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Daschle Tax Review May Delay Confirmation as U.S. Health Chief

By Aliza Marcus

Jan. 15 (Bloomberg) -- Thomas A. Daschle’s tax records face scrutiny by Republicans on the Senate Finance Committee, possibly delaying his confirmation as Barack Obama’s Health and Human Services secretary.

Republicans on the committee also are reviewing Daschle’s relations with a provider of education loans, the Wall Street Journal reported today, citing committee aides. The examination means the former U.S. senator’s nomination is unlikely to be voted on before Obama is sworn in as president next week.

Daschle, once his party’s leader in the Senate, becomes the second Cabinet nominee hitting a snag in the panel. Max Baucus, the Montana Democrat who chairs the committee, was forced to reschedule U.S. Treasury Secretary nominee Timothy Geithner’s confirmation hearing for Jan. 21. Geithner, president of the Federal Reserve Bank of New York, told committee members on Jan. 13 that he had discovered he underpaid his taxes for several years.

“The committee is doing the tax review of Daschle as part of due diligence,” said Jill Kozeny, a spokeswoman for Senator Charles Grassley of Iowa, the top Republican on the committee, by telephone. “It’s absolutely routine and very thorough, and it’s happened with every nominee.”

Carol Guthrie, a committee spokeswoman, said “there’s not a delay.”

“The finance committee has a number of very important tasks to tackle this month, and the committee is in the process of vetting several nominees,” she said. “We haven’t scheduled a hearing that’s been changed.”

Daschle’s name also has surfaced in an examination by Grassley of tax-exempt educational organizations. Daschle took trips as a guest of EduCap Inc., one of those lenders, the Journal reported. News of those flights was reported in 2007, after he left the Senate, the Journal said.

“The issue is the tax-exempt organization and how it uses these assets,” Kozeny said.

The newspaper said aides stressed that the issues are complicated and no sign of impropriety has emerged.

An aide to Daschle declined to be quoted by name.

To contact the reporter on this story: Aliza Marcus in Washington at Amarcus8@bloomberg.net

Last Updated: January 15, 2009 11:53 EST