Alabama Tax Boss Accused Of Using Audits To Strike At Political Enemies Hearings Leave Third Governor In A Row Embroiled In Probe

The state’s top tax official is accused of using racial slurs and targeting political enemies for audits, prompting charges of racism and dirty tricks against the administration of Gov. Fob James.

Some legislators are calling for Revenue Commissioner Ralph Eagerton’s removal from office over the allegations, which have dominated state capital news in recent days. Eagerton has declined to comment.

Political analysts said the controversy is hurting James and his Republican agenda of shrinking government and reforming education and the courts. He is the third consecutive Alabama governor to get bogged down in ethics questions.

The discord began earlier this year when it was disclosed that 24 legislators, 13 of them black, had been targeted for state income tax audits by Eagerton’s department. That led to formation of a legislative panel to investigate the tax-collecting agency. In recent testimony:

Three high-ranking Revenue Department employees attributed racial slurs to Eagerton, including one directed at Alabama’s only black state revenue commissioner. Eagerton allegedly promised a mass tax audit of the former commissioner’s accounting firm.

A department employee said papers were shredded that showed Dwight Pridgen, chief of the department’s income tax division, checking the income tax returns of legislators for review.

The department’s administrative law judge, William Thompson, said he was audited after issuing rulings that Eagerton and Pridgen disliked.

Witnesses agreed that paranoia is prevalent at the department.

Pridgen, in his testimony to the committee, said working in the Revenue Department is “a living hell.”

James, who appointed Eagerton in January, was silent about the racial accusations until Thursday, when he said he had never heard Eagerton utter racially derogatory remarks.

The governor conceded he hadn’t mentioned the accusations to Eagerton, whose testimony before the committee could be weeks away.

Alfred Sawyer, the governor’s spokesman, said James is concerned the committee may be on a “witch hunt” instead of serving its purpose - to learn if anyone was targeted for audit for political or racial reasons.

The previous governor, Democrat Jim Folsom, lost to James in 1994 amid a wide-ranging corruption investigation that is continuing. Folsom took office in 1993 after Republican Gov. Guy Hunt was ousted upon his felony ethics conviction for pocketing $200,000 from an inaugural fund.