Mailers Lobby Against Private Law Provision

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The Mail Advertising Service Association, Alexandria, VA, has hired a lobbying firm to help kill a provision in postal reform legislation bill H.R. 22 that allows the U.S. Postal Service to form a private corporation that could sell non-postal products.

MASA, which represents printshops and other direct marketing industry service bureaus, believes the Private Law Corporation provision could give the USPS the ability to compete with members in the mail services and mail preparation businesses.

"We feel that the reform legislation, and particularly the portion on the Private Law Corporation, would enable the postal service to get involved in many more private sector businesses unfettered," said Barry Brennan, MASA's postal affairs director. "This could put it in direct competition with the private sector and our members."

Brennan said the lobbying group working with MASA is asking local businesses to contact the House Postal Subcommittee and the House Government Reform and Oversight Committee. While it is still early to tell whether or not MASA is making any progress with congressional members, Brennan said they are hopeful.

Rep. John McHugh (R-NY), chairman of the House Postal Subcommittee intends to reintroduce postal reform legislation after the opening of the first session of the 106th Congress next month.

In related news, two state legislative organizations recently passed resolutions calling for a federal statute to require the U.S. Postal Service to pay state and local taxes on profits made on non-postal products and services such as novelties, telephone cards and photocopying services.

The separate resolutions, passed last week by the National Conference of State Legislators and earlier this month by the American Legislative Exchange Council call on Congress to enact legislation requiring the USPS to collect and remit sales and use tax on the sale and consumption of nonpostal goods and services.

The council resolution went a step further and requested Congress to prohibit the service offerings and advertisements in areas where the general public is served by private industry.

The Coalition Against Unfair USPS Competition, Washington -- whose members sell many of the non-postal products that the USPS sells -- supported the legislation.

"[Our] members are family-owned businesses and pay millions of dollars in state and local taxes on the services they sell," said coalition chairman Charmaine Fennie. "The U.S. Postal Service pays nothing on profits from exactly the same products."

The resolutions come on the heels of a GAO report issued last month criticizing the USPS for losing $84.7 million on new products designed to compete with the private sector.

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