The path to postal reform continues to be a bumpy one. The vote on S. 662, the sister bill to the Postal Accountability and Enhancement Act (H.R. 22) passed by Congress in July, has been held up by a dispute over “fair and equitable” mail rates. Sen. Kit Bond (R-MO) has placed a hold on the bill, charging that S. 662 requires language that would allows mailers to challenge prices for first-class mail if they feel the rates are not “fair and equitable.”
Bond’s provision is backed by Kansas City, MO-based greeting cards giant Hallmark Cards and other entities that want to keep first-class postal rates down. He argues that it would protect first-class mailers from higher postal rate hikes to subsidize discounts for large bulk mailers.
Opposing Bond is Sen. Susan Collins (R-ME), who contends that Bond’s language would reduce the flexibility of the Postal Service to set its own rates. Collins represents the interests of large mailers such as L.L. Bean, the Freeport, ME-based apparel and home merchant. Bean and other catalogers that use standard mail want the Postal Service to be able to set rates that allow for market dynamics.
For its part, the USPS sides with Collins, believing that a rate-making process that doesn’t adjust to a changing environment would put the Postal Service in a bad spot moving forward, says Thomas Day, the agency’s senior vice president of government relations. “We are looking for a rate making process that allows for ease of use,” he says. “We need flexibility that will allow us to stay up-to-date with the current market place. As it is, right now we’re dealing with a rate system that was first established back in 1970.”
Day says that the amendment Bond proposes would tie the hands of the USPS. “The prognosis for legislation would be untenable if these so called ‘fair and equitable’ rates were instituted. If the Board of Governors can’t get such amendments changed, it’s better to just to stay with the old rules,” Day says. He maintains that the USPS is self-sustaining, and fair and equitable rates would harm the entire mailing industry. New laws need to be enacted that allow for flexibility–enabling the Postal Service to set its own rates and make the best overall decisions for all mailers, not just a select few, he says.
If the dispute is not resolved, S. 662 can’t be voted on in the Senate. But Neal Denton, executive director of the Alliance of Nonprofit Mailers, believes that the stalemate will be broken soon. “Anyone who underestimates Susan Collins has not worked with her for very long,” says Denton. “I believe that she will be able to move these impediments, and a vote will happen within 15 to 30 days.”