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Bill
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Title II — Postal Service Governance

H.R. 2748 · 113th Congress · Jul 19, 2013 · Lineage

II Postal Service Governance

A Temporary Governance Authority

Sec. 201 Purposes

(a)
Purposes— The purposes of this subtitle are as follows:
(1)
To eliminate budget deficits and cash shortages of the Postal Service through strategic financial planning, sound budgeting, accurate revenue forecasts, and careful spending.
(2)
To ensure that universal service, as required by section 101 of title 39, United States Code, is maintained during the period of any fiscal emergency.
(3)
To conduct necessary investigations and studies to determine the fiscal status and operational efficiency of the Postal Service.
(4)
To assist the Postal Service in—
(A)
restructuring its organization and workforce to bring expenses in line with diminishing revenue and generate sufficient profits for capital investments and repayment of debt;
(B)
meeting all fiscal obligations to the Treasury of the United States; and
(C)
ensuring the appropriate and efficient delivery of postal services.
(5)
To ensure the long-term financial, fiscal, and economic vitality and operational efficiency of the Postal Service.
(b)
Reservation of powers— Nothing in this subtitle may be construed—
(1)
to relieve any obligation of the Postal Service to the Treasury of the United States existing as of the date of enactment of this Act; or
(2)
to limit the authority of Congress to exercise legislative authority over the Postal Service.

Sec. 202 Establishment of the Postal Service Financial Responsibility and Management Assistance Authority

