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Title II — Postal Service Operations Reform

H.R. 756 · 115th Congress · Jan 31, 2017 · Lineage

II Postal Service Operations Reform

Sec. 201 Governance reform

(a)
Board of Governors—
(1)
In general— Section 202 of title 39, United States Code, is amended to read as follows:

“202. Board of Governors

“(a) In general—There is established in the Postal Service a Board of Governors composed of 5 Governors, a Postmaster General, and a Deputy Postmaster General, all of whom shall be appointed in accordance with this section. The Governors shall have the power to—

“(1) exercise the powers of the Postal Service, consistent with section 203(c);

“(2) appoint, fix the term of service of, and remove the Postmaster General;

“(3) in consultation with the Postmaster General, appoint, fix the term of service of, and remove the Deputy Postmaster General;

“(4) set the strategic direction of postal operations and approve the pricing and product strategy for the Postal Service;

“(5) set the compensation of the Postmaster General and the Deputy Postmaster General in accordance with private sector best practices, as determined by the Governors pursuant to section 3686; and

“(6) carry out any other duties specifically provided for in this title.

“(b) Appointment; pay

“(1) In general—The Governors shall be appointed by the President, by and with the advice and consent of the Senate, not more than 3 of whom may be adherents of the same political party. The Governors shall elect a Chair from among their members. 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.

“(2) Compensation—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.

“(3) Consultation—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.

“(c) Terms of Governors

“(1) In general—The terms of the 5 Governors shall be 7 years, except that the terms of the 5 Governors first taking office shall expire as designated by the President at the time of appointment, 1 at the end of 1 year, 1 at the end of 2 years, 1 at the end of 3 years, 1 at the end of 4 years, and 1 at the end of 5 years, following the appointment of the first of them. Any Governor appointed to fill a vacancy before the expiration of the term for which the Governor’s predecessor was appointed shall serve for the remainder of such term. A Governor may continue to serve after the expiration of the Governor’s term until such Governor’s successor has qualified, but not to exceed one year.

“(2) Limitation—No individual may serve more than 2 terms as a Governor.

“(d) Staff—The Chair of the Board of Governors shall ensure that the Board has appropriate independent staff to carry out the roles and responsibilities of the Board and the Governors.”

(2)
Application— Any individual serving as a Governor on the Board of Governors of the Postal Service on the date of enactment of this Act shall continue to serve as a Governor until the term applicable to such individual expires (as determined under section 202(b) of title 39, United States Code, as in effect before the amendments made by this section take effect pursuant to subsection (g)).
(b)
Postmaster General—
(1)
In general— Section 203 of title 39, United States Code, is amended to read as follows:

“203. Postmaster General

“(a) In general—The chief executive officer of the Postal Service is the Postmaster General, appointed pursuant to section 202(a)(2). The alternate chief executive officer of the Postal Service is the Deputy Postmaster General, appointed pursuant to section 202(a)(3) of this title.

“(b) Powers—Consistent with the requirements of this title, the exercise of the power of the Postal Service shall be vested in the Governors and carried out by the Postmaster General in a manner consistent with the strategic direction and pricing and product strategy approved by the Governors. The Postmaster General shall, in accordance with by-laws determined appropriate by the Board, consult with the Governors and the Deputy Postmaster General in carrying out such power.”

(2)
Conforming amendment— The item relating to section 203 in the table of sections for chapter 2 of title 39, United States Code, is amended to read as follows:
(c)
Procedures of the Board— Section 205 of title 39, United States Code, is amended to read as follows:

“205. Procedures of the Board of Governors and the Governors

“(a) Vacancies—Vacancies in the Board shall not impair the powers of the Board or the Governors under this title.

“(b) Vote—The Board and the Governors shall act upon majority vote of those members who are present, subject to such quorum requirements as the Board and the Governors may respectively establish.

“(c) Limitation—No officer or employee of the United States may serve concurrently as a Governor. A Governor may hold any other office or employment not inconsistent or in conflict with the Governor’s duties, responsibilities, and powers as an officer of the Government of the United States in the Postal Service.”

(d)
Delegation of authority— Section 402 of title 39, United States Code, is amended to read as follows:

“402. Delegation of authority

“(a) Postmaster General—The Postmaster General may delegate his or her authority under such terms, conditions, and limitations, including the power of redelegation, as he or she determines desirable. The Postmaster General may establish such committees of officers and employees of the Postal Service, and delegate such powers to any committee, as the Postmaster General determines appropriate to carry out his or her functions and duties. Delegations under this section shall be consistent with other provisions of this title, shall not relieve the Postmaster General of full responsibility for the carrying out the Postmaster General’s duties and functions, and shall be revocable by the Postmaster General.

“(b) Board of Governors—The Board may establish such committees of the Board, and delegate such powers to any committee, as the Board determines appropriate to carry out its functions and duties. Delegations to committees shall be consistent with other provisions of this title, shall not relieve the Board of full responsibility for the carrying out of its duties and functions, and shall be revocable by the Board in its exclusive judgment.”

(e)
International postal arrangements—
(1)
In general— Section 407 of title 39, United States Code, is amended by adding at the end the following:

“(f) After submission to the Postal Regulatory Commission by the Department of State of the budget detailing the estimated costs of carrying out the activities under this section, and the Commission’s review and approval of such submission, the Postal Service shall transfer to the Department of State, from any funds available to the Postal Service, such sums as may be reasonable, documented, and auditable for the Department of State to carry out such activities.”

