clauses are prospectively barred in Postal
Service collective bargaining agreements.
Subjects postal employees to the same
Reduction-in-Force authority as the rest
of the federal workforce. Any employees
who lose their jobs due to current restruc-
turing will have preferential hiring status
among Postal Service contractors.
Postal Specific Pension Assump-
tions. Uses Postal Service specific demo-
graphic assumptions to more accurately
calculate the Postal Service's total liabili-
ties and annual payments for both the
FERS and the CSRS pension systems.
Protects Rural Post Offices. Lim-
its the closure of rural post offices and
requires the Postal Service to consider
broadband penetration, cellular phone
service, and distance to closest replace-
ment service in determining whether to
close post offices.
Creates a Chief Innovation Officer.
Creates a Chief Innovation Officer to
focus the Postal Service's efforts to iden-
tify and grow new postal and authorized
non-postal products to help enhance the
Postal Service's revenue.
Enhances Innovation Cap Lim-
its. Raises the limits on experimental
products market test cap limits to help
encourage innovation and develop new
products.
Here are the highlights of S. 1486 as
originally introduced in August 2013,
taken from Senate Homeland Security
and Governmental Affairs website (www.
hsgac.senate.gov/media/minority-media/
chairman-carper-ranking-member-
coburn-introduce-bipartisan-postal-
reform-bill):
• Pension Reforms. Requires the
Office of Personnel Management (OPM)
use actuarial data to determine how
much the Postal Service must pay into
the two federal pension programs—the
Federal Employees Retirement System
(FERS) and the Civil Service Retirement
System (CSRS) to more accurately reflects
the amount of the Postal Service's pro-
jected liability. This reform is expected
to result in a Postal Service FERS surplus.
The Postal Service would be permitted
to request and receive up to $6 billion
of any surplus, which could be spent to
retire Postal Service debt and give it need-
ed liquidity. In addition, the bill would
allow the Postal Service and postal unions
to bargain over the extent of new postal
employees' participation in FERS and the
Thrift Savings Program (TSP).
• Health Care Reforms. Eliminates
the Postal Service's statutory retiree
health pre-funding and replace it with
a less aggressive 40-year amortization
of the Postal Service's retiree health lia-
bility. Implements provisions requiring
that 1) health plans be created to meet
the needs of postal retirees enrolled in
Medicare parts A and B, some of whom
currently purchase full Medicare and
Federal Employees Health Benefit Plan
(FEHBP) coverage; and 2) postal retirees
not enrolled in Medicare be given the
opportunity to do so penalty-free. Allows
the Postal Service and the postal unions
to bargain over the creation of a new
health plan for postal employees, either
within or outside of FEHBP.
• Service Changes. Places a morato-
rium on service standard changes and
plant closings for two years, keeping all
plants open as of the date of enactment
in operation for the duration of the
moratorium. Codifies the Postal Service's
current plan to find savings in its retail
operations without closing post offices.
Preserves Saturday delivery for at least a
year. Requires the Postal Service to use
the most cost effective means of mail
delivery, requiring centralized or curbside
delivery for new addresses and business
addresses, and requires the Postal Service
to seek to convert residential addresses
from door delivery to centralized or curb-
side delivery on a voluntary basis.
• Revenue and Innovation. Stream-
lines the current rate-setting process, giv-
ing the Postal Service more authority to
set prices on its own while preserving
a more flexible CPI rate cap until 2016,
when the rate cap would expire. Gives
the Postal Service enhanced authority to
innovate and introduce new non-postal
products that take advantage of its retail
and mail processing, transportation, and
delivery network. Authorizes the Postal
Service to offer services on behalf of fed-
eral, state, or local government agencies.
Lifts the current prohibition on shipping
beer, wine, and distilled spirits, allowing
the Postal Service to deliver under the
same rules as private sector shippers.
• Federal Workers Compensation
Reform. Contains the Workers Compen-
sation Act of 2013, which reforms the
workers' compensation program for fed-
eral employees who are injured on the
job. The act brings compensation levels
for older workers more in line with retire-
ment benefits, strengthens programs for
helping injured workers get back on the
job, makes other updates and improve-
ments.
Both the House and Senate bills have a
lot in common and are consistent with
the USPS 5-Year Plan. There are changes
in services and facility closures, pension
and health care reform, and revenue
innovation. The main differences are in
the specific approach to achieving these
changes.
However, in mid-December, after one
last effort to get the Senate bill to the
floor for debate and vote, time ran out
and Congress adjourned for 2013. Sena-
tors Tom Carper and Tom Coburn hoped
to return to the legislation in 2014.
Finally, Some Good News
Two recent announcements have
brought good news to the USPS. In Octo-
ber 2013 the PRC approved a National
Service Agreement (NSA) between the
USPS and Amazon for seven-day delivery
of packages to residential addresses in
Los Angeles and New York metropolitan
areas. Delivery began in November 2013
and is expected to quickly be expanded
to other major cities like Dallas, Houston,
New Orleans, and Phoenix.
And 2013 ended with the announce-
ment on December 24, 2013 that the
PRC had partially granted the USPS
request for an exigent rate increase to
recover losses from the 2008 recession.
The PRC found that the USPS had expe-
rienced financial harm and was legally
entitled to implement a price increase
that exceeded the CPI-U.
The increase will not, however, be
permanent as requested by the USPS,
but only in effect until the exigent losses
of $2.8 billion are collected—less than
two years. The 4.3 percent exigent rate
increase was implemented in conjunc-
tion with the inflation-based adjustment
of 1.7 percent that was approved earlier
by the PRC. The overall adjustment of
six percent became effective on January
26, 2014. ◗◗
Nancy DeDiemar is a former chairman
of NAQP and Printer of the Year. She is the
co-publisher of Printips (MyPRINTResource.
com/10206473), a newsletter subscription
service for printers. Contact her at Nan-
cy91762@gmail.com.
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