(a)
Establishment— There is established, in accordance with the provisions of this subtitle, an entity to be known as the “Postal Service Financial Responsibility and Management Assistance Authority” (hereinafter in this subtitle referred to as the “Authority”).
(b)
Operations during the control period—
(1)
Control period defined— For the purposes of this subtitle, the term control period means the period that commences on the date as of which the Authority has at least 4 members and terminates as of the date determined under paragraph (5).
(2)
Transfer of authorities and responsibilities— Effective as of the date on which the control period commences—
(A)
subsections (a) and (b) of section 202 are repealed;
(B)
the term of office of each of the 9 Governors (appointed under the second sentence of section 202(a)(1) of title 39, United States Code, as last in effect before the date of enactment of this Act) shall terminate; and
(C)
the Authority shall assume its responsibilities, as set forth in section 206.
(3)
Treatment of certain executives—
(A)
Definition— For the purposes of this section, the term Level-Two Postal Service Executive includes the Postmaster General, the Deputy Postmaster General, and all the other officers and employees of the Postal Service in level two of the Postal Career Executive Service (or the equivalent), but does not include any officer or employee of the Office of Inspector General of the United States Postal Service.
(B)
Treatment— Notwithstanding any other provision of law or the provisions of any employment contract, during the control period—
(i)
all Level-Two Postal Service Executives shall serve at the pleasure of the Authority;
(ii)
the duties and responsibilities of all Level-Two Postal Service Executives, as well as the terms and conditions of their employment (including their compensation), shall be subject to determination or redetermination by the Authority;
(iii)
total compensation of a Level-Two Postal Service Executive may not, for the first full fiscal year occurring in such control period or any subsequent fiscal year commencing in such control period, exceed the annual rate of basic pay payable for level I of the Executive Schedule under section 5312 of title 5, United States Code, for that year; for purposes of this clause, the term total compensation means basic pay, bonuses, awards, and all other monetary compensation;
(iv)
the percentage by which the rate of basic pay of a Level-Two Postal Service Executive is increased during any year may not exceed the percentage change in the Consumer Price Index for All Urban Consumers, unadjusted for seasonal variation, for the most recent 12-month period available, except that, in the case of a Level-Two Postal Service Executive who has had a significant change in job responsibilities, a greater change shall be allowable if approved by the Authority;
(v)
apart from basic pay, a Level-Two Postal Service Executive may not be afforded any bonus, award, or other monetary compensation for any full fiscal year in the control period if expenditures of the Postal Service for such fiscal year exceeded revenues of the Postal Service for such fiscal year (determined in accordance with generally accepted accounting principles); and
(vi)
no deferred compensation may be paid, accumulated, or recognized in the case of any Level-Two Postal Service Executive, with respect to any full year in the control period, which is not generally paid, accumulated, or recognized in the case of employees of the United States (outside of the Postal Service) in level I of the Executive Schedule under section 5312 of title 5, United States Code, with respect to such year. ; and
(vii)
in the case of any Level-Two Postal Service Executive, the expense incurred by the Postal Service for non-cash awards or honorary recognitions covered under section 4503 of title 5, United States Code, may not exceed a combined total of $200 with respect to any full year in the control period.
(C)
Bonus authority— Section 3686 of title 39, United States Code, shall, during the period beginning on the commencement date of the control period and ending on the termination date of the control period—
(i)
be suspended with respect to all Level-Two Postal Service Executives; but
(ii)
remain in effect for all other officers and employees of the Postal Service otherwise covered by this section.
(4)
Certification requirement— The control period may not terminate until after the Authority, with the concurrence of the Secretary of the Treasury and the Director of the Office of Personnel Management, certifies to the Director of the Office of Management and Budget that—
(A)
for 2 consecutive fiscal years (occurring after the date of enactment of this Act), expenditures of the Postal Service did not exceed revenues of the Postal Service (as determined in accordance with generally accepted accounting principles);
(B)
the Authority has approved a Postal Service financial plan and budget that shows expenditures of the Postal Service not exceeding revenues of the Postal Service (as so determined) for the fiscal year to which such budget pertains and each of the next 3 fiscal years; and
(C)
the Postal Service financial plan and budget (as referred to in subparagraph (B)) includes plans—
(i)
for the repayment of any collateralized debt authorized by section 503; and
(ii)
to properly fund Postal Service pensions and retiree health benefits in accordance with applicable provisions of title 5, United States Code.
(5)
Termination of control period—
(A)
Termination date—
(i)
General rule— Except as provided in clause (ii), the control period shall terminate 180 days after the date on which the certification described in paragraph (4) is made.
(ii)
Alternative date—
(I)
Authority— The Director of the Office of Management and Budget may, by written notice given to the Authority within 15 days after the date on which the certification described in paragraph (4) is made, provide for an alternative termination date (in lieu of the date that would otherwise apply under clause (i)).
(II)
Range— An alternative date under this clause shall not apply unless such date occurs not less than 30 days after the date on which written notice under subclause (I) is given and not later than 180 days after the date on which the certification described in paragraph (4) is made.
(B)
Public notice— The Authority shall cause to be published in the Federal Register—
(i)
the date on which the certification described in paragraph (4) is made, not later than 1 business day after the date on which such certification is made; and
(ii)
the termination date of the control period, not later than 16 business days after the date on which the certification described in paragraph (4) is made.

