Proposed Postal Reform Acts Seek Rate Hike, Postmaster General Term Limits

Much attention has focused on the USPS SERVES US Act, which was introduced by U.S. Rep. Jake LaTurner (R-KS-2) on September 25. The proposed legislation would give the Postal Regulatory Commission (PRC) greater oversight powers over the U.S. Postal Service, especially when it comes to postal rate increases and service accountability standards.

For the past several years the Postal Service has been raising rates above the rate of inflation every six months, while at the same time lowering its delivery times. Since such a large percentage of printed mail goes through the U.S. Postal Service, it’s having a severe negative impact on the printing industry, including commercial, direct mail, and publication printers — and their customers — that send Market Dominant First-Class, Marketing Mail, and Periodicals class printed products through the mail stream.

Although the PRC approved a July 2024 postal rate hike, the PRC admitted it was not prudent, but also claimed it lacked the statutory authority to reject the USPS rate increase. As such, the new legislation would give more authority to the PRC.

PRINTING United Alliance advocated for the legislation, in conjunction with its coalition partners Keep US Posted and the Coalition for a 21^st Century Postal Service.

As PRINTING United Alliance Government Affairs Coordinator Stephanie Buka pointed out in a recent blog post, the USPS SERVES Us Act provides:

• Annual Rate Increase Limit: Limits USPS to one rate increase per year, avoiding unnecessary implementation costs and providing greater rate predictability.
• X-Factor Rate Reduction: Implements an X-factor reducing rate authority, a widely utilized tool to ensure cost discipline, if USPS productivity is not improved each year.
• Price Cap Protection: Prohibits the PRC from creating a rate system with no price cap ultimately preserving the trade-off between pricing flexibility and rate predictability.
• “Underwater Surcharge” Limitation: Caps surcharges if service performance and cost efficiency are not maintained for the relevant products.
• Volume Growth Objective: Creates a new volume encouraging objective for evaluating rate increases and requires the PRC to apply each objective for rate setting in every proceeding.
• Independent Volume Model: Requires the PRC to develop its own volume estimation model independent of the USPS.
• Service Accountability: Holds the USPS accountable for service performance by reducing rate authority if it fails to meet established service targets and makes PRC nature of service evaluations binding decisions, not just advisory opinions.
• Customer Advocate Office: Establishes an autonomous Office of Customer Advocate within the PRC, with the authority to represent customer concerns and initiate proceedings on their behalf.
• Complaint Resolution: Streamlines PRC consideration of complaints and empowers the PRC to reduce rates for affected authorities if it finds a rate is unlawful.
• Financial Health Consideration: Mandates arbitrations in USPS-Union contract disputes to consider the financial health of the USPS.
• Retirement Fund Investments: Authorizes USPS to invest retirement assets in private index funds such as those used by the Thrift Savings Fund.

Second Act Seeks Congressional Oversight, Postmaster General Term Limits

Postmaster General Louis DeJoy

Another piece of legislation has also been introduced by U.S. Sen. Jon Ossoff (D-GA). Called the Postmaster General Reform Act of 2024, it would provide greater Congressional oversight over the U.S Postmaster General (a position currently held by Louis DeJoy since 2020.)

The new Act would make the Postmaster General position subject to a Presidential appointment, with confirmation required by the U.S. Senate — a process similar to filling other administration positions. Currently, the U.S. Postal Service Board of Governors appoints a new Postmaster General, without any action by Congress.

The legislation would also create term limits for the position, with a maximum of two, five-year terms. The U.S. Senate-confirmed Postmaster General would also have to receive confirmation again before serving a second term, creating greater Congressional oversight and accountability.

If passed into law, the Act would go into effect with the next appointment of a Postmaster General, requiring a Presidential appointment and Senate confirmation.

“What we have seen in the State of Georgia over the last year has been abysmal performance by U.S. Postal Service leadership,” Sen. Ossoff said during a news conference. “ … High-quality postal service can’t be a luxury; it is a necessity, and we see the importance now of holding the Postmaster General accountable to the elected representatives of the people in the U.S. Senate.”

Sen. Ossoff has been pushing hard in recent months to make the USPS more accountable, especially in his home state of Georgia. In March, he launched an inquiry with Postmaster General DeJoy about missing and delayed mail processed through the Regional Processing and Distribution Center. In April, he questioned DeJoy under oath about the delays during a U.S. Senate Homeland Security and Government Affairs Committee hearing. In May, Ossoff launched a new inquiry seeking current on-time mail delivery statistics for the metro Atlanta area.

Then, in June, Sen. Ossoff launched an inquiry with the U.S. Postal Service Inspector General after the Fulton County (Georgia) Clerk of Courts uncovered that more than 1,100 pieces of official correspondence — including notices of hearings, court orders, and other legal documents — never reached intended recipients and had been returned by the USPS to the court marked as “return to sender.”

This culminated with Ossoff’s meeting in July with DeJoy in Washington, DC, to push for improved mail delivery service. And, in September, he filed an inquiry with the Internal Revenue Service (IRS) after receiving reports that some Georgia residents are being charged penalties and interest fees on late or missing filings and payments that they mailed to the IRS.

With a rapidly approaching election that will determine the next U.S. President and which political party will control the chambers of Congress — it appears that legislation impacting the future of the U.S. Postal Service will be a topic right in the mix.

“While the Postmaster General Reform Act of 2024 addresses the leadership of the USPS, the real solution lies in the USPS SERVES US Act (H.R. 9839),” reports Ford Bowers, CEO of PRINTING United Alliance.

“This crucial legislation, sponsored by Rep. Jake LaTurner, empowers the Postal Regulatory Commission by giving it the authority to oversee and protect the USPS, ensuring it can effectively serve the American people,” Bowers adds. “We encourage members to take action via an action alert to ask their representatives to co-sponsor the USPS SERVES US Act.”