National Rural Letter Carriers’Legislative Update

Mid States Conference 2011

Kevin P. Talley

Assistant Director of Governmental Affairs

ktalley@nrlca.org

Topics of Discussion

Politics of 112th Congress

USPS Finances

U.S. Senate

U.S. House of Representatives

PAC Totals

112th Congress

House of Representatives

241 Republicans192 Democrats

2 Vacancies

112th Congress – House of Representatives

112th Congress

U.S. Senate

51 Democrats2 Independents (D)

46 Republicans1 Vacancy

112th Congress – U.S. Senate

* Includes CSRS and FERS pension funding for postal and federal. This is calculated from the Postal Service’s 2009 Annual Report and the Notes to the 2009 Financial Statements of the United States (http://www.gao.gov/financial/fy2009financialreport.html).† S&P 500 companies.‡Watson Wyatt, Accounting for Pensions and Other Postretirement Benefits 2009. The study includes Fortune 1000 Companies that prefund, but 28 percent (for 2008) is exaggerated because 63 percent of companies do not prefund.

Fund Postal Federal Non-Postal Military Private Sector

Pension 99%* 41%* 24%* 80%†

Health Benefits 41%* 0%* 29%* 28%‡

Benchmark for Pension Standards

Gold Standard: 80% for Pensions 30% for Health

Senate Bills

Senator Carper• Modifies the methodology for

calculating the CSRS surplus, $$ can be transferred to the PSRHBF

• FERS Pension Surplus $$ Returned• Arbitrator language to consider:

– Financial Condition of the USPS– Flexibilities and restraints in the

rate system– Pay and compensation for

comparable levels of work in the private sector

– Render disputes in 45 days• Ability to close post offices and

facilities • Repeal 6 day delivery language

Senator CollinsSenator CollinsS. 353S. 353

• Directs OPM to use existing Directs OPM to use existing authority to change the authority to change the methodology for calculating the methodology for calculating the CSRS surplus, $$ can be CSRS surplus, $$ can be transferred to the PSRHBFtransferred to the PSRHBF

• Arbitrator language to consider:Arbitrator language to consider:– Financial Condition of the USPSFinancial Condition of the USPS

• Converts federal and postal Converts federal and postal employees on workers’ comp. to employees on workers’ comp. to retirement upon retirement age (S. retirement upon retirement age (S. 261)261)

Arbitration Language (suggested)

Option #1: LABOR DISPUTES.—Section 1207(c) of title 39, United States Code, is amended by adding at the end the following:”(d) Nothing in this Title shall be construed to limit factors an arbitrator may take into consideration in rendering a decision pursuant to this subsection.“

Option #2: The arbitration board shall consider both the financial condition of the Postal Service and the objective of maintaining postal employees’ compensation relative to inflation in making any decision

Senate Appropriations Financial Services & General Government Subcommittee

Democrats:• Sen. Richard Durbin (IL)-Chair -Position on 6 day delivery: Uncommitted; traditionally favors maintaining 6 day delivery • Sen. Frank Lautenberg (NJ) -Position on 6 day delivery: Uncommitted; traditionally favors maintaining 6 day delivery • Sen. Ben Nelson (NE) -Position on 6 day delivery: Favors maintaining 6 day delivery

Republicans:• Sen. Jerry Moran (KS)-Ranking Member -Position on 6 day delivery: Uncommitted; traditionally favors maintaining 6 day delivery• Sen. Mark Kirk (IL) - Position on 6 day delivery: Uncommitted

House of Representatives – 112th Congress

H.R. 1351 – USPS Pension Obligation Recalculation and Restoration Act of 2011 Introduced by Rep. Lynch (D-MA) on 4/4/11.

Direct OPM, within 6 months of enactment, to recalculate USPS' past, present, and future CSRS pension obligation for those employees that served as both federal workers prior to 1971 and postal employees post-1971, using an updated methodology.

Any resulting surplus from recalculation is then transferred over to the USPS Retiree Health Benefit Fund.

Immediate repayment of the USPS FERS surplus of $6.9 billion. Would apply $5.5B towards USPS FY11 Retiree Health Benefits

payment, $1.2B towards the upcoming USPS workers compensation payment, and the resulting $200M applied to existing treasury debt.

65 co-sponsors (as of 5/6/11). [only 1 Republican has signed on]

112th Congress

Rep. Issa Bill Unclear on content of bill, but may address

CSRS/FERS overpayment, USPS management structure, and reduce costs at USPS.

Expected to be introduced by July 2011.

Tough decisions will be made, but we will be at the table throughout the process.

House of Representatives – 112th Congress

Maintaining 6-Day Delivery PRC Report shows eliminating Saturday would save

only $1.7 billion (not USPS estimate of $3.1 billion) $484 million would come from Rural Carriers.

Net revenue lost - $0.6 billion. Average 25% of First-Class and Priority mail to be

delayed by 2 days.

All Members (7 R, 4 D) of the House Appropriations subcommittee on Financial Services and General Government support maintaining 6-day delivery.

House of Representatives – 112th Congress

H.Res. 137 – 6-day Bill Introduced by Rep. Sam Graves (R-MO).

“…the sense of the House of Representatives that the United States Postal Service should take all appropriate measures to ensure the continuation of its 6-day mail delivery service.”

124 co-sponsors (as of 5/6/11)

House of Representatives – 112th Congress

H.R. 1262 – Reform USPS for the 21st Century Act Introduced by Rep. Gerry Connolly (D-VA) The scope of this bill is to tackle a long-list of USPS

related initiatives. Some of the items included are: Vote By Mail “Forever Box" Electric Vehicles Nonpostal Products and Services Small Business Mailing Pools Electronic Post Office Box Services

11 co-sponsors (as of 5/6/11)

State Members Aggregate Per CapitaIowa 2488 $20,382.00 $8.19Illinois 4390 $10,530.00 $2.40Indiana 3540 $4,038.80 $1.14Kansas 1626 $15,808.50 $9.72Michigan 4542 $14,886.98 $3.28Minnesota 3163 $4,214.00 $1.33Missouri 3565 $17,729.48 $4.97North Dakota 686 $3,049.00 $4.44Nebraska 1490 $4,073.50 $2.73Ohio 4490 $16,624.21 $3.70South Dakota 756 $2,564.50 $3.39Wisconsin 3758 $12,120.00 $3.23Middle States 34494 $126,020.97 $3.65National Avg 107609 $335,014.26 $3.11

Conclusion