Congress Set to Tackle DM Issues

Internet taxation, privacy, spam, postal reorganization and nonprofit postal rates are just some of the issues Congress will address as both chambers return from their August recess this week.

Some of these bills may be passed by Oct. 6, the target adjournment date for the second session while others may be reintroduced next year.

Mailers, for example, will be watching H.R. 22, the Postal Modernization Act, sponsored by Rep. John McHugh, R-NY, chairman of the House postal service subcommittee. The bill is designed to give the U.S. Postal Service more freedom to manage its business and to establish rules to ensure fair competition.

The bill, which has been debated in the postal and direct marketing communities for six years, is in danger of dying because McHugh must step down since he has served as chairman for three terms, the congressional limit.

Though H.R. 22 probably will not pass this session, Jerry Cerasale, senior vice president of government affairs at the Direct Marketing Association, said there may be some postal reform coming from the Democrats on the subcommittee.

“This depends on who becomes the chairman,” Cerasale said, “which is based on whether the House stays Republican or goes Democratic” as a result of the November election.

The subcommittee will hold a hearing this month.

Nonprofit mailers also hope for quick passage of two bills that would grant them postal relief, saying the legislation would counteract increases in the USPS’ proposed rate case.

The Nonprofit Rate Relief Act, H.R. 4636, was introduced by Rep. Chaka Fattah, D-PA, ranking minority member of the House postal service subcommittee. The bill is virtually the same as S. 2686, introduced by Sens. Thad Cochran, R-MS; Daniel K. Akaka and Daniel Inouye, both D-HI; Richard Durbin, D-IL; and Joseph Lieberman, D-CT. Cochran is chairman, and Akaka is ranking minority member of the Senate Subcommittee on International Security, Proliferation and Federal Services.

The bills aim to:

• Set nonprofit periodical rates and other preferred rates at 95 percent of the counterpart commercial rate. As a result, nonprofit mailers would receive a 5 percent discount from the commercial rate, excluding the advertising portion.

• Set the revenue-per-piece for nonprofit Standard A mail to reflect a 40 percent discount off the revenue-per-piece for commercial Standard A mail.

Essentially, the bills stipulate that nonprofit rates would always be a percentage of commercial rates – the two categories would always be compiled and counted together – which nonprofits think would greatly improve the reliability of USPS data.

This legislation must be passed before Congress adjourns so it can be given to the Postal Rate Commission in time to be incorporated into the current rate case. The rate case calls for an average increase of 6.4 percent for commercial Standard A rates and nearly 20 percent for nonprofit rates.

One bill that may be passed this session is an anti-spam bill, H.R. 3113, the Unsolicited Commercial Electronic Mail Act of 2000. The bill, which was co-sponsored by Reps. Gene Green, D-TX, Heather Wilson, R-NM, and Gary Miller, R-CA, is designed to protect consumers and Internet service providers from unsolicited commercial e-mail flooding their e-mail accounts. The House passed the bill by a 427-1 vote this summer.

H.R. 3113 would place several restrictions on e-mail marketers, including requiring that commercial e-mail messages have valid reply addresses; that marketers take consumers’ names off mailing lists when asked; and that commercial e-mails be labeled as such.

The bill also would allow ISPs and consumers to petition the Federal Trade Commission for cease-and-desist orders and would protect state laws that allow consumers to sue spammers.

Financial penalties would start at $500 per violation but could not exceed $50,000. However, if a judge found that a company committed excessive violations, the sum could rise to as much as $150,000.

The bill now heads to the Senate.

Cerasale said DMers also are concerned about a bill and an amendment that address the sale of Social Security numbers for marketing purposes.

The bill, called the Social Security Number Protection Act of 2000, S. 2699, was introduced by Sen. Dianne Feinstein, D-CA, in May and would make the practice of selling Social Security numbers for a profit a federal crime. Under the bill, the FTC would have rule-making authority to determine appropriate exceptions, such as when a person’s health or safety is at risk, when the purchase or sale is necessary for law enforcement or national security reasons, or when the individual provides affirmative, voluntary consent.

The amendment, introduced by Sen. Judd Gregg, R-NH, prohibits displaying Social Security numbers on the Internet to the general public for commercial purposes without consent. The amendment was added this summer to the appropriations bill of the Appropriations Subcommittee on Commerce Justice, State and Judiciary, which Gregg chairs. The appropriations bill, S. 4690, will be on the Senate floor this week or next.

As for other privacy issues, a bill sponsored by Sen. John McCain, R-AZ, chairman of the Committee on Commerce, Science and Transportation, would protect the privacy of consumers who use the Internet. The bill, called the Consumer Internet Privacy Enhancement Act, S. 2928, is still in committee, and McCain plans to hold a hearing on it later this month.

The bill would make it unlawful for a commercial Web site operator to collect personally identifiable information online unless the operator provides notice to the user and an opportunity for the user to limit its use for marketing purposes.

The Senate also may take up the Internet Non-Discrimination Act, H.R. 3709, sponsored by Rep. Christopher Cox, R-CA, which extends the nationwide ban on new, special and discriminatory Internet taxes for five years.

The House passed the bill by a vote of 352-75. The moratorium is set to expire Oct. 21, 2001. The bill would extend the ban until Oct. 21, 2006.

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