HR 6407 RDS
109th CONGRESS
2d Session
H. R. 6407
IN THE SENATE OF THE UNITED STATES
December 8, 2006
Received
AN ACT
To reform the postal laws of the United States.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE- This Act may be cited as the ‘Postal Accountability and Enhancement Act‘.
(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I--DEFINITIONS; POSTAL SERVICES
Sec. 101. Definitions.
Sec. 102. Postal Services.
TITLE II--MODERN RATE REGULATION
Sec. 201. Provisions relating to market-dominant products.
Sec. 202. Provisions relating to competitive products.
Sec. 203. Provisions relating to experimental and new products.
Sec. 204. Reporting requirements and related provisions.
Sec. 205. Complaints; appellate review and enforcement.
Sec. 206. Clerical amendment.
TITLE III--MODERN SERVICE STANDARDS
Sec. 301. Establishment of modern service standards.
Sec. 302. Postal service plan.
TITLE IV--PROVISIONS RELATING TO FAIR COMPETITION
Sec. 401. Postal Service Competitive Products Fund.
Sec. 402. Assumed Federal income tax on competitive products income.
Sec. 403. Unfair competition prohibited.
Sec. 404. Suits by and against the Postal Service.
Sec. 405. International postal arrangements.
TITLE V--GENERAL PROVISIONS
Sec. 501. Qualification and term requirements for Governors.
Sec. 502. Obligations.
Sec. 503. Private carriage of letters.
Sec. 504. Rulemaking authority.
Sec. 505. Noninterference with collective bargaining agreements.
Sec. 506. Bonus authority.
TITLE VI--ENHANCED REGULATORY COMMISSION
Sec. 601. Reorganization and modification of certain provisions relating to the Postal
Regulatory Commission.
Sec. 602. Authority for Postal Regulatory Commission to issue subpoenas.
Sec. 603. Authorization of appropriations from the Postal Service Fund.
Sec. 604. Redesignation of the Postal Rate Commission.
Sec. 605. Inspector General of the Postal Regulatory Commission.
TITLE VII--EVALUATIONS
Sec. 701. Assessments of ratemaking, classification, and other provisions.
Sec. 702. Report on universal postal service and the postal monopoly.
Sec. 703. Study on equal application of laws to competitive products.
Sec. 704. Report on postal workplace safety and workplace-related injuries.
Sec. 705. Study on recycled paper.
Sec. 706. Greater diversity in Postal Service executive and administrative schedule
management positions.
Sec. 707. Contracts with women, minorities, and small businesses.
Sec. 708. Rates for periodicals.
Sec. 709. Assessment of certain rate deficiencies.
Sec. 710. Assessment of future business model of the Postal Service.
Sec. 711. Provisions relating to cooperative mailings.
Sec. 712. Definition.
TITLE VIII--POSTAL SERVICE RETIREMENT AND HEALTH BENEFITS
FUNDING
Sec. 801. Short title.
Sec. 802. Civil Service Retirement System.
Sec. 803. Health insurance.
Sec. 804. Repeal of disposition of savings provision.
Sec. 805. Effective dates.
TITLE IX--COMPENSATION FOR WORK INJURIES
Sec. 901. Temporary disability; continuation of pay.
TITLE X--MISCELLANEOUS
Sec. 1001. Employment of postal police officers.
Sec. 1002. Obsolete provisions.
Sec. 1003. Reduced rates.
Sec. 1004. Sense of Congress regarding Postal Service purchasing reform.
Sec. 1005. Contracts for transportation of mail by air.
Sec. 1006. Date of postmark to be treated as date of appeal in connection with the closing
or consolidation of post offices.
Sec. 1007. Provisions relating to benefits under chapter 81 of title 5, United States Code,
for officers and employees of the former Post Office Department.
Sec. 1008. Hazardous matter.
Sec. 1009. ZIP codes and retail hours.
Sec. 1010. Technical and conforming amendments.
TITLE I--DEFINITIONS; POSTAL SERVICES
SEC. 101. DEFINITIONS.
Section 102 of title 39, United States Code, is amended by striking ‘and‘ at the end of
paragraph (3), by striking the period at the end of paragraph (4) and inserting a
semicolon, and by adding at the end the following:
‘(5) ‘postal service‘ refers to the delivery of letters, printed matter, or mailable packages, including acceptance, collection, sorting, transportation, or other functions ancillary thereto;
‘(6) ‘product‘ means a postal service with a distinct cost or market characteristic for which a rate or rates are, or may reasonably be, applied;
‘(7) ‘rates‘, as used with respect to products, includes fees for postal services;
‘(8) ‘market-dominant product‘ or ‘product in the market-dominant category of mail‘ means a product subject to subchapter I of chapter 36; and
‘(9) ‘competitive product‘ or ‘product in the competitive category of mail‘ means a product subject to subchapter II of chapter 36; and
‘(10) ‘year‘, as used in chapter 36 (other than subchapters I and VI thereof), means a fiscal year.‘.
SEC. 102. POSTAL SERVICES.
(a) IN GENERAL- Section 404 of title 39, United States Code, is amended--
(1) in subsection (a), by striking paragraph (6) and by redesignating paragraphs (7) through (9) as paragraphs (6) through (8), respectively; and
(2) by adding at the end the following:
‘(c)(1) In this subsection, the term ‘nonpostal service‘ means any service that is not a postal service defined under section 102(5).
‘(2) Nothing in this section shall be considered to permit or require that the Postal Service
provide any nonpostal service, except that the Postal Service may provide nonpostal
services which were offered as of January 1, 2006, as provided under this subsection.
‘(3) Not later than 2 years after the date of enactment of the Postal Accountability and
Enhancement Act, the Postal Regulatory Commission shall review each nonpostal service
offered by the Postal Service on the date of enactment of that Act and determine whether
that nonpostal service shall continue, taking into account--
‘(A) the public need for the service; and
‘(B) the ability of the private sector to meet the public need for the service.
‘(4) Any nonpostal service not determined to be continued by the Postal Regulatory
Commission under paragraph (3) shall terminate.
‘(5) If the Postal Regulatory Commission authorizes the Postal Service to continue a
nonpostal service under this subsection, the Postal Regulatory Commission shall
designate whether the service shall be regulated under this title as a market dominant
product, a competitive product, or an experimental product.‘.
(b) CONFORMING AMENDMENTS- Section 1402(b)(1)(B)(ii) of the Victims of Crime
Act of 1984 (98 Stat. 2170; 42 U.S.C. 10601(b)(1)(B)(ii)) is amended by striking
‘404(a)(8)‘ and inserting ‘404(a)(7)‘.
TITLE II--MODERN RATE REGULATION
SEC. 201. PROVISIONS RELATING TO MARKET-DOMINANT PRODUCTS.
(a) IN GENERAL- Chapter 36 of title 39, United States Code, is amended by striking
sections 3621 and 3622 and inserting the following:
‘Sec. 3621. Applicability; definitions
‘(a) APPLICABILITY- This subchapter shall apply with respect to--
‘(1) first-class mail letters and sealed parcels;
‘(2) first-class mail cards;
‘(3) periodicals;
‘(4) standard mail;
‘(5) single-piece parcel post;
‘(6) media mail;
‘(7) bound printed matter;
‘(8) library mail;
‘(9) special services; and
‘(10) single-piece international mail,
subject to any changes the Postal Regulatory Commission may make under section 3642.
‘(b) RULE OF CONSTRUCTION- Mail matter referred to in subsection (a) shall, for
purposes of this subchapter, be considered to have the meaning given to such mail matter
under the mail classification schedule.
‘Sec. 3622. Modern rate regulation
‘(a) AUTHORITY GENERALLY- The Postal Regulatory Commission shall, within 18
months after the date of enactment of this section, by regulation establish (and may from
time to time thereafter by regulation revise) a modern system for regulating rates and
classes for market-dominant products.
‘(b) OBJECTIVES- Such system shall be designed to achieve the following objectives,
each of which shall be applied in conjunction with the others:
‘(1) To maximize incentives to reduce costs and increase efficiency.
‘(2) To create predictability and stability in rates.
‘(3) To maintain high quality service standards established under section 3691.
‘(4) To allow the Postal Service pricing flexibility.
‘(5) To assure adequate revenues, including retained earnings, to maintain financial
stability.
‘(6) To reduce the administrative burden and increase the transparency of the ratemaking
process.
‘(7) To enhance mail security and deter terrorism.
‘(8) To establish and maintain a just and reasonable schedule for rates and classifications,
however the objective under this paragraph shall not be construed to prohibit the Postal
Service from making changes of unequal magnitude within, between, or among classes of
mail.
‘(9) To allocate the total institutional costs of the Postal Service appropriately between
market-dominant and competitive products.
‘(c) FACTORS- In establishing or revising such system, the Postal Regulatory
Commission shall take into account--
‘(1) the value of the mail service actually provided each class or type of mail service to
both the sender and the recipient, including but not limited to the collection, mode of
transportation, and priority of delivery;
‘(2) the requirement that each class of mail or type of mail service bear the direct and
indirect postal costs attributable to each class or type of mail service through reliably
identified causal relationships plus that portion of all other costs of the Postal Service
reasonably assignable to such class or type;
‘(3) the effect of rate increases upon the general public, business mail users, and
enterprises in the private sector of the economy engaged in the delivery of mail matter
other than letters;
‘(4) the available alternative means of sending and receiving letters and other mail matter
at reasonable costs;
‘(5) the degree of preparation of mail for delivery into the postal system performed by the
mailer and its effect upon reducing costs to the Postal Service;
‘(6) simplicity of structure for the entire schedule and simple, identifiable relationships
between the rates or fees charged the various classes of mail for postal services;
‘(7) the importance of pricing flexibility to encourage increased mail volume and
operational efficiency;
‘(8) the relative value to the people of the kinds of mail matter entered into the postal
system and the desirability and justification for special classifications and services of
mail;
‘(9) the importance of providing classifications with extremely high degrees of reliability
and speed of delivery and of providing those that do not require high degrees of
reliability and speed of delivery;
‘(10) the desirability of special classifications for both postal users and the Postal Service
in accordance with the policies of this title, including agreements between the Postal
Service and postal users, when available on public and reasonable terms to similarly
situated mailers, that--
‘(A) either--
‘(i) improve the net financial position of the Postal Service through reducing Postal
Service costs or increasing the overall contribution to the institutional costs of the Postal
Service; or
‘(ii) enhance the performance of mail preparation, processing, transportation, or other
functions; and
‘(B) do not cause unreasonable harm to the marketplace.
‘(11) the educational, cultural, scientific, and informational value to the recipient of mail
matter;
‘(12) the need for the Postal Service to increase its efficiency and reduce its costs,
including infrastructure costs, to help maintain high quality, affordable postal services;
(13) the value to the Postal Service and postal users of promoting intelligent mail and of
secure, sender-identified mail; and
‘(14) the policies of this title as well as such other factors as the Commission determines
appropriate.
‘(d) REQUIREMENTS-
‘(1) IN GENERAL- The system for regulating rates and classes for market-dominant
products shall--
‘(A) include an annual limitation on the percentage changes in rates to be set by the
Postal Regulatory Commission that will be equal to the change in the Consumer Price
Index for All Urban Consumers unadjusted for seasonal variation over the most recent
available 12-month period preceding the date the Postal Service files notice of its
intention to increase rates;
‘(B) establish a schedule whereby rates, when necessary and appropriate, would change
at regular intervals by predictable amounts;
‘(C) not later than 45 days before the implementation of any adjustment in rates under
this section, including adjustments made under subsection (c)(10)--
‘(i) require the Postal Service to provide public notice of the adjustment;
‘(ii) provide an opportunity for review by the Postal Regulatory Commission;
‘(iii) provide for the Postal Regulatory Commission to notify the Postal Service of any
noncompliance of the adjustment with the limitation under subparagraph (A); and
‘(iv) require the Postal Service to respond to the notice provided under clause (iii) and
describe the actions to be taken to comply with the limitation under subparagraph (A);
‘(D) establish procedures whereby the Postal Service may adjust rates not in excess of the
annual limitations under subparagraph (A); and
‘(E) notwithstanding any limitation set under subparagraphs (A) and (C), and provided
there is not sufficient unused rate authority under paragraph (2)(C), establish procedures
whereby rates may be adjusted on an expedited basis due to either extraordinary or
exceptional circumstances, provided that the Commission determines, after notice and
opportunity for a public hearing and comment, and within 90 days after any request by
the Postal Service, that such adjustment is reasonable and equitable and necessary to
enable the Postal Service, under best practices of honest, efficient, and economical
management, to maintain and continue the development of postal services of the kind and
quality adapted to the needs of the United States.
