at tax firms, CPA firms, or down at a lower level to allow you to advance in the private sector -- whether the IRS is looking at the revolving door almost as a recruitment tool?

Koskinen: People say that of the sayings of Chairman John, one of them is every challenge is an opportunity. So it is the bug, but it is my view. ACA is a huge challenge. It's a great opportunity for us to demonstrate capacity.

So the point about the revolving door was just told to me by somebody who used to be here 30 years ago. So it's not a revolving-door concept. It is that if you are a place that's known for providing great training to new people in an area that's important -- tax accounting, tax administration -- that you will become an attractive place to go. And because people will go and say, well, I'll go and see and I'll be there two or three years, and then if it's not what I like to do or if something else comes along, it would have been a good thing to do.

It's almost like a graduate program. And in the old days, a lot of people loved what they saw and stayed. And it's a little like tuition credit programs, which we don't do anymore that I'm a big fan of, and the problem people have always said, "Well, if you give somebody support to get a college degree or a graduate degree, once they get it they're going to leave." And my position is if we can do that for people, that would be good, but having run those programs, most people who do that stay because this is the kind of organization they want to be with. It invests in their workforce. It values people.

So it'd be the same way here. If we could actually mount -- and we still have good training, but if we could become known again as a place if you go for two or three years you will really be a desirable commodity, both internally and externally, it's a great way to recruit.

TA: You don't feel that that's already the case?

Koskinen: Well, more recently we just haven't been able to hire many people. But with the training over the last two or three years, the common theme I hear from people on my tour is that when you cut training by 85 percent, you don't do that anymore. And when you cause people to say OK, I'm going to take all the training -- whatever's available is online, so if you want a five-day course, you've got to go five days and sit in front of a computer, that probably doesn't work as well.

So one of the things I want to do is return us -- and it's not to the days of 30 years ago, but days of three or four years ago when we actually were doing training. And we've done surveys. I just met with the training people yesterday. Funny you should ask. And our metrics and our organization structure are among the best in the government, so we know how to do it and we still do a reasonable amount of it considering we don't have much money for it. So I don't think that's a huge lift as long as you make it a priority. But if we do what we've done because of constraints over the last couple of years and just say, well, we just can't train anymore, we can't do it face to face, you're going to lose that. So it's not as if we have to reinvent the wheel, but it is something that I'm concerned about.

And so if I were going to say for a young person, what would get them here, I would say a couple of things. One, it's a great mission and I haven't met anybody who doesn't enjoy what they're doing, because of the importance of it. It's across the board. So it's a great place to work if you want to have the feeling you're making a difference and doing something important.

Two, if you thought you were going to get really good training. So at the end of two or three years, if you didn't like it here you could go to an accounting firm or a law firm or whatever it might be that's an attractive place to go. A lot of places you go and you think, well, I may be there two or three years, but I haven't gained much other than I know something more about how widgets are made.

And the third time is that we could give you resources, technological resources, to allow you to effectively do the job so you feel that you're empowered, then we'd be a great place to come to.

TA: I understand the appeal of it, especially under the circumstances, but does it not create a longer-term problem as far as retention is concerned? Because you get people coming in saying, "Well, I'll use the IRS for two or three years to get my training up or to get ready to advance to another job," and now you've got to go back and fill that position again?

Koskinen: To some extent you've invested two or three years, but my experience is the capture rate's pretty good, that the people will come. Mostly, in fact, because I've talked to these 15 or 20 people I have lunch with and asked how'd you get here and what'd you do. And a large percentage of them, people who have been here 15 or 20 years, say, "Well, I came and I took a job out of college. It sounded good, and they came and recruited me, and again I thought I'd get some training. And I fell in love with the place and never left."

So my thought is if you run a program not willing to have people come and learn and go, you want them all to stay so they don't have an option. I've always said if you run an organization and nobody recruits your people, you've got a problem because that means you haven't developed people anybody wants. You've neither recruited them or trained them or developed them.

So I've always said the best testimonial to a good place to work is people are forever coming in and trying to steal your people. And so I would be delighted to have young people come here for two or three years and some of them get recruited away because they were so good and the training is so good, because the more of that that happens, the more people are going to stand in line to get here. And as I say, the experience is, because it would be a great place to work, is the capture rate would be terrific.

So there'd be some turnover. There's always turnover in all organizations. Financial institutions turn over 10 percent of people a year, and that's fine because the ones that stay, the 90 percent that don't turn over, they'll [be] a great cadre of people. And that's the history. When you go around and talk to these people who've been here 15 or 20 or 25 years, they are spectacular people.

I was telling somebody earlier, my experience in organizational turnarounds is that people are never the problem. It's the structure, the leadership, the resources you're given. This is the best workforce I've ever been associated with at the front end of a start-up, and it's because there's a mission. It's public service. It's been a great place to work. They've been promoted and developed. They have options. They can work in international. They can work domestic. They can be revenue agents. When we talked to them, they all started as revenue agents or in the chief counsel's office and they've moved around. One woman put it to me, you can come here and have a lot of different careers, which is why a lot of them stay.

So I don't view it as a huge problem, I don't think at this point. But I am concerned that the last three or four years have had a negative impact on that. And if we're not careful, if I just sit around and solve all the other problems and three and a half years from now leave and we haven't dealt with this problem, then it will be a serious issue. So we're focused on it. We're going to work at the front end getting good people in here. We want people in the middle to get training and, again, capacity to develop themselves, either for promotion within or, again, some of them may say, "Gee, now I know a lot of this. If there's not a promotion here, I just got recruited by a law firm, by an accounting firm, my sense is good."

Some of them -- as you've seen the LB&I people -- some of them go out and then come back five or eight years later, which is terrific. They learned whatever they learned and they've come back. It's interesting. This is the only organization I've ever seen do that as much. The number of people who have been here for 10 or 20 years go away for five to 10 years and then come back is amazing.

And they come back because they had a great experience. And again, they believe in the mission, and it's a way to spend the last four or five or eight years of their career making a contribution. You know, Mike Danilack was that way. He was here for a long time and then was gone, came back, always thought about coming here four or five years. It was terrific. John Dalrymple, deputy commissioner of service and enforcement -- he was here 30 years or whatever, gone for seven or eight, and of course, comes with a very broadened perspective. So in fact, I told people, we need to hunt around and find out where did all those people go into the private sector, and which of those can we entice back for four or five years?

Ultimately, though, the sign of a strong organization is you develop leadership from within. And so again, it's good to have outside people, even people who came back who were kind of outside, because they ask why do we do it this way? And you want somebody to say why are we doing it that way? It's a question that should always be asked. But on the other hand, if you always have to bring people from outside, it means you have not developed a program that causes leadership to come from within.

I got an organization chart in September of last year with 30 positions, the senior people. Seventeen of them today are different. Now, that's a huge turnover.

The reason it works is the vast majority of them are people who were here and they'd been promoted from within, they filled gaps, so they know the organization. They've been in a lot of different positions. They've got a lot of energy and enthusiasm, so it's a terrific leadership team.

But I've got to tell you, in most organizations, you take the top 30 and a year later it's 17 are new, most of them can't do it from within. Most of them can't absorb that. That's a huge turnover, but for us it's worked.

Now my concern is, we've taken the bench strength, which has been terrific, and moved it up. And the question is, who's on the bench? What's the next group look like? And that's where we've got to invest.

But these aren't unique. All of these issues are what any large organization -- any organization, but certainly a large organization -- has. How do you recruit people? How do you train them? How do you promote them? How do you provide the resources, structure, and leadership they need to succeed? So it's not -- you don't have to read a fancy business book or know what makes companies great to understand the basics.


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