*Postmaster General Henderson Supports HR 22

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SAN ANTONIO--Postmaster General William J. Henderson told 8,000 attendees to this Spring's Postal Forum here yesteday that he now suppports HR 22, the Postal Modernization Act of 1999, thanks to the results of a late afternoon negotiation session on May 14th with the postal subcommittee.


This is the first time the postal service publically offered its full support of the bill.


"I'm happy to report to you that, based on agreements reached Friday, we in managment in the postal service announced wholehearted support of HR 22," he told the crowd.


Over the past four years, the USPS has worked with the subcommittee, the full oversight committee, and the rest of the postal community to develop fair, meaningful reform with the goals to provide greater freedom, protect the public interest and preserve the historic mandate of the USPS -- to deliver universal service. Since last December, the agency has contributed 35 amendments to the bill.


While some of these amendments were incorporated into the final bill, which was marked up on April 29th, many were not. As a result, the USPS felt it was necessary to take action and negotiate with the subcommittee to whittle down the bills into six that are most important to keep the bill moving along and to show its support of postal reform. These six amendments were approved by the subcommittee, and, as the bill stands, the USPS fully approves it.


The six modified amendments are:


* A Clarified negotiated service agreement provision that could improve large and small mailers with discounts and premium services


* Equal mark up for competitive products, but international transportation costs and unique or disproportionate operating costs excluded


* Disproportionate noncompetitive products with inflation-based price caps and business and marketplace flexibility


* Clarifiied provisions on the Competitive Products Fund annual remittance to the Postal Service Fund, which will now allow a USPS Private Law Corporation to give funds back to a noncompetitive postal service fund thereby not affecting customer rates


* Competitive Products Fund granted a five-year transition period with access to market-rate credit from the Federal Financing Bank


* Federal Tort Claims Act to reflect the USPS's integrated operational structures


Perhaps the most important amendment to direct mailers is the one that assures pricing flexibility, and Henderson said that last Friday McHugh agreed to principles and language that would assure the level of pricing flexibility management has been working toward.


"Our principle goal," said Henderson, "has been to gain pricing flexibility so we can serve you better. HR 22 will do that. It also protects and ensures universal service for the American people."


The bill now moves from the subcommittee to the full committee on government reform for vote, expected sometime in the next few weeks. Originally, a hearing was scheduled for May 19, but this was postponed so that the subcommittee could incorporate the USPS legislative language and so that more mailing organizations and Congressman could add amendments to the bill.


For example, Congressman Henry Waxman (D-CA) is planning to introduce a bill that may not support the Private Law Corporation, as well as the price cap provisions because they could be considered restrictive to unions. Insiders say that many democrats in Congress agree with Waxman, and if the house votes against these provisions, the bill could be passed without them.


"It's hard to say if the USPS will still support this bill if they can't get the Private Law Corporation provisons," said Neal Denton, executive director, The Alliance of Nonprofit Mailers.


In addition, another bill--called the "UPS Amendments"--may also be introduced by a member of the committee, and this bill is also against provisions in postal reform.


Indeed, despite the fact that the USPS has taken a leadership position on HR 22, it still has its work cut out for it.


But it is showing toughness.


Referring to the UPS--which began an all-out public relations campaign against the USPS last week by having UPS delivery people deliver a press kit to every Congressman in the U.S. showing that, in its view, the USPS is playing unfairly, Henderson said the agency's newly found support of HR 22 "may create some problems for us with our competitors, because you know what an all out push they have tried to make us less competitive. So we're prepared for that. We're prepared to fight back."
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