‘(2) LIMITATIONS-
‘(A) CLASSES OF MAIL- Except as provided under subparagraph (C), the annual
limitations under paragraph (1)(A) shall apply to a class of mail, as defined in the
Domestic Mail Classification Schedule as in effect on the date of enactment of the Postal
Accountability and Enhancement Act.
‘(B) ROUNDING OF RATES AND FEES- Nothing in this subsection shall preclude the
Postal Service from rounding rates and fees to the nearest whole integer, if the effect of
such rounding does not cause the overall rate increase for any class to exceed the
Consumer Price Index for All Urban Consumers.
‘(C) USE OF UNUSED RATE AUTHORITY-
‘(i) DEFINITION- In this subparagraph, the term ‘unused rate adjustment authority‘
means the difference between--
‘(I) the maximum amount of a rate adjustment that the Postal Service is authorized to
make in any year subject to the annual limitation under paragraph (1); and
‘(II) the amount of the rate adjustment the Postal Service actually makes in that year.
‘(ii) AUTHORITY- Subject to clause (iii), the Postal Service may use any unused rate
adjustment authority for any of the 5 years following the year such authority occurred.
‘(iii) LIMITATIONS- In exercising the authority under clause (ii) in any year, the Postal
Service--
‘(I) may use unused rate adjustment authority from more than 1 year;
‘(II) may use any part of the unused rate adjustment authority from any year;
‘(III) shall use the unused rate adjustment authority from the earliest year such authority
first occurred and then each following year; and
‘(IV) for any class or service, may not exceed the annual limitation under paragraph (1)
by more than 2 percentage points.
‘(3) REVIEW- Ten years after the date of enactment of the Postal Accountability and
Enhancement Act and as appropriate thereafter, the Commission shall review the system
for regulating rates and classes for market-dominant products established under this
section to determine if the system is achieving the objectives in subsection (b), taking
into account the factors in subsection (c). If the Commission determines, after notice and
opportunity for public comment, that the system is not achieving the objectives in
subsection (b), taking into account the factors in subsection (c), the Commission may, by
regulation, make such modification or adopt such alternative system for regulating rates
and classes for market-dominant products as necessary to achieve the objectives.
‘(e) WORKSHARE DISCOUNTS-
‘(1) DEFINITION- In this subsection, the term ‘workshare discount‘ refers to rate
discounts provided to mailers for the presorting, prebarcoding, handling, or transportation
of mail, as further defined by the Postal Regulatory Commission under subsection (a).
‘(2) SCOPE- The Postal Regulatory Commission shall ensure that such discounts do not
exceed the cost that the Postal Service avoids as a result of workshare activity, unless--
‘(A) the discount is--
‘(i) associated with a new postal service, a change to an existing postal service, or with a
new work share initiative related to an existing postal service; and
‘(ii) necessary to induce mailer behavior that furthers the economically efficient
operation of the Postal Service and the portion of the discount in excess of the cost that
the Postal Service avoids as a result of the workshare activity will be phased out over a
limited period of time;
‘(B) the amount of the discount above costs avoided--
‘(i) is necessary to mitigate rate shock; and
‘(ii) will be phased out over time;
‘(C) the discount is provided in connection with subclasses of mail consisting exclusively
of mail matter of educational, cultural, scientific, or informational value; or
‘(D) reduction or elimination of the discount would impede the efficient operation of the
Postal Service.
‘(3) LIMITATION- Nothing in this subsection shall require that a work share discount be
reduced or eliminated if the reduction or elimination of the discount would--
‘(A) lead to a loss of volume in the affected category or subclass of mail and reduce the
aggregate contribution to the institutional costs of the Postal Service from the category or
subclass subject to the discount below what it otherwise would have been if the discount
had not been reduced or eliminated; or
‘(B) result in a further increase in the rates paid by mailers not able to take advantage of
the discount.
‘(4) REPORT- Whenever the Postal Service establishes a workshare discount rate, the
Postal Service shall, at the time it publishes the workshare discount rate, submit to the
Postal Regulatory Commission a detailed report that--
‘(A) explains the Postal Service‘s reasons for establishing the rate;
‘(B) sets forth the data, economic analyses, and other information relied on by the Postal
Service to justify the rate; and
‘(C) certifies that the discount will not adversely affect rates or services provided to users
of postal services who do not take advantage of the discount rate.
‘(f) Transition Rule- For the 1-year period beginning on the date of enactment of this
section, rates and classes for market-dominant products shall remain subject to
modification in accordance with the provisions of this chapter and section 407, as such
provisions were last in effect before the date of enactment of this section. Proceedings
initiated to consider a request for a recommended decision filed by the Postal Service
during that 1-year period shall be completed in accordance with subchapter II of chapter
36 of this title and implementing regulations, as in effect before the date of enactment of
this section.‘.
(b) REPEALED SECTIONS- Sections 3623, 3624, 3625, and 3628 of title 39, United
States Code, are repealed.
(c) REDESIGNATION- Chapter 36 of title 39, United States Code (as in effect after the
amendment made by section 601, but before the amendment made by section 202) is
amended by striking the heading for subchapter II and inserting the following:
‘SUBCHAPTER I--PROVISIONS RELATING TO MARKET-DOMINANT
PRODUCTS‘.
SEC. 202. PROVISIONS RELATING TO COMPETITIVE PRODUCTS.
Chapter 36 of title 39, United States Code, is amended by inserting after section 3629 the
following:
‘SUBCHAPTER II--PROVISIONS RELATING TO COMPETITIVE PRODUCTS
‘Sec. 3631. Applicability; definitions and updates
‘(a) APPLICABILITY- This subchapter shall apply with respect to--
‘(1) priority mail;
‘(2) expedited mail;
‘(3) bulk parcel post;
‘(4) bulk international mail; and
‘(5) mailgrams;
subject to subsection (d) and any changes the Postal Regulatory Commission may make
under section 3642.
‘(b) DEFINITION- For purposes of this subchapter, the term ‘costs attributable‘, as used
with respect to a product, means the direct and indirect postal costs attributable to such
product through reliably identified causal relationships.
‘(c) RULE OF CONSTRUCTION- Mail matter referred to in subsection (a) shall, for
purposes of this subchapter, be considered to have the meaning given to such mail matter
under the mail classification schedule.
‘Sec. 3632. Action of the Governors
‘(a) AUTHORITY TO ESTABLISH RATES AND CLASSES- The Governors, with the
concurrence of a majority of all of the Governors then holding office, shall establish rates
and classes for products in the competitive category of mail in accordance with the
requirements of this subchapter and regulations promulgated under section 3633.
‘(b) PROCEDURES-
‘(1) IN GENERAL- Rates and classes shall be established in writing, complete with a
statement of explanation and justification, and the date as of which each such rate or class
takes effect.
‘(2) RATES OR CLASSES OF GENERAL APPLICABILITY- In the case of rates or
classes of general applicability in the Nation as a whole or in any substantial region of the
Nation, the Governors shall cause each rate and class decision under this section and the
record of the Governors‘ proceedings in connection with such decision to be published in
the Federal Register at least 30 days before the effective date of any new rates or classes.
‘(3) RATES OR CLASSES NOT OF GENERAL APPLICABILITY- In the case of rates
or classes not of general applicability in the Nation as a whole or in any substantial region
of the Nation, the Governors shall cause each rate and class decision under this section
and the record of the proceedings in connection with such decision to be filed with the
Postal Regulatory Commission by such date before the effective date of any new rates or
classes as the Governors consider appropriate, but in no case less than 15 days.
‘(4) CRITERIA- As part of the regulations required under section 3633, the Postal
Regulatory Commission shall establish criteria for determining when a rate or class
established under this subchapter is or is not of general applicability in the Nation as a
whole or in any substantial region of the Nation.
‘(c) TRANSITION RULE- Until regulations under section 3633 first take effect, rates
and classes for competitive products shall remain subject to modification in accordance
with the provisions of this chapter and section 407, as such provisions were as last in
effect before the date of enactment of this section.
‘Sec. 3633. Provisions applicable to rates for competitive products
‘(a) IN GENERAL- The Postal Regulatory Commission shall, within 18 months after the
date of enactment of this section, promulgate (and may from time to time thereafter
revise) regulations to--
‘(1) prohibit the subsidization of competitive products by market-dominant products;
‘(2) ensure that each competitive product covers its costs attributable; and
‘(3) ensure that all competitive products collectively cover what the Commission
determines to be an appropriate share of the institutional costs of the Postal Service.
‘(b) REVIEW OF MINIMUM CONTRIBUTION- Five years after the date of enactment
of this section, and every 5 years thereafter, the Postal Regulatory Commission shall
conduct a review to determine whether the institutional costs contribution requirement
under subsection (a)(3) should be retained in its current form, modified, or eliminated. In
making its determination, the Commission shall consider all relevant circumstances,
including the prevailing competitive conditions in the market, and the degree to which
any costs are uniquely or disproportionately associated with any competitive products.‘.
SEC. 203. PROVISIONS RELATING TO EXPERIMENTAL AND NEW PRODUCTS.
Subchapter III of chapter 36 of title 39, United States Code, is amended to read as
follows:
‘SUBCHAPTER III--PROVISIONS RELATING TO EXPERIMENTAL AND NEW
PRODUCTS
‘Sec. 3641. Market tests of experimental products
‘(a) AUTHORITY-
‘(1) IN GENERAL- The Postal Service may conduct market tests of experimental
products in accordance with this section.
‘(2) PROVISIONS WAIVED- A product shall not, while it is being tested under this
section, be subject to the requirements of sections 3622, 3633, or 3642, or regulations
promulgated under those sections.
‘(b) CONDITIONS- A product may not be tested under this section unless it satisfies
each of the following:
‘(1) SIGNIFICANTLY DIFFERENT PRODUCT- The product is, from the viewpoint of
the mail users, significantly different from all products offered by the Postal Service
within the 2-year period preceding the start of the test.
‘(2) MARKET DISRUPTION- The introduction or continued offering of the product will
not create an unfair or otherwise inappropriate competitive advantage for the Postal
Service or any mailer, particularly in regard to small business concerns (as defined under
subsection (h)).
‘(3) CORRECT CATEGORIZATION- The Postal Service identifies the product, for the
purpose of a test under this section, as either market-dominant or competitive, consistent
with the criteria under section 3642(b)(1). Costs and revenues attributable to a product
identified as competitive shall be included in any determination under section 3633(3)
(relating to provisions applicable to competitive products collectively). Any test that
solely affects products currently classified as competitive, or which provides services
ancillary to only competitive products, shall be presumed to be in the competitive product
category without regard to whether a similar ancillary product exists for market-dominant
products.
‘(c) NOTICE-
‘(1) IN GENERAL- At least 30 days before initiating a market test under this section, the
Postal Service shall file with the Postal Regulatory Commission and publish in the
Federal Register a notice--
‘(A) setting out the basis for the Postal Service‘s determination that the market test is
covered by this section; and
‘(B) describing the nature and scope of the market test.
‘(2) SAFEGUARDS- For a competitive experimental product, the provisions of section
504(g) shall be available with respect to any information required to be filed under
paragraph (1) to the same extent and in the same manner as in the case of any matter
described in section 504(g)(1). Nothing in paragraph (1) shall be considered to permit or
require the publication of any information as to which confidential treatment is accorded
under the preceding sentence (subject to the same exception as set forth in section
504(g)(3)).
‘(d) DURATION-
‘(1) IN GENERAL- A market test of a product under this section may be conducted over
a period of not to exceed 24 months.
‘(2) EXTENSION AUTHORITY- If necessary in order to determine the feasibility or
desirability of a product being tested under this section, the Postal Regulatory
Commission may, upon written application of the Postal Service (filed not later than 60
days before the date as of which the testing of such product would otherwise be
scheduled to terminate under paragraph (1)), extend the testing of such product for not to
exceed an additional 12 months.
