‘‘(1) REQUIREMENTS.—For each group of func-
tionally equivalent agreements between the Postal 
Service and users of the mail, whether such group 
fulfilled requirements to— 
‘‘(A) cover costs attributable; and 
‘‘(B) improve the net financial position of 
the Postal Service. 
‘‘(2) NONCOMPLIANCE.—Any group of function-
ally equivalent agreements not meeting subpara-
graphs (A) and (B) of paragraph (1) shall be deter-
mined to be in noncompliance under this subsection. 
‘‘(3) DEFINITION.—For purposes of this sub-
section, a group of functionally equivalent agree-
ments shall consist of 1 or more service agreements 
that are functionally equivalent to each other within 
the same market-dominant or competitive product, 
but shall not include agreements within an experi-
mental product.’’. 
(B) 
TECHNICAL
AMENDMENT.—Section 
3653(d) of title 39, United States Code (as re-
designated by subparagraph (A)), is amended 
by striking ‘‘subsections (c) and (e)’’ and in-
serting ‘‘subsections (c) and (d)’’. 
SEC. 204. NONPOSTAL SERVICES. 
(a) NONPOSTAL SERVICES.— 
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(1) IN GENERAL.—Part IV of title 39, United 
States Code, is amended by adding after chapter 36 
the following: 
‘‘CHAPTER 37—NONPOSTAL SERVICES 
‘‘Sec. 
‘‘3701. Purpose. 
‘‘3702. Definitions. 
‘‘3703. Postal Service program for State governments. 
‘‘3704. Postal Service program for other Government agencies. 
‘‘3705. Transparency and accountability for nonpostal services. 
‘‘§ 3701. Purpose 
‘‘The purpose of this chapter is to enable the Postal 
Service to increase its net revenues through specific non-
postal products and services that are expressly authorized 
by this chapter. Postal Service revenues and expenses 
under this chapter shall be funded through the Postal 
Service Fund. 
‘‘§ 3702. Definitions 
‘‘In this chapter— 
‘‘(1) the term ‘nonpostal services’ is limited to 
services offered by the Postal Service that are ex-
pressly authorized by this chapter and are not postal 
products or services; 
‘‘(2) the term ‘attributable costs’ has the mean-
ing given such term in section 3631; and 
‘‘(3) the term ‘year’ means a fiscal year. 
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‘‘§ 3703. Postal Service program for State govern-
ments 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of this title, the Postal Service may establish a pro-
gram to enter into agreements with an agency of any State 
government, local government, or tribal government to 
provide property and services on behalf of such agencies 
for non-commercial products and services, but only if such 
property and services— 
‘‘(1) provide enhanced value to the public, such 
as by lowering the cost or raising the quality of such 
services or by making such services more accessible; 
‘‘(2) do not interfere with or detract from the 
value of postal services, including— 
‘‘(A) the cost and efficiency of postal serv-
ices; and 
‘‘(B) unreasonably restricting access to 
postal retail service, such as customer waiting 
time and access to parking; and 
‘‘(3) provide a reasonable contribution to the in-
stitutional costs of the Postal Service, defined as re-
imbursement that covers at least 100 percent of at-
tributable costs of all property and services provided 
under each relevant agreement in each year. 
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‘‘(b) PUBLIC NOTICE.—At least 90 days before offer-
ing a service under the program, the Postal Service shall 
make available to the public on its website— 
‘‘(1) the agreement with the agency regarding 
such service; and 
‘‘(2) a business plan that describes the specific 
service to be provided, the enhanced value to the 
public, terms of reimbursement, the estimated an-
nual reimbursement to the Postal Service, and the 
estimated percentage of attributable Postal Service 
costs that will be covered by reimbursement (with 
documentation to support the estimates). 
‘‘(c) PUBLIC COMMENT.—Before offering a service 
under the program, the Postal Service shall provide for 
a public comment period of at least 30 days that allows 
the public to post comments relating to the provision of 
such services on the Postal Service website. The Postal 
Service shall make reasonable efforts to provide written 
responses to the comments on such website at least 30 
days before offering such services. 
