IB 

Union Calendar No. 427 

108TH CONGRESS 

2D SESSION H. R. 4341 

[Report No. 108–672, Parts I and II] 

To reform the postal laws of the United States. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 12, 2004 

Mr. MCHUGH (for himself, Mr. DAVIS of Illinois, Mr. TOM DAVIS of Virginia, 

Mr. WAXMAN, Mrs. MILLER of Michigan, Mr. BURTON of Indiana, Mr. 

SCHROCK, Mr. SHAYS, Mr. OWENS, Mrs. MALONEY, Mr. MICA, Mr. 

LATOURETTE, Mr. LEWIS of Kentucky, Mr. PLATTS, Mr. CANNON, Mr. 

PUTNAM, Mr. DUNCAN, Mr. DEAL of Georgia, Ms. WATSON, Mr. LYNCH, 

Ms. NORTON, Mr. MURPHY, Mr. TURNER of Ohio, Mr. CARTER, Mrs. 

BLACKBURN, Mr. TIBERI, and Ms. HARRIS) introduced the following bill; 

which was referred to the Committee on Government Reform 

SEPTEMBER 8, 2004 

Reported and referred to the Committee on the Judiciary for a period ending 

not later than September 28, 2004, for consideration of such provisions 

of the bill as fall within the jurisdiction of that committee pursuant to 

clause 1(k), rule X 

SEPTEMBER 23, 2004 

Additional sponsors: Mr. CLAY, Mr. WELDON of Pennsylvania, Mrs. EMERSON, Mr. LANTOS, Mr. RUSH, Mr. FORD, Ms. MCCARTHY of Missouri, 

Mr. BOUCHER, Mr. MCINTYRE, Mr. POMEROY, Mrs. CUBIN, Mr. MOORE, 

Mr. EVANS, Mr. ROSS, Mr. BOEHLERT, Mr. FRANK of Massachusetts, 

Ms. SLAUGHTER, Mr. RAHALL, Mr. BAIRD, Mr. LAHOOD, Mr. 

MCDERMOTT, Mr. PAYNE, Mr. WILSON of South Carolina, Mrs. CAPITO, 

Mr. DAVIS of Tennessee, Mr. BRADLEY of New Hampshire, Mr. BILIRAKIS, Mr. MORAN of Virginia, Mr. LUCAS of Kentucky, Ms. BERKLEY, 

Mr. MICHAUD, Mr. MEEK of Florida, Mr. TOWNS, Mr. LARSON of Connecticut, Mr. PRICE of North Carolina, Mr. LINCOLN DIAZ-BALART of 

Florida, Mr. CONYERS, Mr. SHERMAN, Ms. LINDA T. SA ́NCHEZ of Cali-
2 

•HR 4341 RH 

fornia, Mr. GREEN of Wisconsin, Mr. CHANDLER, Mr. COSTELLO, Mr. 

PALLONE, Mr. SIMMONS, Mr. FERGUSON, Mr. MCNULTY, Mr. VAN

HOLLEN, Ms. HARMAN, Mr. OXLEY, and Mr. ALLEN

SEPTEMBER 23, 2004 

Reported by the Committee on the Judiciary with an amendment, committed 

to the Committee of the Whole House on the State of the Union, and 

ordered to be printed 

[Strike out all after the enacting clause and insert the part printed in italic] 

[For text of introduced bill see copy of bill as introduced on May 12, 2004] 

A BILL 

To reform the postal laws of the United States. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Postal Accountability and Enhancement Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—DEFINITIONS; POSTAL SERVICES 

Sec. 101. Definitions. 

Sec. 102. Postal services. 

Sec. 103. Financial transparency. 

TITLE II—MODERN RATE REGULATION 

Sec. 201. Provisions relating to market-dominant products. 

Sec. 202. Provisions relating to competitive products. 

Sec. 203. Provisions relating to experimental and new products. 

Sec. 204. Reporting requirements and related provisions. 

Sec. 205. Complaints; appellate review and enforcement. 

Sec. 206. Workshare discounts. 

Sec. 207. Clerical amendment. 
3 

•HR 4341 RH 

TITLE III—PROVISIONS RELATING TO FAIR COMPETITION 

Sec. 301. Postal Service Competitive Products Fund. 

Sec. 302. Assumed Federal income tax on competitive products income. 

Sec. 303. Unfair competition prohibited. 

Sec. 304. Suits by and against the Postal Service. 

Sec. 305. International postal arrangements. 

Sec. 306. Redesignation. 

Sec. 307. Clarification. 

TITLE IV—GENERAL PROVISIONS 

Sec. 401. Qualification requirements for Governors. 

Sec. 402. Obligations. 

Sec. 403. Private carriage of letters. 

Sec. 404. Rulemaking authority. 

Sec. 405. Noninterference with collective bargaining agreements, etc. 

Sec. 406. Bonus authority. 

Sec. 407. Mediation in collective-bargaining disputes. 

TITLE V—ENHANCED REGULATORY COMMISSION 

Sec. 501. Reorganization and modification of certain provisions relating to the 

Postal Regulatory Commission. 

Sec. 502. Authority for Postal Regulatory Commission to issue subpoenas. 

Sec. 503. Appropriations for the Postal Regulatory Commission. 

Sec. 504. Redesignation of the Postal Rate Commission. 

Sec. 505. Officer of the Postal Regulatory Commission representing the general 

public. 

TITLE VI—INSPECTORS GENERAL 

Sec. 601. Inspector General of the Postal Regulatory Commission. 

Sec. 602. Inspector General of the United States Postal Service to be appointed 

by the President. 

TITLE VII—EVALUATIONS 

Sec. 701. Universal postal service study. 

Sec. 702. Assessments of ratemaking, classification, and other provisions. 

Sec. 703. Study on equal application of laws to competitive products. 

Sec. 704. Greater diversity in Postal Service Executive and administrative schedule management positions. 

Sec. 705. Plan for assisting displaced workers. 

Sec. 706. Contracts with women, minorities, and small businesses. 

Sec. 707. Rates for periodicals. 

Sec. 708. Assessment of certain rate deficiencies. 

Sec. 709. Postal processing and distribution network study. 

Sec. 710. Definition. 

TITLE VIII—MISCELLANEOUS; TECHNICAL AND CONFORMING 

AMENDMENTS 

Sec. 801. Employment of postal police officers. 

Sec. 802. Date of postmark to be treated as date of appeal in connection with the 

closing or consolidation of post offices. 
4 

•HR 4341 RH 

Sec. 803. Provisions relating to benefits under chapter 81 of title 5, United States 

Code, for officers and employees of the former Post Office Department. 

Sec. 804. Obsolete provisions. 

Sec. 805. Expanded contracting authority. 

Sec. 806. Investments. 

Sec. 807. Repeal of section 5403. 

Sec. 808. Reduced rates. 

Sec. 809. Hazardous matter. 

Sec. 810. Provisions relating to cooperative mailings. 

Sec. 811. Technical and conforming amendments. 

TITLE IX—POSTAL PENSION FUNDING REFORM AMENDMENTS 

Sec. 901. Civil Service Retirement System. 

Sec. 902. Health insurance. 

Sec. 903. Repealer. 

Sec. 904. Ensuring appropriate use of escrow and military savings. 

Sec. 905. Effective dates. 

1 TITLE I—DEFINITIONS; POSTAL 

2 SERVICES 

3 SEC. 101. DEFINITIONS. 

4 Section 102 of title 39, United States Code, is amended 

5 by striking ‘‘and’’ at the end of paragraph (3), by striking 

6 the period at the end of paragraph (4) and inserting a semi7 colon, and by adding at the end the following: 

8 ‘‘(5) ‘postal service’ means the carriage of letters, 

9 printed matter, or mailable packages, including ac10 ceptance, collection, processing, delivery, or other serv11 ices supportive or ancillary thereto; 

12 ‘‘(6) ‘product’ means a postal service with a dis13 tinct cost or market characteristic for which a rate or 

14 rates are, or may reasonably be, applied; 

15 ‘‘(7) ‘rates’, as used with respect to products, in16 cludes fees for postal services; 
5 

•HR 4341 RH 

1 ‘‘(8) ‘market-dominant product’ or ‘product in 

2 the market-dominant category of mail’ means a prod3 uct subject to subchapter I of chapter 36; 

4 ‘‘(9) ‘competitive product’ or ‘product in the 

5 competitive category of mail’ means a product subject 

6 to subchapter II of chapter 36; 

7 ‘‘(10) ‘Consumer Price Index’ means the Con8 sumer Price Index for All Urban Consumers pub9 lished monthly by the Bureau of Labor Statistics of 

10 the Department of Labor; and 

11 ‘‘(11) ‘year’, as used in chapter 36 (other than 

12 subchapters I and VI thereof), means a fiscal year.’’. 

13 SEC. 102. POSTAL SERVICES. 

14 (a) IN GENERAL.—Section 404 of title 39, United 

15 States Code, is amended— 

16 (1) in subsection (a), by striking paragraph (6) 

17 and by redesignating paragraphs (7) through (9) as 

18 paragraphs (6) through (8), respectively; and 

19 (2) by adding at the end the following: 

20 ‘‘(c) Nothing in this title shall be considered to permit 

21 or require that the Postal Service provide any special non22 postal or similar services, except that nothing in this sub23 section shall prevent the Postal Service from providing any 

24 special nonpostal or similar services provided by the Postal 

25 Service as of May 12, 2004.’’. 
6 

•HR 4341 RH 

1 (b) CONFORMING AMENDMENT.—Section 

2 1402(b)(1)(B)(ii) of the Victims of Crime Act of 1984 (98 

3 Stat. 2170; 42 U.S.C. 10601(b)(1)(B)(ii)) is amended by 

4 striking ‘‘404(a)(8)’’ and inserting ‘‘404(a)(7)’’. 

5 SEC. 103. FINANCIAL TRANSPARENCY. 

6 (a) IN GENERAL.—Section 101 of title 39, United 

7 States Code, is amended by redesignating subsections (d) 

8 through (g) as subsections (e) through (h), respectively, and 

9 by inserting after subsection (c) the following: 

10 ‘‘(d) As an establishment that provides both market11 dominant and competitive products, the Postal Service shall 

12 be subject to a high degree of transparency, including in 

13 its finances and operations, to ensure fair treatment of cus14 tomers of the Postal Service’s market-dominant products 

15 and companies competing with the Postal Service’s com16 petitive products.’’. 

17 (b) CONFORMING AMENDMENT.—Section 5001 of title 

18 39, United States Code, is amended by striking ‘‘101(e) and 

19 (f)’’ and inserting ‘‘101(f) and (g)’’. 
7 

•HR 4341 RH 

1 TITLE II—MODERN RATE 

2 REGULATION 

3 SEC. 201. PROVISIONS RELATING TO MARKET-DOMINANT 

4 PRODUCTS. 

5 (a) IN GENERAL.—Chapter 36 of title 39, United 

6 States Code, is amended by striking sections 3621 and 3622 

7 and inserting the following: 

8 ‘‘§ 3621. Applicability; definitions 

9 ‘‘(a) APPLICABILITY.—This subchapter shall apply 

10 with respect to— 

11 ‘‘(1)(A) single piece first-class letters (both do12 mestic and international); 

13 ‘‘(B) single piece first-class cards (both domestic 

14 and international); and 

15 ‘‘(C) special services; 

16 ‘‘(2) all first-class mail not included under para17 graph (1); 

18 ‘‘(3) periodicals; 

19 ‘‘(4) standard mail; 

20 ‘‘(5) media mail; 

21 ‘‘(6) library mail; and 

22 ‘‘(7) bound printed matter, 

23 subject to any changes the Postal Regulatory Commission 

24 may make under section 3642. 
8 

•HR 4341 RH 

1 ‘‘(b) RULE OF CONSTRUCTION.—Mail matter referred 

2 to in subsection (a) shall, for purposes of this subchapter, 

3 be considered to have the meaning given to such mail matter 

4 under the mail classification schedule. 

5 ‘‘§ 3622. Modern rate regulation 

6 ‘‘(a) AUTHORITY GENERALLY.—The Postal Regulatory 

7 Commission shall, within 24 months after the date of the 

8 enactment of this section, by regulation establish (and may 

9 from time to time thereafter by regulation revise) a modern 

10 system for regulating rates and classes for market-dominant 

11 products. 

12 ‘‘(b) OBJECTIVES.—Such system shall be designed to 

13 achieve the following objectives: 

14 ‘‘(1) To maximize incentives to reduce costs and 

15 increase efficiency. 

16 ‘‘(2) To create predictability and stability in 

17 rates. 

18 ‘‘(3) To maintain high quality service standards. 

19 ‘‘(4) To allow the Postal Service pricing flexi20 bility. 

21 ‘‘(5) To assure adequate revenues, including re22 tained earnings, to maintain financial stability. 

23 ‘‘(6) To reduce the administrative burden of the 

24 ratemaking process. 
9 

•HR 4341 RH 

1 ‘‘(c) FACTORS.—In establishing or revising such sys2 tem, the Postal Regulatory Commission shall take into ac3 count— 

4 ‘‘(1) the establishment and maintenance of a fair 

5 and equitable schedule for rates and classification sys6 tem; 

7 ‘‘(2) the value of the mail service actually pro8 vided each class or type of mail service to both the 

9 sender and the recipient, including but not limited to 

10 the collection, mode of transportation, and priority of 

11 delivery; 

12 ‘‘(3) the direct and indirect postal costs attrib13 utable to each class or type of mail service plus that 

14 portion of all other costs of the Postal Service reason15 ably assignable to such class or type; 

16 ‘‘(4) the effect of rate increases upon the general 

17 public, business mail users, and enterprises in the 

18 private sector of the economy engaged in the delivery 

19 of mail matter other than letters; 

20 ‘‘(5) the available alternative means of sending 

21 and receiving letters and other mail matter at reason22 able costs; 

23 ‘‘(6) the degree of preparation of mail for deliv24 ery into the postal system performed by the mailer 
10 

•HR 4341 RH 

1 and its effect upon reducing costs to the Postal Serv2 ice; 

3 ‘‘(7) simplicity of structure for the entire sched4 ule and simple, identifiable relationships between the 

5 rates or fees charged the various classes of mail for 

6 postal services; 

7 ‘‘(8) the relative value to the people of the kinds 

8 of mail matter entered into the postal system and the 

9 desirability and justification for special classifica10 tions and services of mail; 

11 ‘‘(9) the importance of providing classifications 

12 with extremely high degrees of reliability and speed of 

13 delivery and of providing those that do not require 

14 high degrees of reliability and speed of delivery; 

15 ‘‘(10) the desirability of special classifications 

16 from the point of view of both the user and of the 

17 Postal Service; 

18 ‘‘(11) the educational, cultural, scientific, and 

19 informational value to the recipient of mail matter; 

20 and 

21 ‘‘(12) the policies of this title as well as such 

22 other factors as the Commission deems appropriate. 

23 ‘‘(d) ALLOWABLE PROVISIONS.—The system for regu24 lating rates and classes for market-dominant products may 

25 include one or more of the following: 
11 

•HR 4341 RH 

1 ‘‘(1) Price caps, revenue targets, or other form of 

2 incentive regulation. 

3 ‘‘(2) Cost-of-service regulation. 

4 ‘‘(3) Such other form of regulation as the Com5 mission considers appropriate to achieve, consistent 

6 with subsection (c), the objectives of subsection (b). 

7 ‘‘(e) LIMITATION.—In the administration of this sec8 tion, the Commission shall not permit the average rate in 

9 any subclass of mail to increase at an annual rate greater 

10 than the comparable increase in the Consumer Price Index, 

11 unless it has, after notice and opportunity for a public 

12 hearing and comment, determined that such increase is rea13 sonable and equitable and necessary to enable the Postal 

14 Service, under best practices of honest, efficient, and eco15 nomical management, to maintain and continue the devel16 opment of postal services of the kind and quality adapted 

17 to the needs of the United States. 

18 ‘‘(f) TRANSITION RULE.—Until regulations under this 

19 section first take effect, rates and classes for market-domi20 nant products shall remain subject to modification in ac21 cordance with the provisions of this chapter and section 

22 407, as such provisions were last in effect before the date 

23 of the enactment of this section.’’. 

24 (b) REPEALED SECTIONS.—Sections 3623, 3624, 3625, 

25 and 3628 of title 39, United States Code, are repealed. 
12 

•HR 4341 RH 

1 (c) REDESIGNATION.—Chapter 36 of title 39, United 

2 States Code (as in effect after the amendment made by sec3 tion 501(a)(2), but before the amendment made by section 

4 202) is amended by striking the heading for subchapter II 

5 and inserting the following: 

6 ‘‘SUBCHAPTER I—PROVISIONS RELATING TO 

7 MARKET-DOMINANT PRODUCTS’’. 

8 SEC. 202. PROVISIONS RELATING TO COMPETITIVE PROD9 UCTS. 

10 Chapter 36 of title 39, United States Code, is amended 

11 by inserting after section 3629 the following: 

12 ‘‘SUBCHAPTER II—PROVISIONS RELATING TO 

13 COMPETITIVE PRODUCTS 

14 ‘‘§ 3631. Applicability; definitions and updates 

15 ‘‘(a) APPLICABILITY.—This subchapter shall apply 

16 with respect to— 

17 ‘‘(1) priority mail; 

18 ‘‘(2) expedited mail; 

19 ‘‘(3) mailgrams; 

20 ‘‘(4) international mail; and 

21 ‘‘(5) parcel post, 

22 subject to any changes the Postal Regulatory Commission 

23 may make under section 3642. 

24 ‘‘(b) DEFINITION.—For purposes of this subchapter, 

25 the term ‘costs attributable’, as used with respect to a prod-
13 

•HR 4341 RH 

1 uct, means the direct and indirect postal costs attributable 

2 to such product. 

3 ‘‘(c) RULE OF CONSTRUCTION.—Mail matter referred 

4 to in subsection (a) shall, for purposes of this subchapter, 

5 be considered to have the meaning given to such mail matter 

6 under the mail classification schedule. 

7 ‘‘§ 3632. Action of the Governors 

8 ‘‘(a) AUTHORITY TO ESTABLISH RATES AND CLASS9 ES.—The Governors shall establish rates and classes for 

10 products in the competitive category of mail in accordance 

11 with the requirements of this subchapter and regulations 

12 promulgated under section 3633. 

13 ‘‘(b) PROCEDURES.— 

14 ‘‘(1) IN GENERAL.—Rates and classes shall be es15 tablished in writing, complete with a statement of ex16 planation and justification, and the date as of which 

17 each such rate or class takes effect. 

18 ‘‘(2) RATES OR CLASSES OF GENERAL APPLICA19 BILITY.—In the case of rates or classes of general ap20 plicability in the Nation as a whole or in any sub21 stantial region of the Nation, the Governors shall 

22 cause each rate and class decision under this section 

23 and the record of the Governors’ proceedings in con24 nection with such decision to be published in the Fed-
14 

•HR 4341 RH 

1 eral Register at least 30 days before the effective date 

2 of any new rates or classes. 

3 ‘‘(3) RATES OR CLASSES NOT OF GENERAL AP4 PLICABILITY.—In the case of rates or classes not of 

5 general applicability in the Nation as a whole or in 

6 any substantial region of the Nation, the Governors 

7 shall cause each rate and class decision under this 

8 section and the record of the proceedings in connec9 tion with such decision to be filed with the Postal 

10 Regulatory Commission by such date before the effec11 tive date of any new rates or classes as the Governors 

12 consider appropriate, but in no case less than 15 

13 days. 

14 ‘‘(4) CRITERIA.—As part of the regulations re15 quired under section 3633, the Postal Regulatory 

16 Commission shall establish criteria for determining 

17 when a rate or class established under this subchapter 

18 is or is not of general applicability in the Nation as 

19 a whole or in any substantial region of the Nation. 

20 ‘‘(c) TRANSITION RULE.—Until regulations under sec21 tion 3633 first take effect, rates and classes for competitive 

22 products shall remain subject to modification in accordance 

23 with the provisions of this chapter and section 407, as such 

24 provisions were as last in effect before the date of the enact25 ment of this section. 
15 

•HR 4341 RH 

1 ‘‘§ 3633. Provisions applicable to rates for competitive 

2 products 

3 ‘‘The Postal Regulatory Commission shall, within 18 

4 months after the date of the enactment of this section, pro5 mulgate (and may from time to time thereafter revise) regu6 lations— 

7 ‘‘(1) to prohibit the subsidization of competitive 

8 products by market-dominant products; 

9 ‘‘(2) to ensure that each competitive product cov10 ers its costs attributable; and 

11 ‘‘(3) to ensure that all competitive products col12 lectively make a reasonable contribution to the insti13 tutional costs of the Postal Service.’’. 

14 SEC. 203. PROVISIONS RELATING TO EXPERIMENTAL AND 

15 NEW PRODUCTS. 

16 Subchapter III of chapter 36 of title 39, United States 

17 Code, is amended to read as follows: 

18 ‘‘SUBCHAPTER III—PROVISIONS RELATING TO 

19 EXPERIMENTAL AND NEW PRODUCTS 

20 ‘‘§ 3641. Market tests of experimental products 

21 ‘‘(a) AUTHORITY.— 

22 ‘‘(1) IN GENERAL.—The Postal Service may con23 duct market tests of experimental products in accord24 ance with this section. 

25 ‘‘(2) PROVISIONS WAIVED.—A product shall not, 

26 while it is being tested under this section, be subject 
16 

•HR 4341 RH 

1 to the requirements of sections 3622, 3633, or 3642, 

2 or regulations promulgated under those sections. 

3 ‘‘(b) CONDITIONS.—A product may not be tested under 

4 this section unless it satisfies each of the following: 

5 ‘‘(1) SIGNIFICANTLY DIFFERENT PRODUCT.—The 

6 product is, from the viewpoint of the mail users, sig7 nificantly different from all products offered by the 

8 Postal Service within the 2-year period preceding the 

9 start of the test. 

10 ‘‘(2) MARKET DISRUPTION.—The introduction or 

11 continued offering of the product will not create an 

12 unfair or otherwise inappropriate competitive advan13 tage for the Postal Service or any mailer, particularly 

14 in regard to small business concerns (as defined under 

15 subsection (h)). 

16 ‘‘(3) CORRECT CATEGORIZATION.—The Postal 

17 Service identifies the product, for the purpose of a test 

18 under this section, as either market dominant or com19 petitive, consistent with the criteria under section 

20 3642(b)(1). Costs and revenues attributable to a prod21 uct identified as competitive shall be included in any 

22 determination under section 3633(3) (relating to pro23 visions applicable to competitive products collec24 tively). 