‘(e) DOLLAR-AMOUNT LIMITATION-
‘(1) IN GENERAL- A product may only be tested under this section if the total revenues
that are anticipated, or in fact received, by the Postal Service from such product do not
exceed $10,000,000 in any year, subject to paragraph (2) and subsection (g). In carrying
out the preceding sentence, the Postal Regulatory Commission may limit the amount of
revenues the Postal Service may obtain from any particular geographic market as
necessary to prevent market disruption (as defined under subsection (b)(2)).
‘(2) EXEMPTION AUTHORITY- The Postal Regulatory Commission may, upon written
application of the Postal Service, exempt the market test from the limit in paragraph (1) if
the total revenues that are anticipated, or in fact received, by the Postal Service from such
product do not exceed $50,000,000 in any year, subject to subsection (g). In reviewing an
application under this paragraph, the Postal Regulatory Commission shall approve such
application if it determines that--
‘(A) the product is likely to benefit the public and meet an expected demand;
‘(B) the product is likely to contribute to the financial stability of the Postal Service; and
‘(C) the product is not likely to result in unfair or otherwise inappropriate competition.
‘(f) CANCELLATION- If the Postal Regulatory Commission at any time determines that
a market test under this section fails, with respect to any particular product, to meet 1 or
more of the requirements of this section, it may order the cancellation of the test involved
or take such other action as it considers appropriate. A determination under this
subsection shall be made in accordance with such procedures as the Commission shall by
regulation prescribe.
‘(g) ADJUSTMENT FOR INFLATION- For purposes of each year following the year in
which occurs the deadline for the Postal Service‘s first report to the Postal Regulatory
Commission under section 3652(a), each dollar amount contained in this section shall be
adjusted by the change in the Consumer Price Index for such year (as determined under
regulations of the Commission).
‘(h) DEFINITION OF A SMALL BUSINESS CONCERN- The criteria used in defining
small business concerns or otherwise categorizing business concerns as small business
concerns shall, for purposes of this section, be established by the Postal Regulatory
Commission in conformance with the requirements of section 3 of the Small Business
Act.
‘(i) EFFECTIVE DATE- Market tests under this subchapter may be conducted in any
year beginning with the first year in which occurs the deadline for the Postal Service‘s
first report to the Postal Regulatory Commission under section 3652(a).
‘Sec. 3642. New products and transfers of products between the market-dominant and
competitive categories of mail
‘(a) IN GENERAL- Upon request of the Postal Service or users of the mails, or upon its
own initiative, the Postal Regulatory Commission may change the list of marketdominant
products under section 3621 and the list of competitive products under section
3631 by adding new products to the lists, removing products from the lists, or transferring
products between the lists.
‘(b) CRITERIA- All determinations by the Postal Regulatory Commission under
subsection (a) shall be made in accordance with the following criteria:
‘(1) The market-dominant category of products shall consist of each product in the sale of
which the Postal Service exercises sufficient market power that it can effectively set the
price of such product substantially above costs, raise prices significantly, decrease
quality, or decrease output, without risk of losing a significant level of business to other
firms offering similar products. The competitive category of products shall consist of all
other products.
‘(2) EXCLUSION OF PRODUCTS COVERED BY POSTAL MONOPOLY- A product
covered by the postal monopoly shall not be subject to transfer under this section from
the market-dominant category of mail. For purposes of the preceding sentence, the term
‘product covered by the postal monopoly‘ means any product the conveyance or
transmission of which is reserved to the United States under section 1696 of title 18,
subject to the same exception as set forth in the last sentence of section 409(e)(1).
‘(3) ADDITIONAL CONSIDERATIONS- In making any decision under this section,
due regard shall be given to--
‘(A) the availability and nature of enterprises in the private sector engaged in the delivery
of the product involved;
‘(B) the views of those who use the product involved on the appropriateness of the
proposed action; and
‘(C) the likely impact of the proposed action on small business concerns (within the
meaning of section 3641(h)).
‘(c) TRANSFERS OF SUBCLASSES AND OTHER SUBORDINATE UNITS
ALLOWABLE- Nothing in this title shall be considered to prevent transfers under this
section from being made by reason of the fact that they would involve only some (but not
all) of the subclasses or other subordinate units of the class of mail or type of postal
service involved (without regard to satisfaction of minimum quantity requirements
standing alone).
‘(d) NOTIFICATION AND PUBLICATION REQUIREMENTS-
‘(1) NOTIFICATION REQUIREMENT- The Postal Service shall, whenever it requests
to add a product or transfer a product to a different category, file with the Postal
Regulatory Commission and publish in the Federal Register a notice setting out the basis
for its determination that the product satisfies the criteria under subsection (b) and, in the
case of a request to add a product or transfer a product to the competitive category of
mail, that the product meets the regulations promulgated by the Postal Regulatory
Commission under section 3633. The provisions of section 504(g) shall be available with
respect to any information required to be filed.
‘(2) PUBLICATION REQUIREMENT- The Postal Regulatory Commission shall,
whenever it changes the list of products in the market-dominant or competitive category
of mail, prescribe new lists of products. The revised lists shall indicate how and when any
previous lists (including the lists under sections 3621 and 3631) are superseded, and shall
be published in the Federal Register.
‘(e) PROHIBITION- Except as provided in section 3641, no product that involves the
physical delivery of letters, printed matter, or packages may be offered by the Postal
Service unless it has been assigned to the market-dominant or competitive category of
mail (as appropriate) either--
‘(1) under this subchapter; or
‘(2) by or under any other provision of law.‘.
SEC. 204. REPORTING REQUIREMENTS AND RELATED PROVISIONS.
(a) REDESIGNATION- Chapter 36 of title 39, United States Code (as in effect before
the amendment made by subsection (b)) is amended--
(1) by striking the heading for subchapter IV and inserting the following:
‘SUBCHAPTER V--POSTAL SERVICES, COMPLAINTS, AND JUDICIAL
REVIEW‘; and
(2) by striking the heading for subchapter V and inserting the following:
‘SUBCHAPTER VI--GENERAL‘.
(b) REPORTS AND COMPLIANCE- Chapter 36 of title 39, United States Code, is
amended by inserting after subchapter III the following:
‘SUBCHAPTER IV--REPORTING REQUIREMENTS AND RELATED PROVISIONS
‘Sec. 3651. Annual reports by the Commission
‘(a) IN GENERAL- The Postal Regulatory Commission shall submit an annual report to
the President and the Congress concerning the operations of the Commission under this
title, including the extent to which regulations are achieving the objectives under sections
3622 and 3633, respectively.
‘(b) ADDITIONAL INFORMATION-
‘(1) IN GENERAL- In addition to the information required under subsection (a), each
report under this section shall also include, with respect to the period covered by such
report, an estimate of the costs incurred by the Postal Service in providing--
‘(A) postal services to areas of the Nation where, in the judgment of the Postal
Regulatory Commission, the Postal Service either would not provide services at all or
would not provide such services in accordance with the requirements of this title if the
Postal Service were not required to provide prompt, reliable, and efficient services to
patrons in all areas and all communities, including as required under the first sentence of
section 101(b);
‘(B) free or reduced rates for postal services as required by this title; and
‘(C) other public services or activities which, in the judgment of the Postal Regulatory
Commission, would not otherwise have been provided by the Postal Service but for the
requirements of law.
‘(2) BASIS FOR ESTIMATES- The Commission shall detail the basis for its estimates
and the statutory requirements giving rise to the costs identified in each report under this
section.
‘(c) INFORMATION FROM POSTAL SERVICE- The Postal Service shall provide the
Postal Regulatory Commission with such information as may, in the judgment of the
Commission, be necessary in order for the Commission to prepare its reports under this
section.
‘Sec. 3652. Annual reports to the Commission
‘(a) COSTS, REVENUES, RATES, AND SERVICE- Except as provided in subsection
(c), the Postal Service shall, no later than 90 days after the end of each year, prepare and
submit to the Postal Regulatory Commission a report (together with such nonpublic
annex to the report as the Commission may require under subsection (e))--
‘(1) which shall analyze costs, revenues, rates, and quality of service, using such
methodologies as the Commission shall by regulation prescribe, and in sufficient detail to
demonstrate that all products during such year complied with all applicable requirements
of this title; and
‘(2) which shall, for each market-dominant product provided in such year, provide--
‘(A) product information, including mail volumes; and
‘(B) measures of the quality of service afforded by the Postal Service in connection with
such product, including--
‘(i) the level of service (described in terms of speed of delivery and reliability) provided;
and
‘(ii) the degree of customer satisfaction with the service provided.
The Inspector General shall regularly audit the data collection systems and procedures
utilized in collecting information and preparing such report (including any annex thereto
and the information required under subsection (b)). The results of any such audit shall be
submitted to the Postal Service and the Postal Regulatory Commission.
‘(b) INFORMATION RELATING TO WORKSHARE DISCOUNTS- The Postal
Service shall include, in each report under subsection (a), the following information with
respect to each market-dominant product for which a workshare discount was in effect
during the period covered by such report:
‘(1) The per-item cost avoided by the Postal Service by virtue of such discount.
‘(2) The percentage of such per-item cost avoided that the per-item workshare discount
represents.
‘(3) The per-item contribution made to institutional costs.
‘(c) MARKET TESTS- In carrying out subsections (a) and (b) with respect to
experimental products offered through market tests under section 3641 in a year, the
Postal Service shall--
‘(1) report data on the costs, revenues, and quality of service by market test, which may
be reported in summary form; and
‘(2) report such data as the Postal Regulatory Commission requires.
‘(d) SUPPORTING MATTER- The Postal Regulatory Commission shall have access, in
accordance with such regulations as the Commission shall prescribe, to the working
papers and any other supporting matter of the Postal Service and the Inspector General in
connection with any information submitted under this section.
‘(e) CONTENT AND FORM OF REPORTS-
‘(1) IN GENERAL- The Postal Regulatory Commission shall, by regulation, prescribe
the content and form of the public reports (and any nonpublic annex and supporting
matter relating to the report) to be provided by the Postal Service under this section. In
carrying out this subsection, the Commission shall give due consideration to--
‘(A) providing the public with timely, adequate information to assess the lawfulness of
rates charged;
‘(B) avoiding unnecessary or unwarranted administrative effort and expense on the part
of the Postal Service; and
‘(C) protecting the confidentiality of commercially sensitive information.
‘(2) REVISED REQUIREMENTS- The Commission may, on its own motion or on
request of an interested party, initiate proceedings (to be conducted in accordance with
regulations that the Commission shall prescribe) to improve the quality, accuracy, or
completeness of Postal Service data required by the Commission under this subsection
whenever it shall appear that--
‘(A) the attribution of costs or revenues to products has become significantly inaccurate
or can be significantly improved;
‘(B) the quality of service data has become significantly inaccurate or can be significantly
improved; or
‘(C) such revisions are, in the judgment of the Commission, otherwise necessitated by the
public interest.
‘(f) CONFIDENTIAL INFORMATION-
‘(1) IN GENERAL- If the Postal Service determines that any document or portion of a
document, or other matter, which it provides to the Postal Regulatory Commission in a
nonpublic annex under this section or under subsection (d) contains information which is
described in section 410(c) of this title, or exempt from public disclosure under section
552(b) of title 5, the Postal Service shall, at the time of providing such matter to the
Commission, notify the Commission of its determination, in writing, and describe with
particularity the documents (or portions of documents) or other matter for which
confidentiality is sought and the reasons therefor.
‘(2) TREATMENT- Any information or other matter described in paragraph (1) to which
the Commission gains access under this section shall be subject to paragraphs (2) and (3)
of section 504(g) in the same way as if the Commission had received notification with
respect to such matter under section 504(g)(1).
‘(g) OTHER REPORTS- The Postal Service shall submit to the Postal Regulatory
Commission, together with any other submission that the Postal Service is required to
make under this section in a year, copies of its then most recent--
‘(1) comprehensive statement under section 2401(e);
‘(2) performance plan under section 2803; and
‘(3) program performance reports under section 2804.
‘Sec. 3653. Annual determination of compliance
‘(a) OPPORTUNITY FOR PUBLIC COMMENT- After receiving the reports required
under section 3652 for any year, the Postal Regulatory Commission shall promptly
provide an opportunity for comment on such reports by users of the mails, affected
parties, and an officer of the Commission who shall be required to represent the interests
of the general public.
