Dear NALC e-Activist,

H.R. 22 passed the House of Representatives 440-28 and S.662 passed the Senate uaanimousBy

Postal reform has overwhelming bi-partisan support. It was crafted in a bipartisan manner by leaders in both bodies. The legslation is essential for the health of a vital part of the American economy. And it has broad support in the postal industry, including mailers, customers and postal employees.

The Senate Conference Committee Members are Collins, Stevens, Coleman, Bennet and Voinivich for the Republicans and Carper, Lieberman and Akaka for the Democrats. The Conference Committee members for the House of Representatives have not yet been named.

Major Differences and/or Issues of Concern to the NALC Between the Mouse and Senate Bills

TIER 1 ISSUES
Exigency provision (escape clause) in CPI Price Cap

The centerpiece of the legisiatlon ties future postage hikes to changes in the Consumer Price Index (CPI) However, both versions of the bill provide for "exigencies," special circumstances under which the PRC can waive the CPI cap and allow for rate hikes greater than the CPI to avoid major service disruptions. This provision is sometimes called the "escape clause."

NALC supports the House language on exigencies, which allows the PRC to waive the cap if "it is reasonable and equitable and necessary."

NALC opposes the Senate language, which requlres "unexpected and extraordinary"circumstances to waive - the CPI limit, which the Senate staff has defined as events such as 9/11 and the anthrax attacks.

NALC believes the Senate language is too restrictive and would force the USPS to impose job and service cuts in the face of external shocks like the energy price shocks of 2005 or acts of Congress to place new burdens on the USPS (for example, the nilitary pension costs of the CSRS funding reform law in 2003 or the deficit reduction acts of the 1980s and 1990s).

Banking of unused rate-hiking authority

The Senate bill includes a "banlang" provision, which gves the USPS flexibility in pricing by allowing it to save unused price-hilung authority for later use. For example, if the CPI increased by 3.0 percent and the USPS raised rates by 2.0 percent in a year, ir could save the unused 1.0 percent increase allowed under the CPI for up to five years. Use of "banked" prior-year authority would be subject to annual limit of 2.0 percentage points - thus, postage rates for any class or service could never rise by more than two percentage points above general inflation in any given year.

The House bill does not include a "banking" provision. It would force the USPS into a "use it or lose it" situation each year and make price hikes automatic, even when economic conditions don't warrant it.

NALC believes the final bill must include the Senate banking provision. The language of the provision was developed through painstaking discussions between all the major stakeholders and the Senate staff. The employee groups, the Postal Service and the major mailers support the Senate banlang provision.

The Legislation's Escrow and Military Pension Provisions Must be Retained in Final Legislation

Both H.R. 22 and S. 662 repeal the escrow requirement contained in the CSRS funding reform law of 2003 (P.L. 101-1 8) and reverse that law's unfair transfer of $27 billion in military pension obligations from the Treasury to the Postal Senice. Both bills require the USPS to use most of the escrow savings to pre-fund postal retiree health benefits, though they use different funding formulas, and both bills require the U.S. Treasury to pay for military pension benefits ezmed by soldiers who later became postal employees - not the Postal Service.

In the event that changes are made in the allocation of the military service obligation between the USPS and the Treasury, the continued support of the NALC for the legislation will be contingent on acomparable reduction in USPS obligations to pre-fund retiree health benefits.

The Bush administration argues that the USPS should pay for CSRS pension benefits earned by postal empioyees when they were in the military. But no other federal agency is required to do this.

The Bush administration argues that all agencies, including the USPS, pay for military benefits earned by their employees covered by FERS.. But the USPS is different; it is funded by postal rate payers while other agencies are funded by taxpayers. Taxpayers not ratepayers should pay for all military costs.

Military pensions should be the responsibility of all American citizens since military service benefits all Americans. Transferring military costs to the postage rate payers is a stamp tax and is unfair.

TIER 2 ISSUES

Worker's Compensation

The Senate bill includes a postal-only reform of the Worker's Compensation (FECA) program that would add a three-day waiting period before injured postal employees could start FECA benefits and force injured postal employees who reach ordinary retirement age to give up FECA benefits in favor of lesser benefits under CSRS or FERS. The House bill does not have an OWCP provision.

NALC opposes the Senate FECA provision since it would result in lost pay or the forced use of annual leave by injured workers and punish injured workers whose regular retirement benefits are reduced due to their injuries (injured workers can't contribute to the TSP).

NALC believes any FECA reform should be enacted to apply to all federal employees, not just postal employees. Senator Akaka has been extremely vocal on his opposition to tkiis unfair provision as well

Single Piece Parcel

Both bills classify services as either market-dominant or competitive products. The House bill classifies single piece parcels as competitive products. The Senate bill treats this category of parcels as a market dominant product.

