Commission Hears Advice on Postal Reform

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The Presidential Commission on the U.S. Postal Service is getting an earful on how to reform the USPS, though most comments focus on the usual suspects, including the rate-setting process, labor practices and the postal service's business model.


The commission received written comments from 250 business groups, companies and individuals by the Feb. 12 filing deadline. Many of the comments were repeated in a public meeting yesterday in Washington. Those testifying included representatives from mailing associations, postal unions, the Postal Rate Commission and United Parcel Service.


In its written comments, the Direct Marketing Association called for updating the postal service's business and regulatory model. The DMA said the basis for establishing rates should be changed. It argued, for example, that upstream mail functions be open to free competition and that the USPS be permitted to entertain negotiated service agreements, special rate and service arrangements with mailers that the postal service says would provide pricing incentives that encourage greater mail volume.


Regarding the labor situation, the DMA suggested that benefits for future employees be subject to bargaining and that arbitrators consider the changing nature of communications and the need for improved productivity to ensure the system's viability.


The DMA praised the postal service's work-sharing programs and said it supports the Mailbox Rule, which states that only pieces for which postage has been paid may be placed in a letterbox. However, it said that USPS control of the mailbox should not be absolute and that access should be allowed to licensees to ensure the most affordable and efficient "last mile" delivery function.


Many of the DMA's suggestions, including dealing with labor issues, work sharing, pricing and monopoly functions of the USPS, require changes to existing law.


Comments from other associations included:


* The Association for Postal Commerce, a coalition of business mailers, called the system of postal products and prices "unworkable." It said the business model and monopoly statues must be changed and the labor and management system reconsidered. Still, the association said reform should be implemented incrementally.


* The Mailers Council, representing mailers and mailing associations, made six recommendations: continued universal service, improved productivity, enhanced mailer options, enhanced postal compensation, improved financial transparency and increased investment in technology.


* Recommendations from the Alliance of Nonprofit Mailers covered universal mail delivery, the postal monopoly, rate setting, the deferred liability, controlling costs, adjustments in service, competition with the private sector and USPS governance and oversight.


The alliance suggested that the USPS continue to offer discounts to encourage deeper work sharing, private transportation, drop-shipping and automation of the mail, and that it continue to protect a fair, open rate-setting process. It also urged shaving the time to litigate a rate case by creating an open system of sharing postal data with the PRC continuously during the time between rate cases.


* American Business Media, the industry association for business-to-business information providers, said the postal commission must deal with politically sensitive issues including USPS efficiency, cuts to USPS staff and labor policies. It also called for keeping the current rate-setting system and for defining the term universal service.


Specific companies offering comments included:


* Elk's Magazine, which expressed frustration with the current rate-setting process and suggested bolstering the PRC's authority.


* Valpak Direct Marketing Systems, which argued for productivity improvements, reducing the postal service's monopoly and increasing the debt limit.


President Bush formed the commission in December. It is scheduled to present its findings to him by July 31.


The commission also announced the dates and locations of upcoming field hearings. They are March 18 in Austin, TX; April 4 in Los Angeles and April 29 in Chicago. The meetings will focus on technology, private-sector partnerships and work force, respectively.


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