(2)
Application— The amendment made by paragraph (1) shall take effect on October 1 of the first fiscal year beginning after the date of enactment of this Act.
(3)
Conforming amendment— Section 633 of title VI of the Treasury and General Government Appropriations Act, 1999 (Public Law 105–277; 39 U.S.C. 407 note) is amended by striking subsection (d).
(f)
Technical and conforming amendments— Title 39, United States Code, is amended as follows:
(1)
In section 102(3)—
(A)
by striking “9 members” and inserting “5 members”; and
(B)
by striking “section 202(a)” and inserting “section 202(b)(1)”.
(2)
In section 204—
(A)
by striking “the Board” and inserting “the Postmaster General”; and
(B)
by striking “the Governors and”.
(3)
In section 207, by striking “the Board” and inserting “the Postal Service”.
(4)
In section 414(b)(2), by striking “the Governors” in each instance it appears and inserting “the Postal Service”.
(5)
In section 416(c)—
(A)
by striking “the Governors” and inserting “the Postal Service”; and
(B)
by striking “they” and inserting “the Postal Service”.
(6)
In section 1011, by striking “the Board” and inserting “the Postal Service”.
(7)
By striking section 2402 and inserting the following:

“2402. Annual report

“The Postmaster General shall render an annual report concerning the operations of the Postal Service under this title to the President and Congress.”

(8)
In section 3632—
(A)
by striking the section heading, and inserting “Establishment of rates and classes of competitive products”;
(B)
by striking subsection (a) and redesignating subsections (b) and (c) as (a) and (b), respectively;
(C)
in paragraph (a)(2) (as redesignated by subparagraph (B)), by striking “and the record of the Governors’ proceedings in connection with such decision”;
(D)
in paragraph (a)(3) (as redesignated by subparagraph (B))—
(i)
by striking “and the record of the proceedings in connection with such decision”; and
(ii)
by striking “the Governors consider” and inserting “the Postal Service considers”; and
(E)
by striking “the Governors” in each instance it appears and inserting “the Postal Service”.
(9)
The table of sections for chapter 36 is amended by striking the item relating to section 3632 and inserting the following:
(g)
Delayed effective date— The amendments made by this section shall take effect upon the date that is 30 days after the date of enactment of this Act.

Sec. 202 Transition to more efficient and secure mail delivery

(a)
In general— Subchapter VII of chapter 36 of title 39, United States Code, is amended by adding at the end the following:

“3692. Delivery-point modernization

“(a) Definitions—For purposes of this section—

“(1) the term “delivery point” means a mailbox or other receptacle to which mail is delivered;

“(2) the term “primary mode of mail delivery” means the typical method by which the Postal Service delivers letter mail to the delivery point of a postal patron;

“(3) the term “door delivery” means a primary mode of mail delivery whereby mail is placed into a slot or receptacle at or near the postal patron’s door or is hand delivered to a postal patron, but does not include centralized delivery, curbside delivery, or sidewalk delivery;

“(4) the term “centralized delivery” means a primary mode of mail delivery whereby mail receptacles of a number of delivery points are grouped or clustered at a single location;

“(5) the term “curbside delivery” means a primary mode of mail delivery whereby a mail receptacle is situated at the edge of a sidewalk abutting a road or curb, at a road, or at a curb, and can be served by a letter carrier from a motorized vehicle; and

“(6) the term “sidewalk delivery” means a primary mode of mail delivery whereby a mail receptacle is situated at the edge of a sidewalk and can be served by a letter carrier from the sidewalk.

“(b) Policy—It shall be the policy of the Postal Service—

“(1) to provide access to secure, convenient mail and package delivery receptacles to the greatest number of postal patrons feasible; and

“(2) to use the most cost-effective primary mode of mail delivery feasible for postal patrons.

“(c) Phaseout of door delivery for new addresses

“(1) In general—For any new delivery point established after the date of enactment of the Postal Service Reform Act of 2017, the Postal Service shall provide a primary mode of mail delivery other than door delivery, with a preference for secure, centralized delivery.

“(2) Exception—Paragraph (1) shall not apply in circumstances in which the new delivery point is built or established within a block of existing delivery points whose primary mode of mail delivery is door delivery.

“(d) Business address conversion

“(1) Identification—Not later than 1 year after the date of the Postal Service Reform Act of 2017, each Postal Service district office shall identify the business delivery points within its service area that are appropriate candidates for conversion from door delivery to centralized delivery, curbside delivery, or sidewalk delivery.

“(2) Conversion requirement—Beginning not later than October 1, 2018, the Postal Service shall implement a program to convert delivery points identified under paragraph (1) to centralized delivery, curbside delivery, or sidewalk delivery at a rate sufficient to ensure that—

“(A) not less than 20 percent of such delivery points are converted by September 30, 2019;

“(B) not less than 40 percent of such delivery points are converted by September 30, 2020;

“(C) not less than 60 percent of such delivery points are converted by September 30, 2021;

“(D) not less than 80 percent of such delivery points are converted by September 30, 2022; and

“(E) all such delivery points are converted by September 30, 2023.

“(3) Notification—In carrying out conversions under paragraph (2), the Postal Service shall provide written notice at least 60 days in advance of the implementation date of a change in primary mode of mail delivery to postal customers served by an applicable delivery point.

“(e) Residential address conversion

“(1) Identification—Not later than 1 year after the date of the enactment of the Postal Service Reform Act of 2017, each Postal Service district office shall identify the residential delivery points within its service area that are appropriate candidates for conversion from door delivery to centralized delivery, curbside delivery, or sidewalk delivery.

“(2) Voluntary conversion—Not later than October 1, 2018, the Postal Service shall commence a program to convert delivery points identified under paragraph (1) to centralized delivery, curbside delivery, or sidewalk delivery. Such program shall operate as follows:

“(A) Not later than 3 months after the identification of the delivery points under paragraph (1), the Postal Service shall divide such delivery points into geographically based address units (such as street blocks or other similar reasonably segregable units) not to exceed 50 delivery points per unit.

“(B) Not later than 6 months after such identification, the Postal Service shall provide written notification to postal patrons served by each identified delivery point containing the following:

“(i) Notice that the delivery point has been proposed for conversion to a more efficient primary mode of mail delivery to more economically provide universal postal service and improve service.

“(ii) A description of the new primary mode of delivery proposed by the Postal Service and a visual example of such mode.

“(iii) A conversion consent form and notice that conversion for residential addresses is on a voluntary basis.