NALC supports the Senate language on single piece parcels. Such parcels are typically sent to and from households and are a crucial component of universal service. Treating single piece parcels as competitive products would dramatically increase their rates and unduly harm average citizens who rely on affordable service from the USPS.

Coupled with the major restructuring of the union's grassroots legislative program is a determination to return NALC's political action committeq-the Committee on Letter Carriers Political Education (C0LCPE)-to the top ranks of PACs in America.

President Young, alluding to several notorious Washington scandals-many which are still being investigated-told the state chairs February 2 that there will always be dirty money in American politics.

"What we need is clean money to combat it," he said. "That's where the labor movement and their PACs and the NALC and COLCPE come in."
"We need COLCPE to help elect Members of Congress from both parties who will stand up for working people like the hard-working letter carriers we represent," he said. "Elections are expensive and if we don't raise money to elect a pre-union Congress, we will simply cede our democracy to the corporate interests and unscrupulous ideologues who will always find a way to funnel money to politicians willing to do their bidding."

Young noted that 20 years ago, COLCPE routinely ranked in the top 10 PACs in the country. But it has not kept pace and last year, COLCPE ranked 37th among the country's PACs sponsored by United Parcel Service, FedEx and even the APWU, are now much bigger than COLCPE.

"I want to change that," Young said. "I want the NALC to be the largest PAC in the postal industry. I want to match our leadership in the legiqlative arena with leadership in the political arena. And I want to return to the Top 10 PACs in America."

So how will we raise more funds for COLCPE?
Young said the key will be to enlist more members to give to COLCPE through automatic deductions from their paychecks or their bank accounts. (At present, about three percent of NALC members make such automatic contributions.) To do that, Young said two important steps will be taken.
Every branch president with at least 50 members will be asked to appoint a COLCPE coordinator to work with state chairs and the national office on enlisting carriers to sign up for automatic contribution deductions.
A new campaign will be launched called the "Gimme 5 for COLCPE" campaign, asking members to do what 5,000+ active carriers already do: give an average of $5 per pay period to COLCPE through payroll deductions.

"That's just 50 cents per day, far less than the cost of a cup of fancy coffee at Starbucks that many of our members stop for routinely each day," Young noted. The union plans to utilize its publications, web site and direct mail to spread the 'Gimme 5' message. Resident national officers and NBAs will take the message to the field throughout the year and the Regional- Field Coordinators will integrate 'Gimme 5' in training at state conventions and regional training events.

Carriers who sign up will receive a special lapel pin to wear to show their commitment to protecting our jobs and benefits. At the National Convention in Las Vegas, carriers who are signed up for automatic contributions will receive a special T-shirt to wear on "COLCPE Day" at the convention.

The Senate on February 9 passed S. 662, the Postal Accountability and Enhancement Act and moved postal reform legislation on to a critical House-Senate conference committee to work out differences with the House-passed version needed before final congressional approval.

The Senate action came on a unanimous consent request by Senate Republican leader Bill Frist of Tennessee that enabled passage to occur without lengthy floor debate. It followed decisions by GOP Sens. Jeff Sessions of Alabama and Jim DeMint of South Carolina to lift the "hold" each had placed on the bill in the aftermath of a vehement campaign by Postal Service Board of Governors Chairman James Miller to block passage.

The House last summer had passed H.R. 22 by a 410-20 vote. NALC President William H. Young applauded that Senate action, but warned that the battle is not over yet.

'Important Step'
"I am very pleased that the Senate has now joined the House in approving much overdue postal reform legislation," Young said. "This is an important stepone that hopefully will lead to speedy action by the House-Senate conference toattain final language for the president's signature."
"Our work is not finished," Young emphasized.
"This union will work with the conferees so that the legislation enacted into law not only will protect the collective bargaining rights of the men and women we represent, but also will ensure efficient, universal mail delivery to all Americans for decades to come, coupled with marketing and pricing flexibility to enable the Postal Service to compete successfully in the Internet Age," Young said. Young singled out for praise Senate Government Affairs Chair Susan Collins (R-ME) and Sen. Tom Carper (D-DE), citing their diligence in pressing their colleagues for passage against the limited, but vocal, efforts by further delay floor action.

"Senators Collins and Carper are champions to the millions of people who rely on the U.S. mail everyday and will continue to do so for the foreseeable future," Young said.

Protects Bargaining
The bill would preserve six-day delivery and universal service while protecting postal employees' collective bargaining rights. It would also repeal the Postal Service's obligation to make a $3.3 billion per year contribution to an escrow account and also reverse the unfair allocation of military pension costs to the USPS.

