Recreation without taxation.

It was like a working vacation in heaven. With only a few hours devoted to the obligatory meetings, the employees got a chance to frolic on racquetball and tennis courts, test their prowess against championship golf courses, relax in a sauna, and glide on bicycles through piney glades. But these weren't just any paper-pushers relieving a little occupational stress. Enjoying this annual three-day getaway in Pennsylvania's Pocono Mountains were about 190 managers from the Internal Revenue Service. Guess who picked up the $88,000 tab? That's right - you did.

The agency describes the retreat as vital "continuing education," with a full schedule of work-related discussion and activity. Topics included managing a culturally diverse workforce, dealing with difficult people, and harnessing "the power of laughter." Among the other educational offerings were an evening hayride and bonfire, water volleyball, two 45-minute sessions of body toning, and a talent show. In the end, only about 16 out of 50 hours of activity were officially devoted to business. If, in fact, the workers did spend 16 hours sharpening their skills, then the conference might seem to have some slight professional justification. But don't be fooled. In general, as attendees at such conferences well know, the choice between sitting in class or sitting in a hot tub doesn't provoke a whole lot of soul-searching.

The Poconos retreat last June wasn't the only sweet bonus accorded the people who collect our taxes. IRS employees, particularly management personnel, have enjoyed a variety of pricey perquisites over the past year. They've been treated to seminars at expensive beachfront resorts and mountain retreats, health club memberships, and even cash awards for helping to throw a party.

Of course, such merriment isn't limited to the IRS, as the agency defensively points out. From grandiose office decor to limousine service to first-class flights, self-indulgent spending is a sanctioned sport throughout the federal government. But bureaucratic hedonism is particularly distasteful when it's practiced by the IRS. The image of the stereotypical taxman, after all, is that of an ascetic in a cheap grey suit grimly toting up columns of numbers - not of a frat boy in a Hawaiian shirt guzzling beer at a keg party. These are the people who expect us to report our income with the highest degree of honesty and accuracy, the ones who, when they feel we've fallen short of that standard, can impose fines, seize our cars and homes, garnishee our wages, and humiliate us before our neighbors. It's a little disturbing to discover that the very agency that should be cracking down on the deluxe, deductible "educational conference" is joining in the scam as gleefully as the American Medical Association or the nation's sybaritic bar organizations.

Buffalo bills

A chief function of tax collectors is to catch people who - either by honest mistake or fraud - fail to pay their fair share. It's a noble and daunting task, considering that Americans short their government tens of billions of dollars annually, contributing mightily to the federal deficit. IRS officials say that Congress only recently started giving the agency the money it needs to hire more agents and modernize its technology - steps expected to beef up collections. Yet, all along, these officials have somehow found plenty of money to transform office work into off-site parties.

While only a small percentage of IRS conferences are held "abroad," some taxmen prove you don't have to travel far from home to live it up. Last May, Donald Mitgang, director of the Buffalo district office, hosted an IRS executives' conference at the Radisson Inn in nearby Niagara Falls. Several of Mitgang's employees were yanked away from their calculators to cook for the visiting hotshots, The Buffalo News reported in June. Other workers made sandwiches or fetched beer, soft drinks, and snacks for their weary superiors. Some tended bar or served as hostesses at cocktail parties. Still others acted as chauffeurs or sightseeing directors on local trips for IRS executives and their families. The taxpayers were even kind enough to rent a van for these outings.

And in the end, about 10 employees were awarded cash prizes for their work at the conference. At least two of the honorees refused the money, questioning the use of government funds for baked goods and cocktail parties. Upon hearing those complaints, the IRS referred charges of wrongdoing to the U.S. Treasury Department's inspector general, who is still investigating the matter.

A month after the Buffalo party, reports surfaced that the IRS's national office was purchasing memberships in a conveniently located spa for staff stationed at its L'Enfant Plaza annex. The arrangement saved the workers a 10-minute walk across the Mall to the gym at IRS headquarters on Constitution Avenue, which offers stationary bicycles, weightlifting equipment, even aerobics sessions. The IRS claimed the investment in the private club made sense: It would help improve employees' health, making them more productive. But the agency decided not to renew its memberships after Rep. Scott Klug, complaining that the benefit could set a precedent of tax-payers funding private health club memberships for federal workers across the country, sparked a congressional investigation into the matter. "I've got no arguments whatsoever with the IRS concerns about the health of their employess," Klug said. "I think they'll get healthier walking across the Mall to the gym."

