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The taxman's burden

April 2, 2001, 01:59 PM —  CIO — 

IN JANUARY, just three months before the internal revenue service planned to field a new call center application, its first system upgrade in a $10 billion modernization project, its CIO of almost three years, Paul Cosgrave, quit.

Not surprisingly, eyebrows were raised.

During the past 25 years, the IRS has twice tried -- and twice failed -- to modernize. In 1978, then-President Jimmy Carter halted a project to network the IRS's central databases -- its Master Files -- with its business applications, because the agency had not figured out how it would protect taxpayer privacy. In 1995, Congress in effect pulled the plug on a second effort, which involved multiple new systems, after the IRS had spent 10 years and $2 billion with, in Congress's view, very little to show for it. Now, after spending $231 million without actually deploying a single system, Cosgrave jumped ship. (See "The Revolving Door".)

Was this third modernization project on the brink of disaster?

Perhaps not.

Why can't the IRS hold on to an information chief?


Paul Cosgrave, the Internal Revenue Service's third CIO since 1990, left his job and its four-year term in January 2001 after two-and-a-half years. His departure cannot be classified as a surprise. Few federal appointees who come, as did Cosgrave, from the private sector stay around even that long. Their average tenure? Between one-and-a-half and two years, according to Paul Light, a federal personnel expert with the Washington, D.C.-based Brookings Institution. [On Feb. 27, John Reece was named as the IRS's new CIO.]

Cosgrave has told friends he was tired of commuting to Washington from his home in New York.
Former IRS CIO Paul Cosgrave: "These are not career jobs."
"These are not career jobs," he says, referring to public service posts. Now IRS Commissioner Charles Rossotti says he'd like to find someone willing to stay for three years.

Hank Philcox, the IRS's first CIO, appointed in 1990, questions whether the IRS can find anyone to stay even that long. He calls the job "a killer." Philcox left after three years for a better paying job. Arthur Gross, who replaced him, stayed only two years, leaving shortly after the current commissioner, Charles Rossotti, was appointed in 1998.

Philcox says the pressures on corporate CIOs to cut costs and keep pace with technology are magnified at an agency like the IRS with its "ancient infrastructure." And the job has plenty of other hassles. Glitches quickly become political disasters, says Philcox, who recalls a 1985 crash of return processing systems in Philadelphia. "It buried the IRS in letters and problems that took literally three years to work out of," Philcox says.

Government bureaucracy can also get the better of private sector executives used to getting things done quickly, notes Michael Murphy, executive director of the Tax Executives Institute, a lobbying

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