House, senate pass historic postal reform legislation

Both the House and Senate passed historic postal reform legislation in the final hours of the 109th Congress after key negotiators – Reps. Tom Davis (R-VA) and Henry A. Waxman(D-CA)- and Sens. Susan Collins (R-ME) and Tom Carper (D-DE) – brokered an agreement that will modernize the U.S. Postal Service and make it viable for the 21st century.

The legislation, the first major overhaul of the USPS since 1970, will help stabilize mail volume and stamp prices. The postal reform bill has been more than a decade in the making.

“This represents a lot of work done behind the scenes, and a lot of compromises made with the mailers and the unions,” said Jerry Cerasale, senior vice president of government affairs for the DMA. “We are very proud and excited that this has finally moved forward.”

The new bill, H.R. 6407, was introduced by Rep. Davis, who chairs the House Committee on Government Reform on Dec. 7.

The House passed the bill late Friday night and the Senate early Saturday morning.

The postal reform bill represents a major victory for the millions of businesses, nonprofit organizations and consumers across the country that rely on the USPS. The bill now goes to President Bush for a signature, and most believe he will sign it.

The final legislation reflects an agreement reached among key members of congress, the Administration and the mailing community. It contains all of the elements mailing stakeholders have sought over the past several years, including: a cap that will tie future postal rate increases to the rate of inflation; a tight exigency clause defining the conditions for emergency rate increases; the return of the military retirement cost burden (some $27 billion) to the Treasury; and language supporting the continuation of work-sharing agreements.

“We are grateful that the funding for USPS retiree military service obligations will be borne by the Treasury,” said John E. Potter, Postmaster General, in a statement on Saturday. “This, combined with release of the escrow funds, will be used for retiree health benefits.”

Lawmakers also were able to strike a deal on the level of authority given to the newly created Postal Regulatory Commission. The bill maintains language included in both the House and Senate versions giving the commission tools, such as subpoena power, to ensure that the USPS is in compliance with the law and that the interests of the mailing public are protected. It also contains new language giving the Commission the power, as an expert regulatory body, to monitor the new rate system in future years and make whatever changes are necessary to ensure that it continues to meet postal customers’ needs.

At the same time, the bill would add an Inspector General of the Postal Regulatory Commission to monitor the regulator in the use of its expanded powers.

The Direct Marketing Association has long held that postal reform will play a critical role in making sure that the Postal Service can continue to deliver the reliable, cost-effective service that consumers and businesses have come to expect.

The bill also would install a three-day waiting period before an employee is eligible to receive workers’ compensation for job-related injuries. The waiting period is a feature of most state workers’ comp programs, and at one point had been dubbed a deal-breaker by the National Association of Letter Carriers union. Other federal employees are not subject to a waiting period.

“The parties were able to resolve their differences, including the NALC issue,” said Bob McLean, executive director of the Mailers Council.

“Everyone had to compromise to be able to get to this point. For example, the bill still includes the three-day waiting period [stipulation], which the NALC was against. This hasn’t changed. That’s the kind of compromise we are talking about.”

NALC had shut down the bill before Congress’ Oct. 1 adjournment after deciding it could not support S. 662 because it would have established a three-day waiting period for injured letter carriers before they could go on continuation of pay.

Mr. McLean said the Mailers Council is very pleased with the bill.

“This bill will save mailers billions, that’s billions with a ‘b’, of dollars,” he said.

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