Time Becomes Factor in Postal Reform Passage

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Though mailers still expect postal reform bills to be introduced shortly, many are growing less confident that legislation will be passed before the end of the year because of the fall elections.


House Government Reform Committee chairman Tom Davis, R-VA, will introduce a postal reform bill by the end of the month with Rep. John McHugh, R-NY, who chairs the House committee's postal panel, a McHugh spokeswoman said.


And after one last scheduled hearing April 7, Senate Governmental Affairs Committee chairwoman Susan Collins, R-ME, plans to introduce legislation with Sen. Thomas Carper, D-DE, that would be out of committee by May.


Postal Rate Commission chairman George Omas and S. David Fineman, chairman of the USPS Board of Governors, will testify at the April 7 hearing about proposed changes to the U.S. Postal Service's rate-setting process and governance structure.


After the bills are introduced, however, many steps remain before legislation would be signed into law.


"I don't think we can say with any certainty that a postal reform bill is going to pass or it's not going to pass this year," said Bob McLean, executive director of the Mailers Council. "Certainly, we would have liked to have one bill introduced by now. But that doesn't preclude passage. It just makes it a little more difficult."


Congress has only through July to work on legislation before summer recess. Lawmakers also aren't in session numerous days in September, and the targeted adjournment for this session of Congress is Oct. 1, though that probably will be extended. Also, many members of Congress will be focused on re-election campaigns.


Moreover, Davis told a meeting of the National Association of Postal Supervisors last week that House and Senate leaders are "unenthusiastic" about moving a bill, according to his spokesman. The White House is committed to postal overhaul this year, he said, but Congress has faced "heavy lobbying" by groups that oppose full-scale changes, such as private-sector competition with the USPS.


At a luncheon at the Capitol Hill Club last week, House Appropriations postal subcommittee chairman Ernest Istook, R-OK, said Congress operates in a crisis mode before it takes action and lawmakers are unconvinced an urgent need exists for comprehensive postal reform this year, according to his spokeswoman.


Still, McLean is optimistic.


"The leadership in both chambers have indicated the willingness to schedule time to debate these bills," he said. "That's an essential step."


He also predicts a smooth conference committee process.


"One of the most significant things that has occurred during this prolonged series of hearings is that we've seen opinions coalesce," he said. "We've been able to build consensus in some ways that probably didn't exist six months ago. That tells me we've got a hint that something might occur."


But if there are stark differences between the two bills, McLean said, "the chances for passage go down dramatically."


An aide for Collins said the Senate bill probably will contain workforce reform proposals.


In general there is common ground between the two chambers, she said.


Neal Denton, executive director of the Alliance of Nonprofit Mailers, Washington, said he expects the House and Senate bills to resemble previous reform packages.


"HR 4970, a House bill that had been promoted in 2002, and S. 1285, a measure introduced by Sen. Tom Carper in 2003, will likely serve as general blueprints," he said.


If so, the rate-setting process will be one focus.


For example, Denton said a provision in a final bill may be that classes of mail be identified as either "market dominant" or "competitive."


A new, stronger Postal Regulatory Commission would establish the new system for determining rates for "market dominant" products such as First Class, Standard and Periodicals. This new PRC might consider price caps, revenue targets and cost-of-service regulations, for example, and could set limits to rate increases by tying average increases to the Consumer Price Index.


Rate setting for "competitive" products such as Priority, Express, International and Parcel Post mail would be much more flexible and set by the Board of Governors.


McLean agreed that rate setting likely will be the heart of the legislation and that it also will include language "outlining in more specificity what the universal service delivery requirement will be."


Other elements might provide for annual audits of finances, governance, increased borrowing authority and "perhaps a loosening of the private express statutes to allow more private delivery of mail," Denton said.


Workforce issues likely will be examined, such as reducing the size of the postal workforce and opening employee health benefits to collective bargaining.


Legislation also likely will include provisions that shift the payment of military retirement benefits for USPS workers back to the Treasury and revoke the requirement in last year's CSRS legislation requiring the postal service to put CSRS savings into escrow beginning in 2006.


Meanwhile, postmaster general John E. Potter urged a Senate subcommittee last week to include funding for postal appropriations not in President Bush's 2005 fiscal year federal budget. The largest expense is $779 million for emergency preparedness.


Potter told members of the Appropriations subcommittee on transportation, Treasury and general government that the funding would support deployment of the biohazard detection system, the ventilation and filtration system and construction of a Washington-based mail-irradiation facility.


Sen. Ted Stevens, R-AK, the Appropriations Committee chairman, said his committee will work with the Senate Governmental Affairs Committee to "push this because, after all, we were the target" of bioterrorism attacks in the mail.


By declaring it an "emergency," it would put the money out of the scope of the budget limits, "and the House will accept it," he said.


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