25 ‘‘(c) NOTICE.— 
17 

•HR 4341 RH 

1 ‘‘(1) IN GENERAL.—At least 30 days before initi2 ating a market test under this section, the Postal 

3 Service shall file with the Postal Regulatory Commis4 sion and publish in the Federal Register a notice— 

5 ‘‘(A) setting out the basis for the Postal 

6 Service’s determination that the market test is 

7 covered by this section; and 

8 ‘‘(B) describing the nature and scope of the 

9 market test. 

10 ‘‘(2) SAFEGUARDS.—For a competitive experi11 mental product, the provisions of section 504(g) shall 

12 be available with respect to any information required 

13 to be filed under paragraph (1) to the same extent 

14 and in the same manner as in the case of any matter 

15 described in section 504(g)(1). Nothing in paragraph 

16 (1) shall be considered to permit or require the publi17 cation of any information as to which confidential 

18 treatment is accorded under the preceding sentence 

19 (subject to the same exception as set forth in section 

20 504(g)(3)). 

21 ‘‘(d) DURATION.— 

22 ‘‘(1) IN GENERAL.—A market test of a product 

23 under this section may be conducted over a period of 

24 not to exceed 24 months. 
18 

•HR 4341 RH 

1 ‘‘(2) EXTENSION AUTHORITY.—If necessary in 

2 order to determine the feasibility or desirability of a 

3 product being tested under this section, the Postal 

4 Regulatory Commission may, upon written applica5 tion of the Postal Service (filed not later than 60 days 

6 before the date as of which the testing of such product 

7 would otherwise be scheduled to terminate under 

8 paragraph (1)), extend the testing of such product for 

9 not to exceed an additional 12 months. 

10 ‘‘(e) DOLLAR-AMOUNT LIMITATION.— 

11 ‘‘(1) IN GENERAL.—A product may be tested 

12 under this section only if the total revenues that are 

13 anticipated, or in fact received, by the Postal Service 

14 from such product do not exceed $10,000,000 nation15 wide in any year, subject to paragraph (2) and sub16 section (g). In carrying out the preceding sentence, 

17 the Postal Regulatory Commission may limit the 

18 amount of revenues the Postal Service may obtain 

19 from any particular geographic market as necessary 

20 to prevent market disruption (as defined in subsection 

21 (b)(2)). 

22 ‘‘(2) EXEMPTION AUTHORITY.—The Postal Regu23 latory Commission may, upon written application of 

24 the Postal Service, exempt the market test from the 

25 limit in paragraph (1) if the total revenues that are 
19 

•HR 4341 RH 

1 anticipated, or in fact received, by the Postal Service 

2 from such product do not exceed $50,000,000 in any 

3 year, subject to subsection (g). In reviewing an appli4 cation under this paragraph, the Postal Regulatory 

5 Commission shall approve such application if it de6 termines that— 

7 ‘‘(A) the product is likely to benefit the pub8 lic and meet an expected demand; 

9 ‘‘(B) the product is likely to contribute to 

10 the financial stability of the Postal Service; and 

11 ‘‘(C) the product is not likely to result in 

12 unfair or otherwise inappropriate competition. 

13 ‘‘(f) CANCELLATION.—If the Postal Regulatory Com14 mission at any time determines that a market test under 

15 this section fails, with respect to any particular product, 

16 to meet one or more of the requirements of this section, it 

17 may order the cancellation of the test involved or take such 

18 other action as it considers appropriate. A determination 

19 under this subsection shall be made in accordance with such 

20 procedures as the Commission shall by regulation prescribe. 

21 ‘‘(g) ADJUSTMENT FOR INFLATION.—For purposes of 

22 each year following the year in which occurs the deadline 

23 for the Postal Service’s first report to the Postal Regulatory 

24 Commission under section 3652(a), each dollar amount con25 tained in this section shall be adjusted by the change in 
20 

•HR 4341 RH 

1 the Consumer Price Index for such year (as determined 

2 under regulations of the Commission). 

3 ‘‘(h) DEFINITION OF A SMALL BUSINESS CONCERN.— 

4 The criteria used in defining small business concerns or oth5 erwise categorizing business concerns as small business con6 cerns shall, for purposes of this section, be established by 

7 the Postal Regulatory Commission in conformance with the 

8 requirements of section 3 of the Small Business Act. 

9 ‘‘(i) EFFECTIVE DATE.—Market tests under this sub10 chapter may be conducted in any year beginning with the 

11 first year in which occurs the deadline for the Postal Serv12 ice’s first report to the Postal Regulatory Commission under 

13 section 3652(a). 

14 ‘‘§ 3642. New products and transfers of products be15 tween the market-dominant and competi16 tive categories of mail 

17 ‘‘(a) IN GENERAL.—Upon request of the Postal Service 

18 or users of the mails, or upon its own initiative, the Postal 

19 Regulatory Commission may change the list of market-dom20 inant products under section 3621 and the list of competi21 tive products under section 3631 by adding new products 

22 to the lists, removing products from the lists, or transferring 

23 products between the lists. 
21 

•HR 4341 RH 

1 ‘‘(b) CRITERIA.—All determinations by the Postal Reg2 ulatory Commission under subsection (a) shall be made in 

3 accordance with the following criteria: 

4 ‘‘(1) The market-dominant category of products 

5 shall consist of each product in the sale of which the 

6 Postal Service exercises sufficient market power that 

7 it can effectively set the price of such product substan8 tially above costs, raise prices significantly, decrease 

9 quality, or decrease output, without risk of losing 

10 business to other firms offering similar products. The 

11 competitive category of products shall consist of all 

12 other products. 

13 ‘‘(2) EXCLUSION OF PRODUCTS COVERED BY

14 POSTAL MONOPOLY.—A product covered by the postal 

15 monopoly shall not be subject to transfer under this 

16 section from the market-dominant category of mail. 

17 For purposes of the preceding sentence, the term 

18 ‘product covered by the postal monopoly’ means any 

19 product the conveyance or transmission of which is 

20 reserved to the United States under section 1696 of 

21 title 18, subject to the same exception as set forth in 

22 the last sentence of section 409(e)(1). 

23 ‘‘(3) ADDITIONAL CONSIDERATIONS.—In making 

24 any decision under this section, due regard shall be 

25 given to— 
22 

•HR 4341 RH 

1 ‘‘(A) the availability and nature of enter2 prises in the private sector engaged in the deliv3 ery of the product involved; 

4 ‘‘(B) the views of those who use the product 

5 involved on the appropriateness of the proposed 

6 action; and 

7 ‘‘(C) the likely impact of the proposed ac8 tion on small business concerns (within the 

9 meaning of section 3641(h)). 

10 ‘‘(c) TRANSFERS OF SUBCLASSES AND OTHER SUBOR11 DINATE UNITS ALLOWABLE.—Nothing in this title shall be 

12 considered to prevent transfers under this section from being 

13 made by reason of the fact that they would involve only 

14 some (but not all) of the subclasses or other subordinate 

15 units of the class of mail or type of postal service involved 

16 (without regard to satisfaction of minimum quantity re17 quirements standing alone). 

18 ‘‘(d) NOTIFICATION AND PUBLICATION REQUIRE19 MENTS.— 

20 ‘‘(1) NOTIFICATION REQUIREMENT.—The Postal 

21 Service shall, whenever it requests to add a product 

22 or transfer a product to a different category, file with 

23 the Postal Regulatory Commission and publish in the 

24 Federal Register a notice setting out the basis for its 

25 determination that the product satisfies the criteria 
23 

•HR 4341 RH 

1 under subsection (b) and, in the case of a request to 

2 add a product or transfer a product to the competi3 tive category of mail, that the product meets the regu4 lations promulgated by the Postal Regulatory Com5 mission pursuant to section 3633. The provisions of 

6 section 504(g) shall be available with respect to any 

7 information required to be filed. 

8 ‘‘(2) PUBLICATION REQUIREMENT.—The Postal 

9 Regulatory Commission shall, whenever it changes the 

10 list of products in the market-dominant or competi11 tive category of mail, prescribe new lists of products. 

12 The revised lists shall indicate how and when any 

13 previous lists (including the lists under sections 3621 

14 and 3631) are superseded, and shall be published in 

15 the Federal Register. 

16 ‘‘(e) NOTIFICATION REQUIREMENT.—The Postal Regu17 latory Commission shall, whenever it reaches a conclusion 

18 that a product or products should be transferred between 

19 the list of market-dominant products under section 3621 

20 and the list of competitive products under section 3631, im21 mediately notify the appropriate committees of the Con22 gress. No such transfer may take effect less than 12 months 

23 after such conclusion. 

24 ‘‘(f) PROHIBITION.—Except as provided in section 

25 3641, no product that involves the carriage of letters, print-
24 

•HR 4341 RH 

1 ed matter, or mailable packages may be offered by the Post2 al Service unless it has been assigned to the market-domi3 nant or competitive category of mail (as appropriate) ei4 ther— 

5 ‘‘(1) under this subchapter; or 

6 ‘‘(2) by or under any other provision of law.’’. 

7 SEC. 204. REPORTING REQUIREMENTS AND RELATED PRO8 VISIONS. 

9 (a) REDESIGNATION.—Chapter 36 of title 39, United 

10 States Code (as in effect before the amendment made by sub11 section (b)) is amended by striking the heading for sub12 chapter IV and inserting the following: 

13 ‘‘SUBCHAPTER V—POSTAL SERVICES, 

14 COMPLAINTS, AND JUDICIAL REVIEW’’. 

15 (b) REPORTS AND COMPLIANCE.—Chapter 36 of title 

16 39, United States Code, is amended by inserting after sub17 chapter III the following: 

18 ‘‘SUBCHAPTER IV—REPORTING REQUIREMENTS 

19 AND RELATED PROVISIONS 

20 ‘‘§ 3651. Annual reports by the Commission 

21 ‘‘(a) IN GENERAL.—The Postal Regulatory Commis22 sion shall submit an annual report to the President and 

23 the Congress concerning the operations of the Commission 

24 under this title, including the extent to which regulations 
25 

•HR 4341 RH 

1 are achieving the objectives under sections 3622 and 3633, 

2 respectively. 

3 ‘‘(b) ADDITIONAL INFORMATION.—In addition to the 

4 information required under subsection (a), each report 

5 under this section shall also include, with respect to the pe6 riod covered by such report, an estimate of the costs in7 curred by the Postal Service in providing— 

8 ‘‘(1) postal services to areas of the Nation where, 

9 in the judgment of the Postal Regulatory Commission, 

10 the Postal Service either would not provide services at 

11 all or would not provide such services in accordance 

12 with the requirements of this title if the Postal Service 

13 were not required to provide prompt, reliable, and ef14 ficient services to patrons in all areas and all com15 munities, including as required under the first sen16 tence of section 101(b); 

17 ‘‘(2) free or reduced rates for postal services as 

18 required by this title; and 

19 ‘‘(3) other public services or activities which, in 

20 the judgment of the Postal Regulatory Commission, 

21 would not otherwise have been provided by the Postal 

22 Service but for the requirements of law. 

23 The Commission shall detail the bases for its estimates and 

24 the statutory requirements giving rise to the costs identified 

25 in each report under this section. 
26 

•HR 4341 RH 

1 ‘‘(c) INFORMATION FROM POSTAL SERVICE.—The 

2 Postal Service shall provide the Postal Regulatory Commis3 sion with such information as may, in the judgment of the 

4 Commission, be necessary in order for the Commission to 

5 prepare its reports under this section. 

6 ‘‘§ 3652. Annual reports to the Commission 

7 ‘‘(a) COSTS, REVENUES, AND RATES.—Except as pro8 vided in subsection (c), the Postal Service shall, no later 

9 than 90 days after the end of each year, prepare and submit 

10 to the Postal Regulatory Commission a report (together 

11 with such nonpublic annex thereto as the Commission may 

12 require under subsection (e))— 

13 ‘‘(1) which shall analyze costs, revenues, and 

14 rates, using such methodologies as the Commission 

15 shall by regulation prescribe, and in sufficient detail 

16 to demonstrate that the rates in effect for all products 

17 during such year complied with all applicable re18 quirements of this title; and 

19 ‘‘(2) which shall, for each market-dominant 

20 product provided in such year, provide— 

21 ‘‘(A) market information, including mail 

22 volumes; and 

23 ‘‘(B) measures of the quality of service af24 forded by the Postal Service in connection with 

25 such product, including— 
27 

•HR 4341 RH 

1 ‘‘(i) the service standard applicable to 

2 such product; 

3 ‘‘(ii) the level of service (described in 

4 terms of speed of delivery and reliability) 

5 provided; and 

6 ‘‘(iii) the degree of customer satisfac7 tion with the service provided. 

8 Before submitting a report under this subsection (including 

9 any annex thereto and the information required under sub10 section (b)), the Postal Service shall have the information 

11 contained in such report (and annex) audited by the Inspec12 tor General. The results of any such audit shall be submitted 

13 along with the report to which it pertains. 

14 ‘‘(b) INFORMATION RELATING TO WORKSHARE DIS15 COUNTS.— 

16 ‘‘(1) IN GENERAL.—The Postal Service shall in17 clude, in each report under subsection (a), the fol18 lowing information with respect to each market-domi19 nant product for which a workshare discount was in 

20 effect during the period covered by such report: 

21 ‘‘(A) The per-item cost avoided by the Post22 al Service by virtue of such discount. 

23 ‘‘(B) The percentage of such per-item cost 

24 avoided that the per-item workshare discount 

25 represents. 
28 

•HR 4341 RH 

1 ‘‘(C) The per-item contribution made to in2 stitutional costs. 

3 ‘‘(2) WORKSHARE DISCOUNT DEFINED.—For 

4 purposes of this subsection, the term ‘workshare dis5 count’ refers to presorting, barcoding, dropshipping, 

6 and other similar discounts, as further defined under 

7 regulations which the Postal Regulatory Commission 

8 shall prescribe. 

9 ‘‘(c) MARKET TESTS.—In carrying out subsections (a) 

10 and (b) with respect to experimental products offered 

11 through market tests under section 3641 in a year, the Post12 al Service— 

13 ‘‘(1) may report summary data on the costs, rev14 enues, and quality of service by market test; and 

15 ‘‘(2) shall report such data as the Postal Regu16 latory Commission requires. 

17 ‘‘(d) SUPPORTING MATTER.—The Postal Regulatory 

18 Commission shall have access, in accordance with such reg19 ulations as the Commission shall prescribe, to the working 

20 papers and any other supporting matter of the Postal Serv21 ice and the Inspector General in connection with any infor22 mation submitted under this section. 

23 ‘‘(e) CONTENT AND FORM OF REPORTS.— 

24 ‘‘(1) IN GENERAL.—The Postal Regulatory Com25 mission shall, by regulation, prescribe the content and 
29 

•HR 4341 RH 

1 form of the public reports (and any nonpublic annex 

2 and supporting matter relating thereto) to be pro3 vided by the Postal Service under this section. In car4 rying out this subsection, the Commission shall give 

5 due consideration to— 

6 ‘‘(A) providing the public with adequate in7 formation to assess the lawfulness of rates 

8 charged; 

9 ‘‘(B) avoiding unnecessary or unwarranted 

10 administrative effort and expense on the part of 

11 the Postal Service; and 

12 ‘‘(C) protecting the confidentiality of com13 mercially sensitive information. 

14 ‘‘(2) REVISED REQUIREMENTS.—The Commis15 sion may, on its own motion or on request of an in16 terested party, initiate proceedings (to be conducted 

17 in accordance with regulations that the Commission 

18 shall prescribe) to improve the quality, accuracy, or 

19 completeness of Postal Service data required by the 

20 Commission under this subsection whenever it shall 

21 appear that— 

22 ‘‘(A) the attribution of costs or revenues to 

23 products has become significantly inaccurate or 

24 can be significantly improved; 
30 

•HR 4341 RH 

1 ‘‘(B) the quality of service data has become 

2 significantly inaccurate or can be significantly 

3 improved; or 

4 ‘‘(C) such revisions are, in the judgment of 

5 the Commission, otherwise necessitated by the 

6 public interest. 

7 ‘‘(f) CONFIDENTIAL INFORMATION.— 

8 ‘‘(1) IN GENERAL.—If the Postal Service deter9 mines that any document or portion of a document, 

10 or other matter, which it provides to the Postal Regu11 latory Commission in a nonpublic annex under this 

12 section or pursuant to subsection (d) contains infor13 mation which is described in section 410(c) of this 

14 title, or exempt from public disclosure under section 

15 552(b) of title 5, the Postal Service shall, at the time 

16 of providing such matter to the Commission, notify 

17 the Commission of its determination, in writing, and 

18 describe with particularity the documents (or portions 

19 of documents) or other matter for which confiden20 tiality is sought and the reasons therefor. 

21 ‘‘(2) TREATMENT.—Any information or other 

22 matter described in paragraph (1) to which the Com23 mission gains access under this section shall be sub24 ject to paragraphs (2) and (3) of section 504(g) in the 

25 same way as if the Commission had received notifica-
31 

•HR 4341 RH 

1 tion with respect to such matter under section 

2 504(g)(1). 

3 ‘‘(g) OTHER REPORTS.—The Postal Service shall sub4 mit to the Postal Regulatory Commission, together with any 

5 other submission that it is required to make under this sec6 tion in a year, copies of its then most recent— 

7 ‘‘(1) comprehensive statement under section 

8 2401(e); 

9 ‘‘(2) performance plan under section 2803; and 

10 ‘‘(3) program performance reports under section 

11 2804. 

12 ‘‘§ 3653. Annual determination of compliance 

13 ‘‘(a) OPPORTUNITY FOR PUBLIC COMMENT.—After re14 ceiving the reports required under section 3652 for any 

15 year, the Postal Regulatory Commission shall promptly 

16 provide an opportunity for comment on such reports by 

17 users of the mails, affected parties, and an officer of the 

18 Commission who shall be required to represent the interests 

19 of the general public. 

20 ‘‘(b) DETERMINATION OF COMPLIANCE OR NONCOMPLI21 ANCE.—Not later than 90 days after receiving the submis22 sions required under section 3652 with respect to a year, 

23 the Postal Regulatory Commission shall make a written de24 termination as to— 
32 

•HR 4341 RH 

1 ‘‘(1) whether any rates or fees in effect during 

2 such year (for products individually or collectively) 

3 were not in compliance with applicable provisions of 

4 this chapter (or regulations promulgated thereunder); 

5 ‘‘(2) whether any performance goals established 

6 under section 2803 or 2804 for such year were not 

7 met; and 

8 ‘‘(3) whether any market-dominant product 

9 failed to meet any service standard during such year. 

10 If, with respect to a year, no instance of noncompliance 

11 is found under this subsection to have occurred in such year, 

12 the written determination shall be to that effect. 

13 ‘‘(c) IF ANY NONCOMPLIANCE IS FOUND.—If, for a 

14 year, a timely written determination of noncompliance is 

15 made under subsection (b), the Postal Regulatory Commis16 sion shall take appropriate action in accordance with sub17 sections (c)–(e) of section 3662 (as if a complaint averring 

18 such noncompliance had been duly filed and found under 

19 such section to be justified). 

20 ‘‘(d) REBUTTABLE PRESUMPTION.—A timely written 

21 determination described in the last sentence of subsection 

22 (b) shall, for purposes of any proceeding under section 3662, 

23 create a rebuttable presumption of compliance by the Postal 

24 Service (with regard to the matters described in paragraphs 
33 

•HR 4341 RH 

1 (1) through (3) of subsection (b)) during the year to which 

2 such determination relates.’’. 

3 SEC. 205. COMPLAINTS; APPELLATE REVIEW AND ENFORCE4 MENT. 

5 Chapter 36 of title 39, United States Code, is amended 

6 by striking sections 3662 and 3663 and inserting the fol7 lowing: 

8 ‘‘§ 3662. Rate and service complaints 

9 ‘‘(a) IN GENERAL.—Interested persons (including an 

10 officer of the Postal Regulatory Commission representing 

11 the interests of the general public) who believe the Postal 

12 Service is not operating in conformance with the require13 ments of chapter 1, 4, or 6, or this chapter (or regulations 

14 promulgated under any of those chapters) may lodge a com15 plaint with the Postal Regulatory Commission in such form 

16 and manner as the Commission may prescribe. 

17 ‘‘(b) PROMPT RESPONSE REQUIRED.— 

18 ‘‘(1) IN GENERAL.—The Postal Regulatory Com19 mission shall, within 90 days after receiving a com20 plaint under subsection (a), either— 

21 ‘‘(A) begin proceedings on such complaint; 

22 or 

23 ‘‘(B) issue an order dismissing the com24 plaint (together with a statement of the reasons 

25 therefor). 
34 

•HR 4341 RH 

1 ‘‘(2) TREATMENT OF COMPLAINTS NOT TIMELY

2 ACTED ON.—For purposes of section 3663, any com3 plaint under subsection (a) on which the Commission 

4 fails to act in the time and manner required by para5 graph (1) shall be treated in the same way as if it 

6 had been dismissed pursuant to an order issued by 

7 the Commission on the last day allowable for the 

8 issuance of such order under paragraph (1). 

9 ‘‘(c) ACTION REQUIRED IF COMPLAINT FOUND TO BE

10 JUSTIFIED.—If the Postal Regulatory Commission finds the 

11 complaint to be justified, it shall order that the Postal Serv12 ice take such action as the Commission considers appro13 priate in order to achieve compliance with the applicable 

14 requirements and to remedy the effects of any noncompli15 ance (such as ordering unlawful rates to be adjusted to law16 ful levels, ordering the cancellation of market tests, ordering 

17 the Postal Service to discontinue providing loss-making 

18 products, or requiring the Postal Service to make up for 

19 revenue shortfalls in competitive products). 

20 ‘‘(d) SUSPENSION AUTHORITY.—The Postal Regu21 latory Commission may suspend implementation of rates 

22 or classifications under section 3632(b)(3) for a limited pe23 riod of time pending expedited proceedings under this sec24 tion. In evaluating whether circumstances warrant suspen25 sion, the Commission shall consider factors such as (1) 
35 

•HR 4341 RH 

1 whether there is a substantial likelihood that such rate or 

2 classification will violate the requirements of chapter 1, 4, 

3 or 6, or this chapter (or regulations promulgated under any 

4 of those chapters), (2) whether any persons would suffer sub5 stantial injury, loss, or damage absent a suspension, (3) 

6 whether the Postal Service or any other persons would suffer 

7 substantial injury, loss, or damage under a suspension, and 

8 (4) the public interest. 

