As mailers study the details of the U.S. Postal Service’s new rate case, industry groups were hopeful about the establishment of a House-Senate conference committee to resolve differences between the two chambers’ differing bills and the eventual passage of a new postal reform law.
But it probably won’t lead to any short-term relief for mailers.
“Even if we have a postal reform bill passed this year, we’re gong to have a rate case this year and probably next year,” said Bob McLean, executive director of the Mailers Council, explaining that such a measure would require time for implementation and phasing-in.
On Wednesday, the U.S. Postal Service filed a rate case with the Postal Rate Commission that would raise standard mail rates by an average of 9% and all rates by an average of 8.5%.
Right now, the House has yet to name its members of the House-Senate conference committee that would resolve differences between postal reform bills H.R. 22, which passed last Summer, and S. 662, which got the OK in February.
The Senate has already named its conferees. But the House has yet to do so, according to Ben Cooper, chairman of the 21st Century Mailers Coalition. He said that Rep. Tom Davis, chairman of the House Government Reform Committtee, is waiting until he can find enough representatives that would pass a bill that would be acceptable to President Bush.
The main sticking point is who would pay for the more than $70 billion civil service and military pensions of former postal workers.
In 2002 the postal service discovered it substantially overpaid the Civil Service Retirement System fund that pays its retirees. But to allow the USPS to use this money for other purposes, legislation had to be enacted authorizing it to do so. So the following year Public Law 108-18 shifted the obligations to the Treasury, which set up an escrow account to pay for the pensions (Direct, March 1).
At the time it generally was thought this issue would be addressed in postal reform bills then in Congress. Since reform did not pass, 108-18 expired at the end of 2004, effectively relegating the pension costs to the USPS.
The White House consistently opposed the reform bills, in part because it feels having the Treasury pay for postal pensions would add to the federal deficit.
The White House and the Congressional leadership are all adamant in their positions on this issue, said McLean, who hoped a compromise would be hashed out once the conference committee is formed.