Sec. 203 Membership and qualification requirements

(a)
Membership—
(1)
In general— The Authority shall consist of 5 members appointed by the President who meet the qualifications described in subsection (b), except that the Authority may take any action under this subtitle at any time after the President has appointed the initial 4 of its members. Members of the Authority shall report to the Secretary of the Treasury.
(2)
Recommendations— Of the 5 members so appointed—
(A)
1 shall be appointed by the President taking into account any individuals recommended by the Speaker of the House of Representatives;
(B)
1 shall be appointed by the President taking into account any individuals recommended by the majority leader of the Senate;
(C)
1 shall be appointed by the President taking into account any individuals recommended by the minority leader of the House of Representatives;
(D)
1 shall be appointed by the President taking into account any individuals recommended by the minority leader of the Senate; and
(E)
1 shall be appointed by the President taking into account any individuals recommended by the Comptroller General.
(3)
Political affiliation— No more than 3 members of the Authority may be of the same political party.
(4)
Chair— The President shall designate 1 of the members of the Authority as the Chair of the Authority.
(5)
Sense of Congress regarding deadline for appointment— It is the sense of Congress that the President should appoint the members of the Authority as soon as practicable after the date of enactment of this Act, but no later than 30 days after such date.
(6)
Term of service—
(A)
In general— Except as provided in subparagraph (B), each member of the Authority shall be appointed for a term of 3 years.
(B)
Appointment for term following initial term— As designated by the President at the time of appointment for the term immediately following the initial term, of the members appointed for the term immediately following the initial term—
(i)
1 member shall be appointed for a term of 1 year;
(ii)
2 members shall be appointed for a term of 2 years; and
(iii)
2 members shall be appointed for a term of 3 years.
(C)
Vacancies and succession— Any member of the Authority appointed to fill a vacancy before the expiration of the term for which the predecessor of the member of the Authority was appointed shall serve for the remainder of such term.
(D)
Removal— The President may remove any member of the Authority only for cause.
(E)
Compensation for service— Each member of the Authority shall be paid for full-time service at a rate of pay equivalent to the rate of basic pay payable for level III of the Executive Schedule under section 5314 of title 5, United States Code.
(b)
Qualification requirements—
(1)
In general— An individual meets the qualifications for membership on the Authority if the individual—
(A)
has significant knowledge and expertise in finance, management, and the organization or operation of businesses having more than 500 employees; and
(B)
represents the public interest generally, is not a representative of specific interests using or belonging to the Postal Service, and does not have any business or financial interest in any enterprise in the private sector of the economy engaged in the delivery of mail matter.
(2)
Specific conditions— An individual shall not be considered to satisfy paragraph (1)(B) if, at any time during the 5-year period ending on the date of appointment, such individual—
(A)
has been an officer, employee, or private contractor with the Postal Service, United States Postal Service Inspector General, or the Postal Regulatory Commission; or
(B)
has served as an employee or contractor of a labor organization representing employees of the Postal Service, the United States Postal Service Inspector General, or the Postal Regulatory Commission.

Sec. 204 Organization and staff

(a)
Adoption of bylaws for conducting business— As soon as practicable after the appointment of its members, the Authority shall adopt bylaws, rules, and procedures governing its activities under this subtitle, including procedures for hiring experts and consultants. Upon adoption, such bylaws, rules, and procedures shall be submitted by the Authority to the Postmaster General, the President, and Congress.
(b)
Executive director and staff—
(1)
Executive director— The Authority shall have an Executive Director who shall be appointed by the Chair with the consent of the Authority. The Executive Director shall be paid at a rate determined by the Authority, except that such rate may not exceed the rate of basic pay payable for level IV of the Executive Schedule under section 5315 of title 5, United States Code.
(2)
Staff— With the approval of the Authority, the Executive Director may appoint and fix the pay of such additional personnel as the Executive Director considers appropriate, except that no individual appointed by the Executive Director may be paid at a rate greater than the rate of pay for the Executive Director. Personnel appointed under this paragraph shall serve at the pleasure of the Executive Director.
(3)
Inapplicability of certain civil service laws— The Executive Director and staff of the Authority may be appointed without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, and paid without regard to the provisions of chapter 51 and subchapter III of chapter 53 of such title relating to classification and General Schedule pay rates.
(4)
Staff of Federal agencies— Upon request of the Chair, the head of any Federal department or agency may detail, on a reimbursable or nonreimbursable basis, any of the personnel of such department or agency to the Authority to assist it in carrying out its duties under this subtitle.

Sec. 205 Funding

(a)
General rule— There are authorized to be appropriated, out of the Postal Service Fund, such sums as may be necessary for the Authority. In requesting an appropriation under this section for a fiscal year, the Authority shall prepare and submit to the Congress under section 2009 of title 39, United States Code, a budget of the Authority’s expenses, including expenses for facilities, supplies, compensation, and employee benefits, not to exceed $10,000,000.
(b)
Initial rule— Notwithstanding any other provision of this section, effective as of the date on which at least 4 members of the Authority have been appointed, there shall be available to the Authority, out of the Postal Service Fund, such sums as the Authority may require in order to carry out this subtitle, not to exceed the amount equal to the product obtained by multiplying—
(1)
the dollar amount specified in subsection (a), times
(2)
a fraction—
(A)
the numerator of which is the number of months remaining in the fiscal year as of the date on which at least 4 members of the Authority have been appointed (rounding any fraction of a month to the next highest whole number); and
(B)
the denominator of which is 12.
(c)
Amendment to section 2009— Section 2009 is amended in the next to last sentence—
(1)
by striking “, and (3)” and inserting “, (3)”; and
(2)
by striking the period and inserting “, and (4) the Postal Service Financial Responsibility and Management Assistance Authority requests to be appropriated, out of the Postal Service Fund, under section 205 of the Postal Reform Act of 2013.”.