‘(b) DETERMINATION OF COMPLIANCE OR NONCOMPLIANCE- Not later than
90 days after receiving the submissions required under section 3652 with respect to a
year, the Postal Regulatory Commission shall make a written determination as to--
‘(1) whether any rates or fees in effect during such year (for products individually or
collectively) were not in compliance with applicable provisions of this chapter (or
regulations promulgated thereunder); or
‘(2) whether any service standards in effect during such year were not met.
If, with respect to a year, no instance of noncompliance is found under this subsection to
have occurred in such year, the written determination shall be to that effect.
‘(c) NONCOMPLIANCE WITH REGARD TO RATES OR SERVICES- If, for a year, a
timely written determination of noncompliance is made under subsection (b), the Postal
Regulatory Commission shall take appropriate action in accordance with subsections (c)
and (e) of section 3662 (as if a complaint averring such noncompliance had been duly
filed and found under such section to be justified).
‘(d) REVIEW OF PERFORMANCE GOALS- The Postal Regulatory Commission shall
also evaluate annually whether the Postal Service has met the goals established under
sections 2803 and 2804, and may provide recommendations to the Postal Service related
to the protection or promotion of public policy objectives set out in this title.
‘(e) REBUTTABLE PRESUMPTION- A timely written determination described in the
last sentence of subsection (b) shall, for purposes of any proceeding under section 3662,
create a rebuttable presumption of compliance by the Postal Service (with regard to the
matters described under paragraphs (1) and (2) of subsection (b)) during the year to
which such determination relates.
‘Sec. 3654. Additional financial reporting
‘(a) ADDITIONAL FINANCIAL REPORTING-
‘(1) IN GENERAL- The Postal Service shall file with the Postal Regulatory Commission
beginning with the first full fiscal year following the effective date of this section--
‘(A) within 40 days after the end of each fiscal quarter, a quarterly report containing the
information required by the Securities and Exchange Commission to be included in
quarterly reports under sections 13 and 15(d) of the Securities Exchange Act of 1934 (15
U.S.C. 78m, 78o(d)) on Form 10-Q, as such Form (or any successor form) may be
revised from time to time;
‘(B) within 60 days after the end of each fiscal year, an annual report containing the
information required by the Securities and Exchange Commission to be included in
annual reports under such sections on Form 10-K, as such Form (or any successor form)
may be revised from time to time; and
‘(C) periodic reports within the time frame and containing the information prescribed in
Form 8-K of the Securities and Exchange Commission, as such Form (or any successor
form) may be revised from time to time.
‘(2) REGISTRANT DEFINED- For purposes of defining the reports required by
paragraph (1), the Postal Service shall be deemed to be the ‘registrant‘ described in the
Securities and Exchange Commission Forms, and references contained in such Forms to
Securities and Exchange Commission regulations are incorporated herein by reference, as
amended.
‘(3) INTERNAL CONTROL REPORT- For purposes of defining the reports required by
paragraph (1)(B), the Postal Service shall comply with the rules prescribed by the
Securities and Exchange Commission implementing section 404 of the Sarbanes-Oxley
Act of 2002 (15 U.S.C. 7262), beginning with the annual report for fiscal year 2010.
‘(b) FINANCIAL REPORTING-
‘(1) The reports required by subsection (a)(1)(B) shall include, with respect to the Postal
Service‘s pension and post-retirement health obligations--
‘(A) the funded status of the Postal Service‘s pension and postretirement health
obligations;
‘(B) components of the net change in the fund balances and obligations and the nature
and cause of any significant changes;
‘(C) components of net periodic costs;
‘(D) cost methods and assumptions underlying the relevant actuarial valuations;
‘(E) the effect of a one-percentage point increase in the assumed health care cost trend
rate for each future year on the service and interest costs components of net periodic
postretirement health cost and the accumulated obligation;
‘(F) actual contributions to and payments from the funds for the years presented and the
estimated future contributions and payments for each of the following 5 years;
‘(G) the composition of plan assets reflected in the fund balances; and
‘(H) the assumed rate of return on fund balances and the actual rates of return for the
years presented.
‘(2) The Office of Personnel Management shall provide the data listed under paragraph
(1) to the Postal Service not later than 30 days after the end of each fiscal year.
‘(3)(A) Beginning with reports for the fiscal year 2010, for purposes of the reports
required under subparagraphs (A) and (B) of subsection (a)(1), the Postal Service shall
include segment reporting.
‘(B) The Postal Service shall determine the appropriate segment reporting under
subparagraph (A) after consultation with the Postal Regulatory Commission.
‘(c) TREATMENT- For purposes of the reports required by subsection (a)(1)(B), the
Postal Service shall obtain an opinion from an independent auditor on whether the
information listed in subsection (b) is fairly stated in all material respects, either in
relation to the basic financial statements as a whole or on a stand-alone basis.
‘(d) SUPPORTING MATTER- The Postal Regulatory Commission shall have access to
the audit documentation and any other supporting matter of the Postal Service and its
independent auditor in connection with any information submitted under this section.
‘(e) REVISED REQUIREMENTS- The Postal Regulatory Commission may, on its own
motion or on request of an interested party, initiate proceedings (to be conducted in
accordance with regulations that the Commission shall prescribe) to improve the quality,
accuracy, or completeness of Postal Service data required under this section whenever it
shall appear that--
‘(1) the data have become significantly inaccurate or can be significantly improved; or
‘(2) those revisions are, in the judgment of the Commission, otherwise necessitated by
the public interest.
‘(f) CONFIDENTIAL INFORMATION-
‘(1) IN GENERAL- If the Postal Service determines that any document or portion of a
document, or other matter, which it provides to the Postal Regulatory Commission in a
nonpublic annex under this section or pursuant to subsection (d) contains information
which is described in section 410(c) of this title, or exempt from public disclosure under
section 552(b) of title 5, the Postal Service shall, at the time of providing such matter to
the Commission, notify the Commission of its determination, in writing, and describe
with particularity the documents (or portions of documents) or other matter for which
confidentiality is sought and the reasons therefor.
‘(2) TREATMENT- Any information or other matter described in paragraph (1) to which
the Commission gains access under this section shall be subject to paragraphs (2) and (3)
of section 504(g) in the same way as if the Commission had received notification with
respect to such matter under section 504(g)(1).‘.
SEC. 205. COMPLAINTS; APPELLATE REVIEW AND ENFORCEMENT.
Chapter 36 of title 39, United States Code, is amended by striking sections 3662 and
3663 and inserting the following:
‘Sec. 3662. Rate and service complaints
‘(a) In General- Any interested person (including an officer of the Postal Regulatory
Commission representing the interests of the general public) who believes the Postal
Service is not operating in conformance with the requirements of the provisions of
sections 101(d), 401(2), 403(c), 404a, or 601, or this chapter (or regulations promulgated
under any of those provisions) may lodge a complaint with the Postal Regulatory
Commission in such form and manner as the Commission may prescribe.
‘(b) Prompt Response Required-
‘(1) IN GENERAL- The Postal Regulatory Commission shall, within 90 days after
receiving a complaint under subsection (a)--
‘(A) either--
‘(i) upon a finding that such complaint raises material issues of fact or law, begin
proceedings on such complaint; or
‘(ii) issue an order dismissing the complaint; and
‘(B) with respect to any action taken under subparagraph (A) (i) or (ii), issue a written
statement setting forth the bases of its determination.
‘(2) TREATMENT OF COMPLAINTS NOT TIMELY ACTED ON- For purposes of
section 3663, any complaint under subsection (a) on which the Commission fails to act in
the time and manner required by paragraph (1) shall be treated in the same way as if it
had been dismissed pursuant to an order issued by the Commission on the last day
allowable for the issuance of such order under paragraph (1).
‘(c) Action Required if Complaint Found To Be Justified- If the Postal Regulatory
Commission finds the complaint to be justified, it shall order that the Postal Service take
such action as the Commission considers appropriate in order to achieve compliance with
the applicable requirements and to remedy the effects of any noncompliance (such as
ordering unlawful rates to be adjusted to lawful levels, ordering the cancellation of
market tests, ordering the Postal Service to discontinue providing loss-making products,
or requiring the Postal Service to make up for revenue shortfalls in competitive products).
‘(d) Authority To Order Fines in Cases of Deliberate Noncompliance- In addition, in
cases of deliberate noncompliance by the Postal Service with the requirements of this
title, the Postal Regulatory Commission may order, based on the nature, circumstances,
extent, and seriousness of the noncompliance, a fine (in the amount specified by the
Commission in its order) for each incidence of noncompliance. Fines resulting from the
provision of competitive products shall be paid from the Competitive Products Fund
established in section 2011. All receipts from fines imposed under this subsection shall be
deposited in the general fund of the Treasury of the United States.
‘Sec. 3663. Appellate review
‘A person, including the Postal Service, adversely affected or aggrieved by a final order
or decision of the Postal Regulatory Commission may, within 30 days after such order or
decision becomes final, institute proceedings for review thereof by filing a petition in the
United States Court of Appeals for the District of Columbia. The court shall review the
order or decision in accordance with section 706 of title 5, and chapter 158 and section
2112 of title 28, on the basis of the record before the Commission.
‘Sec. 3664. Enforcement of orders
‘The several district courts have jurisdiction specifically to enforce, and to enjoin and
restrain the Postal Service from violating, any order issued by the Postal Regulatory
Commission.‘.
SEC. 206. CLERICAL AMENDMENT.
Chapter 36 of title 39, United States Code, is amended by striking the heading and
analysis for such chapter and inserting the following:
‘CHAPTER 36--POSTAL RATES, CLASSES, AND SERVICES
‘SUBCHAPTER I--PROVISIONS RELATING TO MARKET-DOMINANT
PRODUCTS
‘Sec.
‘3621. Applicability; definitions.
‘3622. Modern rate regulation.
‘[3623. Repealed.]
‘[3624. Repealed.]
‘[3625. Repealed.]
‘3626. Reduced Rates.
‘3627. Adjusting free rates.
‘[3628. Repealed.]
‘3629. Reduced rates for voter registration purposes.
‘SUBCHAPTER II--PROVISIONS RELATING TO COMPETITIVE PRODUCTS
‘3631. Applicability; definitions and updates.
‘3632. Action of the Governors.
‘3633. Provisions applicable to rates for competitive products.
‘3634. Assumed Federal income tax on competitive products.
‘SUBCHAPTER III--PROVISIONS RELATING TO EXPERIMENTAL AND NEW
PRODUCTS
‘3641. Market tests of experimental products.
‘3642. New products and transfers of products between the market-dominant and
competitive categories of mail.
‘SUBCHAPTER IV--REPORTING REQUIREMENTS AND RELATED PROVISIONS
‘3651. Annual reports by the Commission.
‘3652. Annual reports to the Commission.
‘3653. Annual determination of compliance.
‘3654. Additional financial reporting.
‘SUBCHAPTER V--POSTAL SERVICES, COMPLAINTS, AND JUDICIAL REVIEW
‘3661. Postal Services.
‘3662. Rate and service complaints.
‘3663. Appellate review.
‘3664. Enforcement of orders.
‘SUBCHAPTER VI--GENERAL
‘3681. Reimbursement.
‘3682. Size and weight limits.
‘3683. Uniform rates for books; films, other materials.
‘3684. Limitations.
‘3685. Filing of information relating to periodical publications.
‘3686. Bonus authority.
‘SUBCHAPTER VII--MODERN SERVICE STANDARDS
‘3691. Establishment of modern service standards.‘.
TITLE III--MODERN SERVICE STANDARDS
SEC. 301. ESTABLISHMENT OF MODERN SERVICE STANDARDS.
Chapter 36 of title 39, United States Code, as amended by this Act, is further amended by
adding at the end the following:
‘SUBCHAPTER VII--MODERN SERVICE STANDARDS
‘Sec. 3691. Establishment of modern service standards
‘(a) AUTHORITY GENERALLY- Not later than 12 months after the date of enactment
of this section, the Postal Service shall, in consultation with the Postal Regulatory
Commission, by regulation establish (and may from time to time thereafter by regulation
revise) a set of service standards for market-dominant products.
‘(b) OBJECTIVES-
‘(1) IN GENERAL- Such standards shall be designed to achieve the following objectives:
‘(A) To enhance the value of postal services to both senders and recipients.
‘(B) To preserve regular and effective access to postal services in all communities,
including those in rural areas or where post offices are not self-sustaining.