9 ‘‘(e) AUTHORITY TO ORDER FINES IN CASES OF DE10 LIBERATE NONCOMPLIANCE.—In addition, in cases of delib11 erate noncompliance by the Postal Service with the require12 ments of this title, the Postal Regulatory Commission may 

13 order, based on the nature, circumstances, extent, and seri14 ousness of the noncompliance, a fine (in the amount speci15 fied by the Commission in its order) for each incidence of 

16 noncompliance. Fines resulting from the provision of com17 petitive products shall be paid out of the Competitive Prod18 ucts Fund established in section 2011. All receipts from 

19 fines imposed under this subsection shall be deposited in 

20 the general fund of the Treasury of the United States. 

21 ‘‘§ 3663. Appellate review 

22 ‘‘A person adversely affected or aggrieved by a final 

23 order or decision of the Postal Regulatory Commission may, 

24 within 30 days after such order or decision becomes final, 

25 institute proceedings for review thereof by filing a petition 
36 

•HR 4341 RH 

1 in the United States Court of Appeals for the District of 

2 Columbia. The court shall review the order or decision in 

3 accordance with section 706 of title 5, and chapter 158 and 

4 section 2112 of title 28, on the basis of the record before 

5 the Commission. For purposes of this section, the term ‘per6 son’ includes the Postal Service. 

7 ‘‘§ 3664. Enforcement of orders 

8 ‘‘The several district courts have jurisdiction specifi9 cally to enforce, and to enjoin and restrain the Postal Serv10 ice from violating, any order issued by the Postal Regu11 latory Commission.’’. 

12 SEC. 206. WORKSHARE DISCOUNTS. 

13 (a) IN GENERAL.—Title 39, United States Code, is 

14 amended by adding after section 3686 (as added by section 

15 406) the following: 

16 ‘‘§ 3687. Workshare discounts 

17 ‘‘(a) IN GENERAL.—As part of the regulations estab18 lished under section 3622(a), the Postal Regulatory Com19 mission shall establish rules for workshare discounts that 

20 ensure that workshare discounts do not exceed the cost that 

21 the Postal Service avoids as the result of private sector 

22 workshare activity, except— 

23 ‘‘(1) where the discount is associated with a new 

24 product or service or with a change to an existing 

25 product or service and is necessary, over a period of 
37 

•HR 4341 RH 

1 time not to exceed 4 years, to induce mailer behavior 

2 that will enable the new or changed product or service 

3 in furtherance of the overall economically efficient op4 eration of the Postal Service; 

5 ‘‘(2) to the extent that a reduction in the dis6 count would lead to a loss of volume in the affected 

7 category and reduce the aggregate contribution to in8 stitutional costs of the Postal Service, from the mail 

9 matter subject to the discount, below what it otherwise 

10 would have been if the discount had not been reduced 

11 to costs avoided; would result in a further increase in 

12 the rates paid by mailers not able to take advantage 

13 of the discount; or would impede the efficient oper14 ation of the Postal Service; 

15 ‘‘(3) where the amount of the discount above 

16 costs avoided is necessary to mitigate rate shock and 

17 will be phased out over time; or 

18 ‘‘(4) where the workshare discount is provided in 

19 connection with subclasses of mail consisting exclu20 sively of mail matter of educational, cultural, or sci21 entific value. 

22 ‘‘(b) REPORTING REQUIREMENT.—Whenever the Post23 al Service establishes or maintains a workshare discount, 

24 the Postal Service shall, at the time it publishes the 

25 workshare discount rate, file with the Postal Regulatory 
38 

•HR 4341 RH 

1 Commission a detailed report and explanation of its rea2 sons for establishing or maintaining the rate, setting forth 

3 the data, economic analyses, and other information relied 

4 on by the Postal Service to justify the rate. 

5 ‘‘(c) DEFINITION.—For purposes of this section, the 

6 term ‘workshare discount’ refers to rate discounts provided 

7 to mailers for presorting, prebarcoding, handling, or trans8 portation, as further defined by the Postal Regulatory Com9 mission as part of regulations established under section 

10 3622(a).’’. 

11 (b) CLERICAL AMENDMENT.—The analysis for chapter 

12 36 of title 39, United States Code (as amended by section 

13 207) is amended by adding after the item relating to section 

14 3686 the following: 

‘‘3687. Workshare discounts.’’. 

15 SEC. 207. CLERICAL AMENDMENT. 

16 Chapter 36 of title 39, United States Code, is amended 

17 by striking the heading and analysis for such chapter and 

18 inserting the following: 

‘‘CHAPTER 36—POSTAL RATES, CLASSES AND SERVICES

‘‘SUBCHAPTER I—PROVISIONS RELATING TO MARKET-DOMINANT PRODUCTS

‘‘Sec. 

‘‘3621. Applicability; definitions. 

‘‘3622. Modern rate regulation. 

‘‘[3623. Repealed]. 

‘‘[3624. Repealed]. 

‘‘[3625. Repealed]. 

‘‘3626. Reduced Rates. 

‘‘3627. Adjusting free rates. 

‘‘[3628. Repealed]. 

‘‘3629. Reduced rates for voter registration purposes. 
39 

•HR 4341 RH 

‘‘SUBCHAPTER II—PROVISIONS RELATING TO COMPETITIVE PRODUCTS

‘‘3631. Applicability; definitions and updates. 

‘‘3632. Action of the Governors. 

‘‘3633. Provisions applicable to rates for competitive products. 

‘‘3634. Assumed Federal income tax on competitive products. 

‘‘SUBCHAPTER III—PROVISIONS RELATING TO EXPERIMENTAL AND NEW

PRODUCTS

‘‘3641. Market tests of experimental products. 

‘‘3642. New products and transfers of products between the market-dominant and 

competitive categories of mail. 

‘‘SUBCHAPTER IV—REPORTING REQUIREMENTS AND RELATED PROVISIONS

‘‘3651. Annual reports by the Commission. 

‘‘3652. Annual reports to the Commission. 

‘‘3653. Annual determination of compliance. 

‘‘SUBCHAPTER V—POSTAL SERVICES, COMPLAINTS, AND JUDICIAL REVIEW

‘‘3661. Postal services. 

‘‘3662. Rate and service complaints. 

‘‘3663. Appellate review. 

‘‘3664. Enforcement of orders. 

‘‘SUBCHAPTER VI—GENERAL

‘‘3681. Reimbursement. 

‘‘3682. Size and weight limits. 

‘‘3683. Uniform rates for books; films, other materials. 

‘‘3684. Limitations. 

‘‘3685. Filing of information relating to periodical publications. 

‘‘3686. Bonus authority.’’. 

1 TITLE III—PROVISIONS RELAT2 ING TO FAIR COMPETITION 

3 SEC. 301. POSTAL SERVICE COMPETITIVE PRODUCTS FUND. 

4 (a) PROVISIONS RELATING TO POSTAL SERVICE COM5 PETITIVE PRODUCTS FUND AND RELATED MATTERS.— 

6 (1) IN GENERAL.—Chapter 20 of title 39, United 

7 States Code, is amended by adding at the end the fol8 lowing: 
40 

•HR 4341 RH 

1 ‘‘§ 2011. Provisions relating to competitive products 

2 ‘‘(a) There is established in the Treasury of the United 

3 States a revolving fund, to be called the Postal Service Com4 petitive Products Fund, which shall be available to the Post5 al Service without fiscal year limitation for the payment 

6 of— 

7 ‘‘(1) costs attributable to competitive products; 

8 and 

9 ‘‘(2) all other costs incurred by the Postal Serv10 ice, to the extent allocable to competitive products. 

11 For purposes of this subsection, the term ‘costs attributable’ 

12 has the meaning given such term by section 3631. 

13 ‘‘(b) There shall be deposited in the Competitive Prod14 ucts Fund, subject to withdrawal by the Postal Service— 

15 ‘‘(1) revenues from competitive products; 

16 ‘‘(2) amounts received from obligations issued by 

17 the Postal Service under subsection (e); 

18 ‘‘(3) interest and dividends earned on invest19 ments of the Competitive Products Fund; and 

20 ‘‘(4) any other receipts of the Postal Service (in21 cluding from the sale of assets), to the extent allocable 

22 to competitive products. 

23 ‘‘(c) If the Postal Service determines that the moneys 

24 of the Competitive Products Fund are in excess of current 

25 needs, it may invest such amounts as it considers appro26 priate in— 
41 

•HR 4341 RH 

1 ‘‘(1) obligations of, or obligations guaranteed by, 

2 the Government of the United States; and 

3 ‘‘(2) in accordance with regulations which the 

4 Secretary of the Treasury shall prescribe (by not later 

5 than 18 months after the date of the enactment of the 

6 Postal Accountability and Enhancement Act), such 

7 other obligations or securities as it deems appro8 priate. 

9 ‘‘(d) The Postal Service may, in its sole discretion, 

10 provide that moneys of the Competitive Products Fund be 

11 deposited in a Federal Reserve bank or a depository for 

12 public funds. 

13 ‘‘(e)(1) Subject to the limitations specified in section 

14 2005(a), the Postal Service is authorized to borrow money 

15 and to issue and sell such obligations as it determines nec16 essary to provide for competitive products and deposit such 

17 amounts in the Competitive Products Fund, except that the 

18 Postal Service may pledge only assets related to the provi19 sion of competitive products (as determined under sub20 section (h) or, for purposes of any period before accounting 

21 practices and principles under subsection (h) have been es22 tablished and applied, the best information available from 

23 the Postal Service, including the audited statements re24 quired by section 2008(e)), and the revenues and receipts 

25 from such products, for the payment of the principal of or 
42 

•HR 4341 RH 

1 interest on such obligations, for the purchase or redemption 

2 thereof, and for other purposes incidental thereto, including 

3 creation of reserve, sinking, and other funds which may be 

4 similarly pledged and used, to such extent and in such man5 ner as it deems necessary or desirable. 

6 ‘‘(2) The Postal Service may enter into binding cov7 enants with the holders of such obligations, and with the 

8 trustee, if any, under any agreement entered into in connec9 tion with the issuance thereof with respect to— 

10 ‘‘(A) the establishment of reserve, sinking, and 

11 other funds; 

12 ‘‘(B) application and use of revenues and re13 ceipts of the Competitive Products Fund; 

14 ‘‘(C) stipulations concerning the subsequent 

15 issuance of obligations or the execution of leases or 

16 lease purchases relating to properties of the Postal 

17 Service; and 

18 ‘‘(D) such other matters as the Postal Service 

19 considers necessary or desirable to enhance the mar20 ketability of such obligations. 

21 ‘‘(3) Obligations issued by the Postal Service under 

22 this subsection— 

23 ‘‘(A) may not be purchased by the Secretary of 

24 the Treasury; 
43 

•HR 4341 RH 

1 ‘‘(B) shall not be exempt either as to principal 

2 or interest from any taxation now or hereafter im3 posed by any State or local taxing authority; 

4 ‘‘(C) shall not be obligations of, nor shall pay5 ment of the principal thereof or interest thereon be 

6 guaranteed by, the Government of the United States, 

7 and the obligations shall so plainly state; and 

8 ‘‘(D) notwithstanding the provisions of the Fed9 eral Financing Bank Act of 1973 or any other provi10 sion of law (except as specifically provided by ref11 erence to this subparagraph in a law enacted after 

12 this subparagraph takes effect), shall not be eligible 

13 for purchase by, commitment to purchase by, or sale 

14 or issuance to, the Federal Financing Bank. 

15 ‘‘(4)(A) This paragraph applies with respect to the pe16 riod beginning on the date of the enactment of this para17 graph and ending at the close of the 5-year period which 

18 begins on the date on which the Postal Service makes its 

19 submission under subsection (h)(1). 

20 ‘‘(B) During the period described in subparagraph (A), 

21 nothing in subparagraph (A) or (D) of paragraph (3) or 

22 the last sentence of section 2006(b) shall, with respect to 

23 any obligations sought to be issued by the Postal Service 

24 under this subsection, be considered to affect such obliga-
44 

•HR 4341 RH 

1 tions’ eligibility for purchase by, commitment to purchase 

2 by, or sale or issuance to, the Federal Financing Bank. 

3 ‘‘(C) The Federal Financing Bank may elect to pur4 chase such obligations under such terms, including rates of 

5 interest, as the Bank and the Postal Service may agree, but 

6 at a rate of yield no less than the prevailing yield on out7 standing marketable securities of comparable maturity 

8 issued by entities with the same credit rating as the rating 

9 then most recently obtained by the Postal Service under sub10 paragraph (D), as determined by the Bank. 

11 ‘‘(D) In order to be eligible to borrow under this para12 graph, the Postal Service shall first obtain a credit rating 

13 from a nationally recognized credit rating organization. 

14 Such rating— 

15 ‘‘(i) shall be determined taking into account only 

16 those assets and activities of the Postal Service which 

17 are described in section 3634(a)(2) (relating to the 

18 Postal Service’s assumed taxable income from com19 petitive products); and 

20 ‘‘(ii) may, before final rules of the Postal Regu21 latory Commission under subsection (h) are issued (or 

22 deemed to have been issued), be based on the best in23 formation available from the Postal Service, includ24 ing the audited statements required by section 

25 2008(e). 
45 

•HR 4341 RH 

1 ‘‘(f) The receipts and disbursements of the Competitive 

2 Products Fund shall be accorded the same budgetary treat3 ment as is accorded to receipts and disbursements of the 

4 Postal Service Fund under section 2009a. 

5 ‘‘(g) A judgment against the Postal Service or the Gov6 ernment of the United States (or settlement of a claim) 

7 shall, to the extent that it arises out of activities of the Post8 al Service in the provision of competitive products, be paid 

9 out of the Competitive Products Fund. 

10 ‘‘(h)(1) The Secretary of the Treasury, in consultation 

11 with the Postal Service and an independent, certified public 

12 accounting firm and such other advisors as the Secretary 

13 considers appropriate, shall develop recommendations re14 garding— 

15 ‘‘(A) the accounting practices and principles that 

16 should be followed by the Postal Service with the ob17 jectives of (i) identifying and valuing the assets and 

18 liabilities of the Postal Service associated with pro19 viding, and the capital and operating costs incurred 

20 by the Postal Service in providing, competitive prod21 ucts, and (ii) preventing the subsidization of such 

22 products by market-dominant products; and 

23 ‘‘(B) the substantive and procedural rules that 

24 should be followed in determining the Postal Service’s 

25 assumed Federal income tax on competitive products 
46 

•HR 4341 RH 

1 income for any year (within the meaning of section 

2 3634). 

3 Such recommendations shall be submitted to the Postal Reg4 ulatory Commission no earlier than 6 months, and no later 

5 than 12 months, after the effective date of this section. 

6 ‘‘(2)(A) Upon receiving the recommendations of the 

7 Secretary of the Treasury under paragraph (1), the Com8 mission shall give interested parties, including the Postal 

9 Service, users of the mails, and an officer of the Commission 

10 who shall be required to represent the interests of the general 

11 public, an opportunity to present their views on those rec12 ommendations through submission of written data, views, 

13 or arguments with or without opportunity for oral presen14 tation, or in such other manner as the Commission con15 siders appropriate. 

16 ‘‘(B) After due consideration of the views and other 

17 information received under subparagraph (A), the Commis18 sion shall by rule— 

19 ‘‘(i) provide for the establishment and applica20 tion of the accounting practices and principles which 

21 shall be followed by the Postal Service; 

22 ‘‘(ii) provide for the establishment and applica23 tion of the substantive and procedural rules described 

24 in paragraph (1)(B); and 
47 

•HR 4341 RH 

1 ‘‘(iii) provide for the submission by the Postal 

2 Service to the Postal Regulatory Commission of an3 nual and other periodic reports setting forth such in4 formation as the Commission may require. 

5 Final rules under this subparagraph shall be issued not 

6 later than 12 months after the date on which the Secretary 

7 of the Treasury makes his submission to the Commission 

8 under paragraph (1) (or by such later date as the Commis9 sion and the Postal Service may agree to). The Commission 

10 is authorized to promulgate regulations revising such rules. 

11 ‘‘(C) Reports described in subparagraph (B)(iii) shall 

12 be submitted at such time and in such form, and shall in13 clude such information, as the Commission by rule requires. 

14 The Commission may, on its own motion or on request of 

15 an interested party, initiate proceedings (to be conducted 

16 in accordance with such rules as the Commission shall pre17 scribe) to improve the quality, accuracy, or completeness of 

18 Postal Service data under such subparagraph whenever it 

19 shall appear that— 

20 ‘‘(i) the quality of the information furnished in 

21 those reports has become significantly inaccurate or 

22 can be significantly improved; or 

23 ‘‘(ii) such revisions are, in the judgment of the 

24 Commission, otherwise necessitated by the public in25 terest. 
48 

•HR 4341 RH 

1 ‘‘(D) A copy of each report described in subparagraph 

2 (B)(iii) shall also be transmitted by the Postal Service to 

3 the Secretary of the Treasury and the Inspector General of 

4 the United States Postal Service. 

5 ‘‘(i) The Postal Service shall render an annual report 

6 to the Secretary of the Treasury concerning the operation 

7 of the Competitive Products Fund, in which it shall address 

8 such matters as risk limitations, reserve balances, allocation 

9 or distribution of moneys, liquidity requirements, and 

10 measures to safeguard against losses. A copy of its then most 

11 recent report under this subsection shall be included with 

12 any other submission that it is required to make to the Post13 al Regulatory Commission under section 3652(g).’’. 

14 (2) CLERICAL AMENDMENT.—The analysis for 

15 chapter 20 of title 39, United States Code, is amended 

16 by adding after the item relating to section 2010 the 

17 following: 

‘‘2011. Provisions relating to competitive products.’’. 

18 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 

19 (1) DEFINITION.—Section 2001 of title 39, 

20 United States Code, is amended by striking ‘‘and’’ at 

21 the end of paragraph (1), by redesignating paragraph 

22 (2) as paragraph (3), and by inserting after para23 graph (1) the following: 
49 

•HR 4341 RH 

1 ‘‘(2) ‘Competitive Products Fund’ means the 

2 Postal Service Competitive Products Fund established 

3 by section 2011; and’’. 

4 (2) CAPITAL OF THE POSTAL SERVICE.—Section 

5 2002(b) of title 39, United States Code, is amended 

6 by striking ‘‘Fund,’’ and inserting ‘‘Fund and the 

7 balance in the Competitive Products Fund,’’. 

8 (3) POSTAL SERVICE FUND.— 

9 (A) PURPOSES FOR WHICH AVAILABLE.— 

10 Section 2003(a) of title 39, United States Code, 

11 is amended by striking ‘‘title.’’ and inserting 

12 ‘‘title (other than any of the purposes, functions, 

13 or powers for which the Competitive Products 

14 Fund is available).’’. 

15 (B) DEPOSITS.—Section 2003(b) of title 39, 

16 United States Code, is amended by striking 

17 ‘‘There’’ and inserting ‘‘Except as otherwise pro18 vided in section 2011, there’’. 

19 (4) RELATIONSHIP BETWEEN THE TREASURY

20 AND THE POSTAL SERVICE.—Section 2006 of title 39, 

21 United States Code, is amended— 

22 (A) in subsection (b), by adding at the end 

23 the following: ‘‘Nothing in this chapter shall be 

24 considered to permit or require the Secretary of 

25 the Treasury to purchase any obligations of the 
50 

•HR 4341 RH 

1 Postal Service other than those issued under sec2 tion 2005.’’; and 

3 (B) in subsection (c), by inserting ‘‘under 

4 section 2005’’ before ‘‘shall be obligations’’. 

5 SEC. 302. ASSUMED FEDERAL INCOME TAX ON COMPETI6 TIVE PRODUCTS INCOME. 

7 Subchapter II of chapter 36 of title 39, United States 

8 Code, as amended by section 202, is amended by adding 

9 at the end the following: 

10 ‘‘§ 3634. Assumed Federal income tax on competitive 

11 products income 

12 ‘‘(a) DEFINITIONS.—For purposes of this section— 

13 ‘‘(1) the term ‘assumed Federal income tax on 

14 competitive products income’ means the net income 

15 tax that would be imposed by chapter 1 of the Inter16 nal Revenue Code of 1986 on the Postal Service’s as17 sumed taxable income from competitive products for 

18 the year; and 

19 ‘‘(2) the term ‘assumed taxable income from com20 petitive products’, with respect to a year, refers to the 

21 amount representing what would be the taxable in22 come of a corporation under the Internal Revenue 

23 Code of 1986 for the year, if— 

24 ‘‘(A) the only activities of such corporation 

25 were the activities of the Postal Service allocable 
51 

•HR 4341 RH 

1 under section 2011(h) to competitive products; 

2 and 

3 ‘‘(B) the only assets held by such corpora4 tion were the assets of the Postal Service allo5 cable under section 2011(h) to such activities. 

6 ‘‘(b) COMPUTATION AND TRANSFER REQUIREMENTS.— 

7 The Postal Service shall, for each year beginning with the 

8 year in which occurs the deadline for the Postal Service’s 

9 first report to the Postal Regulatory Commission under sec10 tion 3652(a)— 

11 ‘‘(1) compute its assumed Federal income tax on 

12 competitive products income for such year; and 

13 ‘‘(2) transfer from the Competitive Products 

14 Fund to the Postal Service Fund the amount of that 

15 assumed tax. 

16 ‘‘(c) DEADLINE FOR TRANSFERS.—Any transfer re17 quired to be made under this section for a year shall be 

18 due on or before the January 15th next occurring after the 

19 close of such year.’’. 

20 SEC. 303. UNFAIR COMPETITION PROHIBITED. 

21 (a) SPECIFIC LIMITATIONS.—Chapter 4 of title 39, 

22 United States Code, is amended by adding after section 404 

23 the following: 
52 

•HR 4341 RH 

1 ‘‘§ 404a. Specific Limitations 

2 ‘‘(a) Except as specifically authorized by law, the Post3 al Service may not— 

4 ‘‘(1) establish any rule or regulation (including 

5 any standard) the effect of which is to preclude com6 petition or establish the terms of competition unless 

7 the Postal Service demonstrates that the regulation 

8 does not create an unfair competitive advantage for 

9 itself or any entity funded (in whole or in part) by 

10 the Postal Service; 

11 ‘‘(2) compel the disclosure, transfer, or licensing 

12 of intellectual property to any third party (such as 

13 patents, copyrights, trademarks, trade secrets, and 

14 proprietary information); or 

15 ‘‘(3) obtain information from a person that pro16 vides (or seeks to provide) any product, and then offer 

17 any product or service that uses or is based in whole 

18 or in part on such information, without the consent 

19 of the person providing that information, unless sub20 stantially the same information is obtained (or ob21 tainable) from an independent source or is otherwise 

22 obtained (or obtainable). 