The taxman slummeth

The IRS claims that such expenditures, although they may look bad, are proper not only for a government entity but for any employer. Seminars, for example, improve workers' skills. "The expectations of the public are that this agency is held to a standard higher than any other agency in the federal sector," says Ellen Murphy, chief IRS spokeswoman. "However, we have an obligation to the public to have employees - who serve them - who are productive, well trained, and can carry out the service the public expects of them."

The agency has had some trouble meeting those expectations in recent years. While letting billions in unpaid taxes slip past, the IRS itself until recently had annual budget shortfalls of nearly $500 million. The workforce was too small and poorly trained. Newly hired accountants were reported to be scoring at the bottom fifth of standardized tests for entry-level professionals. Hampering the agency's credibility as much as the operational problems were the ethical breaches exposed during a series of congressional hearings beginning in 1989. A subcommittee chaired by Rep. Douglas Barnard discovered, for example, that an IRS staffer had launched a tax investigation against someone who had sued him. A top official in Los Angeles investigated the enemies of a group of businessmen with whom he was seeking a job. And three managers in Cleveland, claiming to be on an undercover mission, spent federal funds joyriding on a government boat during working hours.

All these problems fell into the lap of Fred Goldberg, who became IRS commissioner in 1989. An amiable tax attorney, Goldberg worked at the IRS off and of during the Reagan administration, between stints in the private sector. The new infusion of cash from Congress is helping Goldberg attack the agency's operational problems. As for the scandals, one of Goldberg's primary ventures is to inject a healthy dose of ethics training into the agency. "The public must have confidence that each Internal Revenue employee is held to the highest standards of professional and ethical conduct," he told Barnard's subcommittee in July. Unfortunately, the highlights of this new ethics campaign were two training seminars at a cozy West Virginia mountain resort, about two hours from Washington, D.C.

IRS MIA 

The CoolFont Resort & Conference Center, according to its brochure, includes a solar-heated indoor swimming pool, exercise equipment, a whirlpool, a sauna, and a spa for massages and facials. (The participants were kept too busy to enjoy the facilities, the agency insisted.) A private consultant was hired to conduct the four-day seminars, one in February and another in March, for 53 IRS managers from across the country. The trainees were taught how to conduct ethics sessions for their colleagues back home. The cost of the program was $1,850 per person, plus travel expenses.

The Justice Department's Office of Government Ethics (OGE) provides a variety of ethics courses to all federal employees, free of charge. IRS officials, however, said they wanted something more extensive than Justice's curriculum. Rather than just teach the ethics laws, which is what the OGE covers, the program focused on ethical principles and concepts broader than those in the rules. In essence, IRS managers spent federal funds at a resort to learn to avoid even the appearance of wrongdoing. Hmmm.

That coursework apparently hasn't paid off. For example, not long after the Poconos retreat in June, about 150 attorneys from the IRS's southeast region were treated to a continuing legal education conference at Pier 66 Resort & Marina in Fort Lauderdale, Florida. In its brochure, the resort is described as "lush," with private balconies overlooking the water, telephones in the bathrooms, daily cruises to the Caribbean islands, waterfront tennis courts, a world-class marina, parasailing, snorkeling, yachting, massages, and free shuttle service to the beach. The four-day event, which cost the government $100,000, was held primarily to help the lawyers get the training they, needed for their annual state license renewals. Assuming they made it to class between tanning sessions, the attendees ruminated on tax court rules and procedures, new developments in criminal tax law, and trial preparation - issues that could perhaps be more easily discussed without seagulls crying and waves crashing just outside the door.

If these outings reflect the example Goldberg hopes his IRS will set for the taxpaying public, then his efforts to encourage better compliance may be in for a rough ride. Americans will never be gleeful about paying money to the government. The least they can expect is some degree of fiscal integrity from the bureaucrats who routinely carve a hunk out of their paychecks and often demand even more come tax season.

The tax-deductible conference is one of the great con games that unites the middle class with the rich against the rest of America. Since everyone with any power is able to play, who's going to raise a fuss? And that's what is ultimately so disturbing about the IRS's taxpayer-financed vacations. Rather than sipping mai tais and yukking it up with doctors, lawyers, educators, and the rest of the tax cheats, the nation's taxmen shouldn't just be setting a better example - they should be breaking down the doors and busting up the party.