A key U.S. House panel on Thursday approved a sweeping Postal Reform bill, trying to find a way to erase billions each year in red ink at the Postal Service.
"This is one of those pieces of legislation, one of those issues, that has to have finality in a brief period of time," said Rep. Dennis Ross (R-FL), who has championed sweeping changes in the Postal Service since he was elected last year.
While the idea of reform drew the backing of both parties, the details of the GOP reform package left Democrats unimpressed, as the bill passed in a mainly party line vote in the Oversight Committee; next stop is the House floor.
To save the Postal Service, we must enact meaningful and immediate reform so we can maintain service to the American people and return it to financial solvency,” said panel Chairman Rep. Darrell Issa (R-CA).
One flash point came on labor issues, as Republicans kept language that would bar "no-layoff" clauses in collective bargaining agreements.
Another controversial part of this bill would allow the Postal Service to get rid of Saturday mail delivery as a way to save several billion dollars each year.
But the committee amended that plan to say the Postal Service could not do that for six months, and offered another way to reduce service, by having 12 "non-delivery" days each year - basically a mail holiday.
The Postal Service has argued for months that the Congress should give it the power to make the change to five day a week mail delivery.
"Five-day delivery is one of the fundamental changes that will help the Postal Service better respond to changing customer needs," USPS officials argue.
Here is a summary of the GOP reform bill as provided by the House Oversight Committee:
Summary of the H.R. 2309, the Postal Reform Act, as Amended
Prevents Taxpayer Bailouts: plan delivers an efficient, effective Postal Service without the thinly-veiled taxpayer bailout proposed by other bills and thoroughly denounced by the Government Accountability Office.
Modernizes Delivery Standards: the Postal Reform Act saves an estimated $3 billion a year by giving the Postal Service the option of eliminating Saturday delivery six months after the enactment of the legislation. According to polling by Quinnipiac University, 79% of the American people favor moving to 5 day delivery in order to restore the Postal Service to solvency.
Normalizes Rates: phases out many special rates for certain customers that force the Postal Service to actually charge certain customers less than the true cost of delivery, while preserving the ability for non-profits to fundraise and communicate with a mass audience in an economical manner.
Ends Special Treatment for Political Parties: the legislation eliminates the ability of the national and state political committees to use the non-profit mail rate.
Shares Sacrifice in Post Office Consolidations- Empanels a BRAC-style two-year task force, directed to recommend a plan to consolidate redundant post offices - saving at least $1 billion a year, excess mail processing faciliites - saving at least $2 billion per year - and the 30% of management facilities. The legislation ensures that small post offices that do not cost much to operate but serve isolated areas are maintained in order to preserve universal service. Under current closure rules, rural post offices are unfairly targeted by strict formulas on foot traffic that fail to account for community impact. The legislation also preserves appeal rights for citizens affected by post office consolidation.
Normalizes Pay & Benefits: mandates that postal workers pay at least the same health and life insurance premiums federal workers do, and clarifies that compensation parity with the private sector is maintained.
Establishes a Restructuring Authority to Turnaround Postal Defaults:when the Postal Service fails to pay its bills for more than 30 days, a receivership-style authority takes over for USPS management with an explicit mandate to cut costs while maintaining universal service. Management is replaced if they cannot successfully restructure Postal Service finances. Restructuring will be financed with an up to $10 billion line of credit that must be fully collateralized by postal facilities. The restrucutring authority will have the ability to make policy changes to cut costs as well- for instance- by moving from expensive door delivery to curb or clusterboxes in neighborhoods, the Postal Service will save $3.5 billion annually, while maintaining to the greatest extent possible door service in poor, densely populated, and historic neighborhoods. The solvency authority will also have the ability to remove postal workers from the expensive federal workers compensation system to be placed in their own.
Enables Postal Service to Pursue New Revenue: even though the Postal Service is supposed to act like a private business, it can't make money from selling advertisements. The Issa-Ross Postal Reform Act allows USPS to sell advertising space on vehicles and facilities, as long as the ads respect the Postal Service's integrity.
Offers an Affordable Payment Plan for Retiree Health Care Benefits-Allows the Postal Service to make the retiree health care funding payment they can make this year, roughly $1 billion, and pay the balance in equal installments in Fiscal Year 2015 and Fiscal Year 2016.
Surpluses in Pension Accounts to Facilitate Workforce Rightsizing-Provides for consideration of using a net surplus in all Postal Service pension accounts to fund the cost of reducing the size of the postal workforce. This provision protects taxpayers by ensuring that surplus funds are only accessible if there is an actual net surplus in all accounts.
No-More No-Layoff Clauses- No-layoff clauses are prospectively barred in Postal Service collective bargaining agreements. For employees who might lose their job, they will receive a hiring preference at Postal Service contractors. Postal employees would be subject to the same Reduction-in-Force authority as the rest of the federal workforce.
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