23 ‘‘(b) The Postal Regulatory Commission shall prescribe 

24 regulations to carry out this section. 

25 ‘‘(c) Any party (including an officer of the Commis26 sion representing the interests of the general public) who 
53 

•HR 4341 RH 

1 believes that the Postal Service has violated this section may 

2 bring a complaint in accordance with section 3662.’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1) GENERAL POWERS.—Section 401 of title 39, 

5 United States Code, is amended by striking ‘‘The’’ 

6 and inserting ‘‘Subject to the provisions of section 

7 404a, the’’. 

8 (2) SPECIFIC POWERS.—Section 404(a) of title 

9 39, United States Code, is amended by striking 

10 ‘‘Without’’ and inserting ‘‘Subject to the provisions of 

11 section 404a, but otherwise without’’. 

12 (c) CLERICAL AMENDMENT.—The analysis for chapter 

13 4 of title 39, United States Code, is amended by inserting 

14 after the item relating to section 404 the following: 

‘‘404a. Specific limitations.’’. 

15 SEC. 304. SUITS BY AND AGAINST THE POSTAL SERVICE. 

16 (a) IN GENERAL.—Section 409 of title 39, United 

17 States Code, is amended by striking subsections (d) and (e) 

18 and inserting the following: 

19 ‘‘(d)(1) For purposes of the provisions of law cited in 

20 paragraphs (2)(A) and (2)(B), respectively, the Postal Serv21 ice— 

22 ‘‘(A) shall be considered to be a ‘person’, as used 

23 in the provisions of law involved; and 

24 ‘‘(B) shall not be immune under any other doc25 trine of sovereign immunity from suit in Federal 
54 

•HR 4341 RH 

1 court by any person for any violation of any of those 

2 provisions of law by any officer or employee of the 

3 Postal Service. 

4 ‘‘(2) This subsection applies with respect to— 

5 ‘‘(A) the Act of July 5, 1946 (commonly referred 

6 to as the ‘Trademark Act of 1946’ (15 U.S.C. 1051 

7 and following)); and 

8 ‘‘(B) the provisions of section 5 of the Federal 

9 Trade Commission Act to the extent that such section 

10 5 applies to unfair or deceptive acts or practices. 

11 ‘‘(e)(1) To the extent that the Postal Service, or other 

12 Federal agency acting on behalf of or in concert with the 

13 Postal Service, engages in conduct with respect to any com14 petitive product, the Postal Service or other Federal agency 

15 (as the case may be)— 

16 ‘‘(A) shall not be immune under any doctrine of 

17 sovereign immunity from suit in Federal court by 

18 any person for any violation of Federal law by such 

19 agency or any officer or employee thereof; and 

20 ‘‘(B) shall be considered to be a person (as de21 fined in subsection (a) of the first section of the Clay22 ton Act) for purposes of— 

23 ‘‘(i) the antitrust laws (as defined in such 

24 subsection); and 
55 

•HR 4341 RH 

1 ‘‘(ii) section 5 of the Federal Trade Com2 mission Act to the extent that such section 5 ap3 plies to unfair methods of competition. 

4 ‘‘(2) No damages, interest on damages, costs or attor5 ney’s fees may be recovered, and no criminal liability may 

6 be imposed, under the antitrust laws (as so defined) from 

7 any officer or employee of the Postal Service, or other Fed8 eral agency acting on behalf of or in concert with the Postal 

9 Service, acting in an official capacity. 

10 ‘‘(3) This subsection shall not apply with respect to 

11 conduct occurring before the date of the enactment of this 

12 subsection. 

13 ‘‘(f)(1) Each building constructed or altered by the 

14 Postal Service shall be constructed or altered, to the max15 imum extent feasible as determined by the Postal Service, 

16 in compliance with one of the nationally recognized model 

17 building codes and with other applicable nationally recog18 nized codes. 

19 ‘‘(2) Each building constructed or altered by the Postal 

20 Service shall be constructed or altered only after consider21 ation of all requirements (other than procedural require22 ments) of zoning laws, land use laws, and applicable envi23 ronmental laws of a State or subdivision of a State which 

24 would apply to the building if it were not a building con-
56 

•HR 4341 RH 

1 structed or altered by an establishment of the Government 

2 of the United States. 

3 ‘‘(3) For purposes of meeting the requirements of para4 graphs (1) and (2) with respect to a building, the Postal 

5 Service shall— 

6 ‘‘(A) in preparing plans for the building, consult 

7 with appropriate officials of the State or political 

8 subdivision, or both, in which the building will be lo9 cated; 

10 ‘‘(B) upon request, submit such plans in a time11 ly manner to such officials for review by such officials 

12 for a reasonable period of time not exceeding 30 days; 

13 and 

14 ‘‘(C) permit inspection by such officials during 

15 construction or alteration of the building, in accord16 ance with the customary schedule of inspections for 

17 construction or alteration of buildings in the locality, 

18 if such officials provide to the Postal Service— 

19 ‘‘(i) a copy of such schedule before construc20 tion of the building is begun; and 

21 ‘‘(ii) reasonable notice of their intention to 

22 conduct any inspection before conducting such 

23 inspection. 

24 Nothing in this subsection shall impose an obligation on 

25 any State or political subdivision to take any action under 
57 

•HR 4341 RH 

1 the preceding sentence, nor shall anything in this subsection 

2 require the Postal Service or any of its contractors to pay 

3 for any action taken by a State or political subdivision to 

4 carry out this subsection (including reviewing plans, car5 rying out on-site inspections, issuing building permits, and 

6 making recommendations). 

7 ‘‘(4) Appropriate officials of a State or a political sub8 division of a State may make recommendations to the Post9 al Service concerning measures necessary to meet the re10 quirements of paragraphs (1) and (2). Such officials may 

11 also make recommendations to the Postal Service con12 cerning measures which should be taken in the construction 

13 or alteration of the building to take into account local con14 ditions. The Postal Service shall give due consideration to 

15 any such recommendations. 

16 ‘‘(5) In addition to consulting with local and State 

17 officials under paragraph (3), the Postal Service shall estab18 lish procedures for soliciting, assessing, and incorporating 

19 local community input on real property and land use deci20 sions. 

21 ‘‘(6) For purposes of this subsection, the term ‘State’ 

22 includes the District of Columbia, the Commonwealth of 

23 Puerto Rico, and a territory or possession of the United 

24 States. 
58 

•HR 4341 RH 

1 ‘‘(g)(1) Notwithstanding any other provision of law, 

2 legal representation may not be furnished by the Depart3 ment of Justice to the Postal Service in any action, suit, 

4 or proceeding arising, in whole or in part, under any of 

5 the following: 

6 ‘‘(A) Subsection (d) or (e) of this section. 

7 ‘‘(B) Subsection (f) or (g) of section 504 (relating 

8 to administrative subpoenas by the Postal Regulatory 

9 Commission). 

10 ‘‘(C) Section 3663 (relating to appellate review). 

11 The Postal Service may, by contract or otherwise, employ 

12 attorneys to obtain any legal representation that it is pre13 cluded from obtaining from the Department of Justice 

14 under this paragraph. 

15 ‘‘(2) In any circumstance not covered by paragraph 

16 (1), the Department of Justice shall, under section 411, fur17 nish the Postal Service such legal representation as it may 

18 require, except that, with the prior consent of the Attorney 

19 General, the Postal Service may, in any such circumstance, 

20 employ attorneys by contract or otherwise to conduct litiga21 tion brought by or against the Postal Service or its officers 

22 or employees in matters affecting the Postal Service. 

23 ‘‘(3)(A) In any action, suit, or proceeding in a court 

24 of the United States arising in whole or in part under any 

25 of the provisions of law referred to in subparagraph (B) 
59 

•HR 4341 RH 

1 or (C) of paragraph (1), and to which the Commission is 

2 not otherwise a party, the Commission shall be permitted 

3 to appear as a party on its own motion and as of right. 

4 ‘‘(B) The Department of Justice shall, under such 

5 terms and conditions as the Commission and the Attorney 

6 General shall consider appropriate, furnish the Commission 

7 such legal representation as it may require in connection 

8 with any such action, suit, or proceeding, except that, with 

9 the prior consent of the Attorney General, the Commission 

10 may employ attorneys by contract or otherwise for that pur11 pose. 

12 ‘‘(h) A judgment against the Government of the United 

13 States arising out of activities of the Postal Service shall 

14 be paid by the Postal Service out of any funds available 

15 to the Postal Service, subject to the restriction specified in 

16 section 2011(g).’’. 

17 (b) TECHNICAL AMENDMENT.—Section 409(a) of title 

18 39, United States Code, is amended by striking ‘‘Except as 

19 provided in section 3628 of this title,’’ and inserting ‘‘Ex20 cept as otherwise provided in this title,’’. 

21 SEC. 305. INTERNATIONAL POSTAL ARRANGEMENTS. 

22 (a) IN GENERAL.—Section 407 of title 39, United 

23 States Code, is amended to read as follows: 

24 ‘‘§ 407. International postal arrangements 

25 ‘‘(a) It is the policy of the United States— 
60 

•HR 4341 RH 

1 ‘‘(1) to promote and encourage communications 

2 between peoples by efficient operation of international 

3 postal services and other international delivery serv4 ices for cultural, social, and economic purposes; 

5 ‘‘(2) to promote and encourage unrestricted and 

6 undistorted competition in the provision of inter7 national postal services and other international deliv8 ery services, except where provision of such services by 

9 private companies may be prohibited by law of the 

10 United States; 

11 ‘‘(3) to promote and encourage a clear distinc12 tion between governmental and operational respon13 sibilities with respect to the provision of international 

14 postal services and other international delivery serv15 ices by the Government of the United States and by 

16 intergovernmental organizations of which the United 

17 States is a member; and 

18 ‘‘(4) to participate in multilateral and bilateral 

19 agreements with other countries to accomplish these 

20 objectives. 

21 ‘‘(b)(1) The Secretary of State shall be responsible for 

22 formulation, coordination, and oversight of foreign policy 

23 related to international postal services and other inter24 national delivery services, and shall have the power to con25 clude treaties, conventions and amendments related to 
61 

•HR 4341 RH 

1 international postal services and other international deliv2 ery services, except that the Secretary may not conclude any 

3 treaty, convention, or other international agreement (in4 cluding those regulating international postal services) if 

5 such treaty, convention, or agreement would, with respect 

6 to any competitive product, grant an undue or unreason7 able preference to the Postal Service, a private provider of 

8 international postal or delivery services, or any other per9 son. 

10 ‘‘(2) In carrying out the responsibilities specified in 

11 paragraph (1), the Secretary of State shall exercise primary 

12 authority for the conduct of foreign policy with respect to 

13 international postal services and international delivery 

14 services, including the determination of United States posi15 tions and the conduct of United States participation in ne16 gotiations with foreign governments and international bod17 ies. In exercising this authority, the Secretary— 

18 ‘‘(A) shall coordinate with other agencies as ap19 propriate, and in particular, shall give full consider20 ation to the authority vested by law or Executive 

21 order in the Postal Regulatory Commission, the De22 partment of Commerce, the Department of Transpor23 tation, and the Office of the United States Trade Rep24 resentative in this area; 
62 

•HR 4341 RH 

1 ‘‘(B) shall maintain continuing liaison with 

2 other executive branch agencies concerned with postal 

3 and delivery services; 

4 ‘‘(C) shall maintain continuing liaison with the 

5 Committee on Government Reform of the House of 

6 Representatives and the Committee on Governmental 

7 Affairs of the Senate; 

8 ‘‘(D) shall maintain appropriate liaison with 

9 both representatives of the Postal Service and rep10 resentatives of users and private providers of inter11 national postal services and other international deliv12 ery services to keep informed of their interests and 

13 problems, and to provide such assistance as may be 

14 needed to ensure that matters of concern are promptly 

15 considered by the Department of State or (if applica16 ble, and to the extent practicable) other executive 

17 branch agencies; and 

18 ‘‘(E) shall assist in arranging meetings of such 

19 public sector advisory groups as may be established to 

20 advise the Department of State and other executive 

21 branch agencies in connection with international 

22 postal services and international delivery services. 

23 ‘‘(3) The Secretary of State shall establish an advisory 

24 committee (within the meaning of the Federal Advisory 

25 Committee Act) to perform such functions as the Secretary 
63 

•HR 4341 RH 

1 considers appropriate in connection with carrying out sub2 paragraphs (A) through (D) of paragraph (2). 

3 ‘‘(c)(1) Before concluding any treaty, convention, or 

4 amendment that establishes a rate or classification for a 

5 product subject to subchapter I of chapter 36, the Secretary 

6 of State shall request the Postal Regulatory Commission to 

7 submit a decision on whether such rate or classification is 

8 consistent with the standards and criteria established by the 

9 Commission under section 3622. 

10 ‘‘(2) The Secretary shall ensure that each treaty, con11 vention, or amendment concluded under subsection (b) is 

12 consistent with a decision of the Commission adopted under 

13 paragraph (1), except if, or to the extent, the Secretary de14 termines, by written order, that considerations of foreign 

15 policy or national security require modification of the Com16 mission’s decision. 

17 ‘‘(d) Nothing in this section shall be considered to pre18 vent the Postal Service from entering into such commercial 

19 or operational contracts related to providing international 

20 postal services and other international delivery services as 

21 it deems appropriate, except that— 

22 ‘‘(1) any such contract made with an agency of 

23 a foreign government (whether under authority of this 

24 subsection or otherwise) shall be solely contractual in 
64 

•HR 4341 RH 

1 nature and may not purport to be international law; 

2 and 

3 ‘‘(2) a copy of each such contract between the 

4 Postal Service and an agency of a foreign government 

5 shall be transmitted to the Secretary of State and the 

6 Postal Regulatory Commission not later than the ef7 fective date of such contract. 

8 ‘‘(e)(1) With respect to shipments of international mail 

9 that are competitive products within the meaning of section 

10 3631 that are exported or imported by the Postal Service, 

11 the Bureau of Customs and Border Protection of the De12 partment of Homeland Security and other appropriate 

13 Federal agencies shall apply the customs laws of the United 

14 States and all other laws relating to the importation or ex15 portation of such shipments in the same manner to both 

16 shipments by the Postal Service and similar shipments by 

17 private companies. 

18 ‘‘(2) For purposes of this subsection, the term ‘private 

19 company’ means a private company substantially owned 

20 or controlled by persons who are citizens of the United 

21 States. 

22 ‘‘(3) In exercising the authority pursuant to subsection 

23 (b) to conclude new treaties, conventions and amendments 

24 related to international postal services and to renegotiate 

25 such treaties, conventions and amendments, the Secretary 
65 

•HR 4341 RH 

1 of State shall, to the maximum extent practicable, take such 

2 measures as are within the Secretary’s control to encourage 

3 the governments of other countries to make available to the 

4 Postal Service and private companies a range of non5 discriminatory customs procedures that will fully meet the 

6 needs of all types of American shippers. The Secretary of 

7 State shall consult with the United States Trade Represent8 ative and the Commissioner of Customs, Department of 

9 Homeland Security in carrying out this paragraph. 

10 ‘‘(4) The provisions of this subsection shall take effect 

11 6 months after the date of the enactment of this subsection 

12 or such earlier date as the Bureau of Customs and Border 

13 Protection of the Department of Homeland Security may 

14 determine in writing.’’. 

15 (b) EFFECTIVE DATE.—Notwithstanding any provi16 sion of the amendment made by subsection (a), the author17 ity of the United States Postal Service to establish the rates 

18 of postage or other charges on mail matter conveyed between 

19 the United States and other countries shall remain avail20 able to the Postal Service until— 

21 (1) with respect to market-dominant products, 

22 the date as of which the regulations promulgated 

23 under section 3622 of title 39, United States Code (as 

24 amended by section 201(a)) take effect; and 
66 

•HR 4341 RH 

1 (2) with respect to competitive products, the date 

2 as of which the regulations promulgated under section 

3 3633 of title 39, United States Code (as amended by 

4 section 202) take effect. 

5 SEC. 306. REDESIGNATION. 

6 Chapter 36 of title 39, United States Code (as in effect 

7 before the amendment made by section 204(a)) is amended 

8 by striking the heading for subchapter V and inserting the 

9 following: 

10 ‘‘SUBCHAPTER VI—GENERAL’’. 

11 SEC. 307. CLARIFICATION. 

12 Section 403(c) of title 39, United States Code, is 

13 amended by adding after ‘‘user.’’ the following: ‘‘The prohi14 bition in this subsection shall not be construed to prevent 

15 the establishment of rates that vary with volume if such 

16 rates will be made available to similarly situated persons 

17 and will increase the aggregate contribution to the institu18 tional costs of the Postal Service.’’. 

19 TITLE IV—GENERAL PROVISIONS 

20 SEC. 401. QUALIFICATION REQUIREMENTS FOR GOV21 ERNORS. 

22 (a) IN GENERAL.—Section 202(a) of title 39, United 

23 States Code, is amended by striking ‘‘(a)’’ and inserting 

24 ‘‘(a)(1)’’ and by striking the fourth sentence and inserting 

25 the following: ‘‘The Governors shall represent the public in-
67 

•HR 4341 RH 

1 terest generally, and at least 4 of the Governors shall be 

2 chosen solely on the basis of their demonstrated ability in 

3 managing organizations or corporations (in either the pub4 lic or private sector) of substantial size; for purposes of this 

5 sentence, an organization or corporation shall be considered 

6 to be of substantial size if it employs at least 50,000 employ7 ees. The Governors shall not be representatives of specific 

8 interests using the Postal Service, and may be removed only 

9 for cause.’’. 

10 (b) CONSULTATION REQUIREMENT.—Section 202(a) of 

11 title 39, United States Code, is amended by adding at the 

12 end the following: 

13 ‘‘(2) In selecting the individuals described in para14 graph (1) for nomination for appointment to the position 

15 of Governor, the President should consult with the Speaker 

16 of the House of Representatives, the minority leader of the 

17 House of Representatives, the majority leader of the Senate, 

18 and the minority leader of the Senate.’’. 

19 (c) RESTRICTION.—Section 202(b) of title 39, United 

20 States Code, is amended by striking ‘‘(b)’’ and inserting 

21 ‘‘(b)(1)’’, and by adding at the end the following: 

22 ‘‘(2)(A) Notwithstanding any other provision of this 

23 section, in the case of the office of the Governor the term 

24 of which is the first one scheduled to expire at least 4 

25 months after the date of the enactment of this paragraph— 
68 

•HR 4341 RH 

1 ‘‘(i) such office may not, in the case of any per2 son commencing service after that expiration date, be 

3 filled by any person other than an individual chosen 

4 from among persons nominated for such office with 

5 the unanimous concurrence of all labor organizations 

6 described in section 206(a)(1); and 

7 ‘‘(ii) instead of the term that would otherwise 

8 apply under the first sentence of paragraph (1), the 

9 term of any person so appointed to such office shall 

10 be 3 years. 

11 ‘‘(B) Except as provided in subparagraph (A), an ap12 pointment under this paragraph shall be made in conform13 ance with all provisions of this section that would otherwise 

14 apply.’’. 

15 (d) APPLICABILITY.—The amendment made by sub16 section (a) shall not affect the appointment or tenure of any 

17 person serving as a Governor of the Board of Governors of 

18 the United States Postal Service pursuant to an appoint19 ment made before the date of the enactment of this Act, or, 

20 except as provided in the amendment made by subsection 

21 (c), any nomination made before that date; however, when 

22 any such office becomes vacant, the appointment of any per23 son to fill that office shall be made in accordance with such 

24 amendment. The requirement set forth in the fourth sentence 

25 of section 202(a)(1) of title 39, United States Code (as 
69 

•HR 4341 RH 

1 amended by subsection (a)) shall be met beginning not later 

2 than 9 years after the date of the enactment of this Act. 

3 SEC. 402. OBLIGATIONS. 

4 (a) PURPOSES FOR WHICH OBLIGATIONS MAY BE

5 ISSUED.—The first sentence of section 2005(a)(1) of title 

6 39, United States Code, is amended by striking ‘‘title.’’ and 

7 inserting ‘‘title, other than any of the purposes for which 

8 the corresponding authority is available to the Postal Serv9 ice under section 2011.’’. 

10 (b) LIMITATION ON NET ANNUAL INCREASE IN OBLI11 GATIONS ISSUED FOR CERTAIN PURPOSES.—The third sen12 tence of section 2005(a)(1) of title 39, United States Code, 

13 is amended to read as follows: ‘‘In any one fiscal year, the 

14 net increase in the amount of obligations outstanding issued 

15 for the purpose of capital improvements and the net in16 crease in the amount of obligations outstanding issued for 

17 the purpose of defraying operating expenses of the Postal 

18 Service shall not exceed a combined total of 

19 $3,000,000,000.’’ . 

20 (c) LIMITATIONS ON OBLIGATIONS OUTSTANDING.— 

21 (1) IN GENERAL.—Subsection (a) of section 2005 

22 of title 39, United States Code, is amended by adding 

23 at the end the following: 

24 ‘‘(3) For purposes of applying the respective limita25 tions under this subsection, the aggregate amount of obliga-
70 

•HR 4341 RH 

1 tions issued by the Postal Service which are outstanding 

2 as of any one time, and the net increase in the amount 

3 of obligations outstanding issued by the Postal Service for 

4 the purpose of capital improvements or for the purpose of 

5 defraying operating expenses of the Postal Service in any 

6 fiscal year, shall be determined by aggregating the relevant 

7 obligations issued by the Postal Service under this section 

8 with the relevant obligations issued by the Postal Service 

9 under section 2011.’’. 

10 (2) CONFORMING AMENDMENT.—The second sen11 tence of section 2005(a)(1) of title 39, United States 

12 Code, is amended by striking ‘‘any such obligations’’ 

13 and inserting ‘‘obligations issued by the Postal Serv14 ice which may be’’. 

15 (d) AMOUNTS WHICH MAY BE PLEDGED, ETC.— 

16 (1) OBLIGATIONS TO WHICH PROVISIONS

17 APPLY.—The first sentence of section 2005(b) of title 

18 39, United States Code, is amended by striking ‘‘such 

19 obligations,’’ and inserting ‘‘obligations issued by the 

20 Postal Service under this section,’’. 

21 (2) ASSETS, REVENUES, AND RECEIPTS TO

22 WHICH PROVISIONS APPLY.—Subsection (b) of section 

23 2005 of title 39, United States Code, is amended by 

24 striking ‘‘(b)’’ and inserting ‘‘(b)(1)’’, and by adding 

25 at the end the following: 
71 

•HR 4341 RH 

1 ‘‘(2) Notwithstanding any other provision of this sec2 tion— 

3 ‘‘(A) the authority to pledge assets of the Postal 

4 Service under this subsection shall be available only 

5 to the extent that such assets are not related to the 

6 provision of competitive products (as determined 

7 under section 2011(h) or, for purposes of any period 

8 before accounting practices and principles under sec9 tion 2011(h) have been established and applied, the 

10 best information available from the Postal Service, 

11 including the audited statements required by section 

12 2008(e)); and 

13 ‘‘(B) any authority under this subsection relat14 ing to the pledging or other use of revenues or receipts 

15 of the Postal Service shall be available only to the ex16 tent that they are not revenues or receipts of the Com17 petitive Products Fund.’’. 

