Roberts Nomination Complicates Postal Reform in Senate

The House of Representatives passed a postal reform bill last week, but the impending debate over Supreme Court nominee John Roberts may cut short efforts in the Senate.

After three hours of debate, four amendments were defeated and the bill, H.R. 22, the Postal Accountability and Enhancement Act, passed 410-20 late July 26.

Attention now turns to the Senate, where a bipartisan reform bill (S. 662) co-sponsored by Sens. Susan Collins, R-ME, and Tom Carper, D-DE, awaits action by the full Senate.

The Senate Committee on Homeland Security and Governmental Affairs approved the bill for floor action in June, and postal insiders expect a vote after Labor Day, when both chambers return from August recess. If the Senate approves the measure, a House-Senate conference committee would convene to resolve differences between the two bills before sending the legislation to President Bush.

But it may not happen like that.

“Any scheduling of a bill after Labor Day — postal or otherwise — will be complicated by the possibility of a Senate debate on the Supreme Court nomination,” said Bob McLean, executive director of the Mailers Council, Arlington, VA. “It has nothing to do with the merits of the postal bill. It's just that the Senate's priority will be the Supreme Court nominee confirmation process.”

If reform is passed and signed by Bush, it could affect the current postal rate case. The U.S. Postal Service filed a request in April for a 5.4 percent across-the-board increase. The USPS said the increase is needed only to meet a requirement from a 2003 bill that called for it to put $3.1 billion in Civil Service retirement savings annually into an escrow account.

H.R. 22, however, calls for replacing this requirement, which would free up $78 billion over 60 years, letting the postal service pay off debt to the U.S. Treasury, fund its healthcare liabilities and mitigate rate increases. As a result, the USPS might push back the effective date of the new rates, or withdraw them entirely.

“We are particularly pleased that the House bill would help mitigate or delay the current USPS rate request,” said Jerry Cerasale, senior vice president of government affairs at the Direct Marketing Association. “We are hoping that the bill moves quickly through the Senate and then goes to conference and gets it through.”

Cerasale said the proposed rate increase is expected to take effect Jan. 16, so to stop it the bill would have to be signed into law during the current session, which ends this fall.

“For nonprofit mailers, postal reform is all about postal rates,” said Chris Cleghorn, a nonprofit executive with Easter Seals in Chicago and president of the Alliance of Nonprofit Mailers. “Every dollar saved from excessive postal rate increases is a dollar spent on the mission of the nonprofit organization.”

The House bill also would return responsibility for funding Civil Service Retirement System pension benefits related to the military service of postal retirees — a $27 billion obligation — to the Treasury Department. No other federal agency has to make this payment.

The Senate bill includes these provisions, but the White House has a different view.

“The bill ultimately presented to the president must not contain provisions that would have an adverse impact on the federal budget, either by releasing funds from escrow without devoting them to pre-fund liabilities or by transferring the military service obligation from USPS to taxpayers,” said a White House statement released last week. “Should the final bill have such an adverse impact on the federal budget, the president's senior advisers would recommend that he veto the bill.”

The Senate and House bills would have “a slight negative effect on the federal budget,” Cerasale said, “but our view is if you have to raise rates, and you are going to have a decrease in volume, it's going to have a bigger effect on the federal budget.”

The administration's position, he said, “will force, in the short term for certain, higher and faster rate increases. We think that is a short-sighted view.”

The White House is reportedly working on a compromise with lawmakers.

With only 20 “no” votes, McLean said, “most of the House of Representatives clearly believes that the bill takes the correct vision on both the escrow and the military pension. It's rare to see a bill receive that kind of overriding support, and fortunately for us, the Senate bill contains the same language. We believe the House of Representatives sent a message to the White House. We hope someone is listening.”

The military pension and escrow issues have long held up the legislation, which did not reach the floor of either chamber last year despite approval by House and Senate committees.

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