“(iv) A description of benefits of conversion to the postal patron, including access to secure mail and package delivery, and benefits of conversion to the Postal Service, including a smaller environmental impact for delivery.

“(v) A description of how the conversion process would work, and the monetary costs (if any) to the postal patron.

“(vi) Any other information the Postal Service considers necessary.

“(C) No delivery point may be converted under this subsection unless prior written consent is provided to the Postal Service by a postal patron served by such delivery point who is at least 18 years old, except as provided for in subparagraph (E). Prior to the conversion of a delivery point under this section, any written consent so provided may be withdrawn by such patron or by any other postal patron served by such delivery point who is at least 18 years old upon written notification to the Postal Service. The Postal Service shall place on the Postal Service’s public website an option to request that a consent form or consent-withdrawal form be delivered to any delivery point identified for conversion under this subsection.

“(D) Upon the receipt of written consent applicable to at least 40 percent of the delivery points within an address unit described under subparagraph (A), the Postal Service shall—

“(i) not later than 30 days after the date that the requisite percentage is reached, provide written notice to each delivery point within such unit stating that the conversion threshold has been reached and that—

“(I) with respect to any delivery point for which a consent for conversion was received, that the primary mode of mail delivery for such address will be converted; and

“(II) with respect to any delivery point for which a consent for conversion was not received, that—

“(aa) a postal patron served by such delivery point may elect, by written consent, at any time to convert the primary mode of mail delivery to the same form of delivery as the converted delivery points in such unit; and

“(bb) if such a patron provides such consent, the primary mode of mail delivery shall be converted not later than 30 days after the date of such consent or, in any case where the conversion of delivery points has not yet occurred, upon implementation of that conversion;

“(ii) not later than 90 days after the date that the requisite percentage is reached, but not less than 30 days following the written notice under clause (i), convert the delivery points for which consent was received to the applicable new primary mode of mail delivery; and

“(iii) following the conversion of an address unit, ensure that the primary mode of mail delivery for any new residents to the address unit is the converted primary mode of mail, regardless of the primary mode of mail delivery for the previous occupant.

“(E) Any delivery point created pursuant to subsection (c)(2) shall be automatically and irrevocably deemed to consent to delivery conversion if the delivery point is established within, or later becomes a part of, an address unit that is proposed for conversion to a different primary mode of mail delivery.

“(f) Considerations—In making a determination to convert the primary mode of mail delivery under this section, the Postal Service shall consider—

“(1) the impact of weather conditions, physical barriers, or any other factor that may impact the feasibility of providing a primary mode of mail delivery other than door delivery (such as a factor that may significantly reduce the potential cost savings associated with providing centralized delivery or curbside delivery);

“(2) whether the address is in a registered historic district (as that term is defined in section 47(c)(3)(B) of the Internal Revenue Code of 1986), is listed on the National Register of Historic Places, is designated as a National Historic Landmark, or is of historic value; and

“(3) population density and the concentration of poverty.

“(g) Waiver for physical hardship

“(1) In general—The Postal Service shall establish and maintain a waiver program under which, upon application, door delivery may be continued, or provided, for a delivery point identified under subsection (d)(1) or (e)(1) at no cost to the applicant in any case in which—

“(A) centralized delivery, curbside delivery, or sidewalk delivery would, but for this paragraph, otherwise be the primary mode of mail delivery; and

“(B) door delivery is necessary in order to avoid causing significant physical hardship or physical safety risks to a postal patron.

“(2) Treatment of waiver—An address receiving door delivery pursuant to a waiver under this subsection—

“(A) shall be counted, for purposes of the reporting requirement under subsection (j), as an address that receives the primary mode of mail delivery which the address would be subject to if not for the waiver; and

“(B) shall, not later than 60 days after ceasing to meet the requirements of paragraph (1), be converted to the primary mode of mail delivery which is otherwise applicable.

“(h) Procedures—In carrying out conversions under this section, the Postal Service shall establish procedures to—

“(1) solicit, consider, and respond to input from the general public, postal patrons, State and local governments, local associations, and property owners;

“(2) calculate and make publicly accessible the cost or savings of the conversion to the Postal Service as well as the average conversion cost or savings to each postal patron and any cost or savings to the State and local government; and

“(3) place centralized delivery points in locations that maximize delivery efficiency, ease of use for postal patrons, and respect for private property rights.

“(i) Voucher program—The Postal Service shall provide for a voucher program under which, upon application, the Postal Service may defray all or any portion of the costs of new mail receptacles associated with conversion from door delivery under this section which would otherwise be borne by postal patrons.

“(j) Annual report—Not later than 60 days after the end of each of fiscal years 2018 through 2023, the Postal Service shall submit to Congress and the Inspector General a report on the implementation of this section during the most recently completed fiscal year. Each such report shall include—

“(1) the number of residential and business addresses that—

“(A) receive door delivery as of the end of the fiscal year preceding the most recently completed fiscal year;

“(B) receive door delivery as of the end of the most recently completed fiscal year; and

“(C) during the most recently completed fiscal year, were converted from door delivery to—

“(i) centralized delivery;

“(ii) curbside delivery; and

“(iii) any other primary mode of mail delivery;

“(2) the estimated cost savings from the conversions described in paragraph (1)(C);

“(3) a description of the progress made by the Postal Service toward meeting the requirements of the phaseout under subsection (c); and

“(4) any other information which the Postal Service considers appropriate.

“(k) Inspector General audit—The Inspector General shall issue an annual audit report on the implementation of this section not later than 90 days after the date on which the Postal Service releases its annual report under subsection (j). Such report shall include—

“(1) an audit of the data contained in the Postal Service’s report under subsection (j); and

“(2) an evaluation of the Postal Service’s implementation of the voucher program under subsection (i).

“(l) Review—Subchapters IV and V shall not apply with respect to any action taken by the Postal Service under this section.”