18 SEC. 403. PRIVATE CARRIAGE OF LETTERS. 

19 (a) IN GENERAL.—Section 601 of title 39, United 

20 States Code, is amended by striking subsection (b) and in21 serting the following: 

22 ‘‘(b) A letter may also be carried out of the mails 

23 when— 

24 ‘‘(1) the amount paid for the private carriage of 

25 the letter is at least the amount equal to 6 times the 
72 

•HR 4341 RH 

1 rate then currently charged for the 1st ounce of a sin2 gle-piece first class letter; 

‘‘(2) the letter weighs at least 121 3 ⁄2 ounces; or 

4 ‘‘(3) such carriage is within the scope of services 

5 described by regulations of the Postal Service (includ6 ing, in particular, sections 310.1 and 320.2–320.8 of 

7 title 39 of the Code of Federal Regulations, as in ef8 fect on July 1, 2003) that purport to permit private 

9 carriage by suspension of the operation of this section 

10 (as then in effect). 

11 ‘‘(c) Any regulations necessary to carry out this section 

12 shall be promulgated by the Postal Regulatory Commis13 sion.’’. 

14 (b) EFFECTIVE DATE.—This section shall take effect 

15 on the date as of which the regulations promulgated under 

16 section 3633 of title 39, United States Code (as amended 

17 by section 202) take effect. 

18 SEC. 404. RULEMAKING AUTHORITY. 

19 Paragraph (2) of section 401 of title 39, United States 

20 Code, is amended to read as follows: 

21 ‘‘(2) to adopt, amend, and repeal such rules and 

22 regulations, not inconsistent with this title, as may be 

23 necessary in the execution of its functions under this 

24 title and such other functions as may be assigned to 
73 

•HR 4341 RH 

1 the Postal Service under any provisions of law out2 side of this title;’’. 

3 SEC. 405. NONINTERFERENCE WITH COLLECTIVE BAR4 GAINING AGREEMENTS, ETC. 

5 (a) NONINTERFERENCE WITH COLLECTIVE BAR6 GAINING AGREEMENTS.—Except as provided in section 407, 

7 nothing in this Act or any amendment made by this Act 

8 shall restrict, expand, or otherwise affect any of the rights, 

9 privileges, or benefits of either employees of or labor organi10 zations representing employees of the United States Postal 

11 Service under chapter 12 of title 39, United States Code, 

12 the National Labor Relations Act, any handbook or manual 

13 affecting employee labor relations within the United States 

14 Postal Service, or any collective bargaining agreement. 

15 (b) FREE MAILING PRIVILEGES CONTINUE UN16 CHANGED.—Nothing in this Act or any amendment made 

17 by this Act shall affect any free mailing privileges accorded 

18 under section 3217 or sections 3403 through 3406 of title 

19 39, United States Code. 

20 SEC. 406. BONUS AUTHORITY. 

21 Subchapter VI of chapter 36 of title 39, United States 

22 Code (as so redesignated by section 306) is amended by add23 ing at the end the following: 
74 

•HR 4341 RH 

1 ‘‘§ 3686. Bonus authority 

2 ‘‘(a) IN GENERAL.—The Postal Service may establish 

3 one or more programs to provide bonuses or other rewards 

4 to officers and employees of the Postal Service to achieve 

5 the objectives of this chapter. 

6 ‘‘(b) WAIVER OF LIMITATION ON COMPENSATION.— 

7 ‘‘(1) IN GENERAL.—Under any such program, 

8 the Postal Service may award a bonus or other re9 ward in excess of the limitation set forth in the last 

10 sentence of section 1003(a), if such program has been 

11 approved under paragraph (2). 

12 ‘‘(2) APPROVAL PROCESS.—If the Postal Service 

13 wishes to have the authority, under any program de14 scribed in subsection (a), to award bonuses or other 

15 rewards in excess of the limitation referred to in 

16 paragraph (1)— 

17 ‘‘(A) the Postal Service shall make an ap18 propriate request to the Postal Regulatory Com19 mission, in such form and manner as the Com20 mission requires; and 

21 ‘‘(B) the Postal Regulatory Commission 

22 shall approve any such request if it finds that 

23 the program is likely to achieve the objectives of 

24 this chapter. 

25 ‘‘(3) REVOCATION AUTHORITY.—If the Postal 

26 Regulatory Commission finds that a program pre-
75 

•HR 4341 RH 

1 viously approved under paragraph (2) is not achiev2 ing the objectives of this chapter, the Commission may 

3 revoke or suspend the authority of the Postal Service 

4 to continue such program until such time as appro5 priate corrective measures have, in the judgment of 

6 the Commission, been taken. 

7 ‘‘(c) REPORTING REQUIREMENT RELATING TO BO8 NUSES OR OTHER REWARDS.—Included in its comprehen9 sive statement under section 2401(e) for any period shall 

10 be— 

11 ‘‘(1) the name of each person receiving a bonus 

12 or other reward during such period which would not 

13 have been allowable but for the provisions of sub14 section (b); 

15 ‘‘(2) the amount of the bonus or other reward; 

16 and 

17 ‘‘(3) the amount by which the limitation referred 

18 to in subsection (b)(1) was exceeded as a result of 

19 such bonus or other reward.’’. 

20 SEC. 407. MEDIATION IN COLLECTIVE-BARGAINING DIS21 PUTES. 

22 (a) IN GENERAL.—Section 1207(b) of title 39, United 

23 States Code, is amended by striking all that follows ‘‘the 

24 Director of the Federal Mediation and Conciliation Service 

25 shall’’ and inserting ‘‘, within 10 days appoint a mediator 
76 

•HR 4341 RH 

1 of nationwide reputation and professional stature, and who 

2 is also a member of the National Academy of Arbitrators. 

3 The parties shall cooperate with the mediator in an effort 

4 to reach an agreement and shall meet and negotiate in good 

5 faith at such times and places that the mediator, in con6 sultation with the parties, shall direct.’’. 

7 (b) PROVISIONS RELATING TO ARBITRATION

8 BOARDS.—Section 1207(c) of title 39, United States Code, 

9 is amended— 

10 (1) in paragraph (1)— 

11 (A) by striking ‘‘90’’ and inserting ‘‘60’’; 

12 (B) by striking ‘‘not members of the fact13 finding panel,’’; and 

14 (C) by striking all that follows ‘‘shall be 

15 made’’ and inserting ‘‘from a list of names pro16 vided by the Director. This list shall consist of 

17 not less than 9 names of arbitrators of nation18 wide reputation and professional stature, who 

19 are also members of the National Academy of Ar20 bitrators, and whom the Director has determined 

21 are available and willing to serve.’’; and 

22 (2) in paragraph (3), by striking ‘‘factfinding 

23 panel’’ and inserting ‘‘mediation’’. 

24 (c) CONFORMING AMENDMENT.—Section 1207(d) of 

25 title 39, United States Code, is amended by striking ‘‘fact-
77 

•HR 4341 RH 

1 finding panel will be established’’ and inserting ‘‘mediator 

2 shall be appointed’’. 

3 TITLE V—ENHANCED 

4 REGULATORY COMMISSION 

5 SEC. 501. REORGANIZATION AND MODIFICATION OF CER6 TAIN PROVISIONS RELATING TO THE POSTAL 

7 REGULATORY COMMISSION. 

8 (a) TRANSFER AND REDESIGNATION.—Title 39, 

9 United States Code, is amended— 

10 (1) by inserting after chapter 4 the following: 

11 ‘‘CHAPTER 5—POSTAL REGULATORY 

12 COMMISSION 

‘‘Sec. 

‘‘501. Establishment. 

‘‘502. Commissioners. 

‘‘503. Rules; regulations; procedures. 

‘‘504. Administration. 

13 ‘‘§ 501. Establishment 

14 ‘‘The Postal Regulatory Commission is an independent 

15 establishment of the executive branch of the Government of 

16 the United States. 

17 ‘‘§ 502. Commissioners 

18 ‘‘(a) The Postal Regulatory Commission is composed 

19 of 5 Commissioners, appointed by the President, by and 

20 with the advice and consent of the Senate. The Commis21 sioners shall be chosen solely on the basis of their technical 

22 qualifications, professional standing, and demonstrated ex23 pertise in economics, accounting, law, or public adminis-
78 

•HR 4341 RH 

1 tration, and may be removed by the President only for 

2 cause. Each individual appointed to the Commission shall 

3 have the qualifications and expertise necessary to carry out 

4 the responsibilities accorded Commissioners under the Post5 al Accountability and Enhancement Act. Not more than 3 

6 of the Commissioners may be adherents of the same political 

7 party. 

8 ‘‘(b) A Commissioner may continue to serve after the 

9 expiration of his term until his successor has qualified, ex10 cept that a Commissioner may not so continue to serve for 

11 more than 1 year after the date upon which his term other12 wise would expire under subsection (e). 

13 ‘‘(c) One of the Commissioners shall be designated as 

14 Chairman by, and shall serve in the position of Chairman 

15 at the pleasure of, the President. 

16 ‘‘(d) The Commissioners shall by majority vote des17 ignate a Vice Chairman of the Commission. The Vice Chair18 man shall act as Chairman of the Commission in the ab19 sence of the Chairman. 

20 ‘‘(e) The Commissioners shall serve for terms of 6 

21 years.’’; 

22 (2) by striking, in subchapter I of chapter 36 (as 

23 in effect before the amendment made by section 

24 201(c)), the heading for such subchapter I and all 

25 that follows through section 3602; and 
79 

•HR 4341 RH 

1 (3) by redesignating sections 3603 and 3604 as 

2 sections 503 and 504, respectively, and transferring 

3 such sections to the end of chapter 5 (as inserted by 

4 paragraph (1)). 

5 (b) DETERMINATIONS.—Section 503 of title 39, United 

6 States Code, as so redesignated by subsection (a)(3), is 

7 amended by adding at the end the following: ‘‘Such rules 

8 shall include procedures which balance, inter alia, the need 

9 for protecting due process rights and ensuring expeditious 

10 decision-making.’’. 

11 (c) APPLICABILITY.—The amendment made by sub12 section (a)(1) shall not affect the appointment or tenure of 

13 any person serving as a Commissioner on the Postal Regu14 latory Commission (as so redesignated by section 504) pur15 suant to an appointment made before the date of the enact16 ment of this Act or any nomination made before that date, 

17 but, when any such office becomes vacant, the appointment 

18 of any person to fill that office shall be made in accordance 

19 with such amendment. 

20 (d) CLERICAL AMENDMENT.—The analysis for part I 

21 of title 39, United States Code, is amended by inserting 

22 after the item relating to chapter 4 the following: 

‘‘5. Postal Regulatory Commission .................................................. 501’’. 
80 

•HR 4341 RH 

1 SEC. 502. AUTHORITY FOR POSTAL REGULATORY COMMIS2 SION TO ISSUE SUBPOENAS. 

3 Section 504 of title 39, United States Code (as so redes4 ignated by section 501) is amended by adding at the end 

5 the following: 

6 ‘‘(f)(1) Any Commissioner of the Postal Regulatory 

7 Commission, any administrative law judge appointed by 

8 the Commission under section 3105 of title 5, and any em9 ployee of the Commission designated by the Commission 

10 may administer oaths, examine witnesses, take depositions, 

11 and receive evidence. 

12 ‘‘(2) The Chairman of the Commission, any Commis13 sioner designated by the Chairman, and any administrative 

14 law judge appointed by the Commission under section 3105 

15 of title 5 may, with respect to any proceeding conducted 

16 by the Commission under this title— 

17 ‘‘(A) issue subpoenas requiring the attendance 

18 and presentation of testimony by, or the production 

19 of documentary or other evidence in the possession of, 

20 any covered person; and 

21 ‘‘(B) order the taking of depositions and re22 sponses to written interrogatories by a covered person. 

23 The written concurrence of a majority of the Commissioners 

24 then holding office shall, with respect to each subpoena 

25 under subparagraph (A), be required in advance of its 

26 issuance. 
81 

•HR 4341 RH 

1 ‘‘(3) In the case of contumacy or failure to obey a sub2 poena issued under this subsection, upon application by the 

3 Commission, the district court of the United States for the 

4 district in which the person to whom the subpoena is ad5 dressed resides or is served may issue an order requiring 

6 such person to appear at any designated place to testify 

7 or produce documentary or other evidence. Any failure to 

8 obey the order of the court may be punished by the court 

9 as a contempt thereof. 

10 ‘‘(4) For purposes of this subsection, the term ‘covered 

11 person’ means an officer, employee, agent, or contractor of 

12 the Postal Service. 

13 ‘‘(g)(1) If the Postal Service determines that any docu14 ment or other matter it provides to the Postal Regulatory 

15 Commission pursuant to a subpoena issued under sub16 section (f), or otherwise at the request of the Commission 

17 in connection with any proceeding or other purpose under 

18 this title, contains information which is described in section 

19 410(c) of this title, or exempt from public disclosure under 

20 section 552(b) of title 5, the Postal Service shall, at the time 

21 of providing such matter to the Commission, notify the 

22 Commission, in writing, of its determination (and the rea23 sons therefor). 
82 

•HR 4341 RH 

1 ‘‘(2) No officer or employee of the Commission may, 

2 with respect to any information as to which the Commis3 sion has been notified under paragraph (1)— 

4 ‘‘(A) use such information for purposes other 

5 than the purposes for which it is supplied; or 

6 ‘‘(B) permit anyone who is not an officer or em7 ployee of the Commission to have access to any such 

8 information. 

9 ‘‘(3) Paragraph (2) shall not prevent information from 

10 being furnished under any process of discovery established 

11 under this title in connection with a proceeding under this 

12 title. The Commission shall, by regulations based on rule 

13 26(c) of the Federal Rules of Civil Procedure, establish pro14 cedures for ensuring appropriate confidentiality for any in15 formation furnished under the preceding sentence.’’. 

16 SEC. 503. APPROPRIATIONS FOR THE POSTAL REGULATORY 

17 COMMISSION. 

18 (a) AUTHORIZATION OF APPROPRIATIONS.—Sub19 section (d) of section 504 of title 39, United States Code 

20 (as so redesignated by section 501) is amended to read as 

21 follows: 

22 ‘‘(d) There are authorized to be appropriated, out of 

23 the Postal Service Fund, such sums as may be necessary 

24 for the Postal Regulatory Commission. In requesting an ap25 propriation under this subsection for a fiscal year, the Com-
83 

•HR 4341 RH 

1 mission shall prepare and submit to the Congress under sec2 tion 2009 a budget of the Commission’s expenses, including 

3 expenses for facilities, supplies, compensation, and em4 ployee benefits.’’. 

5 (b) BUDGET PROGRAM.— 

6 (1) IN GENERAL.—The next to last sentence of 

7 section 2009 of title 39, United States Code, is 

8 amended to read as follows: ‘‘The budget program 

9 shall also include separate statements of the amounts 

10 which (1) the Postal Service requests to be appro11 priated under subsections (b) and (c) of section 2401, 

12 (2) the Office of Inspector General of the United 

13 States Postal Service requests to be appropriated, out 

14 of the Postal Service Fund, under section 8J(e) of the 

15 Inspector General Act of 1978, and (3) the Postal 

16 Regulatory Commission requests to be appropriated, 

17 out of the Postal Service Fund, under section 504(d) 

18 of this title.’’. 

19 (2) CONFORMING AMENDMENT.—Section 

20 2003(e)(1) of title 39, United States Code, is amended 

21 by striking the first sentence and inserting the fol22 lowing: ‘‘The Fund shall be available for the payment 

23 of (A) all expenses incurred by the Postal Service in 

24 carrying out its functions as provided by law, subject 

25 to the same limitation as set forth in the parenthet-
84 

•HR 4341 RH 

1 ical matter under subsection (a); (B) all expenses of 

2 the Postal Regulatory Commission, subject to the 

3 availability of amounts appropriated pursuant to sec4 tion 504(d); and (C) all expenses of the Office of In5 spector General, subject to the availability of amounts 

6 appropriated pursuant to section 8J(e) of the Inspec7 tor General Act of 1978.’’. 

8 (c) EFFECTIVE DATE.— 

9 (1) IN GENERAL.—The amendments made by 

10 this section shall apply with respect to fiscal years be11 ginning on or after October 1, 2004. 

12 (2) SAVINGS PROVISION.—The provisions of title 

13 39, United States Code, that are amended by this sec14 tion shall, for purposes of any fiscal year before the 

15 first fiscal year to which the amendments made by 

16 this section apply, continue to apply in the same way 

17 as if this section had never been enacted. 

18 SEC. 504. REDESIGNATION OF THE POSTAL RATE COMMIS19 SION. 

20 (a) AMENDMENTS TO TITLE 39, UNITED STATES

21 CODE.—Title 39, United States Code, is amended in sec22 tions 404, 503–504 (as so redesignated by section 501), 

23 1001, and 1002 by striking ‘‘Postal Rate Commission’’ each 

24 place it appears and inserting ‘‘Postal Regulatory Commis25 sion’’. 
85 

•HR 4341 RH 

1 (b) AMENDMENTS TO TITLE 5, UNITED STATES

2 CODE.—Title 5, United States Code, is amended in sections 

3 104(1), 306(f), 2104(b), 3371(3), 5314 (in the item relating 

4 to Chairman, Postal Rate Commission), 5315 (in the item 

5 relating to Members, Postal Rate Commission), 

6 5514(a)(5)(B), 7342(a)(1)(A), 7511(a)(1)(B)(ii), 

7 8402(c)(1), 8423(b)(1)(B), and 8474(c)(4) by striking 

8 ‘‘Postal Rate Commission’’ and inserting ‘‘Postal Regu9 latory Commission’’. 

10 (c) AMENDMENT TO THE ETHICS IN GOVERNMENT ACT

11 OF 1978.—Section 101(f)(6) of the Ethics in Government 

12 Act of 1978 (5 U.S.C. App.) is amended by striking ‘‘Postal 

13 Rate Commission’’ and inserting ‘‘Postal Regulatory Com14 mission’’. 

15 (d) AMENDMENT TO THE REHABILITATION ACT OF

16 1973.—Section 501(b) of the Rehabilitation Act of 1973 (29 

17 U.S.C. 791(b)) is amended by striking ‘‘Postal Rate Office’’ 

18 and inserting ‘‘Postal Regulatory Commission’’. 

19 (e) AMENDMENT TO TITLE 44, UNITED STATES

20 CODE.—Section 3502(5) of title 44, United States Code, is 

21 amended by striking ‘‘Postal Rate Commission’’ and insert22 ing ‘‘Postal Regulatory Commission’’. 

23 (f) OTHER REFERENCES.—Whenever a reference is 

24 made in any provision of law (other than this Act or a 

25 provision of law amended by this Act), regulation, rule, doc-
86 

•HR 4341 RH 

1 ument, or other record of the United States to the Postal 

2 Rate Commission, such reference shall be considered a ref3 erence to the Postal Regulatory Commission. 

4 SEC. 505. OFFICER OF THE POSTAL REGULATORY COMMIS5 SION REPRESENTING THE GENERAL PUBLIC. 

6 (a) IN GENERAL.—Chapter 5 of title 39, United States 

7 Code (as added by this Act) is amended by adding after 

8 section 504 the following: 

9 ‘‘§ 505. Officer of the Postal Regulatory Commission 

10 representing the general public 

11 ‘‘The Postal Regulatory Commission shall designate an 

12 officer of the Postal Regulatory Commission in all public 

13 proceedings (such as developing rules, regulations, and pro14 cedures) who shall represent the interests of the general pub15 lic.’’. 

16 (b) CLERICAL AMENDMENT.—The analysis for chapter 

17 5 of title 39, United States Code (as amended by section 

18 501(a)(1)) is amended by adding after the item relating to 

19 section 504 the following: 

‘‘505. Officer of the Postal Regulatory Commission representing the general public.’’. 
87 

•HR 4341 RH 

1 TITLE VI—INSPECTORS 

2 GENERAL 

3 SEC. 601. INSPECTOR GENERAL OF THE POSTAL REGU4 LATORY COMMISSION. 

5 (a) IN GENERAL.—Paragraph (2) of section 8G(a) of 

6 the Inspector General Act of 1978 is amended by inserting 

7 ‘‘the Postal Regulatory Commission,’’ after ‘‘the United 

8 States International Trade Commission,’’. 

9 (b) ADMINISTRATION.—Section 504 of title 39, United 

10 States Code (as so redesignated by section 501) is amended 

11 by adding after subsection (g) (as added by section 502) 

12 the following: 

13 ‘‘(h)(1) Notwithstanding any other provision of this 

14 title or of the Inspector General Act of 1978, the authority 

15 to select, appoint, and employ officers and employees of the 

16 Office of Inspector General of the Postal Regulatory Com17 mission, and to obtain any temporary or intermittent serv18 ices of experts or consultants (or an organization of experts 

19 or consultants) for such Office, shall reside with the Inspec20 tor General of the Postal Regulatory Commission. 

21 ‘‘(2) Except as provided in paragraph (1), any exercise 

22 of authority under this subsection shall, to the extent prac23 ticable, be in conformance with the applicable laws and reg24 ulations that govern selections, appointments and employ-
88 

•HR 4341 RH 

1 ment, and the obtaining of any such temporary or intermit2 tent services, within the Postal Regulatory Commission.’’. 

3 (c) DEADLINE.—No later than 180 days after the date 

4 of the enactment of this Act— 

5 (1) the first Inspector General of the Postal Reg6 ulatory Commission shall be appointed; and 

7 (2) the Office of Inspector General of the Postal 

8 Regulatory Commission shall be established. 

9 SEC. 602. INSPECTOR GENERAL OF THE UNITED STATES 

10 POSTAL SERVICE TO BE APPOINTED BY THE 

11 PRESIDENT. 

12 (a) DEFINITIONAL AMENDMENTS TO THE INSPECTOR

13 GENERAL ACT OF 1978.—Section 11 of the Inspector Gen14 eral Act of 1978 is amended— 

15 (1) in paragraph (1)— 

16 (A) by striking ‘‘or’’ before ‘‘the President of 

17 the Export-Import Bank;’’ and 

18 (B) by inserting ‘‘or the Governors of the 

19 United States Postal Service (within the mean20 ing of section 102(3) of title 39, United States 

21 Code);’’ after ‘‘the President of the Export-Im22 port Bank;’’; and 

23 (2) in paragraph (2)— 

24 (A) by striking ‘‘or’’ before ‘‘the Export-Im25 port Bank,’’; and 
89 

•HR 4341 RH 

1 (B) by inserting ‘‘or the United States Post2 al Service,’’ after ‘‘the Export-Import Bank,’’. 