‘(C) To reasonably assure Postal Service customers delivery reliability, speed and
frequency consistent with reasonable rates and best business practices.
‘(D) To provide a system of objective external performance measurements for each
market-dominant product as a basis for measurement of Postal Service performance.
‘(2) IMPLEMENTATION OF PERFORMANCE MEASUREMENTS- With respect to
paragraph (1)(D), with the approval of the Postal Regulatory Commission an internal
measurement system may be implemented instead of an external measurement system.
‘(c) FACTORS- In establishing or revising such standards, the Postal Service shall take
into account--
‘(1) the actual level of service that Postal Service customers receive under any service
guidelines previously established by the Postal Service or service standards established
under this section;
‘(2) the degree of customer satisfaction with Postal Service performance in the
acceptance, processing and delivery of mail;
‘(3) the needs of Postal Service customers, including those with physical impairments;
‘(4) mail volume and revenues projected for future years;
‘(5) the projected growth in the number of addresses the Postal Service will be required
to serve in future years;
‘(6) the current and projected future cost of serving Postal Service customers;
‘(7) the effect of changes in technology, demographics, and population distribution on the
efficient and reliable operation of the postal delivery system; and
‘(8) the policies of this title and such other factors as the Postal Service determines
appropriate.
‘(d) REVIEW- The regulations promulgated pursuant to this section (and any revisions
thereto), and any violations thereof, shall be subject to review upon complaint under
sections 3662 and 3663.‘.
SEC. 302. POSTAL SERVICE PLAN.
(a) IN GENERAL- Within 6 months after the establishment of the service standards
under section 3691 of title 39, United States Code, as added by this Act, the Postal
Service shall, in consultation with the Postal Regulatory Commission, develop and
submit to Congress a plan for meeting those standards.
(b) CONTENTS- The plan under this section shall--
(1) establish performance goals;
(2) describe any changes to the Postal Service‘s processing, transportation, delivery, and
retail networks necessary to allow the Postal Service to meet the performance goals;
(3) describe any changes to planning and performance management documents
previously submitted to Congress to reflect new performance goals; and
(4) describe the long-term vision of the Postal Service for rationalizing its infrastructure
and workforce, and how the Postal Service intends to implement that vision.
(c) POSTAL FACILITIES-
(1) FINDINGS- Congress finds that--
(A) the Postal Service has more than 400 logistics facilities, separate from its post office
network;
(B) as noted by the President‘s Commission on the United States Postal Service, the
Postal Service has more facilities than it needs and the streamlining of this distribution
network can pave the way for the potential consolidation of sorting facilities and the
elimination of excess costs;
(C) the Postal Service has always revised its distribution network to meet changing
conditions and is best suited to address its operational needs; and
(D) Congress strongly encourages the Postal Service to--
(i) expeditiously move forward in its streamlining efforts; and
(ii) keep unions, management associations, and local elected officials informed as an
essential part of this effort and abide by any procedural requirements contained in the
national bargaining agreements.
(2) IN GENERAL- The Postal Service plan shall include a description of--
(A) the long-term vision of the Postal Service for rationalizing its infrastructure and
workforce; and
(B) how the Postal Service intends to implement that vision.
(3) CONTENT OF FACILITIES PLAN- The plan under this subsection shall include--
(A) a strategy for how the Postal Service intends to rationalize the postal facilities
network and remove excess processing capacity and space from the network, including
estimated timeframes, criteria, and processes to be used for making changes to the
facilities network, and the process for engaging policy makers and the public in related
decisions;
(B) a discussion of what impact any facility changes may have on the postal workforce
and whether the Postal Service has sufficient flexibility to make needed workforce
changes;
(C) an identification of anticipated costs, cost savings, and other benefits associated with
the infrastructure rationalization alternatives discussed in the plan; and
(D) procedures that the Postal Service will use to--
(i) provide adequate public notice to communities potentially affected by a proposed
rationalization decision;
(ii) make available information regarding any service changes in the affected
communities, any other effects on customers, any effects on postal employees, and any
cost savings;
(iii) afford affected persons ample opportunity to provide input on the proposed decision;
and
(iv) take such comments into account in making a final decision.
(4) ANNUAL REPORTS-
(A) IN GENERAL- Not later than 90 days after the end of each fiscal year, the Postal
Service shall prepare and submit a report to Congress on how postal decisions have
impacted or will impact rationalization plans.
(B) CONTENTS- Each report under this paragraph shall include--
(i) an account of actions taken during the preceding fiscal year to improve the efficiency
and effectiveness of its processing, transportation, and distribution networks while
preserving the timely delivery of postal services, including overall estimated costs and
cost savings;
(ii) an account of actions taken to identify any excess capacity within its processing,
transportation, and distribution networks and implement savings through realignment or
consolidation of facilities including overall estimated costs and cost savings;
(iii) an estimate of how postal decisions related to mail changes, security, automation
initiatives, worksharing, information technology systems, excess capacity, consolidating
and closing facilities, and other areas will impact rationalization plans;
(iv) identification of any statutory or regulatory obstacles that prevented or will prevent
or hinder the Postal Service from taking action to realign or consolidate facilities; and
(v) such additional topics and recommendations as the Postal Service considers
appropriate.
(5) EXISTING EFFORTS- Effective on the date of enactment of this Act, the Postal
Service may not close or consolidate any processing or logistics facilities without using
procedures for public notice and input consistent with those described under paragraph
(3)(D).
(d) ALTERNATE RETAIL OPTIONS- The Postal Service plan shall include plans to
expand and market retail access to postal services, in addition to post offices, including--
(1) vending machines;
(2) the Internet;
(3) postage meters;
(4) Stamps by Mail;
(5) Postal Service employees on delivery routes;
(6) retail facilities in which overhead costs are shared with private businesses and other
government agencies;
(7) postal kiosks; or
(8) any other nonpost office access channel providing market retail access to postal
services.
(e) REEMPLOYMENT ASSISTANCE AND RETIREMENT BENEFITS- The Postal
Service plan shall include--
(1) a comprehensive plan under which reemployment assistance shall be afforded to
employees displaced as a result of automation of any of its functions, the closing and
consolidation of any of its facilities, or such other reasons as the Postal Service may
determine; and
(2) a plan, developed in consultation with the Office of Personnel Management, to offer
early retirement benefits.
(f) CONTINUED AUTHORITY- Nothing in this section shall be construed to prohibit
the Postal Service from implementing any change to its processing, transportation,
delivery, and retail networks under any authority granted to the Postal Service for those
purposes.
TITLE IV--PROVISIONS RELATING TO FAIR COMPETITION
SEC. 401. POSTAL SERVICE COMPETITIVE PRODUCTS FUND.
(a) PROVISIONS RELATING TO POSTAL SERVICE COMPETITIVE PRODUCTS
FUND AND RELATED MATTERS-
(1) IN GENERAL- Chapter 20 of title 39, United States Code, is amended by adding at
the end the following:
‘Sec. 2011. Provisions relating to competitive products
‘(a)(1) In this subsection, the term ‘costs attributable‘ has the meaning given such term by
section 3631.
‘(2) There is established in the Treasury of the United States a revolving fund, to be
called the Postal Service Competitive Products Fund, which shall be available to the
Postal Service without fiscal year limitation for the payment of--
‘(A) costs attributable to competitive products; and
‘(B) all other costs incurred by the Postal Service, to the extent allocable to competitive
products.
‘(b) There shall be deposited in the Competitive Products Fund, subject to withdrawal by
the Postal Service--
‘(1) revenues from competitive products;
‘(2) amounts received from obligations issued by Postal Service under subsection (e);
‘(3) interest and dividends earned on investments of the Competitive Products Fund; and
‘(4) any other receipts of the Postal Service (including from the sale of assets), to the
extent allocable to competitive products.
‘(c) If the Postal Service determines that the moneys of the Competitive Products Fund
are in excess of current needs, the Postal Service may request the investment of such
amounts as the Postal Service determines advisable by the Secretary of the Treasury in
obligations of, or obligations guaranteed by, the Government of the United States, and,
with the approval of the Secretary, in such other obligations or securities as the Postal
Service determines appropriate.
‘(d) With the approval of the Secretary of the Treasury, the Postal Service may deposit
moneys of the Competitive Products Fund in any Federal Reserve bank, any depository
for public funds, or in such other places and in such manner as the Postal Service and the
Secretary may mutually agree.
‘(e)(1)(A) Subject to the limitations specified in section 2005(a), the Postal Service is
authorized to borrow money and to issue and sell such obligations as the Postal Service
determines necessary to provide for competitive products and deposit such amounts in the
Competitive Products Fund.
‘(B) Subject to paragraph (5), any borrowings by the Postal Service under subparagraph
(A) shall be supported and serviced by--
‘(i) the revenues and receipts from competitive products and the assets related to the
provision of competitive products (as determined under subsection (h)); or
‘(ii) for purposes of any period before accounting practices and principles under
subsection (h) have been established and applied, the best information available from the
Postal Service, including the audited statements required by section 2008(e).
‘(2) The Postal Service may enter into binding covenants with the holders of such
obligations, and with any trustee under any agreement entered into in connection with the
issuance of such obligations with respect to--
‘(A) the establishment of reserve, sinking, and other funds;
‘(B) application and use of revenues and receipts of the Competitive Products Fund;
‘(C) stipulations concerning the subsequent issuance of obligations or the execution of
leases or lease purchases relating to properties of the Postal Service; and
‘(D) such other matters as the Postal Service, considers necessary or desirable to enhance
the marketability of such obligations.
‘(3) Obligations issued by the Postal Service under this subsection--
‘(A) shall be in such forms and denominations;
‘(B) shall be sold at such times and in such amounts;
‘(C) shall mature at such time or times;
‘(D) shall be sold at such prices;
‘(E) shall bear such rates of interest;
‘(F) may be redeemable before maturity in such manner, at such times, and at such
redemption premiums;
‘(G) may be entitled to such relative priorities of claim on the assets of the Postal Service
with respect to principal and interest payments; and
‘(H) shall be subject to such other terms and conditions,
as the Postal Service determines.
‘(4) Obligations issued by the Postal Service under this subsection--
‘(A) shall be negotiable or nonnegotiable and bearer or registered instruments, as
specified therein and in any indenture or covenant relating thereto;
‘(B) shall contain a recital that such obligations are issued under this section, and such
recital shall be conclusive evidence of the regularity of the issuance and sale of such
obligations and of their validity;
‘(C) shall be lawful investments and may be accepted as security for all fiduciary, trust,
and public funds, the investment or deposit of which shall be under the authority or
control of any officer or agency of the Government of the United States, and the
Secretary of the Treasury or any other officer or agency having authority over or control
of any such fiduciary, trust, or public funds, may at any time sell any of the obligations of
the Postal Service acquired under this section;
‘(D) shall not be exempt either as to principal or interest from any taxation now or
hereafter imposed by any State or local taxing authority; and
‘(E) except as provided in section 2006(c), shall not be obligations of, nor shall payment
of the principal thereof or interest thereon be guaranteed by, the Government of the
United States, and the obligations shall so plainly state.
‘(5) The Postal Service shall make payments of principal, or interest, or both on
obligations issued under this section out of revenues and receipts from competitive
products and assets related to the provision of competitive products (as determined under
subsection (h)), or for purposes of any period before accounting practices and principles
under subsection (h) have been established and applied, the best information available,
including the audited statements required by section 2008(e). For purposes of this
subsection, the total assets of the Competitive Products Fund shall be the greater of--
‘(A) the assets related to the provision of competitive products as calculated under
subsection (h); or
‘(B) the percentage of total Postal Service revenues and receipts from competitive
products times the total assets of the Postal Service.
‘(f) The receipts and disbursements of the Competitive Products Fund shall be accorded
the same budgetary treatment as is accorded to receipts and disbursements of the Postal
Service Fund under section 2009a.
‘(g) A judgment (or settlement of a claim) against the Postal Service or the Government
of the United States shall be paid out of the Competitive Products Fund to the extent that
the judgment or claim arises out of activities of the Postal Service in the provision of
competitive products.