‘‘(d) APPROVAL REQUIRED.—The Postal Service may 
not establish the program under subsection (a) unless the 
Governors of the Postal Service approve such program by 
a recorded vote that is publicly disclosed on the Postal 
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Service website with a majority of the total Governors vot-
ing for approval. 
‘‘(e) 
APPLICATION
OF
REPORTING
REQUIRE-
MENTS.—For purposes of the reporting requirements 
under section 3705, the Postal Service shall submit a sep-
arate report for each agreement with an agency entered 
into under subsection (a) analyzing the costs, revenues, 
rates, and quality of service for the provision of all services 
under such agreement, including information dem-
onstrating that the agreement satisfies the requirements 
of paragraphs (1) through (3) of subsection (a). 
‘‘(f) REGULATIONS REQUIRED.—The Postal Regu-
latory Commission shall issue such regulations as are nec-
essary to carry out this section. 
‘‘(g) DEFINITIONS.—For the purpose of this sec-
tion— 
‘‘(1) the term ‘local government’ means a coun-
ty, municipality, city, town, township, local public 
authority, school district, special district, intrastate 
district, council of governments, or regional or inter-
state government entity; 
‘‘(2) the term ‘State government’ includes the 
government of the District of Columbia, the Com-
monwealth of Puerto Rico, the United States Virgin 
Islands, Guam, American Samoa, the Common-
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wealth of the Northern Mariana Islands, and any 
other territory or possession of the United States; 
‘‘(3) the term ‘tribal government’ means the 
government of an Indian tribe, as that term is de-
fined in section 4(e) of the Indian Self-Determina-
tion Act (25 U.S.C. 450b(e)); and 
‘‘(4) the term ‘United States’, when used in a 
geographical sense, means the States, the District of 
Columbia, the Commonwealth of Puerto Rico, the 
United States Virgin Islands, Guam, American 
Samoa, the Commonwealth of the Northern Mariana 
Islands, and any other territory or possession of the 
United States. 
‘‘(h) CONFIDENTIAL INFORMATION.—Subsection (b) 
or (c) shall not be construed as requiring the Postal Serv-
ice to disclose to the public any information— 
‘‘(1) described in section 410(c); or 
‘‘(2) exempt from public disclosure under sec-
tion 552(b) of title 5. 
‘‘§ 3704. Postal Service program for other Govern-
ment agencies 
‘‘(a) IN GENERAL.—The Postal Service may establish 
a program to provide property and services to other Gov-
ernment agencies within the meaning of section 411, but 
only if such program provides a reasonable contribution 
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‘‘(2) SUPPORTING
MATTER.—A report sub-
mitted under paragraph (1) shall include any non-
public annex, the working papers, and any other 
supporting matter of the Postal Service and the In-
spector General related to the information submitted 
in such report. 
‘‘(b) CONTENT AND FORM OF REPORT.— 
‘‘(1) IN
GENERAL.—The Postal Regulatory 
Commission shall, by regulation, prescribe the con-
tent and form of the report required under sub-
section (a). In prescribing such regulations, the 
Commission shall give due consideration to— 
‘‘(A) providing the public with timely, ade-
quate information to assess compliance; 
‘‘(B) avoiding unnecessary or unwarranted 
administrative effort and expense on the part of 
the Postal Service; and 
‘‘(C) protecting the confidentiality of infor-
mation that is commercially sensitive or is ex-
empt from public disclosure under section 
552(b) of title 5. 
‘‘(2) REVISED REQUIREMENTS.—The Commis-
sion may, on its own motion or on request of any 
interested party, initiate proceedings to improve the 
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quality, accuracy, or completeness of Postal Service 
data required by the Commission if— 
‘‘(A) the attribution of costs or revenues to 
property or services under this chapter has be-
come significantly inaccurate or can be signifi-
cantly improved; 
‘‘(B) the quality of service data provided to 
the Commission for a report under this chapter 
has become significantly inaccurate or can be 
significantly improved; or 
‘‘(C) such revisions are, in the judgment of 
the Commission, otherwise necessitated by the 
public interest. 