(b)
Clerical amendment— The table of sections for chapter 36 of title 39, United States Code, is amended by adding after the item relating to section 3691 the following:
(c)
Updated delivery cost data—
(1)
Study— Not later than 180 days after the date of the enactment of this Act, the Postal Service shall begin to collect data on delivery mode costs and the potential savings of converting to more cost-efficient primary modes of mail delivery.
(2)
Report— Not later than 2 years after the date of enactment of this Act, the Postal Service shall submit 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 a report describing the findings of the study conducted under paragraph (1).
(d)
Inspector General review of costs and benefits of delivery point conversions—
(1)
Study— Not later than 2 years after the date on which the Postal Service commences delivery point conversions pursuant to subsections (d)(2) and (e)(2) of section 3692 of title 39, United States Code (as added by subsection (a)), and not later than 3 years thereafter, the Inspector General of the Postal Community shall conduct a study of the costs and benefits of such conversions.
(2)
Report— Not later than 1 year after the date on which the Inspector General conducts each study required under paragraph (1), the Inspector General shall submit 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 a report on the results of each study.
(3)
Content— The studies required under paragraph (1) shall assess the following:
(A)
The cost savings realized by the Postal Service from the conversions under subsections (d)(2) and (e)(2) of section 3692 of title 39, United States Code (as added by subsection (a)), and the projected cost savings the Postal Service is likely to realize from full implementation of such conversions.
(B)
The expenses incurred by the Postal Service to achieve such conversions and the projected expenses the Postal Service is likely to incur from full implementation of such conversions.
(C)
The impact of the conversions on—
(i)
read and response rates to mailed advertising;
(ii)
advertising mail revenue earned by the Postal Service;
(iii)
small businesses, including small home-based businesses; and
(iv)
mail volumes shipped through the Postal Service.
(D)
Any other factors the Inspector General considers relevant to provide a complete analysis of the costs and benefits associated with the conversions described under such subsections.
(4)
Net cost benefit analysis— The Inspector General shall conduct a cost benefit analysis to determine the net cost or benefit to the Postal Service of the conversions conducted under such subsections and include the analysis in each report submitted under paragraph (2).

Sec. 203 Modernizing postal rates

(a)
Adequacy, efficiency, and fairness of postal rates—
(1)
Objectives— Section 3622(b) of title 39, United States Code, is amended—
(A)
in paragraph (2), by inserting “and ensure” after “create”;
(B)
in paragraph (3)—
(i)
by inserting “and meet” after “maintain”; and
(ii)
by inserting “, with a focus on achieving predictable and consistent delivery” before the period at the end;
(C)
in paragraph (5), by inserting “establish and” before “maintain”;
(D)
in paragraph (6), by striking “process” and inserting “and cost attribution processes”; and
(E)
in paragraph (9), by inserting “(and to ensure appropriate levels of transparency)” before the period at the end.
(2)
Factors— Section 3622(c) of title 39, United States Code, is amended to read as follows:

“(c) Factors—In establishing or revising such system, the Postal Regulatory Commission shall take into account the following factors:

“(1) The effect of rate increases upon the general public and business mail users.

“(2) The available alternative means of sending and receiving written communications, information, and letters and other mail matter at reasonable costs.

“(3) The reliability of delivery timelines and the extent to which the Postal Service is meeting its service standard obligations.

“(4) The need to ensure that the Postal Service has adequate revenues and has taken appropriate cost-cutting measures to maintain financial stability and meet all legal obligations.

“(5) The extent to which the Postal Service has taken actions to increase its efficiency and reduce its costs.

“(6) The value of the mail service actually provided by each class or type of mail service to both the sender and the recipient, including the collection, mode of transportation, and priority of delivery.

“(7) The requirement that each class of mail or type of mail service bear the direct and indirect postal costs attributable to each class or type of mail service through reliably identified causal relationships plus that portion of all other costs of the Postal Service reasonably assignable to such class or type.

“(8) The degree of preparation of mail for delivery into the postal system performed by the mailer and its effect upon improving efficiency and reducing costs to the Postal Service.

“(9) Simplicity of structure for the entire schedule and simple, identifiable relationships between the rates or fees charged the various classes of mail for postal services.

“(10) The importance of pricing flexibility to encourage increased mail volume and operational efficiency.

“(11) The relative value to postal users of the kinds of mail matter entered into the postal system and the desirability and justification for special classifications and services of mail.

“(12) The importance of providing classifications with extremely high degrees of reliability and speed of delivery and of providing those that do not require high degrees of reliability and speed of delivery.

“(13) The desirability of special classifications for both postal users and the Postal Service in accordance with the policies of this title, including agreements between the Postal Service and postal users, when available on public and reasonable terms to similarly situated mailers, that—

“(A) improve the net financial position of the Postal Service by reducing Postal Service costs or increasing the overall contribution to the institutional costs of the Postal Service; and

“(B) do not cause—

“(i) unfair competitive advantage for the Postal Service or postal users eligible for the agreements; or

“(ii) unreasonable disruption to the volume or revenues of other postal users.

“(14) The educational, cultural, scientific, and informational value to the recipient of mail matter.

“(15) The need for the Postal Service to increase its efficiency and reduce its costs, including infrastructure costs, to help maintain high quality, affordable postal services.

“(16) The value to the Postal Service and postal users of promoting intelligent mail and of secure, sender-identified mail.

“(17) The importance of stability and predictability of rates to ratepayers.

“(18) The policies of this title as well as such other factors as the Commission determines appropriate.”