‘(h)(1)(A) The Secretary of the Treasury, in consultation with the Postal Service and an
independent, certified public accounting firm and other advisors as the Secretary
considers appropriate, shall develop recommendations regarding--
‘(i) the accounting practices and principles that should be followed by the Postal Service
with the objectives of--
‘(I) identifying and valuing the assets and liabilities of the Postal Service associated with
providing competitive products, including the capital and operating costs incurred by the
Postal Service in providing such competitive products; and
‘(II) subject to subsection (e)(5), preventing the subsidization of such products by
market-dominant products; and
‘(ii) the substantive and procedural rules that should be followed in determining the
assumed Federal income tax on competitive products income of the Postal Service for
any year (within the meaning of section 3634).
‘(B) Not earlier than 6 months after the date of enactment of this section, and not later
than 12 months after such date, the Secretary of the Treasury shall submit the
recommendations under subparagraph (A) to the Postal Regulatory Commission.
‘(2)(A) Upon receiving the recommendations of the Secretary of the Treasury under
paragraph (1), the Commission shall give interested parties, including the Postal Service,
users of the mails, and an officer of the Commission who shall be required to represent
the interests of the general public, an opportunity to present their views on those
recommendations through submission of written data, views, or arguments with or
without opportunity for oral presentation, or in such other manner as the Commission
considers appropriate.
‘(B)(i) After due consideration of the views and other information received under
subparagraph (A), the Commission shall by rule--
‘(I) provide for the establishment and application of the accounting practices and
principles which shall be followed by the Postal Service;
‘(II) provide for the establishment and application of the substantive and procedural rules
described under paragraph (1)(A)(ii); and
‘(III) provide for the submission by the Postal Service to the Postal Regulatory
Commission of annual and other periodic reports setting forth such information as the
Commission may require.
‘(ii) Final rules under this subparagraph shall be issued not later than 12 months after the
date on which recommendations are submitted under paragraph (1) (or by such later date
on which the Commission and the Postal Service may agree). The Commission is
authorized to promulgate regulations revising such rules.
‘(C)(i) Reports described under subparagraph (B)(i)(III) shall be submitted at such time
and in such form, and shall include such information, as the Commission by rule requires.
‘(ii) The Commission may, on its own motion or on request of an interested party, initiate
proceedings (to be conducted in accordance with such rules as the Commission shall
prescribe) to improve the quality, accuracy, or completeness of Postal Service
information under subparagraph (B)(i)(III) whenever it shall appear that--
‘(I) the quality of the information furnished in those reports has become significantly
inaccurate or can be significantly improved; or
‘(II) such revisions are, in the judgment of the Commission, otherwise necessitated by the
public interest.
‘(D) A copy of each report described under subparagraph (B)(i)(III) shall be submitted by
the Postal Service to the Secretary of the Treasury and the Inspector General of the
United States Postal Service.
‘(i)(1) The Postal Service shall submit an annual report to the Secretary of the Treasury
concerning the operation of the Competitive Products Fund. The report shall address such
matters as risk limitations, reserve balances, allocation or distribution of moneys,
liquidity requirements, and measures to safeguard against losses.
‘(2) A copy of the most recent report submitted under paragraph (1) shall be included in
the annual report submitted by the Postal Regulatory Commission under section
3652(g).‘.
(2) CLERICAL AMENDMENT- The table of sections for chapter 20 of title 39, United
States Code, is amended by adding after the item relating to section 2010 the following:
‘2011. Provisions relating to competitive products.‘.
(b) TECHNICAL AND CONFORMING AMENDMENTS-
(1) DEFINITION- Section 2001 of title 39, United States Code, is amended by striking ‘and‘ at the end of paragraph (1), by redesignating paragraph (2) as paragraph (3), and by inserting after paragraph (1) the following:
‘(2) COMPETITIVE PRODUCTS FUND- The term ‘Competitive Products Fund‘ means
the Postal Service Competitive Products Fund established by section 2011; and‘.
(2) CAPITAL OF THE POSTAL SERVICE- Section 2002(b) of title 39, United States
Code, is amended by striking ‘Fund,‘ and inserting ‘Fund and the balance in the
Competitive Products Fund,‘.
(3) POSTAL SERVICE FUND-
(A) PURPOSES FOR WHICH AVAILABLE- Section 2003(a) of title 39, United States
Code, is amended by striking ‘title.‘ and inserting ‘title (other than any of the purposes,
functions, or powers for which the Competitive Products Fund is available).‘.
(B) DEPOSITS- Section 2003(b) of title 39, United States Code, is amended by striking ‘There‘ and inserting ‘Except as otherwise provided in section 2011, there‘.
(4) RELATIONSHIP BETWEEN THE TREASURY AND THE POSTAL SERVICE
Section 2006 of title 39, United States Code, is amended--
(A) in subsection (a), in the first sentence, by inserting ‘or 2011‘ after ‘section 2005‘;
(B) in subsection (b)--
(i) in the first sentence, by inserting ‘under section 2005‘ before ‘in such amounts‘; and
(ii) in the second sentence, by inserting ‘under section 2005‘ before ‘in excess of such
amount.‘; and
(C) in subsection (c), by inserting ‘or 2011(e)(4)(E)‘ after ‘section 2005(d)(5)‘.
SEC. 402. ASSUMED FEDERAL INCOME TAX ON COMPETITIVE PRODUCTS
INCOME.
Subchapter II of chapter 36 of title 39, United States Code, as amended by section 202, is
amended by adding at the end the following:
‘Sec. 3634. Assumed Federal income tax on competitive products income
‘(a) DEFINITIONS- For purposes of this section--
‘(1) the term ‘assumed Federal income tax on competitive products income‘ means the
net income tax that would be imposed by chapter 1 of the Internal Revenue Code of 1986
on the Postal Service‘s assumed taxable income from competitive products for the year;
and
‘(2) the term ‘assumed taxable income from competitive products‘, with respect to a year,
refers to the amount representing what would be the taxable income of a corporation
under the Internal Revenue Code of 1986 for the year, if--
‘(A) the only activities of such corporation were the activities of the Postal Service
allocable under section 2011(h) to competitive products; and
‘(B) the only assets held by such corporation were the assets of the Postal Service
allocable under section 2011(h) to such activities.
‘(b) COMPUTATION AND TRANSFER REQUIREMENTS- The Postal Service shall,
for each year beginning with the year in which occurs the deadline for the Postal
Service‘s first report to the Postal Regulatory Commission under section 3652(a)--
‘(1) compute its assumed Federal income tax on competitive products income for such
year; and
‘(2) transfer from the Competitive Products Fund to the Postal Service Fund the amount
of that assumed tax.
‘(c) DEADLINE FOR TRANSFERS- Any transfer required to be made under this section
for a year shall be due on or before the January 15th next occurring after the close of such
year.‘.
SEC. 403. UNFAIR COMPETITION PROHIBITED.
(a) SPECIFIC LIMITATIONS- Chapter 4 of title 39, United States Code, is amended by
adding after section 404 the following:
‘Sec. 404a. Specific limitations
‘(a) Except as specifically authorized by law, the Postal Service may not--
‘(1) establish any rule or regulation (including any standard) the effect of which is to
preclude competition or establish the terms of competition unless the Postal Service
demonstrates that the regulation does not create an unfair competitive advantage for itself
or any entity funded (in whole or in part) by the Postal Service;
‘(2) compel the disclosure, transfer, or licensing of intellectual property to any third party
(such as patents, copyrights, trademarks, trade secrets, and proprietary information); or
‘(3) obtain information from a person that provides (or seeks to provide) any product, and
then offer any postal service that uses or is based in whole or in part on such information,
without the consent of the person providing that information, unless substantially the
same information is obtained (or obtainable) from an independent source or is otherwise
obtained (or obtainable).
‘(b) The Postal Regulatory Commission shall prescribe regulations to carry out this
section.
‘(c) Any party (including an officer of the Commission representing the interests of the
general public) who believes that the Postal Service has violated this section may bring a
complaint in accordance with section 3662.‘.
(b) CONFORMING AMENDMENTS-
(1) GENERAL POWERS- Section 401 of title 39, United States Code, is amended by
striking ‘The‘ and inserting ‘Subject to the provisions of section 404a, the‘.
(2) SPECIFIC POWERS- Section 404(a) of title 39, United States Code, is amended by
striking ‘Without‘ and inserting ‘Subject to the provisions of section 404a, but otherwise
without‘.
(c) CLERICAL AMENDMENT- The analysis for chapter 4 of title 39, United States
Code, is amended by inserting after the item relating to section 404 the following:
‘404a. Specific limitations.‘.
SEC. 404. SUITS BY AND AGAINST THE POSTAL SERVICE.
(a) IN GENERAL- Section 409 of title 39, United States Code, is amended by striking
subsections (d) and (e) and inserting the following:
‘(d)(1) For purposes of the provisions of law cited in paragraphs (2)(A) and (2)(B),
respectively, the Postal Service--
‘(A) shall be considered to be a ‘person‘, as used in the provisions of law involved; and
‘(B) shall not be immune under any other doctrine of sovereign immunity from suit in
Federal court by any person for any violation of any of those provisions of law by any
officer or employee of the Postal Service.
‘(2) This subsection applies with respect to--
‘(A) the Act of July 5, 1946 (commonly referred to as the ‘Trademark Act of 1946‘ (15
U.S.C. 1051 and following)); and
‘(B) the provisions of section 5 of the Federal Trade Commission Act to the extent that
such section 5 applies to unfair or deceptive acts or practices.
‘(e)(1) To the extent that the Postal Service, or other Federal agency acting on behalf of
or in concert with the Postal Service, engages in conduct with respect to any product
which is not reserved to the United States under section 1696 of title 18, the Postal
Service or other Federal agency (as the case may be)--
‘(A) shall not be immune under any doctrine of sovereign immunity from suit in Federal
court by any person for any violation of Federal law by such agency or any officer or
employee thereof; and
‘(B) shall be considered to be a person (as defined in subsection (a) of the first section of
the Clayton Act) for purposes of--
‘(i) the antitrust laws (as defined in such subsection); and
‘(ii) section 5 of the Federal Trade Commission Act to the extent that such section 5
applies to unfair methods of competition.
For purposes of the preceding sentence, any private carriage of mail allowable by virtue
of section 601 shall not be considered a service reserved to the United States under
section 1696 of title 18.
‘(2) No damages, interest on damages, costs or attorney‘s fees may be recovered, and no
criminal liability may be imposed, under the antitrust laws (as so defined) from any
officer or employee of the Postal Service, or other Federal agency acting on behalf of or
in concert with the Postal Service, acting in an official capacity.
‘(3) This subsection shall not apply with respect to conduct occurring before the date of
enactment of this subsection.
‘(f)(1) Each building constructed or altered by the Postal Service shall be constructed or
altered, to the maximum extent feasible as determined by the Postal Service, in
compliance with 1 of the nationally recognized model building codes and with other
applicable nationally recognized codes.
‘(2) Each building constructed or altered by the Postal Service shall be constructed or
altered only after consideration of all requirements (other than procedural requirements)
of zoning laws, land use laws, and applicable environmental laws of a State or
subdivision of a State which would apply to the building if it were not a building
constructed or altered by an establishment of the Government of the United States.
‘(3) For purposes of meeting the requirements of paragraphs (1) and (2) with respect to a
building, the Postal Service shall--
‘(A) in preparing plans for the building, consult with appropriate officials of the State or
political subdivision, or both, in which the building will be located;
‘(B) upon request, submit such plans in a timely manner to such officials for review by
such officials for a reasonable period of time not exceeding 30 days; and
‘(C) permit inspection by such officials during construction or alteration of the building,
in accordance with the customary schedule of inspections for construction or alteration of
buildings in the locality, if such officials provide to the Postal Service--
‘(i) a copy of such schedule before construction of the building is begun; and
‘(ii) reasonable notice of their intention to conduct any inspection before conducting such
inspection.
Nothing in this subsection shall impose an obligation on any State or political subdivision
to take any action under the preceding sentence, nor shall anything in this subsection
require the Postal Service or any of its contractors to pay for any action taken by a State
or political subdivision to carry out this subsection (including reviewing plans, carrying
out on-site inspections, issuing building permits, and making recommendations).
‘(4) Appropriate officials of a State or a political subdivision of a State may make
recommendations to the Postal Service concerning measures necessary to meet the
requirements of paragraphs (1) and (2). Such officials may also make recommendations
to the Postal Service concerning measures which should be taken in the construction or
alteration of the building to take into account local conditions. The Postal Service shall
give due consideration to any such recommendations.
