Mailer groups were gratified about the 410-20 vote House approval of postal reform bill H.R. 22 and were hopeful such a bill could become law this year, even in the face of White House resistance.
But some stumbling blocks still remain.
“The overwhelming vote in the House with no divisions along party lines, is likely to give us leverage with the Senate and the White House,” said Bob McLean, executive director of the Mailers Council. “Maybe the White House will sit down and negotiate with us” over issues like payment of the military pensions.
The bill calls for two-thirds of a $3.1 billion retirement payment due in September 2006 to help pay down retiree health care costs and the remaining third could support postal operations.
H.R. 22 also calls for returning to the U.S. Treasury Dept. the obligation for paying the military pensions for former postal workers and for giving the U.S. Postal Service access to a $73 billion escrow account created because of past overpayments into the Civil Service Retirement System.
Removing these payment obligations could possibly forestall the need for a rate case.
“The White House wants a ‘deficit neutral’ solution to this problem, in other words one that would not add to the deficit,” McLean noted. “We don’t want the postal rate payers to be paying for the deficit.”
McLean said the Mailers Council was having meetings with Sen. Susan Collins (R-ME), sponsor of postal reform bill S. 662 over scheduling floor time for the bill.
“One thing that is complicating this is the Supreme Court nominee situation,” he said. [President Bush has nominated John Roberts to fill the vacancy left by retiring Justice Sandra Day O’Connor].
“That will eat up floor time since the Senate does not seem good at handling more than one big issue at a time,” said McLean.
“To see the amount of bi-partisan cooperation was nothing less than exciting,” said Neal Denton, executive director of the Alliance of Nonprofit Mailers. He noted the House voted down three amendments to the bill that could weaken it and would probably represent the administration’s objections to the bill in a House-Senate conference committee.
Some those amendments would have called for an experimental postal privatization and weakening the provisions relating to the CSRS and military pension requirements. Denton commended House Government Reform Committee Chairman Rep. Tom Davis (R-VA) and ranking Democrat Rep. Henry Waxman (D-CA) for standing their ground in opposing these amendments.
“I think the bill will pass by end of year,” said Gene Del Polito, president of the Association for Postal Commerce, although he was not optimistic the White House would change its position on the escrow account or getting the Treasury Dept. to reassume paying the military pensions of former postal workers.
It also remains to be seen, Del Polito pointed out, whether the USPS Board of Governors would try to settle the current rate case that seeks across-the-board increases of 5.4% to take effect early next year.
The BOG is next scheduled to meet Aug. 1 and 2 in Newport Beach, CA.
“If the rate case is settled, there’s less pressure for Congress to act,” said Del Polito.
“While there are still issues that must be worked out, this vote by the Full House is an important step toward much-needed reforms that will allow the Postal Service to operate competitively in the 21st century,” said Jerry Cerasale, senior vice president, of the Direct Marketing Association in a statement. “We are particularly pleased that House bill would help mitigate or delay the current rate request of USPS.
Overall, the bill, also known as the Postal Accountability and Enhancement Act, seeks to preserve universal service, and “modernize” the rate-setting process.
The bill also seeks to change the name of the Postal Rate Commission to the Postal Regulatory Commission and broaden its authority by giving it subpoena power and other powers.
“The legislation is the culmination of a decade of hard work and study, not to mention a great deal of bipartisan negotiation and cooperation,” said Rep. Tom Davis (R-VA), one of the bill’s sponsors. “Consequently, H.R. 22 now represents our best chance at solving the structural, legal, and financial constraints that have brought the Postal Service to the brink of utter breakdown.”
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