SECTION 1. PROCEDURES FOR SEEKING COMPENSATION.

    (a) In General.--Chapter 4 of title 39, United States Code, is 
amended by adding at the end the following:
``Sec. 414. Compensation for certain wrongfully arrested individuals
    ``(a) Not later than 90 days after the date of the enactment of 
this section, the Judicial Officer shall by regulation establish 
procedures under which any individual described in subsection (b)(1)(A) 
may seek compensation under this section.
    ``(b) The regulations shall include provisions under which--
            ``(1) a petition for compensation may be brought--
                    ``(A) by any individual--
                            ``(i) arrested by the Postal Inspection 
                        Service--
                                    ``(I) after December 31, 1983;
                                    ``(II) pursuant to any 
                                investigation in which one or more paid 
                                confidential informants were used;
                                    ``(III) for violating any law of 
                                the United States, or of any State, 
                                prohibiting the use, sale, or 
                                possession of a controlled substance; 
                                but
                            ``(ii) who is not convicted, pursuant to 
                        such arrest, of a violation of any law 
                        described in clause (i);
                    ``(B) after all administrative and judicial 
                procedures otherwise available to petitioner for 
                seeking compensation in connection with the arrest have 
                been exhausted, but not later than 2 years after the 
                date as of which--
                            ``(i) the exhaustion requirement is met; or
                            ``(ii) if later, any such petition may 
                        first be filed under this section; and
                    ``(C) notwithstanding section 2676 or 2679 of title 
                28 or any other provision of law;
            ``(2) a petition for compensation under this section shall 
        be considered by a panel of 3 administrative law judges who 
        shall be--
                    ``(A) qualified by virtue of their background, 
                objectivity, and experience; and
                    ``(B) individuals detailed to the Postal Service, 
                for purposes of this section, on a reimbursable basis;
            ``(3) the provisions of sections 556 and 557 of title 5 
        shall apply to any proceeding conducted by a panel of 
        administrative law judges under this section;
            ``(4) a panel may award such amount to a petitioner as the 
        panel considers appropriate to compensate petitioner for any 
        harm or injury, resulting from petitioner's wrongful arrest, 
        suffered by--
                    ``(A) the petitioner;
                    ``(B) the petitioner's spouse, if any; or
                    ``(C) a child of the petitioner, if any;
        except that not more than a total of $500,000 may be awarded to 
        a petitioner under this section in connection with any 
        particular arrest; and
            ``(5) compensation awarded under this section--
                    ``(A) shall be payable out of the Postal Service 
                Fund; and
                    ``(B) shall be computed taking into account the 
                nature and degree of the harm or injury suffered, the 
                degree to which the Postal Inspection Service failed to 
                take reasonable precautions to prevent any such 
                wrongful arrest from occurring, any history or pattern 
                of similar wrongful arrests by the Postal Inspection 
                Service, any compensation awarded in any earlier 
                proceeding in connection with petitioner's arrest, and 
                such other factors as the panel considers appropriate.
    ``(c) A determination under this section shall not be subject to 
any administrative or judicial review.
    ``(d) For purposes of this section--
            ``(1) the term `Judicial Officer' means the Judicial 
        Officer appointed under section 204;
            ``(2) the term `controlled substance' has the meaning given 
        such term by section 102(6) of the Controlled Drug Abuse 
        Prevention and Control Act of 1970;
            ``(3) the term `administrative law judge' means an 
        administrative law judge appointed under section 3105 of title 
        5; and
            ``(4) a confidential informant shall be considered to be 
        `paid' if such informant receives, or is to receive, a monetary 
        or nonmonetary benefit (including any forbearance from a civil 
        or criminal action) for the services involved.''.
    (b) Chapter Analysis.--The analysis for chapter 4 of title 39, 
United States Code, is amended by adding at the end the following:

``414. Compensation for certain wrongfully arrested individuals.''.
Requires the Judicial Officer of the U.S. Postal Service to establish procedures under which any individual arrested by the Postal Inspection Service (PIS) (pursuant to any investigation in which a paid confidential informant was used) after December 31, 1983, for violating a law prohibiting the use, sale, or possession of a controlled substance, who is not convicted of such offense, may seek compensation after exhausting all administrative and judicial procedures otherwise available. 
Requires a petition to be considered by a panel of three administrative law judges.  Authorizes the panel to award such amount to a petitioner as it considers appropriate (up to $500,000) to compensate the individual for any harm or injury suffered by the petitioner or his or her spouse or child resulting from the petitioner's wrongful arrest.  Requires the compensation to be:  (1) payable out of the Postal Service Fund; and (2) computed taking into account the nature and degree of the harm or injury suffered, the degree to which the PIS failed to take reasonable precautions to prevent any such wrongful arrest from occurring, any history or pattern of similar wrongful arrests by PIS, and any compensation awarded in any earlier proceeding in connection with the petitioner's arrest. 
Exempts the panel's determinations from administrative or judicial review.
To amend title 39, United States Code, to provide for procedures under which persons wrongfully arrested by the Postal Inspection Service on narcotics charges may seek compensation from the United States Postal Service.