‘‘(c) AUDITS.—The Inspector General shall regularly 
audit the data collection systems and procedures used in 
collecting information and preparing the report required 
under subsection (a). The results of any such audit shall 
be submitted to the Postal Service and the Postal Regu-
latory Commission. 
‘‘(d) CONFIDENTIAL INFORMATION.— 
‘‘(1) IN GENERAL.—If the Postal Service deter-
mines that any document or portion of a document, 
or other matter, which it provides to the Postal Reg-
ulatory Commission in a nonpublic annex under this 
section contains information described in section 
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410(c), or exempt from public disclosure under sec-
tion 552(b) of title 5, the Postal Service shall, at the 
time of providing such matter to the Commission, 
notify the Commission of its determination, in writ-
ing, and describe with particularity the documents 
(or portions of documents) or other matter for which 
confidentiality is sought and the reasons therefor. 
‘‘(2) TREATMENT.—Any information or other 
matter described in paragraph (1) to which the 
Commission gains access under this section shall be 
subject to paragraphs (2) and (3) of section 504(g) 
in the same way as if the Commission had received 
notification with respect to such matter under sec-
tion 504(g)(1). 
‘‘(e) ANNUAL COMPLIANCE DETERMINATION.— 
‘‘(1) OPPORTUNITY FOR PUBLIC COMMENT.— 
Upon receiving a report required under subsection 
(a), the Postal Regulatory Commission shall prompt-
ly— 
‘‘(A) provide an opportunity for comment 
on such report by any interested party; and 
‘‘(B) appoint an officer of the Commission 
to represent the interests of the general public. 
‘‘(2) DETERMINATION OF COMPLIANCE OR NON-
COMPLIANCE.—Not later than 90 days after receiv-
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ing a report required under subsection (a), the Post-
al Regulatory Commission shall make a written de-
termination as to whether the nonpostal activities 
carried out during the applicable year were or were 
not in compliance with the provisions of this chapter. 
For purposes of this paragraph, any case in which 
the requirements for coverage of attributable costs 
have not been met shall be considered to be a case 
of noncompliance. If, with respect to a year, no in-
stance of noncompliance is found to have occurred, 
the determination shall be to that effect. Such deter-
mination of noncompliance shall be included with the 
annual compliance determination required under sec-
tion 3653. 
‘‘(3) NONCOMPLIANCE.—If a timely written de-
termination of noncompliance is made under para-
graph (2), the Postal Regulatory Commission shall 
take appropriate action. If the requirements for cov-
erage of attributable costs specified by this chapter 
are not met, the Commission shall, within 60 days 
after the determination, prescribe remedial action to 
restore compliance as soon as practicable, including 
the full restoration of revenue shortfalls during the 
following year. The Commission may order the Post-
al Service to discontinue a nonpostal service under 
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section 3703 that persistently fails to meet cost cov-
erage requirements. 
‘‘(4) DELIBERATE
NONCOMPLIANCE.—In the 
case of deliberate noncompliance by the Postal Serv-
ice with the requirements of this chapter, the Postal 
Regulatory Commission may order, based on the na-
ture, circumstances, extent, and seriousness of the 
noncompliance, a fine (in the amount specified by 
the Commission in its order) for each incidence of 
such noncompliance. All receipts from fines imposed 
under this subsection shall be deposited in the gen-
eral fund of the Treasury. 
‘‘(f) REGULATIONS REQUIRED.—The Postal Regu-
latory Commission shall issue such regulations as are nec-
essary to carry out this section.’’. 
(2) CLERICAL
AMENDMENT.—The table of 
chapters for part IV of title 39, United States Code, 
is amended by adding after the item relating to 
chapter 36 the following: 
‘‘37. Nonpostal services ................................................................... 3701’’. 
(b) CONFORMING AMENDMENTS.— 
(1) SECTION 404.—Section 404(e) of title 39, 
United States Code, is amended— 
(A) in paragraph (2), by inserting after 
‘‘subsection’’ the following: ‘‘, or any nonpostal 
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