3 (b) SPECIAL PROVISIONS CONCERNING THE UNITED

4 STATES POSTAL SERVICE.— 

5 (1) IN GENERAL.—The Inspector General Act of 

6 1978 is amended— 

7 (A) by redesignating section 8J as section 

8 8K; and 

9 (B) by inserting after section 8I the fol10 lowing: 

11 ‘‘SPECIAL PROVISIONS CONCERNING THE UNITED STATES

12 POSTAL SERVICE

13 ‘‘SEC. 8J. (a) In carrying out the duties and respon14 sibilities specified in this Act, the Inspector General of the 

15 United States Postal Service shall have oversight responsi16 bility for all activities of the Postal Inspection Service, in17 cluding any internal investigation performed by the Postal 

18 Inspection Service. The Chief Postal Inspector shall 

19 promptly report any significant activities being carried out 

20 by the Postal Inspection Service to such Inspector General. 

21 The Postmaster General shall promptly report to such In22 spector General all allegations of theft, fraud, or misconduct 

23 by Postal Service officers or employees, and entities or indi24 viduals doing business with the Postal Service. 

25 ‘‘(b) In the case of any report that the Governors of 

26 the United States Postal Service (within the meaning of 
90 

•HR 4341 RH 

1 section 102(3) of title 39, United States Code) are required 

2 to transmit under the second sentence of section 5(d), such 

3 sentence shall be applied by deeming the term ‘appropriate 

4 committees of Congress’ to mean the Committee on Govern5 ment Reform of the House of Representatives, the Com6 mittee on Governmental Affairs of the Senate, and such 

7 other committees or subcommittees of Congress as may be 

8 appropriate. 

9 ‘‘(c) Notwithstanding any provision of paragraph (7) 

10 or (8) of section 6(a), the Inspector General of the United 

11 States Postal Service may select, appoint, and employ such 

12 officers and employees as may be necessary for carrying out 

13 the functions, powers, and duties of the Office of Inspector 

14 General and to obtain the temporary or intermittent serv15 ices of experts or consultants or an organization of experts 

16 or consultants, subject to the applicable laws and regula17 tions that govern such selections, appointments, and em18 ployment, and the obtaining of such services, within the 

19 United States Postal Service. 

20 ‘‘(d) Nothing in this Act shall restrict, eliminate, or 

21 otherwise adversely affect any of the rights, privileges, or 

22 benefits of employees of the United States Postal Service, 

23 or labor organizations representing employees of the United 

24 States Postal Service, under chapter 12 of title 39, United 

25 States Code, the National Labor Relations Act, any hand-
91 

•HR 4341 RH 

1 book or manual affecting employee labor relations with the 

2 United States Postal Service, or any collective bargaining 

3 agreement. 

4 ‘‘(e) There are authorized to be appropriated, out of 

5 the Postal Service Fund, such sums as may be necessary 

6 for the Office of Inspector General of the United States Post7 al Service.’’. 

8 (2) RELATED PROVISIONS.—For certain related 

9 provisions, see section 503(b). 

10 (c) EXERCISE OF CERTAIN POWERS.—Section 6(e)(3) 

11 of the Inspector General Act of 1978 is amended— 

12 (1) by striking ‘‘and the’’ before ‘‘Tennessee Val13 ley Authority’’; and 

14 (2) by inserting ‘‘, and United States Postal 

15 Service’’ after ‘‘Tennessee Valley Authority’’. 

16 (d) PUBLIC CONTRACTS.— 

17 (1) ADDITIONAL PROVISIONS APPLICABLE.—Sec18 tion 410(b)(5) of title 39, United States Code, is 

19 amended— 

20 (A) in subparagraph (A), by striking ‘‘and’’ 

21 after the semicolon; and 

22 (B) by adding after subparagraph (B) the 

23 following: 
92 

•HR 4341 RH 

1 ‘‘(C) the Anti-Kickback Act of 1986 (41 

2 U.S.C. 51 and following), other than subsections 

3 (a) and (b) of 7 and section 8 of that Act; and 

4 ‘‘(D) section 315 of the Federal Property 

5 and Administrative Services Act of 1949 (41 

6 U.S.C. 265) (relating to protecting contractor 

7 employees from reprisal for disclosure of certain 

8 information);’’. 

9 (2) REGULATIONS ON ALLOWABLE COSTS.—Sec10 tion 410 of title 39, United States Code, is amended 

11 by adding at the end the following: 

12 ‘‘(e) The Postal Service shall develop and issue pur13 chasing regulations that prohibit contract costs not allow14 able under section 5.2.5 of the United States Postal Service 

15 Procurement Manual (Publication 41), as in effect on July 

16 12, 1995.’’. 

17 (e) AUDITS OF THE POSTAL SERVICE.— 

18 (1) AUDITS.—Subsection (e) of section 2008 of 

19 title 39, United States Code, is amended to read as 

20 follows: 

21 ‘‘(e)(1) At least once each year beginning with the fis22 cal year commencing after the date of the enactment of the 

23 Postal Accountability and Enhancement Act, the financial 

24 statements of the Postal Service (including those used in 

25 determining and establishing postal rates) shall be audited 
93 

•HR 4341 RH 

1 by the Inspector General or by an independent external 

2 auditor selected by the Inspector General. 

3 ‘‘(2) Audits under this section shall be conducted in 

4 accordance with applicable generally accepted government 

5 auditing standards. 

6 ‘‘(3) Upon completion of the audit required by this 

7 subsection, the person who audits the statement shall submit 

8 a report on the audit to the Postmaster General.’’. 

9 (2) RESULTS OF INSPECTOR GENERAL’S AUDIT

10 TO BE INCLUDED IN ANNUAL REPORT.—Section 2402 

11 of title 39, United States Code, is amended by insert12 ing after the first sentence the following: ‘‘Each report 

13 under this section shall include a copy of the report 

14 most recently received by the Postmaster General 

15 under section 2008(e)(3).’’. 

16 (3) COORDINATION PROVISIONS.—Section 

17 2008(d) of title 39, United States Code, is amended— 

18 (A) by striking ‘‘(d) Nothing’’ and inserting 

19 ‘‘(d)(1) Except as provided in paragraph (2), 

20 nothing’’; and 

21 (B) by adding at the end the following: 

22 ‘‘(2) An audit or report under paragraph (1) may not 

23 be obtained without the prior written approval of the In24 spector General.’’. 
94 

•HR 4341 RH 

1 (4) TRANSITION PROVISION.—For purposes of 

2 any fiscal year preceding the first fiscal year com3 mencing after the date of the enactment of this Act, 

4 the provisions of title 39, United States Code, shall be 

5 applied as if the amendments made by this subsection 

6 had never been enacted. 

7 (f) REPORTS.—Section 3013 of title 39, United States 

8 Code, is amended by striking ‘‘Postmaster General’’ each 

9 place it appears and inserting ‘‘Chief Postal Inspector’’. 

10 (g) TECHNICAL AND CONFORMING AMENDMENTS.— 

11 (1) RELATING TO THE INSPECTOR GENERAL ACT

12 OF 1978.—(A) Subsection (a) of section 8G of the In13 spector General Act of 1978 (as amended by section 

14 601(a)) is further amended— 

15 (i) in paragraph (2), by striking ‘‘the Post16 al Regulatory Commission, and the United 

17 States Postal Service;’’ and inserting ‘‘and the 

18 Postal Regulatory Commission;’’ and 

19 (ii) in paragraph (4), by striking ‘‘except 

20 that’’ and all that follows through ‘‘Code);’’ and 

21 inserting ‘‘except that, with respect to the Na22 tional Science Foundation, such term means the 

23 National Science Board;’’. 

24 (B)(i) Subsection (f) of section 8G of such Act is 

25 repealed. 
95 

•HR 4341 RH 

1 (ii) Subsection (c) of section 8G of such Act is 

2 amended by striking ‘‘Except as provided under sub3 section (f) of this section, the’’ and inserting ‘‘The’’. 

4 (C) Section 8K of such Act (as so redesignated 

5 by subsection (b)(1)(A)) is amended by striking the 

6 matter after ‘‘8D,’’ and before ‘‘of this Act’’ and in7 serting ‘‘8E, 8F, 8H, or 8J’’. 

8 (2) RELATING TO TITLE 39, UNITED STATES

9 CODE.—(A) Subsection (e) of section 202 of title 39, 

10 United States Code, is repealed. 

11 (B) Paragraph (4) of section 102 of such title 39 

12 (as amended by section 101) is amended to read as 

13 follows: 

14 ‘‘(4) ‘Inspector General’ means the Inspector 

15 General of the United States Postal Service, ap16 pointed under section 3(a) of the Inspector General 

17 Act of 1978;’’. 

18 (C) The first sentence of section 1003(a) of such 

19 title 39 is amended by striking ‘‘chapters 2 and 12 

20 of this title, section 8G of the Inspector General Act 

21 of 1978, or other provision of law,’’ and inserting 

22 ‘‘chapter 2 or 12 of this title, subsection (b) or (c) of 

23 this section, or any other provision of law,’’. 

24 (D) Section 1003(b) of such title 39 is amended 

25 by striking ‘‘respective’’ and inserting ‘‘other’’. 
96 

•HR 4341 RH 

1 (E) Section 1003(c) of such title 39 is amended 

2 by striking ‘‘included’’ and inserting ‘‘includes’’. 

3 (3) RELATING TO THE ENERGY POLICY ACT OF

4 1992.—Section 160(a) of the Energy Policy Act of 

5 1992 (42 U.S.C. 8262f(a)) is amended (in the matter 

6 before paragraph (1)) by striking all that follows ‘‘(5 

7 U.S.C. App.)’’ and before ‘‘shall—’’. 

8 (h) EFFECTIVE DATE; TRANSITION PROVISIONS.— 

9 (1) EFFECTIVE DATE.—Except as provided in 

10 paragraph (2) or subsection (c), this section and the 

11 amendments made by this section shall take effect on 

12 the date of the enactment of this Act. 

13 (2) TRANSITION PROVISIONS.— 

14 (A) PRESIDENTIAL APPOINTMENT AUTHOR15 ITY AVAILABLE IMMEDIATELY.—The authority to 

16 appoint an Inspector General of the United 

17 States Postal Service in accordance with the 

18 amendments made by this section shall be avail19 able as of the effective date of this section. 

20 (B) CONTINUATION IN OFFICE.—Pending 

21 the appointment of an Inspector General of the 

22 United States Postal Service in accordance with 

23 the amendments made by this section, the indi24 vidual serving as the Inspector General of the 

25 United States Postal Service on the day before 
97 

•HR 4341 RH 

1 the effective date of this section may continue to 

2 serve— 

3 (i) in accordance with applicable pro4 visions of the Inspector General Act of 1978 

5 and (except as provided in clause (ii)) of 

6 title 39, United States Code, as last in effect 

7 before the effective date of this Act; but 

8 (ii) subject to the provisions of such 

9 title 39 as amended by subsections (e) and 

10 (f) of this section (deeming any reference to 

11 the ‘‘Inspector General’’ in such provisions, 

12 as so amended, to refer to the individual 

13 continuing to serve under authority of this 

14 subparagraph) and subparagraph (C). 

15 (C) AUTHORIZATION OF APPROPRIA16 TIONS.— 

17 (i) IN GENERAL.—Notwithstanding 

18 any other provision of this subsection, sec19 tion 8J(e) of the Inspector General Act of 

20 1978 (as amended by this section) shall be 

21 effective for purposes of fiscal years begin22 ning on or after October 1, 2004. 

23 (ii) SAVINGS PROVISION.—For pur24 poses of the fiscal year ending on September 

25 30, 2004, funding for the Office of Inspector 
98 

•HR 4341 RH 

1 General of the United States Postal Service 

2 shall be made available in the same manner 

3 as if this Act had never been enacted. 

4 (D) ELIGIBILITY OF PRIOR INSPECTOR GEN5 ERAL.—Nothing in this Act shall prevent any 

6 individual who has served as Inspector General 

7 of the United States Postal Service at any time 

8 before the date of the enactment of this Act from 

9 being appointed to that position pursuant to the 

10 amendments made by this section. 

11 TITLE VII—EVALUATIONS 

12 SEC. 701. UNIVERSAL POSTAL SERVICE STUDY. 

13 (a) REPORT BY THE POSTAL SERVICE.—The United 

14 States Postal Service shall, within 12 months after the date 

15 of the enactment of this Act, submit to the President, the 

16 Congress, and the Postal Regulatory Commission, a written 

17 report on universal postal service in the United States 

18 (hereinafter in this section referred to as ‘‘universal serv19 ice’’). Such report shall include at least the following: 

20 (1) A comprehensive review of the history and 

21 development of universal service, including how the 

22 scope and standards of universal service have evolved 

23 over time. 

24 (2) The scope and standards of universal service 

25 provided under current law (including sections 101 
99 

•HR 4341 RH 

1 and 403 of title 39, United States Code) and current 

2 rules, regulations, policy statements, and practices of 

3 the Postal Service. 

4 (3) A description of any geographic areas, popu5 lations, communities, organizations, or other groups 

6 or entities not currently covered by universal service 

7 or that are covered but that are receiving services de8 ficient in scope or quality or both. 

9 (4) The scope and standards of universal service 

10 likely to be required in the future in order to meet the 

11 needs and expectations of the American public, in12 cluding all types of mail users, based on such assump13 tions or alternative sets of assumptions as the Postal 

14 Service considers plausible. 

15 (5) Such recommendations as the Postal Service 

16 considers appropriate. 

17 (b) REPORT BY THE POSTAL REGULATORY COMMIS18 SION.—The Postal Regulatory Commission shall, within 12 

19 months after receiving the report of the Postal Service under 

20 subsection (a), submit to the President and the Congress a 

21 written report evaluating the report of the Postal Service. 

22 The report of the Commission shall include at least the fol23 lowing: 
100 

•HR 4341 RH 

1 (1) Such comments and observations relating to 

2 the matters addressed in the Postal Service’s report as 

3 the Commission considers appropriate. 

4 (2) An estimate of the cost attributable to the ob5 ligation to provide universal service under prior and 

6 current law, respectively. 

7 (3) An estimate of the likely cost of fulfilling the 

8 obligation to provide universal service under— 

9 (A) the assumptions or respective sets of as10 sumptions of the Postal Service described in sub11 section (a)(4); and 

12 (B) such other assumptions or sets of as13 sumptions as the Commission considers plau14 sible. 

15 (4) Such additional topics and recommendations 

16 as the Commission considers appropriate. 

17 (c) CONSULTATION.—In preparing the reports required 

18 by this section, the Postal Service and the Postal Regulatory 

19 Commission— 

20 (1) shall consult with each other, other Federal 

21 agencies, users of the mails, enterprises in the private 

22 sector engaged in the delivery of mail, and the general 

23 public; and 

24 (2) shall address in their respective reports any 

25 written comments received under this section. 
101 

•HR 4341 RH 

1 (d) CLARIFYING PROVISION.—Nothing in this section 

2 shall be considered to relate to any services that are not 

3 postal services (within the meaning of section 102 of title 

4 39, United States Code, as amended by section 101). 

5 SEC. 702. ASSESSMENTS OF RATEMAKING, CLASSIFICATION, 

6 AND OTHER PROVISIONS. 

7 (a) IN GENERAL.—The Postal Regulatory Commission 

8 shall, at least every 5 years, submit a report to the President 

9 and the Congress concerning— 

10 (1) the operation of the amendments made by the 

11 Postal Accountability and Enhancement Act; and 

12 (2) recommendations for any legislation or other 

13 measures necessary to improve the effectiveness or effi14 ciency of the postal laws of the United States. 

15 (b) POSTAL SERVICE VIEWS.—A report under this sec16 tion shall be submitted only after reasonable opportunity 

17 has been afforded to the Postal Service to review such report 

18 and to submit written comments thereon. Any comments 

19 timely received from the Postal Service under the preceding 

20 sentence shall be attached to the report submitted under sub21 section (a). 

22 (c) SPECIFIC INFORMATION REQUIRED.—The Postal 

23 Regulatory Commission shall include, as part of at least 

24 its first report under subsection (a), the following: 
102 

•HR 4341 RH 

1 (1) COST-COVERAGE REQUIREMENT RELATING TO

2 COMPETITIVE PRODUCTS COLLECTIVELY.—With re3 spect to section 3633 of title 39, United States Code 

4 (as amended by this Act)— 

5 (A) a description of how such section has 

6 operated; and 

7 (B) recommendations as to whether or not 

8 such section should remain in effect and, if so, 

9 any suggestions as to how it might be improved. 

10 (2) COMPETITIVE PRODUCTS FUND.—With re11 spect to the Postal Service Competitive Products Fund 

12 (under section 2011 of title 39, United States Code, 

13 as amended by section 301), in consultation with the 

14 Secretary of the Treasury— 

15 (A) a description of how such Fund has op16 erated; 

17 (B) any suggestions as to how the operation 

18 of such Fund might be improved; and 

19 (C) a description and assessment of alter20 native accounting or financing mechanisms that 

21 might be used to achieve the objectives of such 

22 Fund. 

23 (3) ASSUMED FEDERAL INCOME TAX ON COM24 PETITIVE PRODUCTS FUND.—With respect to section 

25 3634 of title 39, United States Code (as amended by 
103 

•HR 4341 RH 

1 this Act), in consultation with the Secretary of the 

2 Treasury— 

3 (A) a description of how such section has 

4 operated; and 

5 (B) recommendations as to whether or not 

6 such section should remain in effect and, if so, 

7 any suggestions as to how it might be improved. 

8 SEC. 703. STUDY ON EQUAL APPLICATION OF LAWS TO COM9 PETITIVE PRODUCTS. 

10 (a) IN GENERAL.—The Federal Trade Commission 

11 shall prepare and submit to the President, the Congress, 

12 and the Postal Regulatory Commission, within 1 year after 

13 the date of the enactment of this Act, a comprehensive report 

14 identifying Federal and State laws that apply differently 

15 to the United States Postal Service with respect to the com16 petitive category of mail (within the meaning of section 102 

17 of title 39, United States Code, as amended by section 101) 

18 and private companies providing similar products. 

19 (b) RECOMMENDATIONS; ADJUSTMENTS.—The Federal 

20 Trade Commission shall include such recommendations as 

21 it considers appropriate for bringing such legal differences 

22 to an end and, in the interim, to account under section 

23 3633, for the net economic effects provided by those laws. 

24 (c) CONSULTATION.—In preparing its report, the Fed25 eral Trade Commission shall consult with the United States 
104 

•HR 4341 RH 

1 Postal Service, the Postal Regulatory Commission, other 

2 Federal agencies, mailers, private companies that provide 

3 delivery services, and the general public, and shall append 

4 to such report any written comments received under this 

5 subsection. 

6 (d) COMPETITIVE PRODUCT RATE REGULATION.—The 

7 Postal Regulatory Commission shall take into account the 

8 recommendations of the Federal Trade Commission, and 

9 subsequent events that affect the continuing validity of the 

10 estimate of the net economic effect, in promulgating or re11 vising the regulations required by section 3633 of title 39, 

12 United States Code. 

13 SEC. 704. GREATER DIVERSITY IN POSTAL SERVICE EXECU14 TIVE AND ADMINISTRATIVE SCHEDULE MAN15 AGEMENT POSITIONS. 

16 (a) STUDY.—The Board of Governors shall study and, 

17 within 1 year after the date of the enactment of this Act, 

18 submit to the President and Congress a report concerning 

19 the extent to which women and minorities are represented 

20 in supervisory and management positions within the 

21 United States Postal Service. Any data included in the re22 port shall be presented in the aggregate and by pay level. 

23 (b) PERFORMANCE EVALUATIONS.—The United States 

24 Postal Service shall, as soon as practicable, take such meas25 ures as may be necessary to ensure that, for purposes of 
105 

•HR 4341 RH 

1 conducting performance appraisals of supervisory or mana2 gerial employees, appropriate consideration shall be given 

3 to meeting affirmative action goals, achieving equal em4 ployment opportunity requirements, and implementation of 

5 plans designed to achieve greater diversity in the workforce. 

6 SEC. 705. PLAN FOR ASSISTING DISPLACED WORKERS. 

7 (a) PLAN.—The United States Postal Service shall, be8 fore the deadline specified in subsection (b), develop and 

9 be prepared to implement, whenever necessary, a com10 prehensive plan under which reemployment assistance shall 

11 be afforded to employees displaced as a result of the automa12 tion or privatization of any of its functions. 

13 (b) REPORT.—Not later than 1 year after the date of 

14 the enactment of this Act, the United States Postal Service 

15 shall submit to its Board of Governors and Congress a writ16 ten report describing its plan under this section. 

17 SEC. 706. CONTRACTS WITH WOMEN, MINORITIES, AND 

18 SMALL BUSINESSES. 

19 The Board of Governors shall study and, within 1 year 

20 after the date of the enactment of this Act, submit to the 

21 President and the Congress a report concerning the number 

22 and value of contracts and subcontracts the Postal Service 

23 has entered into with women, minorities, and small busi24 nesses. 
106 

•HR 4341 RH 

1 SEC. 707. RATES FOR PERIODICALS. 

2 (a) IN GENERAL.—The United States Postal Service, 

3 acting jointly with the Postal Regulatory Commission and 

4 the General Accounting Office, shall study and submit to 

5 the President and Congress a report concerning— 

6 (1) the quality, accuracy, and completeness of the 

7 information used by the Postal Service in deter8 mining the direct and indirect postal costs attrib9 utable to periodicals; and 

10 (2) any opportunities that might exist for im11 proving efficiencies in the collection, handling, trans12 portation, or delivery of periodicals by the Postal 

13 Service, including any pricing incentives for mailers 

14 that might be appropriate. 

15 (b) RECOMMENDATIONS.—The report shall include rec16 ommendations for any administrative action or legislation 

17 that might be appropriate. 

18 SEC. 708. ASSESSMENT OF CERTAIN RATE DEFICIENCIES. 

19 (a) IN GENERAL.—Within 12 months after the date 

20 of the enactment of this Act, the Office of Inspector General 

21 of the United States Postal Service shall study and submit 

22 to the President, the Congress, and the United States Postal 

23 Service, a report concerning the administration of section 

24 3626(k) of title 39, United States Code. 