‘(5) In addition to consulting with local and State officials under paragraph (3), the Postal
Service shall establish procedures for soliciting, assessing, and incorporating local
community input on real property and land use decisions.
‘(6) For purposes of this subsection, the term ‘State‘ includes the District of Columbia,
the Commonwealth of Puerto Rico, and a territory or possession of the United States.
‘(h)(1) Notwithstanding any other provision of law, legal representation may not be
furnished by the Department of Justice to the Postal Service in any action, suit, or
proceeding arising, in whole or in part, under any of the following:
‘(A) Subsection (d) or (e) of this section.
‘(B) Subsection (f) or (g) of section 504 (relating to administrative subpoenas by the
Postal Regulatory Commission).
‘(C) Section 3663 (relating to appellate review).
The Postal Service may, by contract or otherwise, employ attorneys to obtain any legal
representation that it is precluded from obtaining from the Department of Justice under
this paragraph.
‘(2) In any circumstance not covered by paragraph (1), the Department of Justice shall,
under section 411, furnish the Postal Service such legal representation as it may require,
except that, with the prior consent of the Attorney General, the Postal Service may, in any
such circumstance, employ attorneys by contract or otherwise to conduct litigation
brought by or against the Postal Service or its officers or employees in matters affecting
the Postal Service.
‘(3)(A) In any action, suit, or proceeding in a court of the United States arising in whole
or in part under any of the provisions of law referred to in subparagraph (B) or (C) of
paragraph (1), and to which the Commission is not otherwise a party, the Commission
shall be permitted to appear as a party on its own motion and as of right.
‘(B) The Department of Justice shall, under such terms and conditions as the Commission
and the Attorney General shall consider appropriate, furnish the Commission such legal
representation as it may require in connection with any such action, suit, or proceeding,
except that, with the prior consent of the Attorney General, the Commission may employ
attorneys by contract or otherwise for that purpose.
‘(i) A judgment against the Government of the United States arising out of activities of
the Postal Service shall be paid by the Postal Service out of any funds available to the
Postal Service, subject to the restriction specified in section 2011(g).‘.
(b) TECHNICAL AMENDMENT- Section 409(a) of title 39, United States Code, is
amended by striking ‘Except as provided in section 3628 of this title,‘ and inserting
‘Except as otherwise provided in this title,‘.
SEC. 405. INTERNATIONAL POSTAL ARRANGEMENTS.
(a) IN GENERAL- Section 407 of title 39, United States Code, is amended to read as
follows:
‘Sec. 407. International postal arrangements
‘(a) It is the policy of the United States--
‘(1) to promote and encourage communications between peoples by efficient operation of
international postal services and other international delivery services for cultural, social,
and economic purposes;
‘(2) to promote and encourage unrestricted and undistorted competition in the provision
of international postal services and other international delivery services, except where
provision of such services by private companies may be prohibited by law of the United
States;
‘(3) to promote and encourage a clear distinction between governmental and operational
responsibilities with respect to the provision of international postal services and other
international delivery services by the Government of the United States and by
intergovernmental organizations of which the United States is a member; and
‘(4) to participate in multilateral and bilateral agreements with other countries to
accomplish these objectives.
‘(b)(1) The Secretary of State shall be responsible for formulation, coordination, and
oversight of foreign policy related to international postal services and other international
delivery services and shall have the power to conclude postal treaties, conventions, and
amendments related to international postal services and other international delivery
services, except that the Secretary may not conclude any treaty, convention, or other
international agreement (including those regulating international postal services) if such
treaty, convention, or agreement would, with respect to any competitive product, grant an
undue or unreasonable preference to the Postal Service, a private provider of international
postal or delivery services, or any other person.
‘(2) In carrying out the responsibilities specified in paragraph (1), the Secretary of State
shall exercise primary authority for the conduct of foreign policy with respect to
international postal services and international delivery services, including the
determination of United States positions and the conduct of United States participation in
negotiations with foreign governments and international bodies. In exercising this
authority, the Secretary--
‘(A) shall coordinate with other agencies as appropriate, and in particular, shall give full
consideration to the authority vested by law or Executive order in the Postal Regulatory
Commission, the Department of Commerce, the Department of Transportation, and the
Office of the United States Trade Representative in this area;
‘(B) shall maintain continuing liaison with other executive branch agencies concerned
with postal and delivery services;
‘(C) shall maintain continuing liaison with the Committee on Homeland Security and
Governmental Affairs of the Senate and the Committee on Government Reform of the
House of Representatives;
‘(D) shall maintain appropriate liaison with both representatives of the Postal Service and
representatives of users and private providers of international postal services and other
international delivery services to keep informed of their interests and problems, and to
provide such assistance as may be needed to ensure that matters of concern are promptly
considered by the Department of State or (if applicable, and to the extent practicable)
other executive branch agencies; and
‘(E) shall assist in arranging meetings of such public sector advisory groups as may be
established to advise the Department of State and other executive branch agencies in
connection with international postal services and international delivery services.
‘(3) The Secretary of State shall establish an advisory committee (within the meaning of
the Federal Advisory Committee Act) to perform such functions as the Secretary
considers appropriate in connection with carrying out subparagraphs (A) through (D) of
paragraph (2).
‘(c)(1) Before concluding any treaty, convention, or amendment that establishes a rate or
classification for a product subject to subchapter I of chapter 36, the Secretary of State
shall request the Postal Regulatory Commission to submit its views on whether such rate
or classification is consistent with the standards and criteria established by the
Commission under section 3622.
‘(2) The Secretary shall ensure that each treaty, convention, or amendment concluded
under subsection (b) is consistent with the views submitted by the Commission pursuant
to paragraph (1), except if, or to the extent, the Secretary determines, in writing, that it is
not in the foreign policy or national security interest of the United States to ensure
consistency with the Commission‘s views. Such written determination shall be provided
to the Commission together with a full explanation of the reasons thereof, provided that
the Secretary may designate which portions of the determination or explanation shall be
kept confidential for reasons of foreign policy or national security.
‘(d) Nothing in this section shall be considered to prevent the Postal Service from
entering into such commercial or operational contracts related to providing international
postal services and other international delivery services as it deems appropriate, except
that--
‘(1) any such contract made with an agency of a foreign government (whether under
authority of this subsection or otherwise) shall be solely contractual in nature and may
not purport to be international law; and
‘(2) a copy of each such contract between the Postal Service and an agency of a foreign
government shall be transmitted to the Secretary of State and the Postal Regulatory
Commission not later than the effective date of such contract.
‘(e)(1) In this subsection, the term ‘private company‘ means a private company
substantially owned or controlled by persons who are citizens of the United States.
‘(2) With respect to shipments of international mail that are competitive products within
the meaning of section 3631 that are exported or imported by the Postal Service, the
Customs Service and other appropriate Federal agencies shall apply the customs laws of
the United States and all other laws relating to the importation or exportation of such
shipments in the same manner to both shipments by the Postal Service and similar
shipments by private companies.
‘(3) In exercising the authority under subsection (b) to conclude new postal treaties and
conventions related to international postal services and to renegotiate such treaties and
conventions, the Secretary of State shall, to the maximum extent practicable, take such
measures as are within the Secretary‘s control to encourage the governments of other
countries to make available to the Postal Service and private companies a range of
nondiscriminatory customs procedures that will fully meet the needs of all types of
American shippers. The Secretary of State shall consult with the United States Trade
Representative and the Commissioner of Customs in carrying out this paragraph.
‘(4) The provisions of this subsection shall take effect 6 months after the date of
enactment of this subsection or such earlier date as the Bureau of Customs and Border
Protection of the Department of Homeland Security may determine in writing.‘.
(b) EFFECTIVE DATE- Notwithstanding any provision of the amendment made by
subsection (a), the authority of the United States Postal Service to establish the rates of
postage or other charges on mail matter conveyed between the United States and other
countries shall remain available to the Postal Service until--
(1) with respect to market-dominant products, the date as of which the regulations
promulgated under section 3622 of title 39, United States Code (as amended by section
201(a)) take effect; and
(2) with respect to competitive products, the date as of which the regulations promulgated
under section 3633 of title 39, United States Code (as amended by section 202) take
effect.
SEC. 501. QUALIFICATION AND TERM REQUIREMENTS FOR GOVERNORS.
(a) QUALIFICATIONS
(1) IN GENERAL- Section 202(a) of title 39, United States Code, is amended by striking
‘(a)‘ and inserting ‘(a)(1)‘ and by striking the fourth sentence and inserting the following:
‘The Governors shall represent the public interest generally, and shall be chosen solely on
the basis of their experience in the field of public service, law or accounting or on their
demonstrated ability in managing organizations or corporations (in either the public or
private sector) of substantial size; except that at least 4 of the Governors shall be chosen
solely on the basis of their demonstrated ability in managing organizations or
corporations (in either the public or private sector) that employ at least 50,000
employees. The Governors shall not be representatives of specific interests using the
Postal Service, and may be removed only for cause.‘.
(2) APPLICABILITY- The amendment made by paragraph (1) shall not affect the
appointment or tenure of any person serving as a Governor of the United States Postal
Service under an appointment made before the date of enactment of this Act however,
when any such office becomes vacant, the appointment of any person to fill that office
shall be made in accordance with such amendment. The requirement set forth in the
fourth sentence of section 202(a)(1) of title 39, United States Code (as amended by
subsection (a)) shall be met beginning not later than 9 years after the date of enactment of
this Act
(b) CONSULTATION REQUIREMENT- Section 202(a) of title 39, United States Code,
is amended by adding at the end the following:
‘(2) In selecting the individuals described in paragraph (1) for nomination for
appointment to the position of Governor, the President should consult with the Speaker of
the House of Representatives, the minority leader of the House of Representatives, the
majority leader of the Senate, and the minority leader of the Senate.‘.
(c) 7-Year Terms-
(1) IN GENERAL- Section 202(b) of title 39, United States code, is amended in the first
sentence by striking ‘9 years‘ and inserting ‘7 years‘.
(2) APPLICABILITY-
(A) CONTINUATION BY INCUMBENTS- The amendment made by paragraph (1)
shall not affect the tenure of any person serving as a Governor of the United States Postal
Service on the date of enactment of this Act and such person may continue to serve the
remainder of the applicable term.
(B) VACANCY BY INCUMBENT BEFORE 7 YEARS OF SERVICE- If a person who
is serving as a Governor of the United States Postal Service on the date of enactment of
this Act resigns, is removed, or dies before the expiration of the 9-year term of that
Governor, and that Governor has served less than 7 years of that term, the resulting
vacancy in office shall be treated as a vacancy in a 7-year term.
(C) VACANCY BY INCUMBENT AFTER 7 YEARS OF SERVICE- If a person who is
serving as a Governor of the United States Postal Service on the date of enactment of this
Act resigns, is removed, or dies before the expiration of the 9-year term of that Governor,
and that Governor has served 7 years or more of that term, that term shall be deemed to
have been a 7-year term beginning on its commencement date for purposes of
determining vacancies in office. Any appointment to the vacant office shall be for a 7-
year term beginning at the end of the original 9-year term determined without regard to
the deeming under the preceding sentence. Nothing in this subparagraph shall be
construed to affect any action or authority of any Governor or the Board of Governors
during any portion of a 9-year term deemed to be 7-year term under this subparagraph.
(d) TERM LIMITATION-
(1) IN GENERAL- Section 202(b) of title 39, United States Code, is amended--
(A) by inserting ‘(1)‘ after ‘(b)‘; and
(B) by adding at the end the following:
‘(2) No person may serve more than 2 terms as a Governor.‘.
(2) APPLICABILITY- The amendments made by paragraph (1) shall not affect the
tenure of any person serving as a Governor of the United States Postal Service on the date
of enactment of this Act with respect to the term which that person is serving on that date.
Such person may continue to serve the remainder of the applicable term, after which the
amendments made by paragraph (1) shall apply.
SEC. 502. OBLIGATIONS.
(a) PURPOSES FOR WHICH OBLIGATIONS MAY BE ISSUED- The first sentence of
section 2005(a)(1) of title 39, United States Code, is amended by striking ‘title.‘ and
inserting ‘title, other than any of the purposes for which the corresponding authority is
available to the Postal Service under section 2011.‘.