Sec. 206 Responsibilities and powers

The exercise of the powers of the Postal Service shall be directed by the Authority, including—
(1)
all duties and responsibilities ascribed to the Governors and the Board of Governors by title 39, United States Code;
(2)
determining the overall strategies of the Postal Service;
(3)
hiring, monitoring, compensating, and, when necessary, replacing senior management at the level of vice president and higher, as well as ensuring adequate succession planning for these positions;
(4)
approving major policies, particularly those that have an important effect on the Postal Service’s financial position and the provision of universal postal service;
(5)
approving corporate budgets, financial and capital plans, operational and service performance standards and targets, human resource strategies, collective-bargaining strategies, negotiation parameters, collective-bargaining agreements, and the compensation structure for nonbargaining employees;
(6)
formulating and communicating organizational policy and positions on legislative and other public policy matters to Congress and the public; and
(7)
carrying out any responsibility, not otherwise listed in this section, that was the responsibility of the Board of Governors of the Postal Service at any time during the 5-year period ending on the date of enactment of this Act.

Sec. 207 Development of financial plan and budget for the solvency of the Postal Service

(a)
Development of financial plan and budget— For each fiscal year during a control period, the Postmaster General shall submit to the Authority, by August 1 before the start of such fiscal year, a financial plan and budget for such fiscal year for the long-term solvency of the Postal Service, except that, for fiscal year 2014, the deadline for submission of the plan and budget under this subsection shall be the 30th day after a majority of the Authority take office. If a majority of the Authority do not take office before August 1, 2014, the requirement for a financial plan and budget under this subsection for fiscal year 2014 is waived.
(b)
Contents of financial plan and budget— A financial plan and budget under this section for a fiscal year shall specify the budget for the Postal Service as required by section 2009 of title 39, United States Code, for the applicable fiscal year and each of the next 3 fiscal years, in accordance with the following requirements:
(1)
The financial plan and budget shall meet the requirements described in subsection (c) to promote the financial stability of the Postal Service.
(2)
The financial plan and budget shall—
(A)
include the Postal Service’s annual budget program (under section 2009 of title 39, United States Code) and the Postal Service’s plan commonly referred to as its “Integrated Financial Plan”;
(B)
describe lump-sum expenditures by all categories traditionally used by the Postal Service;
(C)
describe capital expenditures (together with a schedule of projected capital commitments and cash outlays of the Postal Service and proposed sources of funding);
(D)
contain estimates of overall debt (both outstanding and anticipated to be issued); and
(E)
contain cash flow and liquidity forecasts for the Postal Service at such intervals as the Authority may require.
(3)
The financial plan and budget shall include a statement describing methods of estimations and significant assumptions.
(4)
The financial plan and budget shall include any other provisions and shall meet such other criteria as the Authority considers appropriate to meet the purposes of this subtitle, including provisions for—
(A)
changes in personnel policies and levels for each component of the Postal Service; and
(B)
management initiatives to promote productivity, improvement in the delivery of services, or cost savings.
(c)
Requirements To promote financial stability—
(1)
In general— The requirements to promote the solvency and financial stability of the Postal Service applicable to the financial plan and budget for a fiscal year are as follows:
(A)
For fiscal year 2016 and each subsequent fiscal year during a control period, budgeted expenditures of the Postal Service for the fiscal year involved may not exceed budgeted revenues of the Postal Service for the fiscal year involved.
(B)
In each fiscal year where a financial plan and budget must be developed, the financial plan and budget shall provide for continuous, substantial progress toward long-term fiscal solvency of the Postal Service.
(C)
The financial plan and budget shall provide for the orderly repayment of any outstanding obligations authorized under section 503.
(D)
The financial plan and budget shall assure the continuing long-term solvency of the Postal Service, as indicated by factors such as the efficient management of the Postal Service’s workforce and the effective provision of services by the Postal Service. In so doing, the financial plan and budget shall consider—
(i)
the legal authority of the Postal Service;
(ii)
the changes in the legal authority and responsibilities of the Postal Service under this Act;
(iii)
any cost savings that the Postal Service anticipates will be achieved through negotiations with employees of the Postal Service;
(iv)
projected changes in mail volume;
(v)
the impact of regulations the Postal Service was required by law to promulgate;
(vi)
projected changes in the number of employees needed to carry out the responsibilities of the Postal Service; and
(vii)
the long-term capital needs of the Postal Service, including the need to maintain, repair, and replace facilities and equipment.
(2)
Application of sound budgetary practices— In meeting the requirements described in paragraph (1) with respect to a financial plan and budget for a fiscal year, the Postal Service shall apply sound budgetary practices, including reducing costs and other expenditures, improving productivity, increasing revenues, or a combination of such practices.
(3)
Assumptions based on current law— In meeting the requirements described in paragraph (1) with respect to a financial plan and budget for a fiscal year, the Postal Service shall base estimates of revenues and expenditures on Federal law Generally Accepted Accounting Principles and Federal law (including regulations) as in effect at the time of the preparation of such financial plan and budget.
(d)
Definition— For the purposes of this section, the term long-term solvency means the ability of the Postal Service over the long term to pay debts and meet expenses, including the ability to perform maintenance and repairs, make investments, and maintain financial reserves, as necessary to fulfill the requirements and comply with the policies of title 39, United States Code, and other obligations of the Postal Service.

