Senate nears final vote on USPS reform bill after running into procedural hurdles

A long-awaited reform bill that would save the Postal Service a total of $107 billion is coming close to a final vote on the Senate floor, after a few procedural hurdles.

The Senate on Monday voted 74-17 to advance the Postal Service Reform Act. The bill faces a final floor vote on Tuesday.

The bill’s advocates at first expected a straightforward vote in the Senate, after the House passed the bill last month. The legislation has more than 100 co-sponsors in the House, and at least 14 Democratic and 14 Republican co-sponsors in the Senate.

Two Republican senators, however, are openly opposed to the legislation and have sought to delay the bill over concerns it will hurt the long-term solvency of Medicare.

Senators from both parties, more recently, proposed a slew of amendments that address hot-button topics at USPS, and would jeopardize the bill’s future if attached to the final version of the bill.

Sen. Pat Toomey (R-Pa.) submitted an amendment that would prohibit USPS from offering, “directly or indirectly, financial services, including by entering into an agreement with a third party to provide financial services.”

Sen. Jeff Merkley (D-Ore.) introduced an amendment that would require USPS to give Congress an unredacted version of its Next-Generation Delivery Vehicle contract award to Oshkosh Defense.

Merkley also introduced an amendment that would cap the number of gas-powered delivery vehicles USPS would be permitted to buy in the coming years as part of its Next-Generation Delivery Vehicle fleet.

The National Association of Letter Carriers on Thursday urged the Senate to pass a “clean” version of the bill, without any amendments, to avoid sending the bill back to the House before it heads to President Joe Biden’s desk.

“NALC was pleased that the Postal Service Reform Act passed in the House with strong bipartisan support,” NALC President Fredric Rolando said. “But the job is not finished. We urge the Senate to pass H.R. 3076 as soon as possible and send it to President Biden’s desk.”

Senate Homeland Security and Governmental Affairs Committee Chairman Gary Peters (D-Mich.), who has led efforts to pass the bill, urged his colleagues last Wednesday to pass the legislation.

“For more than 15 years, this public service and its dedicated workers have been hindered by burdensome financial requirements. The need to quickly pass these balanced reforms, which are broadly supported by the American people, has become increasingly urgent,” Peters said.

HSGAC Ranking Member Rob Portman (R-Ohio), who has also championed the legislation, said last Thursday that the bill won’t increase Medicare premiums or impact its solvency, and urged his colleagues to quickly pass the bill to address USPS’s long-term financial challenges.

“It’s really important that we do it, because the Post Office is in deep trouble, and if we don’t act, it’s going to get a lot worse. We’re going to have big problems,” Portman said.

The bill, if passed, would be the first major piece of postal reform legislation to make it through Congress in more than 15 years, and would address issues that stem from the last reform effort lawmakers passed in 2006.

The bill will save USPS $50 billion over the next 10 years by eliminating a provision from a 2006 law that required USPS to pre-fund retiree health benefits well into the future. It also requires all future postal retirees to enroll in Medicare parts B and D.

USPS, under the legislation, will instead return to an annual pay-as-you-go system to fund retiree health benefits.

The legislation also forgives USPS’s obligation to pay $57 billion in scheduled payments to its retiree health benefits fund.

The agency, citing its long-term financial challenges, has defaulted on payments to the fund since 2012, but must still count these payments in its financial statements.

The White House, in a statement of administration policy last month, said that the Biden administration “supports efforts to strengthen the United States Postal Service, including by providing Postal employees with the dignity, fair pay and employer-provided benefits they have earned.”

“The administration is committed to ensuring that the Postal Service delivers the highest quality, most reliable service possible to every American. This legislation would advance these goals in several ways,” the White House wrote.

The House passed the bill last month, and was expected to pass quickly in the Senate. The legislation, however, ran into procedural hurdles.

The House at first advanced the wrong version of the bill to the Senate. It quickly corrected the error, and voted to send the correct version of the bill to the Senate, but the Senate was already in the process of moving the incorrect version of the bill forward.

Senate Majority Leader Chuck Schumer (D-N.Y.) on Feb. 14 requested the Senate accept the correct version by unanimous consent, but Sen. Rick Scott (R-Fla.) objected.

Scott said he liked parts of the bill that would enhance delivery service for rural communities and guarantee six-day mail delivery, but said he couldn’t support the bill because it “simply shifts risk to Medicare recipients by adding billions in new costs to Medicare.”

“Unfortunately there are pieces of this bill that block the opportunity for us to achieve our shared goal of reforming the Postal Service,” Scott said.

HSGAC hasn’t held a hearing or markup for the bill, which Scott said gave senators no opportunity to modify the bill.

Schumer expressed frustration with Scott’s objection, and called the move “regrettable.”

“Even though this will delay the bill, we will pass it,” Schumer said.

Sen. Jim Risch (R-Idaho), more recently, joined Scott in raising objections over the postal reform bill.

In a letter last Friday, both senators urged their colleagues to delay a vote on the bill until the Congressional Budget Office conducts a “comprehensive, long-term review of this bill” that looks at how it would impact the long-term sustainability of USPS and Medicare.

“We simply want the U.S. Senate to have the opportunity to work on this, improve it, and deliver a bill that truly works. This bill does not fix the underlying issues with the Postal Service, nor does it make it profitable. This bill does not reduce the cost to the Federal government, but instead reduces the cost to the Postal Service and shifts that increased cost to Medicare beneficiaries,” Scott and Risch wrote.

The bill, if approved by the Senate, would be the first major piece of postal reform legislation to make it through Congress in more than 15 years, and would address issues that stem from the last reform effort lawmakers passed in 2006.

USPS has defaulted on scheduled payments to the retiree health fund since 2012, but still includes those payments in its annual financials.

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