(b) LIMITATION ON NET ANNUAL INCREASE IN OBLIGATIONS ISSUED FOR
CERTAIN PURPOSES- The third sentence of section 2005(a)(1) of title 39, United
States Code, is amended to read as follows: ‘In any one fiscal year, the net increase in the
amount of obligations outstanding issued for the purpose of capital improvements and the
net increase in the amount of obligations outstanding issued for the purpose of defraying
operating expenses of the Postal Service shall not exceed a combined total of
$3,000,000,000.‘ .
(c) LIMITATIONS ON OBLIGATIONS OUTSTANDING(
1) IN GENERAL- Subsection (a) of section 2005 of title 39, United States Code, is
amended by adding at the end the following:
‘(3) For purposes of applying the respective limitations under this subsection, the
aggregate amount of obligations issued by the Postal Service which are outstanding as of
any one time, and the net increase in the amount of obligations outstanding issued by the
Postal Service for the purpose of capital improvements or for the purpose of defraying
operating expenses of the Postal Service in any fiscal year, shall be determined by
aggregating the relevant obligations issued by the Postal Service under this section with
the relevant obligations issued by the Postal Service under section 2011.‘.
(2) CONFORMING AMENDMENT- The second sentence of section 2005(a)(1) of title
39, United States Code, is amended by striking ‘any such obligations‘ and inserting
‘obligations issued by the Postal Service which may be‘.
(d) AMOUNTS WHICH MAY BE PLEDGED-
(1) OBLIGATIONS TO WHICH PROVISIONS APPLY- The first sentence of section
2005(b) of title 39, United States Code, is amended by striking ‘such obligations,‘ and
inserting ‘obligations issued by the Postal Service under this section,‘.
(2) ASSETS, REVENUES, AND RECEIPTS TO WHICH PROVISIONS APPLYSubsection
(b) of section 2005 of title 39, United States Code, is amended by striking
‘(b)‘ and inserting ‘(b)(1)‘, and by adding at the end the following:
‘(2) Notwithstanding any other provision of this section--
‘(A) the authority to pledge assets of the Postal Service under this subsection shall be
available only to the extent that such assets are not related to the provision of competitive
products (as determined under section 2011(h) or, for purposes of any period before
accounting practices and principles under section 2011(h) have been established and
applied, the best information available from the Postal Service, including the audited
statements required by section 2008(e)); and
‘(B) any authority under this subsection relating to the pledging or other use of revenues
or receipts of the Postal Service shall be available only to the extent that they are not
revenues or receipts of the Competitive Products Fund.‘.
SEC. 503. PRIVATE CARRIAGE OF LETTERS.
(a) IN GENERAL- Section 601 of title 39, United States Code, is amended by striking
subsection (b) and inserting the following:
‘(b) A letter may also be carried out of the mails when--
‘(1) the amount paid for the private carriage of the letter is at least the amount equal to 6
times the rate then currently charged for the 1st ounce of a single-piece first class letter;
‘(2) the letter weighs at least 12 1/2 ounces; or
‘(3) such carriage is within the scope of services described by regulations of the United
States Postal Service (including, in particular, sections 310.1 and 320.2-320.8 of title 39
of the Code of Federal Regulations, as in effect on July 1, 2005) that purport to permit
private carriage by suspension of the operation of this section (as then in effect).
‘(c) Any regulations necessary to carry out this section shall be promulgated by the Postal
Regulatory Commission.‘.
(b) EFFECTIVE DATE- This section shall take effect on the date as of which the
regulations promulgated under section 3633 of title 39, United States Code (as amended
by section 202) take effect.
SEC. 504. RULEMAKING AUTHORITY.
Paragraph (2) of section 401 of title 39, United States Code, is amended to read as
follows:
‘(2) to adopt, amend, and repeal such rules and regulations, not inconsistent with this
title, as may be necessary in the execution of its functions under this title and such other
functions as may be assigned to the Postal Service under any provisions of law outside of
this title;‘.
SEC. 505. NONINTERFERENCE WITH COLLECTIVE BARGAINING
AGREEMENTS.
(a) LABOR DISPUTES- Section 1207 of title 39, United States Code, is amended to read
as follows:
‘Sec. 1207. Labor disputes
‘(a) If there is a collective-bargaining agreement in effect, no party to such agreement
shall terminate or modify such agreement unless the party desiring such termination or
modification serves written notice upon the other party to the agreement of the proposed
termination or modification not less than 90 days prior to the expiration date thereof, or
not less than 90 days prior to the time it is proposed to make such termination or
modification. The party serving such notice shall notify the Federal Mediation and
Conciliation Service of the existence of a dispute within 45 days after such notice, if no
agreement has been reached by that time.
‘(b) If the parties fail to reach agreement or to adopt a procedure providing for a binding
resolution of a dispute by the expiration date of the agreement in effect, or the date of the
proposed termination or modification, the Director of the Federal Mediation and
Conciliation Service shall within 10 days appoint a mediator of nationwide reputation and
professional stature, and who is also a member of the National Academy of Arbitrators.
The parties shall cooperate with the mediator in an effort to reach an agreement and shall
meet and negotiate in good faith at such times and places that the mediator, in
consultation with the parties, shall direct.
‘(c)(1) If no agreement is reached within 60 days after the expiration or termination of the
agreement or the date on which the agreement became subject to modification under
subsection (a) of this section, or if the parties decide upon arbitration but do not agree
upon the procedures therefore, an arbitration board shall be established consisting of 3
members, 1 of whom shall be selected by the Postal Service, 1 by the bargaining
representative of the employees, and the third by the 2 thus selected. If either of the
parties fails to select a member, or if the members chosen by the parties fail to agree on
the third person within 5 days after their first meeting, the selection shall be made from a
list of names provided by the Director. This list shall consist of not less then 9 names of
arbitrators of nationwide reputation and professional nature, who are also members of the
National Academy of Arbitrators, and whom the Director has determined are available
and willing to serve.
‘(2) The arbitration board shall give the parties a full and fair hearing, including an
opportunity to present evidence in support of their claims, and an opportunity to present
their case in person, by counsel or by other representative as they may elect. Decisions of
the arbitration board shall be conclusive and binding upon the parties. The arbitration
board shall render its decision within 45 days after its appointment.
‘(3) Costs of the arbitration board and mediation shall be shared equally by the Postal
Service and the bargaining representative.
‘(d) In the case of a bargaining unit whose recognized collective-bargaining
representative does not have an agreement with the Postal Service, if the parties fail to
reach the agreement within 90 days after the commencement of collective bargaining, a
mediator shall be appointed in accordance with the terms in subsection (b) of this section,
unless the parties have previously agreed to another procedure for a binding resolution of
their differences. If the parties fail to reach agreement within 180 days after the
commencement of collective bargaining, and if they have not agreed to another procedure
for binding resolution, an arbitration board shall be established to provide conclusive and
binding arbitration in accordance with the terms of subsection (c) of this section.‘.
(b) NONINTERFERENCE WITH COLLECTIVE BARGAINING AGREEMENTS
Except
as otherwise provided by the amendment made by subsection (a), nothing in this
Act shall restrict, expand, or otherwise affect any of the rights, privileges, or benefits of
either employees of or labor organizations representing employees of the United States
Postal Service under chapter 12 of title 39, United States Code, the National Labor
Relations Act, any handbook or manual affecting employee labor relations within the
United States Postal Service, or any collective bargaining agreement.
(c) FREE MAILING PRIVILEGES CONTINUE UNCHANGED- Nothing in this Act or
any amendment made by this Act shall affect any free mailing privileges accorded under
section 3217 or sections 3403 through 3406 of title 39, United States Code.
SEC. 506. BONUS AUTHORITY.
Chapter 36 of title 39, United States Code, is amended by inserting after section 3685 the
following:
‘Sec. 3686. Bonus authority
‘(a) IN GENERAL- The Postal Service may establish 1 or more programs to provide
bonuses or other rewards to officers and employees of the Postal Service in senior
executive or equivalent positions to achieve the objectives of this chapter.
‘(b) LIMITATION ON TOTAL COMPENSATION-
‘(1) IN GENERAL- Under any such program, the Postal Service may award a bonus or
other reward in excess of the limitation set forth in the last sentence of section 1003(a), if
such program has been approved under paragraph (2). Any such award or bonus may not
cause the total compensation of such officer or employee to exceed the total annual
compensation payable to the Vice President under section 104 of title 3 as of the end of
the calendar year in which the bonus or award is paid.
‘(2) APPROVAL PROCESS- If the Postal Service wishes to have the authority, under
any program described in subsection (a), to award bonuses or other rewards in excess of
the limitation set forth in the last sentence of section 1003(a)--
‘(A) the Postal Service shall make an appropriate request to the Board of Governors of
the Postal Service in such form and manner as the Board requires; and
‘(B) the Board of Governors shall approve any such request if the Board certifies, for the
annual appraisal period involved, that the performance appraisal system for affected
officers and employees of the Postal Service (as designed and applied) makes meaningful
distinctions based on relative performance.
‘(3) REVOCATION AUTHORITY- If the Board of Governors of the Postal Service
finds that a performance appraisal system previously approved under paragraph (2)(B)
does not (as designed and applied) make meaningful distinctions based on relative
performance, the Board may revoke or suspend the authority of the Postal Service to
continue a program approved under paragraph (2) until such time as appropriate
corrective measures have, in the judgment of the Board, been taken.
‘(c) Exceptions for Critical Positions- Notwithstanding any other provision of law, the
Board of Governors may allow up to 12 officers or employees of the Postal Service in
critical senior executive or equivalent positions to receive total compensation in an
amount not to exceed 120 percent of the total annual compensation payable to the Vice
President under section 104 of title 3 as of the end of the calendar year in which such
payment is received. For each exception made under this subsection, the Board shall
provide written notification to the Director of the Office of Personnel Management and
the Congress within 30 days after the payment is made setting forth the name of the
officer or employee involved, the critical nature of his or her duties and responsibilities,
and the basis for determining that such payment is warranted.
‘(d) Information for Inclusion in Comprehensive Statement- Included in its
comprehensive statement under section 2401(e) for any period shall be--
‘(1) the name of each person receiving a bonus or other payment during such period
which would not have been allowable but for the provisions of subsection (b) or (c);
‘(2) the amount of the bonus or other payment; and
‘(3) the amount by which the limitation set forth in the last sentence of section 1003(a)
was exceeded as a result of such bonus or other payment.
‘(e) Regulations- The Board of Governors may prescribe regulations for the
administration of this section.‘.
TITLE VI--ENHANCED REGULATORY COMMISSION
SEC. 601. REORGANIZATION AND MODIFICATION OF CERTAIN PROVISIONS
RELATING TO THE POSTAL REGULATORY COMMISSION.
(a) TRANSFER AND REDESIGNATION- Title 39, United States Code, is amended--
(1) by inserting after chapter 4 the following:
‘CHAPTER 5--POSTAL REGULATORY COMMISSION
‘Sec.
‘501. Establishment.
‘502. Commissioners.
‘503. Rules; regulations; procedures.
‘504. Administration.
‘505. Officer of the Postal Regulatory Commission representing the general public.
‘Sec. 501. Establishment
‘The Postal Regulatory Commission is an independent establishment of the executive
branch of the Government of the United States.
‘Sec. 502. Commissioners
‘(a) The Postal Regulatory Commission is composed of 5 Commissioners, appointed by
the President, by and with the advice and consent of the Senate. The Commissioners shall
be chosen solely on the basis of their technical qualifications, professional standing, and
demonstrated expertise in economics, accounting, law, or public administration, and may
be removed by the President only for cause. Each individual appointed to the
Commission shall have the qualifications and expertise necessary to carry out the
enhanced responsibilities accorded Commissioners under the Postal Accountability and
Enhancement Act. Not more than 3 of the Commissioners may be adherents of the same
political party.
‘(b) No Commissioner shall be financially interested in any enterprise in the private
sector of the economy engaged in the delivery of mail matter.
‘(c) A Commissioner may continue to serve after the expiration of his term until his
successor has qualified, except that a Commissioner may not so continue to serve for
more than 1 year after the date upon which his term otherwise would expire under
subsection (f).
‘(d) One of the Commissioners shall be designated as Chairman by, and shall serve in the
position of Chairman at the pleasure of, the President.
‘(e) The Commissioners