Sec. 208 Process for submission and approval of financial plan and budget

(a)
Review by the authority— Upon receipt of a financial plan and budget required by section 207, the Authority shall promptly review such financial plan and budget. In conducting the review, the Authority may request any additional information it considers necessary and appropriate to carry out its duties.
(b)
Approval of postmaster general’s financial plan and budget—
(1)
In general— If the Authority determines that the final financial plan and budget for the fiscal year submitted by the Postmaster General under subsection (a) meets the requirements of section 207—
(A)
the Authority shall approve the financial plan and budget and shall provide the Postmaster General, the President, the Committee on Homeland Security and Governmental Affairs in the Senate, and the Committee on Oversight and Government Reform in the House of Representatives with a notice certifying its approval; and
(B)
the Postmaster General shall promptly submit the annual budget program for the relevant fiscal year to the Office of Management and Budget pursuant to section 2009 of title 39, United States Code.
(2)
Deemed approval after 30 days— If the Authority has not provided the Postmaster General, the President, and Congress with a notice certifying approval under paragraph (1)(A) or a statement of disapproval under subsection (c) before the expiration of the 30-day period which begins on the date the Authority receives the financial plan and budget from the Postmaster General under subsection (a), the Authority shall be deemed to have approved the financial plan and budget and to have provided the Postmaster General, the President, the Committee on Homeland Security and Governmental Affairs in the Senate, and the Committee on Oversight and Government Reform in the House of Representatives with the notice certifying approval under paragraph (1)(A).
(c)
Disapproval of postmaster general’s financial plan and budget—
(1)
In general— If, after reviewing the financial plan and budget for a fiscal year submitted by the Postmaster General under subsection (a) in accordance with the procedures described in this section, the Authority determines that the revised final financial plan and budget does not meet the applicable requirements under section 207, the Authority shall—
(A)
disapprove the financial plan and budget;
(B)
provide the Postmaster General, the President, and Congress with a statement containing the reasons for such disapproval and describing the amount of any shortfall in the financial plan and budget; and
(C)
approve and recommend a financial plan and budget for the Postal Service which meets the applicable requirements under section 207, and submit such financial plan and budget to the Postmaster General, the President, the Committee on Homeland Security and Governmental Affairs in the Senate, and the Committee on Oversight and Government Reform in the House of Representatives.
(2)
Submission to OMB— Upon receipt of the recommended financial plan and budget under paragraph (1)(C), the Postmaster General shall promptly submit the recommended annual budget program to the Office of Management and Budget pursuant to section 2009 of title 39, United States Code.
(d)
Deadline for transmission of financial plan and budget by the Authority— Notwithstanding any other provision of this section, not later than September 30th before the start of each fiscal year for which a financial plan and budget is required, the Authority shall—
(1)
provide Congress with a notice certifying its approval of the Postmaster General’s financial plan and budget for the fiscal year under subsection (c); or
(2)
submit to Congress an approved and recommended financial plan and budget developed by the Authority for the fiscal year under subsection (c)(1)(C).
(e)
Revisions to financial plan and budget—
(1)
Permitting postmaster general to submit revisions— The Postmaster General may submit proposed revisions to the financial plan and budget for the control period to the Authority at any time during the fiscal year.
(2)
Process for review, approval, disapproval, and postmaster general action— The procedures described in subsections (b), (c), and (d) shall apply with respect to a proposed revision to a financial plan and budget in the same manner as such procedures apply with respect to the original financial plan and budget.
(f)
Requirements of the Authority—
(1)
In general— It shall be the policy of the Authority to direct the Postal Service to take any action necessary and permitted by law to ensure that the approved financial plan and budget is fully implemented over the course of each fiscal year and that the budgetary goals for expenses and revenues are achieved.
(2)
Additional fiduciary actions— In addition to paragraph (1), the Authority shall take any additional actions it deems necessary and permitted by law to ensure the requirements of the financial plan and budget are achieved in practice so that the total revenue of the Postal Service exceeds its total operating expenses for the full fiscal year not later than fiscal year 2016 and each fiscal year thereafter. Such actions may include accelerating the conversion of door delivery points to more cost-effective delivery methods, the consolidation of additional mail processing facilities, transition to a 2-day or 3-day First-Class Mail delivery standard for the continental United States, and any other action consistent with this Act and the provisions of title 39, United States Code. For the purposes of this paragraph, the term total operating expenses refers to all categories of expenses identified under that term in the Report on Form 10–K filed by the Postal Service for fiscal year 2012.