(3)
Requirements— Section 3622(d)(1) of title 39, United States Code, is amended—
(A)
by redesignating subparagraphs (B) through (E) as subparagraphs (C) through (F), respectively;
(B)
in subparagraph (F) (as redesignated by clause (i)) by striking “subparagraphs (A) and (C)” and inserting “subparagraphs (A) and (D)”; and
(C)
by inserting after subparagraph (A) the following:

“(B) establish postal rates for each group of functionally equivalent agreements between the Postal Service and users of the mail that—

“(i) cover attributable cost;

“(ii) improve the net financial position of the Postal Service; and

“(iii) do not cause unreasonable disruption in the marketplace, consistent with subsection (c)(13)(B),”

(4)
Technical and conforming amendments— Section 3622 of title 39, United States Code, is amended—
(A)
in subsection (a) by striking “, within 18 months after the date of enactment of this section,”; and
(B)
in subsection (d)(1)(D) (as redesignated by paragraph (3)(A)) by striking “(c)(10)” and inserting “(c)(13)”.
(b)
Repeal of rate preferences for qualified political committees— Subsection (e) of section 3626 of title 39, United States Code, is repealed.
(c)
Use of negotiated service agreements—
(1)
Streamlined review of qualifying service agreements for competitive products— Section 3633 of title 39, United States Code, is amended by adding at the end the following:

“(c) Streamlined review—Not later than 90 days after the date of enactment of this subsection, after notice and opportunity for comment, the Postal Regulatory Commission shall promulgate (and may from time to time thereafter revise) regulations for streamlined after-the-fact review of newly proposed agreements between the Postal Service and users of the mail that provide rates not of general applicability for competitive products. Streamlined review shall apply only if agreements are functionally equivalent to existing agreements that have collectively covered attributable costs and collectively improved the net financial position of the Postal Service. The regulations issued under this subsection shall provide that streamlined review shall be concluded not later than 5 business days after the date on which the agreement is filed with the Commission and shall be limited to approval or disapproval of the agreement as a whole based on the Commission's determination of its functional equivalence. Agreements not approved may be resubmitted without prejudice under section 3632.”

(2)
Submission of service agreements for streamlined review— Section 3632(b) of title 39, United States Code, is amended—
(A)
by redesignating paragraph (4) as paragraph (5); and
(B)
by inserting after paragraph (3) the following:

“(4) Rates for streamlined review—In the case of rates not of general applicability for competitive products that the Postmaster General considers eligible for streamlined review under section 3633(c), the Postmaster General shall cause the agreement to be filed with the Postal Regulatory Commission by a date that is on or before the effective date of any new rate established under the agreement, as the Postmaster General considers appropriate.”

(3)
Transparency and accountability for service agreements—
(A)
Certain information required to be included in determinations of compliance— Section 3653 of title 39, United States Code, is amended—
(i)
by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and
(ii)
by inserting after subsection (b) the following:

“(c) Written determination—Each annual written determination of the Commission under this section shall include the following:

“(1) Requirements—For each group of functionally equivalent agreements between the Postal Service and users of the mail, whether such group fulfilled requirements to—

“(A) cover costs attributable; and

“(B) improve the net financial position of the Postal Service.

“(2) Noncompliance—Any group of functionally equivalent agreements not meeting subparagraphs (A) and (B) of paragraph (1) shall be determined to be in noncompliance under this subsection.

“(3) Definition—For purposes of this subsection, a group of functionally equivalent agreements shall consist of one or more service agreements that are functionally equivalent to each other within the same market-dominant or competitive product, but shall not include agreements within an experimental product.”

(B)
Technical amendment— Section 3653(d) of title 39, United States Code (as redesignated by subparagraph (A)), is amended by striking “subsections (c) and (e)” and inserting “subsections (c) and (d)”.

Sec. 204 Nonpostal services

(a)
Nonpostal services—
(1)
In general— Part IV of title 39, United States Code, is amended by adding after chapter 36 the following:

“37 Nonpostal Services

“3701. Purpose

“The purpose of this chapter is to enable the Postal Service to increase its net revenues through specific nonpostal products and services that are expressly authorized by this chapter. Postal Service revenues and expenses under this chapter shall be funded through the Postal Service Fund.

“3702. Definitions

“In this chapter—

“(1) the term “nonpostal services” is limited to services offered by the Postal Service that are expressly authorized by this title and are not postal products or services;

“(2) the term “attributable costs” has the meaning given such term in section 3631; and

“(3) the term “year” means a fiscal year.

“3703. Postal Service program for State governments

“(a) In general—Notwithstanding any other provision of this title, the Postal Service may establish a program to enter into agreements with an agency of any State government, local government, or tribal government to provide property and services on behalf of such agencies for non-commercial products and services, but only if such property and services—

“(1) provide enhanced value to the public, such as by lowering the cost or raising the quality of such services or by making such services more accessible;

“(2) do not interfere with or detract from the value of postal services, including—

“(A) the cost and efficiency of postal services; and

“(B) unreasonably restricting access to postal retail service, such as customer waiting time and access to parking; and

“(3) provide a reasonable contribution to the institutional costs of the Postal Service, defined as reimbursement that covers at least 100 percent of attributable costs of all property and services provided under each relevant agreement in each year.

“(b) Public notice—At least 90 days before offering a service under the program, the Postal Service shall make available to the public on its website—

“(1) the agreement with the agency regarding such service; and

“(2) a business plan that describes the specific service to be provided, the enhanced value to the public, terms of reimbursement, the estimated annual reimbursement to the Postal Service, and the estimated percentage of attributable Postal Service costs that will be covered by reimbursement (with documentation to support the estimates).

“(c) Public comment—Before offering a service under the program, the Postal Service shall provide for a public comment period of at least 30 days that allows the public to post comments relating to the provision of such services on the Postal Service website. The Postal Service shall make reasonable efforts to provide written responses to the comments on such website at least 30 days before offering such services.

“(d) Approval required—The Postal Service may not establish the program under subsection (a) unless the Governors of the Postal Service approve such program by a recorded vote that is publicly disclosed on the Postal Service website with a majority of the total Governors voting for approval.

“(e) Application of reporting requirements—For purposes of the reporting requirements under section 3705, the Postal Service shall submit a separate report for each agreement with an agency entered into under subsection (a) analyzing the costs, revenues, rates, and quality of service for the provision of all services under such agreement, including information demonstrating that the agreement satisfies the requirements of paragraphs (1) through (3) of subsection (a).