25 (b) SPECIFIC REQUIREMENTS.—The study and report 

26 shall specifically address the adequacy and fairness of the 
107 

•HR 4341 RH 

1 process by which assessments under section 3626(k) of title 

2 39, United States Code, are determined and appealable, in3 cluding— 

4 (1) whether the Postal Regulatory Commission 

5 or any other body outside the Postal Service should 

6 be assigned a role; and 

7 (2) whether a statute of limitations should be es8 tablished for the commencement of proceedings by the 

9 Postal Service thereunder. 

10 SEC. 709. POSTAL PROCESSING AND DISTRIBUTION NET11 WORK STUDY. 

12 The United States Postal Service shall, within 16 

13 months after the date of the enactment of this Act, submit 

14 to the President, the Congress, and the Board of Governors 

15 of the United States Postal Service a written report on the 

16 postal processing and distribution network. Such report 

17 shall include at least the following: 

18 (1) Recommendations to improve the efficiency 

19 and effectiveness of the processing and distribution 

20 network while preserving the timely delivery of postal 

21 services. 

22 (2) Identification of excess capacity (if any) 

23 within the processing and distribution network and 

24 opportunities for savings through realignment or con25 solidation of facilities. 
108 

•HR 4341 RH 

1 (3) Report of the Postal Service’s plans for deal2 ing with the recommendations and findings identified 

3 in paragraphs (1) and (2). 

4 (4) Statutory or regulatory obstacles preventing 

5 the Postal Service from taking action to realign or 

6 consolidate facilities identified in paragraph (2). 

7 (5) Such additional topics and recommendations 

8 as the Postal Service considers appropriate. 

9 SEC. 710. DEFINITION. 

10 For purposes of this title, the term ‘‘Board of Gov11 ernors’’ has the meaning given such term by section 102 

12 of title 39, United States Code. 

13 TITLE VIII—MISCELLANEOUS; 

14 TECHNICAL AND CON15 FORMING AMENDMENTS 

16 SEC. 801. EMPLOYMENT OF POSTAL POLICE OFFICERS. 

17 Section 3061 of title 18, United States Code, is amend18 ed by adding at the end the following: 

19 ‘‘(c)(1) The Postal Service may employ police officers 

20 for duty in connection with the protection of property 

21 owned or occupied by the Postal Service or under the charge 

22 and control of the Postal Service, and persons on the prop23 erty, including duty in areas outside the property to the 

24 extent necessary to protect the property and persons on the 

25 property. 
109 

•HR 4341 RH 

1 ‘‘(2) With respect to such property, such officers shall 

2 have the power to— 

3 ‘‘(A) enforce Federal laws and regulations for the 

4 protection of persons and property; 

5 ‘‘(B) carry firearms; and 

6 ‘‘(C) make arrests without a warrant for any of7 fense against the United States committed in the 

8 presence of the officer or for any felony cognizable 

9 under the laws of the United States if the officer has 

10 reasonable grounds to believe that the person to be ar11 rested has committed or is committing a felony. 

12 ‘‘(3) With respect to such property, such officers may 

13 have, to such extent as the Postal Service may by regula14 tions prescribe, the power to— 

15 ‘‘(A) serve warrants and subpoenas issued under 

16 the authority of the United States; and 

17 ‘‘(B) conduct investigations, on and off the prop18 erty in question, of offenses that may have been com19 mitted against property owned or occupied by the 

20 Postal Service or persons on the property. 

21 ‘‘(4)(A) As to such property, the Postmaster General 

22 may prescribe regulations necessary for the protection and 

23 administration of property owned or occupied by the Postal 

24 Service and persons on the property. The regulations may 

25 include reasonable penalties, within the limits prescribed 
110 

•HR 4341 RH 

1 in subparagraph (B), for violations of the regulations. The 

2 regulations shall be posted and remain posted in a con3 spicuous place on the property. 

4 ‘‘(B) A person violating a regulation prescribed under 

5 this subsection shall be fined under this title, imprisoned 

6 for not more than 30 days, or both.’’. 

7 SEC. 802. DATE OF POSTMARK TO BE TREATED AS DATE OF 

8 APPEAL IN CONNECTION WITH THE CLOSING 

9 OR CONSOLIDATION OF POST OFFICES. 

10 (a) IN GENERAL.—Section 404(b) of title 39, United 

11 States Code, is amended by adding at the end the following: 

12 ‘‘(6) For purposes of paragraph (5), any appeal re13 ceived by the Commission shall— 

14 ‘‘(A) if sent to the Commission through the 

15 mails, be considered to have been received on the date 

16 of the Postal Service postmark on the envelope or 

17 other cover in which such appeal is mailed; or 

18 ‘‘(B) if otherwise lawfully delivered to the Com19 mission, be considered to have been received on the 

20 date determined based on any appropriate docu21 mentation or other indicia (as determined under reg22 ulations of the Commission).’’. 

23 (b) EFFECTIVE DATE.—This section and the amend24 ments made by this section shall apply with respect to any 

25 determination to close or consolidate a post office which is 
111 

•HR 4341 RH 

1 first made available, in accordance with paragraph (3) of 

2 section 404(b) of title 39, United States Code, after the end 

3 of the 3-month period beginning on the date of the enact4 ment of this Act. 

5 SEC. 803. PROVISIONS RELATING TO BENEFITS UNDER 

6 CHAPTER 81 OF TITLE 5, UNITED STATES 

7 CODE, FOR OFFICERS AND EMPLOYEES OF 

8 THE FORMER POST OFFICE DEPARTMENT. 

9 (a) IN GENERAL.—Section 8 of the Postal Reorganiza10 tion Act (39 U.S.C. 1001 note) is amended by inserting 

11 ‘‘(a)’’ after ‘‘8.’’ and by adding at the end the following: 

12 ‘‘(b) For purposes of chapter 81 of title 5, United 

13 States Code, the Postal Service shall, with respect to any 

14 individual receiving benefits under such chapter as an offi15 cer or employee of the former Post Office Department, have 

16 the same authorities and responsibilities as it has with re17 spect to an officer or employee of the Postal Service receiv18 ing such benefits.’’. 

19 (b) EFFECTIVE DATE.—This section and the amend20 ments made by this section shall be effective as of the first 

21 day of the fiscal year in which this Act is enacted. 

22 SEC. 804. OBSOLETE PROVISIONS. 

23 (a) REPEAL.— 

24 (1) IN GENERAL.—Chapter 52 of title 39, United 

25 States Code, is repealed. 
112 

•HR 4341 RH 

1 (2) CONFORMING AMENDMENTS.—(A) Section 

2 5005(a) of title 39, United States Code, is amended— 

3 (i) by striking paragraph (1), and by redes4 ignating paragraphs (2) through (4) as para5 graphs (1) through (3), respectively; and 

6 (ii) in paragraph (3) (as so designated by 

7 clause (i)), by striking ‘‘(as defined in section 

8 5201(6) of this title)’’. 

9 (B) Section 5005(b) of such title 39 is amended 

10 by striking ‘‘(a)(4)’’ each place it appears and insert11 ing ‘‘(a)(3)’’. 

12 (C) Section 5005(c) of such title 39 is amended 

13 by striking ‘‘by carrier or person under subsection 

14 (a)(1) of this section, by contract under subsection 

15 (a)(4) of this section, or’’ and inserting ‘‘by contract 

16 under subsection (a)(3) of this section or’’. 

17 (b) ELIMINATING RESTRICTION ON LENGTH OF CON18 TRACTS.—(1) Section 5005(b)(1) of title 39, United States 

19 Code, is amended by striking ‘‘(or where the Postal Service 

20 determines that special conditions or the use of special 

21 equipment warrants, not in excess of 6 years)’’ and insert22 ing ‘‘(or such longer period of time as may be determined 

23 by the Postal Service to be advisable or appropriate)’’. 

24 (2) Section 5402(d) of such title 39 is amended by 

25 striking ‘‘for a period of not more than 4 years’’. 
113 

•HR 4341 RH 

1 (3) Section 5605 of such title 39 is amended by strik2 ing ‘‘for periods of not in excess of 4 years’’. 

3 (c) CLERICAL AMENDMENT.—The analysis for part V 

4 of title 39, United States Code, is amended by repealing 

5 the item relating to chapter 52. 

6 SEC. 805. EXPANDED CONTRACTING AUTHORITY. 

7 (a) AMENDMENT TO TITLE 39, UNITED STATES

8 CODE.— 

9 (1) CONTRACTS WITH AIR CARRIERS.—Sub10 section (d) of section 5402 of title 39, United States 

11 Code, is amended to read as follows: 

12 ‘‘(d)(1) The Postal Service may contract with any air 

13 carrier for the transportation of mail by aircraft in inter14 state air transportation, including the rates therefor, either 

15 through negotiations or competitive bidding. 

16 ‘‘(2) Notwithstanding subsections (a) through (c), the 

17 Postal Service may contract with any air carrier or foreign 

18 air carrier for the transportation of mail by aircraft in for19 eign air transportation, including the rates therefor, either 

20 through negotiations or competitive bidding, except that— 

21 ‘‘(A) any such contract may be awarded only to 

22 (i) an air carrier holding a certificate required by 

23 section 41101 of title 49 or an exemption therefrom 

24 issued by the Secretary of Transportation, (ii) a for25 eign air carrier holding a permit required by section 
114 

•HR 4341 RH 

1 41301 of title 49 or an exemption therefrom issued by 

2 the Secretary of Transportation, or (iii) a combina3 tion of such air carriers or foreign air carriers (or 

4 both); 

5 ‘‘(B) mail transported under any such contract 

6 shall not be subject to any duty-to-carry requirement 

7 imposed by any provision of subtitle VII of title 49 

8 or by any certificate, permit, or corresponding exemp9 tion authority issued by the Secretary of Transpor10 tation under that subtitle; 

11 ‘‘(C) every contract that the Postal Service 

12 awards to a foreign air carrier under this paragraph 

13 shall be subject to the continuing requirement that air 

14 carriers shall be afforded the same opportunity to 

15 carry the mail of the country to and from which the 

16 mail is transported and the flag country of the for17 eign air carrier, if different, as the Postal Service has 

18 afforded the foreign air carrier; and 

19 ‘‘(D) the Postmaster General shall consult with 

20 the Secretary of Defense concerning actions that affect 

21 the carriage of military mail transported in foreign 

22 air transportation. 

23 ‘‘(3) Paragraph (2) shall not be interpreted as sus24 pending or otherwise diminishing the authority of the Sec25 retary of Transportation under section 41310 of title 49.’’. 
115 

•HR 4341 RH 

1 (2) DEFINITIONS.—Subsection (e) of section 5402 

2 of title 39, United States Code, is amended to read as 

3 follows: 

4 ‘‘(e) For purposes of this section, the terms ‘air car5 rier’, ‘air transportation’, ‘foreign air carrier’, ‘foreign air 

6 transportation’, ‘interstate air transportation’, and ‘mail’ 

7 shall have the meanings given such terms in section 40102 

8 of title 49.’’. 

9 (b) AMENDMENTS TO TITLE 49, UNITED STATES

10 CODE.— 

11 (1) AUTHORITY OF POSTAL SERVICE TO PROVIDE

12 FOR INTERSTATE AIR TRANSPORTATION OF MAIL.— 

13 Section 41901(a) of title 49, United States Code, is 

14 amended to read as follows: 

15 ‘‘(a) TITLE 39.—The United States Postal Service 

16 may provide for the transportation of mail by aircraft in 

17 air transportation under this chapter and under chapter 

18 54 of title 39.’’. 

19 (2) SCHEDULES FOR CERTAIN TRANSPORTATION

20 OF MAIL.—Section 41902(b)(1) of title 49, United 

21 States Code, is amended by inserting before the semi22 colon at the end the following: ‘‘(other than foreign 

23 air transportation of mail)’’. 
116 

•HR 4341 RH 

1 (3) PRICES FOR FOREIGN TRANSPORTATION OF

2 MAIL.—Section 41907 of title 49, United States Code, 

3 is amended— 

4 (A) by striking ‘‘(a) LIMITATIONS.—’’; and 

5 (B) by striking subsection (b). 

6 (4) CONFORMING AMENDMENTS.—Sections 

7 41107, 41901(b)(1), 41902(a), 41903(a), and 41903(b) 

8 of title 49, United States Code, are amended by strik9 ing ‘‘in foreign air transportation or’’. 

10 SEC. 806. INVESTMENTS. 

11 Subsection (c) of section 2003 of title 39, United States 

12 Code, is amended— 

13 (1) by striking ‘‘(c) If’’ and inserting ‘‘(c)(1) Ex14 cept as provided in paragraph (2), if’’; and 

15 (2) by adding at the end the following: 

16 ‘‘(2)(A) Nothing in this section shall be considered to 

17 authorize any investment in any obligations or securities 

18 of a commercial entity. 

19 ‘‘(B) For purposes of this paragraph, the term ‘com20 mercial entity’ means any corporation, company, associa21 tion, partnership, joint stock company, firm, society, or 

22 other similar entity, as further defined under regulations 

23 prescribed by the Postal Regulatory Commission.’’. 
117 

•HR 4341 RH 

1 SEC. 807. REPEAL OF SECTION 5403. 

2 (a) IN GENERAL.—Section 5403 of title 39, United 

3 States Code, is repealed. 

4 (b) CLERICAL AMENDMENT.—The analysis for chapter 

5 54 of title 39, United States Code, is amended by repealing 

6 the item relating to section 5403. 

7 SEC. 808. REDUCED RATES. 

8 Section 3626 of title 39, United States Code, is amend9 ed— 

10 (1) in subsection (a)— 

11 (A) by striking all before paragraph (4) and 

12 inserting the following: 

13 ‘‘(a)(1) Except as otherwise provided in this section, 

14 rates of postage for a class of mail or kind of mailer under 

15 former section 4358, 4452(b), 4452(c), 4554(b), or 4554(c) 

16 of this title shall be established in accordance with section 

17 3622. 

18 ‘‘(2) For the purpose of this subsection, the term ‘reg19 ular-rate category’ means any class of mail or kind of mail20 er, other than a class or kind referred to in section 

21 2401(c).’’; and 

22 (B) by redesignating paragraphs (4) 

23 through (7) as paragraphs (3) through (6), re24 spectively; 

25 (2) in subsection (g), by adding at the end the 

26 following: 
118 

•HR 4341 RH 

1 ‘‘(3) For purposes of this section and former section 

2 4358(a) through (c) of this title, those copies of an issue 

3 of a publication entered within the county in which it is 

4 published, but distributed outside such county on postal 

5 carrier routes originating in the county of publication, shall 

6 be treated as if they were distributed within the county of 

7 publication. 

8 ‘‘(4)(A) In the case of an issue of a publication, any 

9 number of copies of which are mailed at the rates of postage 

10 for a class of mail or kind of mailer under former section 

11 4358(a) through (c) of this title, any copies of such issue 

12 which are distributed outside the county of publication (ex13 cluding any copies subject to paragraph (3)) shall be subject 

14 to rates of postage provided for under this paragraph. 

15 ‘‘(B) The rates of postage applicable to mail under this 

16 paragraph shall be established in accordance with section 

17 3622. 

18 ‘‘(C) This paragraph shall not apply with respect to 

19 an issue of a publication unless the total paid circulation 

20 of such issue outside the county of publication (not counting 

21 recipients of copies subject to paragraph (3)) is less than 

22 5,000.’’; and 

23 (3) by adding at the end the following: 

24 ‘‘(n) In the administration of this section, matter that 

25 satisfies the circulation standards for requester publications 
119 

•HR 4341 RH 

1 shall not be excluded from being mailed at the rates for mail 

2 under former section 4358 solely because such matter is de3 signed primarily for free circulation or for circulation at 

4 nominal rates, or fails to meet the requirements of former 

5 section 4354(a)(5).’’. 

6 SEC. 809. HAZARDOUS MATTER. 

7 (a) NONMAILABILITY GENERALLY.—Section 3001 of 

8 title 39, United States Code, is amended— 

9 (1) by redesignating subsection (n) as subsection 

10 (o); and 

11 (2) by inserting after subsection (m) the fol12 lowing: 

13 ‘‘(o)(1) Except as otherwise authorized by law or regu14 lations of the Postal Service, hazardous material is non15 mailable. 

16 ‘‘(2) In this subsection, the term ‘hazardous material’ 

17 means a substance or material designated by the Secretary 

18 of Transportation under section 5103(a) of title 49.’’. 

19 (b) MAILABILITY.—Chapter 30 of title 39, United 

20 States Code, is amended by adding at the end the following: 

21 ‘‘§ 3018. Hazardous material 

22 ‘‘(a) IN GENERAL.—The Postal Service shall prescribe 

23 regulations for the safe transportation of hazardous mate24 rial in the mail. 

25 ‘‘(b) PROHIBITIONS.—No person may— 
120 

•HR 4341 RH 

1 ‘‘(1) mail or cause to be mailed hazardous mate2 rial that has been declared by statute or Postal Serv3 ice regulation to be nonmailable; 

4 ‘‘(2) mail or cause to be mailed hazardous mate5 rial in violation of any statute or Postal Service reg6 ulation restricting the time, place, or manner in 

7 which hazardous material may be mailed; or 

8 ‘‘(3) manufacture, distribute, or sell any con9 tainer, packaging kit, or similar device that— 

10 ‘‘(A) is represented, marked, certified, or 

11 sold by such person for use in the mailing of 

12 hazardous material; and 

13 ‘‘(B) fails to conform with any statute or 

14 Postal Service regulation setting forth standards 

15 for a container, packaging kit, or similar device 

16 used for the mailing of hazardous material. 

17 ‘‘(c) CIVIL PENALTY; CLEAN-UP COSTS AND DAM18 AGES.— 

19 ‘‘(1) IN GENERAL.—A person who knowingly vio20 lates this section or a regulation prescribed under this 

21 section shall be liable for— 

22 ‘‘(A) a civil penalty of at least $250, but 

23 not more than $100,000, for each violation; 

24 ‘‘(B) the costs of any clean-up associated 

25 with each violation; and 
121 

•HR 4341 RH 

1 ‘‘(C) damages. 

2 ‘‘(2) KNOWING ACTION.—A person acts know3 ingly for purposes of paragraph (1) when— 

4 ‘‘(A) the person has actual knowledge of the 

5 facts giving rise to the violation; or 

6 ‘‘(B) a reasonable person acting in the cir7 cumstances and exercising reasonable care would 

8 have had that knowledge. 

9 ‘‘(3) SEPARATE VIOLATIONS.— 

10 ‘‘(A) VIOLATIONS OVER TIME.—A separate 

11 violation under this subsection occurs for each 

12 day hazardous material, mailed or caused to be 

13 mailed in noncompliance with this section, is in 

14 the mail. 

15 ‘‘(B) SEPARATE ITEMS.—A separate viola16 tion under this subsection occurs for each item 

17 containing hazardous material that is mailed or 

18 caused to be mailed in noncompliance with this 

19 section. 

20 ‘‘(d) HEARINGS.—The Postal Service may determine 

21 that a person has violated this section or a regulation pre22 scribed under this section only after notice and an oppor23 tunity for a hearing. Proceedings under this section shall 

24 be conducted in accordance with section 3001(m). 
122 

•HR 4341 RH 

1 ‘‘(e) PENALTY CONSIDERATIONS.—In determining the 

2 amount of a civil penalty for a violation of this section, 

3 the Postal Service shall consider— 

4 ‘‘(1) the nature, circumstances, extent, and grav5 ity of the violation; 

6 ‘‘(2) with respect to the person who committed 

7 the violation, the degree of culpability, any history of 

8 prior violations, the ability to pay, and any effect on 

9 the ability to continue in business; 

10 ‘‘(3) the impact on Postal Service operations; 

11 and 

12 ‘‘(4) any other matters that justice requires. 

13 ‘‘(f) CIVIL ACTIONS TO COLLECT.— 

14 ‘‘(1) IN GENERAL.—In accordance with section 

15 409(d), a civil action may be commenced in an ap16 propriate district court of the United States to collect 

17 a civil penalty, clean-up costs, and damages assessed 

18 under subsection (c). 

19 ‘‘(2) COMPROMISE.—The Postal Service may 

20 compromise the amount of a civil penalty, clean-up 

21 costs, and damages assessed under subsection (c) be22 fore commencing a civil action with respect to such 

23 civil penalty, clean-up costs, and damages under 

24 paragraph (1). 

25 ‘‘(g) CIVIL JUDICIAL PENALTIES.— 
123 

•HR 4341 RH 

1 ‘‘(1) IN GENERAL.—At the request of the Postal 

2 Service, the Attorney General may bring a civil ac3 tion in an appropriate district court of the United 

4 States to enforce this section or a regulation pre5 scribed under this section. 

6 ‘‘(2) RELIEF.—The court in a civil action under 

7 paragraph (1) may award appropriate relief, includ8 ing a temporary or permanent injunction, civil pen9 alties as determined in accordance with this section, 

10 or punitive damages. 

11 ‘‘(3) CONSTRUCTION.—A civil action under this 

12 subsection shall be in lieu of civil penalties for the 

13 same violation under subsection (c)(1)(A). 

14 ‘‘(h) DEPOSIT OF AMOUNTS COLLECTED.— 

15 ‘‘(1) POSTAL SERVICE FUND.—Except as pro16 vided under paragraph (2), amounts collected under 

17 subsection (c)(1)(B) and (C) shall be deposited into 

18 the Postal Service Fund under section 2003. 

19 ‘‘(2) TREASURY.—Amounts collected under sub20 section (c)(1)(A) and any punitive damages collected 

21 under subsection (c)(1)(C) shall be deposited into the 

22 Treasury of the United States.’’. 

23 (c) CONFORMING AMENDMENTS.—(1) Section 2003(b) 

24 of title 39, United States Code, is amended— 
124 

•HR 4341 RH 

1 (A) in paragraph (7), by striking ‘‘and’’ after 

2 the semicolon; 

3 (B) in paragraph (8), by striking ‘‘purposes.’’ 

4 and inserting ‘‘purposes; and’’; and 

5 (C) by adding at the end the following: 

6 ‘‘(9) any amounts collected under section 3018.’’. 

7 (2) The analysis for chapter 30 of title 39, United 

8 States Code, is amended by adding at the end the following: 

‘‘3018. Hazardous material.’’. 

9 (d) INJURIOUS ARTICLES AS NONMAILABLE.—Section 

10 1716(a) of title 18, United States Code, is amended by in11 serting after ‘‘explosives,’’ the following: ‘‘hazardous mate12 rials,’’. 