Sec. 209 Dissolution of the Authority; reconstitution of the Board of Governors

(a)
In general— Effective as of the date on which the control period terminates (as determined under section 202(b)(5))—
(1)
the Authority is dissolved; and
(2)
section 202 of title 39, United States Code (as amended by section 202(b)(2)(A) of this Act) is amended by inserting after the section heading the following:

“(a)

“(1) The exercise of the power of the Postal Service shall be directed by a Board of Governors composed of 5 members appointed in accordance with this section. The members, to be known as Governors, shall be appointed by the President, by and with the advice and consent of the Senate. Not more than 3 of the Governors may be adherents of the same political party. The Governors shall elect a Chairman from among the individual Governors. The Governors shall represent the public interest generally, and shall be chosen solely on the basis of their experience in the field of public administration, law, or accounting, or on their demonstrated ability in managing organizations or corporations (in either the public or private sector) of substantial size; except that at least 3 of the Governors shall be chosen solely on the basis of their demonstrated ability in managing organizations or corporations (in either the public or private sector) that employ at least 10,000 employees. The Governors shall not be representatives of specific interests using the Postal Service, and may be removed only for cause. Each Governor shall receive a salary of $30,000 a year plus $300 a day for not more than 42 days of meetings each year and shall be reimbursed for travel and reasonable expenses incurred in attending meetings of the Board. Nothing in the preceding sentence shall be construed to limit the number of days of meetings each year to 42 days.

“(2) In selecting the individuals described in paragraph (1) for nomination for appointment to the position of Governor, the President should consult with the Speaker of the House of Representatives, the minority leader of the House of Representatives, the majority leader of the Senate, and the minority leader of the Senate.

“(3) Not later than 60 days after the end of each fiscal year, the Board of Governors shall submit an itemized report describing all travel and reimbursable business travel expenses paid to each Governor when performing Board duties to the Committee on Oversight and Government Reform of the House of Representatives and the Committee on Homeland Security and Governmental Affairs of the Senate. The report submitted under this paragraph shall include a detailed justification for any travel or reimbursable business travel expense that deviates from the Board’s travel and reimbursable business travel expense policies and guidelines under paragraph (1).

