The House passed its bill in July, but a veto threat has stymied the bill as White House aides push lawmakers to eliminate provisions that were part of both the Senate and House bills. Senate conferees were appointed last February, just after that chamber passed the legislation.
Under debate is language that would shift to the Treasury Department the cost of funding pension benefits relating to military service of postal workers. That move would add nearly $27 billion to the federal deficit.
Both bills also would grant the Postal Service access to a growing escrow fund to pay for employee health benefits and operating cost for the agency. The White House contends the escrow should be used strictly to fund future health benefits.
But the two proposals have wide support in Congress. "We think veterans' pensions should not be handed on to post ratepayers," House Government Reform Committee Chairman Tom Davis, R-Va., said last week. It is widely considered that the Postal Service would have to increase rates to cover the costs of the veteran's pension liability.
Senate Homeland Security and Governmental Affairs Chairwoman Susan Collins, R-Maine, pointed out that "even the president's own commission on the USPS supports the return of the military obligation to the Department of Treasury."
Davis said the recent administration staffing changes have stalled the discussions between the Senate conferees, House members and White House staff. "We have a third party to consider, and that's the White House," Davis said.
The Postal Service supports shifting the veterans' pension liability to Treasury and has also lobbied to gain access to its escrow fund. But an issue for the Postal Service is a provision in both the House and Senate versions that imposes a rate cap -- a first for the agency.
Under both versions, a newly formed Postal Regulatory Commission would review rate increase requests. Mailers closely tracking the legislation predict the new commission would be a stronger regulator than the agency's existing Postal Rate Commission, said Ben Cooper, who represents direct mailers at Williams & Jensen.
Cooper said a fixed rate cap would allow mailers to predict their annual postal costs, which he said is an "appropriate incentive to keep people in the system."