Fate of Post Office Overhaul Is Up for Debate

By Stephen Barr
Wednesday, October 4, 2006

Sometimes it is small provisions that trip up big bills.

That was the case last week with compromise legislation that would overhaul the U.S. Postal Service. The bill's collapse also spawned differing opinions on whether it can be salvaged next month in a lame-duck session.

Rep. Thomas M. Davis III (R-Va.) is optimistic that the House and Senate will approve a postal bill. "We are going to get it done," Davis said yesterday, adding, "We are conceptually 99.9 percent of the way there."

But Sen. Susan M. Collins (R-Maine), a chief sponsor who will broker any compromise, is not as confident as Davis. "Unfortunately, at the eleventh hour, various parties raised objections to some of the bill's long-standing provisions, and these objections caused certain members of Congress to block passage of the legislation," Collins said in an e-mail yesterday from her home state.

"While I remain committed to the goal of passing the bill in the lame-duck session, I do not know if that will be possible," she wrote.

Efforts to overhaul operations of the Postal Service have been underway in Congress for a decade as big mailers have pleaded for a new rate structure that makes it easier for them to predict postage increases. The financial health of the Postal Service also has become a concern, as Americans expand their use of the Internet, e-mail and cellphones and send fewer first-class letters, an important source of revenue for the post office.

Finding a legislative solution has been a complex effort. President Bush set up a postal commission to study possible changes, and business groups and outside experts floated their ideas. Enthusiasm for an overhaul has waxed and waned at postal headquarters.

Some of the proposed changes involve multibillion-dollar budget issues, such as how to handle costs for pensions and retiree health care. The White House gave in on one of its requests -- that the Postal Service pick up the tab for military pensions earned by postal workers. Under the compromise, the military portion of postal worker pensions will be paid out of the Treasury, as happens with other agencies. The Postal Service will use the savings to fund future retiree health-care benefits.

But the bill stalled on a relatively modest provision that would require a three-day waiting period before injured postal workers could begin accruing workers' compensation benefits. Employees would be expected to use vacation or sick leave for the first three days they were out of work and would be reimbursed for that time if they were unable to return after 14 days, congressional aides said.

The president of the National Association of Letter Carriers, William H. Young , unexpectedly announced that he would not accept the bill because no one had explained to him why the change was necessary.

Union spokesman Drew Von Bergen said the proposed workers' compensation change "would put postal employees in a different classification than other federal employees."

Under current law, injured federal employees receive "continuation of pay" for up to 45 days, and if their disability continues for more than that, they can receive additional compensation for lost wages after three days in a non-paid status.

Young wrote NALC members, "for the Bush administration, it is always easier to pick on those who are less fortunate than others." He wrote, "The nation's injured letter carriers and other postal employees were an easy mark."

Collins was dismayed by Young's action, congressional aides said. The NALC had not brought up the issue in three years of negotiations on the bill and had promised to support an overhaul of postal operations, the aides said.

Collins and the White House had backed off another workers' compensation provision opposed by the union, and Collins had negotiated solutions to issues raised by large mailers and postal competitors, such as UPS.

One troublesome area -- how to regulate postage rates for certain types of mail under a cap linked to the consumer price index and also provide an escape clause for exceptional circumstances -- was resolved to the satisfaction of big mailers and unions, lobbyists said.

"We were within a quarter-inch of getting it done Friday night," Davis said at a breakfast forum sponsored by the nonprofit Council for Excellence in Government and The Washington Post.

But some administration officials and some lobbyists think the postal overhaul could be dead, not only for this year but for two or three years, if control of Congress shifts in next month's congressional elections. They also doubt that Collins and the White House will give in to the NALC.

Still, one administration official, who spoke on condition of anonymity because he participated in the discussions, noted that the bill has survived delays and attempts to kill it. "This has more lives than nine dead cats," he said.

Stephen Barr's e-mail address isbarrs@washpost.com.

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