“(b)

“(1) The terms of the 5 Governors shall be 7 years, except that—

“(A) upon the reconstitution of the Board of Governors pursuant to the Postal Reform Act of 2013—

“(i) the 5 members last comprising the Postal Service Financial Responsibility and Management Assistance Authority before the termination of the control period (as defined in section 202(b)(1) of the Postal Reform Act of 2013) shall become the initial members of the reconstituted Board of Governors; and

“(ii) the term of each of the 5 respective individuals under clause (i) shall expire at the end of the term which would have applied with respect to that individual, if—

“(I) the control period (as so defined) had not terminated; and

“(II) such individual had remained a member of the Postal Service Financial Responsibility and Management Assistance Authority; and

“(B) the terms of the Governors first taking office after the initial Governors of the reconstituted Board (as described in subparagraph (A)) shall be as fixed by the President at the time of their appointment, except that each such term—

“(i) shall be for a period of years not less than 3 years and not more than 7 years; and

“(ii) shall be fixed such that the term of not more than 1 Governor is thereafter scheduled to expire in any calendar year (determined disregarding the term of an initial Governor expiring as described in subparagraph (A)(ii)).

“(2) Any Governor appointed to fill a vacancy before the expiration of the term for which his predecessor was appointed shall serve for the remainder of such term. A Governor may continue to serve after the expiration of his term until his successor has qualified, but not to exceed 1 year.

“(3) No person may serve more than 14 years as a Governor. For purposes of the preceding sentence, there shall be taken into account any period served as a member of—

“(A) the Postal Service Financial Responsibility and Management Assistance Authority; or

“(B) the Board of Governors, as constituted before the start of the control period.”

(b)
Conforming amendments—
(1)
Section 102(3) is amended by striking “9” and inserting “5”; and
(2)
Section 205(c) is amended by striking all after “present, and” and inserting “an absolute majority of the Governors in office shall constitute a quorum for the transaction of business by the Board.”.

B Other Matters

Sec. 211 Appointment of the Postal Service Inspector General

(a)
Appointment of Inspector General of the Postal Service by President— The Inspector General Act of 1978 (5 U.S.C. App.) is amended—
(1)
in section 8G—
(A)
in subsection (a)—
(i)
in paragraph (2), by striking “the Postal Regulatory Commission, and the United States Postal Service” and inserting “and the Postal Regulatory Commission”;
(ii)
in paragraph (3), by striking “subsection (h)(1)” and inserting “subsection (g)(1)”; and
(iii)
in paragraph (4)—
(I)
in the matter preceding subparagraph (A), by striking “subsection (h)(1)” and inserting “subsection (g)(1)”;
(II)
by striking subparagraph (B); and
(III)
by redesignating subparagraphs (C) through (H) as subparagraphs (B) through (G), respectively;
(B)
in subsection (c), by striking “Except as provided under subsection (f) of this section, the” and inserting “The”;
(C)
by striking subsection (f); and
(D)
by redesignating subsections (g) and (h) as subsections (f) and (g), respectively;
(2)
by inserting after section 8L the following:

“8M. Special provisions concerning the Inspector General of the United States Postal Service

“(a) Oversight of Postal Inspection Service—In carrying out the duties and responsibilities specified in this Act, the Inspector General of the United States Postal Service (in this section referred to as the “Inspector General”) shall have oversight responsibility for all activities of the Postal Inspection Service, including any internal investigation performed by the Postal Inspection Service. The Chief Postal Inspector shall promptly report the significant activities being carried out by the Postal Inspection Service to such Inspector General.

“(b) Supervision; additional duties and responsibilities; report

“(1) Authority, direction, and control

“(A) Audits, investigations, subpoenas—The Inspector General shall be under the authority, direction, and control of the Governors with respect to audits or investigations, or the issuance of subpoenas, which require access to sensitive information concerning—

“(i) ongoing civil or criminal investigations or proceedings;

“(ii) undercover operations;

“(iii) the identity of confidential sources, including protected witnesses;

“(iv) intelligence or counterintelligence matters; or

“(v) other matters the disclosure of which would constitute a serious threat to national security.