“(f) Regulations required—The Postal Regulatory Commission shall issue such regulations as are necessary to carry out this section.

“(g) Definitions—For the purpose of this section—

“(1) the term “local government” means a county, municipality, city, town, township, local public authority, school district, special district, intrastate district, council of governments, or regional or interstate government entity;

“(2) the term “State government” includes the government of the District of Columbia, the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any other territory or possession of the United States;

“(3) the term “tribal government” means the government of an Indian tribe, as that term is defined in section 4(e) of the Indian Self-Determination Act (25 U.S.C. 450b(e)); and

“(4) the term “United States”, when used in a geographical sense, means the States, the District of Columbia, the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any other territory or possession of the United States.

“(h) Confidential information—Subsection (b) or (c) shall not be construed as requiring the Postal Service to disclose to the public any information—

“(1) described in section 410(c); or

“(2) exempt from public disclosure under section 552(b) of title 5.

“3704. Postal Service program for other Government agencies

“(a) In general—The Postal Service may establish a program to provide property and services to other Government agencies within the meaning of section 411, but only if such program provides a reasonable contribution to the institutional costs of the Postal Service, defined as reimbursement by each agency that covers at least 100 percent of the attributable costs of all property and service provided by the Postal Service in each year to such agency.

“(b) Application of reporting requirements—For purposes of the reporting requirements under section 3705, the Postal Service shall submit a separate report for each agreement with an agency entered into under subsection (a) analyzing the costs, revenues, rates, and quality of service for the provision of all services under such agreement, including information demonstrating that the agreement satisfies the requirements of subsection (a).

“3705. Transparency and accountability for nonpostal services

“(a) Annual report to the Commission

“(1) In general—Not later than 90 days after the last day of each year, the Postal Service shall submit to the Postal Regulatory Commission a report that analyzes costs, revenues, rates, and quality of service for each agreement for the provision of property and services under this chapter, using such methodologies as the Commission may prescribe, and in sufficient detail to demonstrate compliance with the requirements of this chapter.

“(2) Supporting matter—A report submitted under paragraph (1) shall include any nonpublic annex, the working papers, and any other supporting matter of the Postal Service and the Inspector General related to the information submitted in such report.

“(b) Content and form of report

“(1) In general—The Postal Regulatory Commission shall, by regulation, prescribe the content and form of the report required under subsection (a). In prescribing such regulations, the Commission shall give due consideration to—

“(A) providing the public with timely, adequate information to assess compliance;

“(B) avoiding unnecessary or unwarranted administrative effort and expense on the part of the Postal Service; and

“(C) protecting the confidentiality of information that is commercially sensitive or is exempt from public disclosure under section 552(b) of title 5.

“(2) Revised requirements—The Commission may, on its own motion or on request of any interested party, initiate proceedings to improve the quality, accuracy, or completeness of Postal Service data required by the Commission if—

“(A) the attribution of costs or revenues to property or services under this chapter has become significantly inaccurate or can be significantly improved;

“(B) the quality of service data provided to the Commission for a report under this chapter has become significantly inaccurate or can be significantly improved; or

“(C) such revisions are, in the judgment of the Commission, otherwise necessitated by the public interest.

“(c) Audits—The Inspector General shall regularly audit the data collection systems and procedures used in collecting information and preparing the report required under subsection (a). The results of any such audit shall be submitted to the Postal Service and the Postal Regulatory Commission.

“(d) Confidential information

“(1) In general—If the Postal Service determines that any document or portion of a document, or other matter, which it provides to the Postal Regulatory Commission in a nonpublic annex under this section contains information described in section 410(c), or exempt from public disclosure under section 552(b) of title 5, the Postal Service shall, at the time of providing such matter to the Commission, notify the Commission of its determination, in writing, and describe with particularity the documents (or portions of documents) or other matter for which confidentiality is sought and the reasons therefor.

“(2) Treatment—Any information or other matter described in paragraph (1) to which the Commission gains access under this section shall be subject to paragraphs (2) and (3) of section 504(g) in the same way as if the Commission had received notification with respect to such matter under section 504(g)(1).

“(e) Annual compliance determination

“(1) Opportunity for public comment—Upon receiving a report required under subsection (a), the Postal Regulatory Commission shall promptly—

“(A) provide an opportunity for comment on such report by any interested party; and

“(B) appoint an officer of the Commission to represent the interests of the general public.

“(2) Determination of compliance or noncompliance—Not later than 90 days after receiving a report required under subsection (a), the Postal Regulatory Commission shall make a written determination as to whether the nonpostal activities carried out during the applicable year were or were not in compliance with the provisions of this chapter. For purposes of this paragraph, any case in which the requirements for coverage of attributable costs have not been met shall be considered to be a case of noncompliance. If, with respect to a year, no instance of noncompliance is found to have occurred, the determination shall be to that effect. Such determination of noncompliance shall be included with the annual compliance determination required under section 3653.

“(3) Noncompliance—If a timely written determination of noncompliance is made under paragraph (2), the Postal Regulatory Commission shall take appropriate action. If the requirements for coverage of attributable costs specified by this chapter are not met, the Commission shall, within 60 days after the determination, prescribe remedial action to restore compliance as soon as practicable, including the full restoration of revenue shortfalls during the following year. The Commission may order the Postal Service to discontinue a nonpostal service under section 3703 that persistently fails to meet cost coverage requirements.

“(4) Deliberate noncompliance—In the case of deliberate noncompliance by the Postal Service with the requirements of this chapter, the Postal Regulatory Commission may order, based on the nature, circumstances, extent, and seriousness of the noncompliance, a fine (in the amount specified by the Commission in its order) for each incidence of such noncompliance. All receipts from fines imposed under this subsection shall be deposited in the general fund of the Treasury.

“(f) Regulations required—The Postal Regulatory Commission shall issue such regulations as are necessary to carry out this section.”

