Issa releases long-awaited postal reform legislation

Friday - 7/19/2013, 7:40pm EDT

Rep. Darrell Issa (R-Calif.), chairman of the Oversight and Government Reform Committee, released long-anticipated legislation Friday aiming to reform the finances of the ailing U.S. Postal Service.

The introduction of the 2013 Postal Reform Act comes on the heels of a USPS oversight hearing and just two days after the committee's ranking member, Rep. Elijah Cummings (D-Md.), introduced his own postal overhaul bill.

As promised at the hearing this week, Issa updated an earlier discussion draft of his bill with several proposals floated by Democrats and included in Cummings' bill.

"The commonsense reforms in this legislation will restore the United States Postal Service to long-term financial solvency while maintaining high-quality universal service for all Americans," Issa said in a statement. "The legislation incorporates reforms offered by members of both sides of the aisle and builds upon months of bipartisan and bicameral discussions."

Changes to union contracts, FERS surplus

The draft of Issa's bill originally barred employee-union contracts from restricting the Postal Service's use of reductions-in-force — even going so far as to require the renegotiation of existing contracts that contained such provisions. However, "by popular demand," Issa said at the hearing this week, there will be no renegotiations of current contracts and the language will only apply to future union deals.

The bill would also modify how the agency pre-funds retiree health-care payments, moving from massive fixed payments — on which the agency has defaulted twice in the past year — to an actuarial-based system of payments.

Another updated provision that drew praise from committee Democrats and American Postal Workers Union President Cliff Guffey, who testified at this weeks' hearing, would require the Office of Personnel Management to use USPS demographic information to calculate the total amount by which USPS has overpaid into the Federal Employees Retirement System. Doing so would cause the FERS surplus to swell to to about $6 billion, which would be refunded to the agency under both Issa's and Cummings' bills.

Finally, Issa's bill requires USPS to create a chief innovation officer by January 2014 to help the agency develop innovative new products and services that will help grow revenue.

Issa's revamped bill is a bit of an olive branch of sorts toward Democrats on the committee.

However, wide disagreement still remains over the issue of five-day mail delivery. Issa was supportive of the Postal Service's planned move to end first-class mail delivery on Saturdays, while retaining package delivery. However, USPS backed down after Congress passed a spending bill in March that effectively barred the agency from five-day delivery.

Committee will consider bill next week

The agency, which has been hemorrhaging cash over the past few years, lost more than $3 billion in the first half of this year. The agency has undertaken its own round of cost-saving measures, including consolidating facilities, cutting hours at local post offices nationwide and reducing its workforce through buyouts and early retirements. However, Postmaster General Pat Donahoe says the agency needs new legislation to fully rescue the agency from insolvency.

The full committee will consider the bill on its next business meeting on July 24.

Sen. Tom Carper (D-Del.), chairman of the Senate Homeland Security and Governmental Affairs Committee, said he welcomed Issa's decision to move forward with the bill, and he planned to introduce bipartisan legislation in the Senate soon.

"While we differ in our approach in some areas, Chairman Issa and I, and the rest of our colleagues, are united in our strong commitment to restore the Postal Service to solvency and give it the tools it needs to thrive in the years to come," Carper said in a statement Friday.

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