Beyond The Headlines: PPAI’s Washington Report Gives You The Inside Scoop

Postal service reform and small business tax cut bills have made national headlines lately. I’m glad to offer PPAI members an in-depth look into these issues and how they could impact your business.  

I hope you enjoy this month’s inside-look into the issues that make headlines—PPAI’s Washington Report:

As predicted last month, the Senate returned to the topic of United States Postal Service (USPS) reform and the Senate has passed S. 1789, the 21st Century Postal Service Act, introduced by Senators Susan Collins (R-ME) and Joe Lieberman (I-CT). Among other things, the bill would give the Postmaster General access to money the USPS has overpaid into one of its pension funds (Federal Employees Retirement System, or FERS) and use it to offer buyouts or retirement incentives to reduce the active postal workforce by 100,000 or more employees over the next several years.

The bill would also allow the USPS to offer non-postal products or services if the PRC has determined that the products and services: 1) make use of USPS’s processing, transportation, delivery, retail network, or technology; 2) are consistent with the public interest and a demonstrated demand for the USPS to offer them; 3) do not create unfair competition with the private sector; and 4) have the potential to improve the USPS’s financial condition.

The reason the Senate had to take two runs at passage was that there were objections to the possibility of cutting back delivery services and closing some post offices and processing facilities. The Senate-passed version includes compromises on those issues. The House will now consider its own version, H.R. 2309, and it does not include the compromises. House Oversight and Government Reform Committee Chairman Darrell Issa (R-CA) made the following statement upon the passage of the Senate bill: “While the Postal Service is actually trying to shutter some facilities it does not need, the Senate bill forces the Postal Service to keep over one hundred excess postal facilities open at a cost of $900 million per year. Worst of all, the Senate bill does not stop the financial collapse of USPS, but only delays it for two years, at best, when reforms will only be more painful. The Senate’s approach is wholly unacceptable.”

The House bill would give the USPS the option of eliminating Saturday delivery six months after the enactment of the legislation. It would create a two-year task force, directed to recommend a plan to consolidate redundant post offices and other facilities. To stop implementation, Congress would have to pass a joint resolution disapproving the recommendations of task force.

We will see whether the House can withstand the constituent pressure on the closure and delivery issues.

Last year, the National Labor Relations Board (NLRB) decided that you should post a poster informing your employees that of their workplace rights. The effective date was to be April 30th.

While the employer community expressed concern from the moment the proposal surfaced, it took a couple of court decisions for the NLRB to take notice.

The NLRB has suffered a series of setbacks in the court in cases challenging its authority to issue the poster requirement. As a result, the NLRB has announced:

“In light of conflicting decisions at the district court level, the DC Circuit Court of Appeals has temporarily enjoined the NLRB’s rule requiring the posting of employee rights, which had been scheduled to take effect on April 30, 2012.

“In view of the DC Circuit’s order, and in light of the strong interest in the uniform implementation and administration of agency rules, regional offices will not implement the rule pending the resolution of the issues before the court.”

The House passed House Majority Leader Eric Cantor’s (R-VA) H.R. 9, the Small Business Tax Cut Act that would allow profitable small businesses to reduce their taxable income by up to 20 percent for one year. A small business is one with less than 500 full time employee equivalents for the purpose of the bill. The reduction is limited to not more than 50 percent of wages paid in the year.

Senate Majority Leader Harry Reid (D-NV) has his own ideas about a small business bill and says he will have the full Senate consider it soon.

S. 2237, the Small Business Jobs and Tax Relief Act would provide a one-time tax credit of up to ten percent of the incremental increase in wages paid by an employer in 2012 over 2011 wages. The incremental increase in the amount of wages eligible for the credit is capped at $5 million. His bill would also extend the temporary 100 percent depreciation bonus through 2012.  At the end of 2011, the temporary bonus dropped to 50 percent and it will expire at the end of the year.

It is hard to imagine the House considering the Senate bill (that is, if the Senate even passes the bill—it is not clear the Majority Leader can get the 60 votes needed to overcome a filibuster) or vice versa so, at the end of the day, this is an exercise in election year politics.

The House Oversight and Government Reform Committee has approved H.R. 4067, a moratorium on “Midnight Rules,” introduced by Rep. Reid Ribble (R-WI). The bill would prohibit federal agencies from proposing or finalizing major “midnight rules” during an outgoing President’s lame-duck period. Under the bill, major rules are those that have an annual effect on the economy of $100 million or more; a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.

We doubt the Senate majority will be inclined to embrace legislation that just happens to deal with the possibility of a lame duck president.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s