(2)
Clerical amendment— The table of chapters for part IV of title 39, United States Code, is amended by adding after the item relating to chapter 36 the following:
(b)
Conforming amendments—
(1)
Section 404— Section 404(e) of title 39, United States Code, is amended—
(A)
in paragraph (2), by inserting after “subsection” the following: “, or any nonpostal products or services authorized by chapter 37”; and
(B)
by adding at the end the following:

“(6) Licensing which, before the date of enactment of this paragraph, has been authorized by the Postal Regulatory Commission for continuation as a nonpostal service may not be used for any purpose other than—

“(A) to continue to provide licensed mailing, shipping, or stationery supplies offered as of June 23, 2011; or

“(B) to license other goods, products, or services, the primary purpose of which is to promote and enhance the image or brand of the Postal Service.

“(7) Nothing in this section shall be construed to prevent the Postal Service from establishing nonpostal products and services that are expressly authorized by chapter 37.”

(2)
Section 411— The last sentence of section 411 of title 39, United States Code, is amended by striking “including reimbursability” and inserting “including reimbursability within the limitations of chapter 37”.
(3)
Treatment of existing nonpostal services— All individual nonpostal services, provided directly or through licensing, that are continued pursuant to section 404(e) of title 39, United States Code, shall be considered to be expressly authorized by chapter 37 of such title (as added by subsection (a)(1)) and shall be subject to the requirements of such chapter.

Sec. 205 Efficient and flexible universal postal service

(a)
Conditions regarding determinations for post office closures— Clause (i) of section 404(d)(2)(A) of title 39, United States Code, is amended to read as follows:

“(i) the effect of such closing or consolidation on the community served by such post office, including through an analysis of—

“(I) the distance (as measured by public roads) to the closest postal retail facility not proposed for closure or consolidation under such plan;

“(II) the characteristics of such location, including weather and terrain;

“(III) whether commercial mobile service (as defined in section 332 of the Communications Act of 1934) and commercial mobile data service (as defined in section 6001 of the Middle Class Tax Relief and Job Creation Act of 2012) are available in at least 80 percent of the total geographic area of the ZIP codes served by the postal retail facility proposed for closure or consolidation; and

“(IV) whether fixed broadband Internet access service is available to households in at least 80 percent of such geographic area at speeds not less than those sufficient for service to be considered broadband for purposes of the most recent report of the Federal Communications Commission under section 706 of the Telecommunications Act of 1996;”

(b)
PRC review of determinations To close or consolidate a post office—
(1)
Deadline for review— Section 404(d)(5) title 39, United States Code, is amended by striking “120 days” and inserting “60 days, or a longer period for good cause shown but in no event longer than 120 days,”.
(2)
Applicability— The amendment made by paragraph (1) shall not apply with respect to an appeal received by the Postal Regulatory Commission before the date of enactment of this Act (as determined by applying the rules set forth in section 404(d)(6) of such title).
(c)
Expedited procedures—
(1)
In general— Section 3661 of title 39, United States Code, is amended by adding at the end the following:

“(d)

“(1) The Commission shall issue its opinion within 90 days, or a longer period for good cause shown but in no event longer than 120 days, after the receipt of any proposal (as referred to in subsection (b)) concerning an identical or substantially identical proposal on which the Commission has issued an opinion within the preceding 5 years.

“(2) If necessary in order to comply with the 90-day requirement under paragraph (1), the Commission may apply expedited procedures which the Commission shall by regulation prescribe.”

(2)
Regulations— The Postal Regulatory Commission shall prescribe any regulations necessary to carry out the amendment made by paragraph (1) within 90 days after the date of enactment of this Act.
(3)
Applicability— The amendment made by this subsection shall apply with respect to any proposal received by the Postal Regulatory Commission on or after the earlier of—
(A)
the 90th day after the date of enactment of this Act; or
(B)
the effective date of the regulations under paragraph (2).
(d)
Alternate postal access choice— Section 404(d) of title 39, United States Code, is amended by striking paragraph (1) and inserting the following:

“(1) The Postal Service, prior to making a determination under subsection (a)(3) as to the necessity for the closing or consolidation of any post office, shall—

“(A) provide adequate notice of its intention to close or consolidate such post office at least 60 days prior to the proposed date of such closing or consolidation to postal patrons served by such post office;

“(B) conduct a nonbinding survey on the proposed closing or consolidation to allow postal patrons served by such post office an opportunity to indicate their preference between or among—

“(i) the closing or consolidation; and

“(ii) one or more alternative options; and

“(C) ensure that—

“(i) should the closure or consolidation of a postal retail facility be deemed necessary, it shall be the policy of the Postal Service to provide alternative access to postal services to those served by the postal retail facility by the option chosen by the highest number of survey respondents under subparagraph (B)(ii); and

“(ii) if the Postal Service is unable to provide alternative access through the option identified in clause (i), or if that option is cost prohibitive, the Postal Service may provide alternative access through a different means. Upon selection of an alternative access method other than the one identified by clause (i), the Postal Service must provide written notice to those patrons served by the postal retail facility identifying and explaining why the option identified by clause (i) was not possible or cost prohibitive.”

(e)
Applicability of procedures relating to closures and consolidations—
(1)
In general— Section 404(d) of title 39, United States Code, is further amended by adding at the end the following:

“(7) For purposes of this subsection, the term “post office” means a post office and any other facility described in section 2(2) of the Postal Service Reform Act of 2017.”

(2)
Effective date— In the case of any post office (within the meaning of the amendment made by paragraph (1)) which, but for such amendment, would not otherwise be subject to section 404(d) of title 39, United States Code, the amendments made by subsections (a) and (d) shall be effective with respect to any closure or consolidation, the proposed effective date of which occurs on or after the 60th day following the date of enactment of this Act.
(f)
Enhanced reporting on postal service efficiency— Section 3652(a) of title 39, United States Code, is amended—
(1)
in paragraph (1), by striking “and” at the end;
(2)
in paragraph (2)(B)(ii), by striking the period at the end and inserting “; and”; and
(3)
by adding after paragraph (2) the following:

“(3) which shall provide the overall change in Postal Service productivity and the resulting effect of such change on overall Postal Service costs during such year, using such methodologies as the Commission shall by regulation prescribe, if necessary.”