“(B) Authority of Governors—With respect to the information described under subparagraph (A), the Governors may prohibit the Inspector General from carrying out or completing any audit or investigation, or from issuing any subpoena, after such Inspector General has decided to initiate, carry out, or complete such audit or investigation or to issue such subpoena, if the Governors determine that such prohibition is necessary to prevent the disclosure of any information described under subparagraph (A) or to prevent the significant impairment to the national interests of the United States.

“(C) Notice required—If the Governors exercise any power under subparagraph (A) or (B), the Governors shall notify the Inspector General in writing stating the reasons for such exercise. Within 30 days after receipt of any such notice, the Inspector General shall transmit a copy of such notice to the Committee on Homeland Security and Governmental Affairs of the Senate and the Committee on Oversight and Government Reform of the House of Representatives, and to other appropriate committees or subcommittees of the Congress.

“(2) Additional duties and responsibilities—In carrying out the duties and responsibilities specified in this Act, the Inspector General—

“(A) may initiate, conduct, and supervise such audits and investigations in the United States Postal Service as the Inspector General considers appropriate; and

“(B) shall give particular regard to the activities of the Postal Inspection Service with a view toward avoiding duplication and insuring effective coordination and cooperation.

“(3) Report required—Any report required to be transmitted by the Governors to the appropriate committees or subcommittees of the Congress under section 5(d) shall also be transmitted, within the seven-day period specified under such section, to the Committee on Homeland Security and Governmental Affairs of the Senate and the Committee on Oversight and Government Reform of the House of Representatives.

“(c) Governors defined—As used in this section, the term Governors has the meaning given such term by section 102(3) of title 39, United States Code.

“(d) Authorization of appropriations—There are authorized to be appropriated, out of the Postal Service Fund, such sums as may be necessary for the Office of Inspector General of the United States.”

(3)
in section 12—
(A)
in paragraph (1), by striking “or the Federal Cochairpersons of the Commissions established under section 15301 of title 40, United States Code” and inserting “the Federal Cochairpersons of the Commissions established under section 15301 of title 40, United States Code; or the Board of Governors of the United States Postal Service”; and
(B)
in paragraph (2), by striking “or the Commissions established under section 15301 of title 40, United States Code” and inserting “the Commissions established under section 15301 of title 40, United States Code, or the United States Postal Service”.
(b)
Technical and conforming amendments— Title 39, United States Code, is amended—
(1)
in section 102(4), by striking “section 202(e) of this title” and inserting “section 3 of the Inspector General Act of 1978 (5 U.S.C. App.)”;
(2)
in section 1001(b), in the first sentence, by inserting “and section 3 of the Inspector General Act of 1978 (5 U.S.C. App.)” after “1001(c) of this title”;
(3)
in section 1003(a), by striking “8G” and inserting “8M”;
(4)
in section 1005(a)(3), by inserting “and section 3 of the Inspector General Act of 1978 (5 U.S.C. App.)” after “1001(c) of this title”;
(5)
in section 2003(e) by striking “8G(f)” and inserting “8M(d)”; and
(6)
in section 2009 by striking “8G(f)” and inserting “8M(d)”.
(c)
Applicability—
(1)
In general— The amendments made by this section shall apply with respect to the first individual appointed as Inspector General of the Postal Service after the date of enactment of this Act.
(2)
Rule of construction— Nothing in this Act may be construed to alter the authority or the length of the term of the individual serving as Inspector General of the Postal Service on the date of enactment of this Act.

Sec. 212 Membership of the Board of Governors

(a)
Postmaster General— Section 202(c) is amended to read as follows:

“(c) The Governors shall appoint and shall have the power to remove the Postmaster General. His pay and term of service shall be fixed by the Governors.”

(b)
Deputy Postmaster General— Section 202(d) is amended to read as follows:

“(d) The Governors shall appoint and shall have the power to remove the Deputy Postmaster General. His term of service shall be fixed by the Governors and the Postmaster General and his pay by the Governors.”