In a message to NALC e-Activists, President Young cited some concerns that must be worked out. including an "exigency" clause covering when USPS can raise postage rates more than the rate of inflation. The NALC supports the Housepassed language.

"We must be diligent and stay vigilant to make sure that this legislation does the most it can to protect our jobs," Young said.

The U.S. House of Representatives took a giant step towards enacting comprehensive postal reform yesterday while rejecting a number of negative amendments that NALC and its coalition of mailers and employee groups opposed. Tuesday night the House passed H.R. 22, the Postal Accountability and Enhancement Act of 2005, by a vote of 410 to 20. The House defeated amendments that would have allowed privatization pilot tests, eliminated the planned labor seat on the USPS Board of Governors, and saddled the USPS with the cost of military pension benefits, and the Pence-McHenry Amendment to slash our workers' compensation benefits was withdrawn. Letter carriers across the country owe a debt of gratitude to the thousands of e-Activist who responded to the NALC's call to action early this week to oppose the workers' compensation amendment. Thank you for your dedication and quick action.

The lopsided vote in favor of postal reform, which is intended to secure the long-term viability of the Postal Service in the Internet Age, is only the first step. We have a lot of work to do to move reform through the U.S. Senate after the August congressional recess and to both improve the bills and protect against any negative amendments when the bills go to a House-Senate conference committee. Based on the performance of our e-Activist network this week, I am confident that we can do whatever it takes to achieve our legislative goals.

If your representative in Congress is not among the members listed below who voted against H.R. 22, please take the time to call (202-224-3121) or e-mail him or her (http://www.house.gov/writerep/) to thank them for supporting postal reform. If your representative is one of the 20 who voted against the bill, contact him or her at the same phone number and ask why he or she voted "no."

Thanks again for your efforts on behalf of all the nation's letter carriers.

In Solidarity,
William H. Young
President

Members of Congress who voted WRONG on H.R. 22
Jeff Flake, AZ-6th
Trent Franks, AZ-2nd
John Shadegg, AZ-3rd
Ed Royce, CA-40th
Marlin Musgrave, CO-4th
Tom Feeney, FL-24th
Dave Weldon, FL-15th
Jim Nussle, IA-1st
Butch Otter, ID-1st
Chris Chocola, IN-2nd
Mike Pence, IN-6th
Todd Akin, MO-2nd
Ernest Istook, OK-5th
Gresham Barrett, SC-3rd
John Culberson, TX-7th
Louie Gohmert, TX-1st
Jeb Hensarling, TX-5th
Sam Johnson, TX-3rd
Ron Paul, TX-14th
Jo Ann Davis, VA-1st

Today Congress returns to Washington after the Memorial Day recess and postal reform is firmly on the agenda in both chambers. House Majority Leader Tom Delay (R-TX) recently announced that H.R. 22, the House version of the Postal Accountability and Enhancement Act of 2005, would be scheduled for floor debate before the July 4th recess. That debate could come as early as June 14th. At the same time, we have learned that the Senate Homeland Security and Governmental Affairs Committee expects to mark-up S. 662, the Senate version of the bill with the same name, in June. Brothers and sisters, crunch time on postal reform is nearly here. The future of the USPS and our jobs as letter carriers will be on the line.
As we monitor the reform legislation and meet regularly with both Democrats and Republicans in the House and the Senate, we have no reason at this time to believe that H.R. 22 will be negatively amended on the floor of the House or that S. 662 will be negatively changed in the Senate committee mark-up. But we would like to improve the bills where we can and we must stay on our toes at this very crucial time to fend off any hostile amendments.
That’s where you and thousands of other e-Activists come in. I know I can count on you to respond to my requests for action in the weeks to come if we need to make our voices heard on Capitol Hill. You can get ready for action by thoroughly reading a brand-new NALC Briefing Paper on Postal Reform on the NALC web site and two related fact sheets, Price Indexing, Flexibility and Postal Collective Bargaining and Military Pension Costs and Postal Reform. This will equip you with all the arguments you will need to make on behalf of America’s letter carriers.
In terms of other preparations, NALC’s National Business Agents and State Presidents have been setting up phone banks and phone trees in strategically important branches throughout the country. When postal reform goes to the floor of the House, those of you residing in key states and legislative districts (whose members of Congress are offering either positive or negative amendments) may be contacted to volunteer your time to reach out to your fellow letter carriers to call, write or email their members of Congress and Senators to advocate the NALC’s positions and views.
I will keep you posted on the status of this legislation as we track it through the month of June. I am confident that I can count on your support and participation at this crucial time.

In unionism,

William H. Young
President