White House postal plan missing Senate stamp of approval

Two pivotal senators are not biting at an administration proposal aimed at striking a deal on disputed provisions of postal overhaul legislation.

Senate Homeland Security and Governmental Affairs Committee Chairwoman Susan Collins, R-Maine, and Sen. Thomas Carper, D-Del., said the administration proposals also are opposed by the Postal Service.

The White House proposed allowing the agency to borrow up to $3 billion a year for the next two years, instead of giving it access to money slated for an escrow account, as provided in the legislation. The administration also proposed paying for some military pensions of postal employees while requiring the Postal Service to cover them in the future. The legislation would shift the pension payments to the Treasury Department.

Collins said she was "pleased to see the administration move on military pensions" but that "the borrowing is strongly opposed by the Postal Service." Carper shook his head when asked about the White House's proposal. "We can do better," he said. "The administration should listen to the recommendations of its own commission," which the bill would implement.

In a Statement of Administration Policy released hours before the House passed the bill on a 410-20 vote last Tuesday, the White House threatened to veto the bill if it would affect the budget adversely. The shift in the escrow account would add to the federal deficit, while the borrowing proposal would not.

The administration also reiterated its concerns about the labor language, saying the Postal Service should be given more flexibility to grant workshare discounts, which are lower rates for bulk mailers in exchange for tasks usually done by the agency. Collins, who along with Carper introduced the Senate version, said she will continue working with the White House to reach a compromise before the Senate vote.

A spokeswoman for Rep. John McHugh, R-N.Y., who sponsored the House version, said he also objected to the borrowing option but called the administration's military pensions proposal "a positive step." A spokesman for House Government Reform Committee Chairman Tom Davis, R-Va., declined to comment.

A mailing industry lobbyist said bulk mailers will tell Congress to "hang tough" on the escrow issue, though most would rather see the Postal Service borrow the money than raise rates. Still, they do not plan to urge lawmakers to accept the White House proposal.

"The administration has enough clout to lobby on their own," said one industry lobbyist.

The Postal Service filed a request in April for a 5.4 percent hike but said passage of either bill would make the increase unnecessary.

Meanwhile, aides say the differences between the House and Senate versions are not substantial enough to bog down the bill. The Senate measure includes a stronger rate cap and more restrictive language on workers compensation. The administration is pushing the Senate provisions, although the American Postal Workers Union, the largest of four unions backing the bill, prefers the House language (HR 22).

But "the major differences aren't between the House and Senate," McHugh's spokeswoman said. "The biggest challenge is going to be reconciling the bills with the administration. ... It's going to be tough, but we'll work it though it."

Carper said he expected to see the bill go to the Senate floor this fall. Collins, who has been meeting with Senate Budget Committee Chairman Judd Gregg, R-N.H., on the legislation's budget impact, said she was working with leadership to get a date for a floor vote.

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