March 26, 2018
Yesterday, March 22, Senators Tom Carper (D-DE), Jerry Moran (R-KS), Heidi Heitkamp (D-ND) and Claire McCaskill (D-MO) introduced S. 2629, the Postal Reform Act of 2018. The legislation is the Senate version of HR 756, the House postal reform bill. H.R. 756 was approved by the House Oversight and Government Reform Committee last year. S. 2629 shares most of the core provisions of H.R. 756; however, there are key differences.
Both bills would integrate FEHBP and Medicare coverage for Medicare-eligible postal retirees in order to reduce the Postal Service’s health care liability. In addition, both include a 3-year USPS premium subsidy for newly enrolled Part B beneficiaries. However, S. 2629 includes three waivers of Medicare Part B coverage: (1) financial hardship, (2) Veterans Administration health coverage and (3) the lack of Medicare providers in the retiree’s area of residence.
Both bills call for a more accurate calculation of the USPS’ pension liability. In addition, both bills would amortize USPS’ remaining health care liability. While H.R. 756 would amortize 100 percent of the remaining liability over the next 35 years, S. 2629 would amortize 80 percent over the next 40 years; the remaining 20 percent would be secured with future postal property sales. (S. 2629 would not require the sales.) S. 2629 would establish a procedure for the USPS to seek waivers from its annual amortization payment through the Postal Regulatory Commission. The Senate bill would also offset the increased Medicare obligation through a one-time $13 billion transfer of funds from the account in which amortization payments have been deposited in the past to the Medicare Trust Fund.
Both bills would reduce the number of presidential-nominated Board of Governors from nine to five, would make the Postal Inspector General (IG) a presidential appointee, would create a Chief Innovation Officer within the USPS, and would reform the way in which the USPS awards vendor contracts.
Both bills would restore one-half of the exigent rate increase that expired in April 2016. S. 2629 would also require the Postal IG to conduct a study relating to the rates charged to “underwater” postal products (i.e., magazines), and would require the USPS to submit to Congress a plan for its long-term solvency.
While H.R. 756 would authorize the voluntary conversion of residential mail deliveries from door delivery to alternative locations (e.g., curbside and cluster boxes) and phase in alternative deliveries for business addresses, S. 2629 contains no delivery conversion language. S. 2629 would permit the shipping of wine, beer and spirits.
Both HR 756 and S. 2629 would expand MSBP appeal rights for EAS level employees and would suspend further post office hour reductions and post office re-classifications, pending an IG report on POStPlan. In addition, S. 2629 would require an IG report on USPS compliance with the statute governing “consultations” and EAS pay talks.
Upon introduction of S. 2629, UPMA Co-Presidents Tony Leonardi and Sean Acord commented: “The United Postmasters and Managers of America (UPMA) applauds the efforts of Senators Carper, Moran, Heitkamp and McCaskill in introducing bipartisan legislation to further the goal of providing financial relief to the U.S Postal Service. UPMA looks forward to continue working with these Senators and other members of Congress to sustain the U.S. Postal Service, a proven national treasure.”
Link to the Senate press release on S. 2629.
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