(g)
POSTPlan study—
(1)
In general— Beginning not later than 30 days after the date of enactment of this Act, the Inspector General of the Postal Community shall conduct a 1-year review to study of the impacts of the POSTPlan post office restructuring plan on Postal Service expenses, revenue, and retail service provision.
(2)
Content— In conducting the review under paragraph (1), the Inspector General shall examine—
(A)
changes in the costs for the provision of Postal Service operated retail service, both nationwide and in the aggregate for each of the Level 2, Level 4, Level 6, and Level 18 post offices for which the hours, functions, or responsibilities changed as a result of the POSTPlan initiative before and after the implementation of the POSTPlan initiative;
(B)
changes in revenue received by Postal Service operated retail service, both nationwide and in the aggregate for each of the Level 2, Level 4, Level 6, and Level 18 post offices for which the hours, functions, or responsibilities changed as a result of the POSTPlan initiative before and after the implementation of the POSTPlan initiative;
(C)
a determination of the relative cost savings, taking into account any changes in revenue earned, realized on an annual basis for Level 2, Level 4, Level 6, and Level 18 offices each in the aggregate and any trends in such cost savings;
(D)
the relative impact on retail access to postal services for individuals served by Level 2, Level 4, Level 6, and Level 18 offices each in the aggregate; and
(E)
any other factors the Inspector General determines appropriate.
(3)
Report and recommendations— Upon completion of the review required under paragraph (1), the Inspector General shall submit to the Postal Service, the Committee on Homeland Security and Governmental Affairs of the Senate, and the Committee on Oversight and Government Reform of the House of Representatives a report containing—
(A)
the results of the review; and
(B)
any recommendations resulting from such review.
(4)
Postal Service review— Prior to any hour changes or consolidation decisions related to POSTPlan initiative impacted post offices, the Postal Service shall—
(A)
review the report and any recommendations submitted pursuant to paragraph (3); and
(B)
revise any planned efforts regarding the POSTPlan initiative, as appropriate.

Sec. 206 Fair stamp-evidencing competition

Section 404a(a) of title 39, United States Code, is further amended—
(1)
in paragraph (2), by striking “or” at the end;
(2)
in paragraph (3) by striking the period and inserting “; or”; and
(3)
by adding at the end the following:

“(4) offer to the public any postage-evidencing product or service that does not comply with any rule or regulation that would be applicable to such product or service if the product or service were offered by a private company.”

Sec. 207 Market-dominant rates

(a)
Establishment of rate baseline— Notwithstanding any order of the Postal Regulatory Commission to the contrary—
(1)
no earlier than the first Sunday after the date of enactment of this Act, on a date selected by the Postmaster General in the exercise of the Postmaster General’s unreviewable discretion, the Postal Service shall reinstate, as nearly as is practicable, 50 percent of the rate surcharge implemented under section 3622(d)(1)(F) (as redesignated by this Act) that was in effect on April 9, 2016; and
(2)
the partially reinstated surcharge reinstated pursuant to paragraph (1) shall be considered a part of the rate base for purposes of determining the percentage changes in rates when the Postal Service files a notice of rate adjustment.
(b)
Subsequent rate increases— The reinstatement described under subsection (a)(1) may not affect the calculation of the Postal Service’s maximum rate adjustment authority under subpart C of part 3010 of title 39, Code of Federal Regulations, for purposes of any rate increase that occurs following such reinstatement.
(c)
Postal Regulatory Commission authority not affected— Nothing in this section shall be construed as affecting the authority of the Postal Regulatory Commission to, by regulation, make such modification or adopt such alternative system for regulating rates and classes for market-dominant products as provided under section 3622 of title 39, United States Code.

Sec. 208 Completion of initial rate regulation review

The Postal Regulatory Commission shall complete the initial review of the system for regulating rates and classes for market-dominant products established under section 3622 of title 39, United States Code, such that a final rule or rules regarding a revised or reapproved system for regulating rates and classes for market-dominant products is issued not later than May 1, 2018.

Sec. 209 Review of Postal Service cost attribution guidelines

Not later than April 1, 2018, the Postal Regulatory Commission shall initiate a review of the regulations issued pursuant to sections 3633(a) and 3652(a)(1) of title 39, United States Code, to determine whether revisions are appropriate to ensure that all direct and indirect costs attributable to competitive and market-dominant products are properly attributed to those products, including by considering the underlying methodologies in determining cost attribution and considering options to revise such methodologies. If the Commission determines, after notice and opportunity for public comment, that revisions are appropriate, the Commission shall make modifications or adopt alternative methodologies as necessary.

Sec. 210 Aviation security for parcels

Not later than 18 months after the date of enactment of this Act, the Inspector General of the Postal Community shall transmit 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 results of a review of the security measures in place for parcels carried on air carriers to domestic and international destinations for which audit trails are generated. The review required under this subsection shall assess, at a minimum—
(1)
the effectiveness of the audit trail created by postage evidencing systems that have been validated under the Federal Information Processing Standards in accurately and consistently identifying the senders of parcels carried on air carriers;
(2)
the effectiveness of the Postal Service’s in-person identity verification procedures in accurately and consistently identifying the senders of parcels carried on air carriers; and
(3)
the effectiveness of the audit trail generated by customs declarations in accurately and consistently identifying the senders of parcels carried on air carriers to international destinations.

Sec. 211 ZIP codes

Not later than 270 days after the date of enactment of this Act, the Postal Service shall designate a single, unique ZIP code for, as nearly as practicable, each of the following communities:
(1)
Miami Lakes, Florida.
(2)
Storey County, Nevada.
(3)
Flanders, Northampton, and Riverside in the Town of Southampton, New York.
(4)
Ocoee, Florida.
(5)
Glendale, New York.