13 SEC. 810. PROVISIONS RELATING TO COOPERATIVE MAIL14 INGS. 

15 (a) DETERMINATION.—The Postal Regulatory Com16 mission shall examine section E670.5.3 of the Domestic 

17 Mail Manual to determine whether it contains adequate 

18 safeguards to protect against (1) abuses of rates for non19 profit mail and (2) deception of consumers. 

20 (b) REGULATIONS.—If the Postal Regulatory Commis21 sion determines that section E670.5.3 of the Domestic Mail 

22 Manual does not contain adequate safeguards as described 

23 in the preceding subsection, the Commission shall promul24 gate such regulations as may be necessary to ensure such 

25 safeguards. 
125 

•HR 4341 RH 

1 (c) TIMING.—The Postal Regulatory Commission shall 

2 complete the examination required by subsection (a) and 

3 the promulgation of any necessary regulations required by 

4 subsection (b) within one year after the date of the enact5 ment of this section. 

6 SEC. 811. TECHNICAL AND CONFORMING AMENDMENTS. 

7 (a) REIMBURSEMENT.—Section 3681 of title 39, 

8 United States Code, is amended by striking ‘‘section 3628’’ 

9 and inserting ‘‘sections 3662 through 3664’’. 

10 (b) SIZE AND WEIGHT LIMITS.—Section 3682 of title 

11 39, United States Code, is amended to read as follows: 

12 ‘‘§ 3682. Size and weight limits 

13 ‘‘The Postal Service may establish size and weight lim14 itations for mail matter in the market-dominant category 

15 of mail consistent with regulations the Postal Regulatory 

16 Commission may prescribe under section 3622. The Postal 

17 Service may establish size and weight limitations for mail 

18 matter in the competitive category of mail consistent with 

19 its authority under section 3632.’’. 

20 (c) REVENUE FOREGONE, ETC.—Title 39, United 

21 States Code, is amended— 

22 (1) in section 503 (as so redesignated by section 

23 501), by striking ‘‘this chapter.’’ and inserting ‘‘this 

24 title.’’; and 
126 

•HR 4341 RH 

1 (2) in section 2401(d), by inserting ‘‘(as last in 

2 effect before enactment of the Postal Accountability 

3 and Enhancement Act)’’ after ‘‘3626(a)’’ and after 

4 ‘‘3626(a)(3)(B)(ii)’’. 

5 (d) APPROPRIATIONS AND REPORTING REQUIRE6 MENTS.— 

7 (1) APPROPRIATIONS.—Subsection (e) of section 

8 2401 of title 39, United States Code, is amended— 

9 (A) by striking ‘‘Committee on Post Office 

10 and Civil Service’’ each place it appears and in11 serting ‘‘Committee on Government Reform’’; 

12 and 

13 (B) by striking ‘‘Not later than March 15 of 

14 each year,’’ and inserting ‘‘Each year,’’. 

15 (2) REPORTING REQUIREMENTS.—Sections 

16 2803(a) and 2804(a) of title 39, United States Code, 

17 are amended by striking ‘‘2401(g)’’ and inserting 

18 ‘‘2401(e)’’. 

19 (e) AUTHORITY TO FIX RATES AND CLASSES GEN20 ERALLY; REQUIREMENT RELATING TO LETTERS SEALED

21 AGAINST INSPECTION.—Section 404 of title 39, United 

22 States Code (as amended by section 102) is further amended 

23 by redesignating subsections (b) and (c) as subsections (d) 

24 and (e), respectively, and by inserting after subsection (a) 

25 the following: 
127 

•HR 4341 RH 

1 ‘‘(b) Except as otherwise provided, the Governors are 

2 authorized to establish reasonable and equitable classes of 

3 mail and reasonable and equitable rates of postage and fees 

4 for postal services in accordance with the provisions of 

5 chapter 36. Postal rates and fees shall be reasonable and 

6 equitable and sufficient to enable the Postal Service, under 

7 best practices of honest, efficient, and economical manage8 ment, to maintain and continue the development of postal 

9 services of the kind and quality adapted to the needs of the 

10 United States. 

11 ‘‘(c) The Postal Service shall maintain one or more 

12 classes of mail for the transmission of letters sealed against 

13 inspection. The rate for each such class shall be uniform 

14 throughout the United States, its territories, and posses15 sions. One such class shall provide for the most expeditious 

16 handling and transportation afforded mail matter by the 

17 Postal Service. No letter of such a class of domestic origin 

18 shall be opened except under authority of a search warrant 

19 authorized by law, or by an officer or employee of the Postal 

20 Service for the sole purpose of determining an address at 

21 which the letter can be delivered, or pursuant to the author22 ization of the addressee.’’. 

23 (f) LIMITATIONS.—Section 3684 of title 39, United 

24 States Code, is amended by striking all that follows ‘‘any 

25 provision’’ and inserting ‘‘of this title.’’. 
128 

•HR 4341 RH 

1 (g) MISCELLANEOUS.—Title 39, United States Code, 

2 is amended— 

3 (1) in section 1005(d)(2)— 

4 (A) by striking ‘‘subsection (g) of section 

5 5532,’’; and 

6 (B) by striking ‘‘8344,’’ and inserting 

7 ‘‘8344’’; 

8 (2) in the analysis for part III, by striking the 

9 item relating to chapter 28 and inserting the fol10 lowing: 

‘‘28. Strategic Planning and Performance Management .............................. 2801’’; 

11 (3) in section 3005(a)— 

12 (A) in the matter before paragraph (1), by 

13 striking all that follows ‘‘nonmailable’’ and pre14 cedes ‘‘(h),’’ and inserting ‘‘under section 

15 3001(d),’’; and 

16 (B) in the sentence following paragraph (3), 

17 by striking all that follows ‘‘nonmailable’’ and 

18 precedes ‘‘(h),’’ and inserting ‘‘under such section 

19 3001(d),’’; 

20 (4) in section 3210(a)(6)(C), by striking the 

21 matter after ‘‘if such mass mailing’’ and before ‘‘than 

22 60 days’’ and inserting ‘‘is postmarked fewer’’; and 

23 (5) by striking the heading for section 3627 and 

24 inserting the following: 
129 

•HR 4341 RH 

1 ‘‘§ 3627. Adjusting free rates’’. 

2 TITLE IX—POSTAL PENSION 

3 FUNDING REFORM AMEND4 MENTS 

5 SEC. 901. CIVIL SERVICE RETIREMENT SYSTEM. 

6 (a) TERMINATION OF OBLIGATION TO PAY GOVERN7 MENT CONTRIBUTIONS.—Section 8334(a)(1)(B)(ii) of title 

8 5, United States Code, is amended by striking all that fol9 lows ‘‘be equal to’’ and inserting ‘‘zero’’. 

10 (b) DETERMINATION AND DISPOSITION OF POSTAL

11 SURPLUS OR SUPPLEMENTAL LIABILITY.—Section 8348(h) 

12 of title 5, United States Code, is amended to read as follows: 

13 ‘‘(h)(1) For purposes of this subsection, the ‘Postal sur14 plus or supplemental liability’ means the estimated dif15 ference, as determined by the Office, between— 

16 ‘‘(A) the actuarial present value of all future 

17 benefits which are payable from the Fund under this 

18 subchapter to current or former employees of the 

19 United States Postal Service, or their survivors, and 

20 attributable to civilian employment with the Postal 

21 Service, and 

22 ‘‘(B) the sum of— 

23 ‘‘(i) the actuarial present value of deduc24 tions to be withheld from the future basic pay of 

25 employees of the Postal Service currently subject 

26 to this subchapter pursuant to section 8334; 
130 

•HR 4341 RH 

1 ‘‘(ii) that portion of the Fund balance, as of 

2 the date the Postal surplus or supplemental li3 ability is determined, attributable to payments 

4 to the Fund by the Postal Service and its em5 ployees, plus the earnings on such amounts while 

6 in the Fund; and 

7 ‘‘(iii) any other appropriate amount, as de8 termined by the Office in accordance with gen9 erally accepted actuarial practices and prin10 ciples. 

11 ‘‘(2)(A)(i) Not later than June 15, 2006, the Office 

12 shall determine the Postal surplus or supplemental liability 

13 as of September 30, 2005. 

14 ‘‘(ii) If a supplemental liability is determined under 

15 this subparagraph for fiscal year 2005, the Office shall es16 tablish an amortization schedule, including a series of equal 

17 annual installments commencing September 30, 2006, 

18 which provides for the liquidation of such liability by Sep19 tember 30, 2043. 

20 ‘‘(iii) If a surplus is determined under this subpara21 graph for fiscal year 2005, the amount of the surplus shall 

22 be transferred to the Postal Service Retiree Health Benefits 

23 Fund by June 30, 2006. 

24 ‘‘(B)(i) For each of fiscal years 2006 through 2038, 

25 the Office shall determine the Postal surplus or supple-
131 

•HR 4341 RH 

1 mental liability as of the close of such fiscal year, with each 

2 such determination to be made by June 15th of the following 

3 fiscal year. 

4 ‘‘(ii) If a supplemental liability is determined under 

5 this subparagraph for a fiscal year, the Office shall establish 

6 an amortization schedule, including a series of equal an7 nual installments commencing on September 30 of the fol8 lowing fiscal year, which provides for the liquidation of 

9 such liability by September 30, 2043. 

10 ‘‘(iii)(I) If a surplus of $500,000,000 or more is deter11 mined under this subparagraph for a fiscal year, the 

12 amount of the surplus shall be transferred to the Postal 

13 Service Retiree Health Benefits Fund by June 30th of the 

14 following fiscal year. 

15 ‘‘(II) If a surplus of less than $500,000,000 is deter16 mined under this subparagraph for a fiscal year, the sur17 plus shall remain in the Fund, subject to transfer in a sub18 sequent fiscal year under subclause (I) or subparagraph 

19 (C)(iii). 

20 ‘‘(C)(i) Not later than June 15, 2040, the Office shall 

21 determine the Postal surplus or supplemental liability as 

22 of September 30, 2039. 

23 ‘‘(ii) If a supplemental liability is determined under 

24 this subparagraph for fiscal year 2039, the Office shall es25 tablish an amortization schedule, including a series of equal 
132 

•HR 4341 RH 

1 annual installments commencing September 30, 2040, 

2 which provides for the liquidation of such liability by Sep3 tember 30, 2043. 

4 ‘‘(iii) If a surplus is determined under this subpara5 graph for fiscal year 2039, the amount of the surplus— 

6 ‘‘(I) shall be applied first toward reducing the 

7 amount of any supplemental liability described in 

8 section 8423(b)(1)(B); and 

9 ‘‘(II) to the extent that any portion of such sur10 plus remains after the application of subclause (I), 

11 shall, not later than June 30, 2040, be transferred to 

12 the Postal Service Retiree Health Benefits Fund. 

13 ‘‘(D) An amortization schedule under this para14 graph— 

15 ‘‘(i) shall be established in accordance with gen16 erally accepted actuarial practices and principles, 

17 with interest computed at the rate used in the most 

18 recent valuation of the Civil Service Retirement Sys19 tem; 

20 ‘‘(ii) shall supersede any amortization schedule 

21 previously established under this paragraph; and 

22 ‘‘(iii) shall not be taken into account, for pur23 poses of any determination of Postal surplus or sup24 plemental liability, except to the extent of any 

25 amounts under such schedule actually paid. 
133 

•HR 4341 RH 

1 ‘‘(E) The Postal Service shall pay to the Office the 

2 amounts due under any amortization schedule established 

3 under this paragraph that has not been superseded. 

4 ‘‘(3) Notwithstanding any other provision of law, in 

5 computing the amount of any payment under any other 

6 subsection of this section that is based on the amount of 

7 the unfunded liability, such payment shall be computed dis8 regarding that portion of the unfunded liability that the 

9 Office determines will be liquidated by payments under this 

10 subsection. 

11 ‘‘(4) As used in this subsection, ‘Postal Service Retiree 

12 Health Benefits Fund’ refers to the Postal Service Retiree 

13 Health Benefits Fund, as established by section 8909a.’’. 

14 (c) PROVISIONS RELATING TO AMOUNTS FOR MILI15 TARY SERVICE.—In the application of paragraph (2) of sec16 tion 8348(g) of title 5, United States Code, for fiscal year 

17 2006, the Office of Personnel Management shall include, in 

18 addition to the amount otherwise computed under that 

19 paragraph, the amounts that would have been included for 

20 fiscal years 2003 through 2005 with respect to credit for 

21 military service of former employees of the United States 

22 Postal Service if Public Law 108–18 had not been enacted 

23 (including earnings thereon) and the Secretary of the Treas24 ury shall make the required transfer to the Civil Service 

25 Retirement and Disability Fund based on that amount. 
134 

•HR 4341 RH 

1 (d) REVIEW.— 

2 (1) IN GENERAL.—Notwithstanding any other 

3 provision of this section, any determination or rede4 termination made by the Office of Personnel Manage5 ment under this section shall, upon request of the 

6 United States Postal Service, be subject to review by 

7 the Postal Regulatory Commission. The Commission 

8 shall submit a report containing the results of any 

9 such review to the Postal Service, the Office of Per10 sonnel Management, and the Congress. 

11 (2) RESPONSE.—Upon receiving the report of the 

12 Postal Regulatory Commission, the Office of Per13 sonnel Management shall reconsider its determination 

14 or redetermination in light of such report, and shall 

15 make any appropriate adjustments. The Office shall 

16 submit a report containing the results of its reconsid17 eration to the Commission, the Postal Service, and the 

18 Congress. 

19 SEC. 902. HEALTH INSURANCE. 

20 (a) IN GENERAL.—Chapter 89 of title 5, United States 

21 Code, is amended— 

22 (1) in section 8906(g)(2)(A), by striking ‘‘by the 

23 United States Postal Service.’’ and inserting ‘‘first 

24 from the Postal Service Retiree Health Benefits Fund 

25 up to the amount contained therein, with any re-
135 

•HR 4341 RH 

1 maining amount paid by the United States Postal 

2 Service.’’; 

3 (2) by inserting after section 8909 the following: 

4 ‘‘§ 8909a. Postal Service Retiree Health Benefits Fund 

5 ‘‘(a) There is in the Treasury of the United States a 

6 Postal Service Retiree Health Benefits Fund (hereinafter in 

7 this section referred to as the ‘Fund’) which is administered 

8 by the Office of Personnel Management. Any amounts 

9 transferred to the Fund under section 8348(h)(2) shall yield 

10 interest at a rate equal to the weighted average yield of all 

11 the investments in the Civil Service Retirement and Dis12 ability Fund as of the date of transfer. All other investments 

13 of amounts in the Fund shall be made in accordance with 

14 subsections (c)–(e) of section 8348. 

15 ‘‘(b) The Fund is available without fiscal year limita16 tion for payments required by section 8906(g)(2). 

17 ‘‘(c)(1) Not later than June 30, 2006, and by June 

18 30 of each succeeding year, the Office of Personnel Manage19 ment shall compute the net present value of the excess of 

20 future payments required by section 8906(g)(2)(A) for cur21 rent and future United States Postal Service annuitants 

22 over the value of the assets of the Fund as of the end of 

23 the fiscal year ending on September 30 of that year. The 

24 actuarial costing method to be used by the Office and all 

25 actuarial assumptions shall be established by the Office 
136 

•HR 4341 RH 

1 after consultation with the United States Postal Service and 

2 must be in accordance with generally accepted actuarial 

3 practices and principles. 

4 ‘‘(2) Not later than September 30, 2006, and by Sep5 tember 30 of each succeeding year, the Office shall compute 

6 and the United States Postal Service shall pay into such 

7 Fund— 

8 ‘‘(A) the portion of the net present value de9 scribed in paragraph (1) attributable to the current 

10 year’s service of Postal Service employees; and 

11 ‘‘(B) interest on the net present value described 

12 in paragraph (1) for that fiscal year, at the interest 

13 rate used in computing that net present value. 

14 ‘‘(3)(A) Any computation or other determination of the 

15 Office under this subsection shall, upon request of the Postal 

16 Service, be subject to review by the Postal Regulatory Com17 mission. The Commission shall submit a report containing 

18 the results of any such review to the Postal Service, the Of19 fice of Personnel Management, and the Congress. 

20 ‘‘(B) Upon receiving the report of the Postal Regu21 latory Commission, the Office of Personnel Management 

22 shall reconsider its computation or other determination in 

23 light of such report, and shall make any appropriate adjust24 ments. The Office shall submit a report containing the re-
137 

•HR 4341 RH 

1 sults of its reconsideration to the Commission, the Postal 

2 Service, and the Congress. 

3 ‘‘(4) The Office shall promulgate, after consultation 

4 with the United States Postal Service, any regulations it 

5 deems necessary under this subsection.’’; and 

6 (3) in the analysis by inserting after the item re7 lating to section 8909 the following: 

‘‘8909a. Postal Service Retiree Health Benefits Fund.’’. 

8 (b) REVIEW.— 

9 (1) IN GENERAL.—Any regulation established 

10 under section 8909a(c)(4) of title 5, United States 

11 Code (as amended by subsection (a)) shall, upon re12 quest of the Postal Service, be subject to review by the 

13 Postal Regulatory Commission. The Commission shall 

14 submit a report containing the results of any such re15 view to the Postal Service, the Office of Personnel 

16 Management, and the Congress. 

17 (2) RESPONSE.—Upon receiving the report of the 

18 Postal Regulatory Commission, the Office of Per19 sonnel Management shall reconsider its regulation in 

20 light of such report, and shall take such action as it 

21 considers appropriate. The Office shall submit a re22 port containing the results of its reconsideration to 

23 the Commission, the Postal Service, and the Congress. 

24 SEC. 903. REPEALER. 

25 Section 3 of Public Law 108–18 is repealed. 
138 

•HR 4341 RH 

1 SEC. 904. ENSURING APPROPRIATE USE OF ESCROW AND 

2 MILITARY SAVINGS. 

3 (a) DEFINITION.—For purposes of this section, the 

4 term ‘‘total savings’’ means, for any fiscal year, the amount 

5 equal to— 

6 (1) the amount of contributions that the Postal 

7 Service would otherwise have been required to make 

8 to the Civil Service Retirement and Disability Fund 

9 under subchapter III of chapter 83 of title 5, United 

10 States Code, for such fiscal year if Public Law 108– 

11 18 and this Act had not been enacted, minus 

12 (2) the amount of amortization payments (if 

13 any) required under section 8348(h)(2) of title 5, 

14 United States Code, for such fiscal year. 

15 (b) CALCULATIONS.—The following calculations shall 

16 be made for each of fiscal years 2006 through 2015: 

17 (1) Not later than January 31 of the fiscal year 

18 following the fiscal year involved, the Office of Per19 sonnel Management (in consultation with the Postal 

20 Service) shall determine the total savings for the fiscal 

21 year. 

22 (2) On the date of making its determination 

23 under paragraph (1), the Office shall also determine 

24 (in consultation with the Postal Service) the amount 

25 by which— 
139 

•HR 4341 RH 

1 (A) the amount the Postal Service paid for 

2 that fiscal year into the Postal Service Retiree 

3 Health Benefits Fund in accordance with 

4 8909a(c)(2) of title 5, United States Code, ex5 ceeds (if at all) 

6 (B) the amount of payments made by the 

7 Postal Service for that fiscal year from such 

8 Fund in order to satisfy the requirements of sec9 tion 8906(g)(2) of such title 5. 

10 (c) REQUIREMENTS.— 

11 (1) IF THRESHOLD IS MET.—If the amount cal12 culated under subsection (b)(2) for a fiscal year is 

13 greater than or equal to two-thirds of the total savings 

14 in such fiscal year, no further action under this sec15 tion is necessary with respect to such fiscal year. 

16 (2) IF THRESHOLD IS NOT MET.— 

17 (A) IN GENERAL.—If the amount calculated 

18 under subsection (b)(2) for a fiscal year is less 

19 than two-thirds of the total savings in such fiscal 

20 year, the Postal Service shall pay into the Postal 

21 Service Retiree Health Benefits Fund, by June 

22 30 of the following fiscal year, an amount equal 

23 to the difference. 

24 (B) ALLOWABLE ALTERNATIVE.— 
140 

•HR 4341 RH 

1 (i) IN GENERAL.—Notwithstanding 

2 subparagraph (A), and subject to clause (ii), 

3 the Postal Service may instead use the 

4 amount that it would otherwise be required 

5 to pay into the Postal Service Retiree 

6 Health Benefits Fund for a year (or any 

7 portion thereof) to reduce the postal debt. 

8 (ii) LIMITATION.—Amounts used to re9 duce the postal debt under this subpara10 graph may not exceed a total of 

11 $3,000,000,000. 

12 (3) AGGREGATION ALLOWED.—Notwithstanding 

13 paragraph (2), if the amount calculated under sub14 section (b)(2) for a fiscal year is less than two-thirds 

15 of the total savings in such fiscal year, but the sum 

16 of the amounts calculated under subsection (b)(2) for 

17 all fiscal years from 2006 to the fiscal year involved 

18 is greater than or equal to two-thirds of the sum of 

19 the total savings for such years, no further action 

20 under this section is necessary with respect to such 

21 fiscal year. 

22 (d) REPORTING REQUIREMENT.—The Office of Per23 sonnel Management shall submit a report containing the 

24 results of its calculations under subsection (b) to the Postal 
141 

•HR 4341 RH 

1 Service, the Postal Regulatory Commission, and the Con2 gress. 

3 (e) WAIVER AUTHORITY.—The requirements of sub4 section (c)(2)(A) may, upon application of the Postal Serv5 ice, be waived by the Postal Regulatory Commission, to the 

6 extent that the Commission determines that such waiver is 

7 reasonable and equitable and necessary to enable the Postal 

8 Service, under best practices of honest, efficient, and eco9 nomical management, to maintain and continue the devel10 opment of postal services of the kind and quality adapted 

11 to the needs of the United States. 

12 SEC. 905. EFFECTIVE DATES. 

13 (a) IN GENERAL.—Except as otherwise provided, this 

14 title shall take effect on October 1, 2005. 

15 (b) GOVERNMENT CONTRIBUTIONS.—Section 901(a)(1) 

16 shall take effect on the first day of the first pay period be17 ginning on or after October 1, 2005. 
Union Calendar No. 427 

108TH CONGRESS 

2D SESSION H. R. 4341 

[Report No. 108–672, Parts I and II] 

A BILL 

To reform the postal laws of the United States. 

SEPTEMBER 23, 2004 

Reported by the Committee on the Judiciary with an 

printed House on the State of the Union, and ordered to be amendment, committed to the Committee of the Whole