By Phil Stolberg, Chief Operating Officer
Are you concerned about the 2021 USPS nonprofit postal rates and reforms?
There is always news buzzing around the halls at BDI. In our industry, there is timely news to discuss and monitor – especially in these quickly evolving times. But above all the talk of legislation changes and discussions about nonprofit postal rates and reforms, I continue to be affirmed – with frequency and without apology – of our relentless commitment to expand our clients’ mission. I hear about our heart to share stories that motivate our clients’ partners into releasing generosity with joyful passion.
Of course, our clients expect (actually, demand) that we help craft and deploy marketing and creative strategies that generate exceptional results… that foster the type of donor relationships that lead to abundant giving, both now and well into the future.
We understand the importance of the pivotal role our clients must perform in order to make a meaningful difference in the lives of those they care for and serve. In addition to helping create and share powerful stories that encourage their donors’ generous support, we’re also compelled to stay abreast of the key governance issues and reforms that impact philanthropy.
Toward this end, we’re actively involved with several industry trade organizations committed to influencing legislation that impacts our industry and the nonprofit sector. At BDI, we’re engaged with partners that rigorously lobby policymakers in the areas of:
- US Postal Service and Rates
- Data Privacy and Security
- Tax Legislation Impacting Charitable Deductions
In addition to the areas above, we’re closely monitoring other important issues that govern our philanthropic industry and a donor’s ability to support worthy causes.
Today, I want to draw your attention to the US Postal Service (USPS). The USPS is preparing for the 2021 holiday peak season in anticipation of customer delivery demands. They are actively hiring mail processing and delivery personnel, as well as installing new mail processing equipment designed to accommodate increased mail volume.
Even so, the USPS is under tremendous pressure from postal user groups, Congress and the Courts to reorganize in a fashion that will be sustainable today, tomorrow and beyond.
The Nonprofit Alliance, of which BDI is an active member, recently prepared the attached briefing, which draws attention to our efforts to influence necessary postal reforms.
Take a moment to read through this briefing below, and then call us should you have questions.
At BDI, we’re committed to applying the necessary resources to influence the governance of our industry. As more is known, I’ll share future Quick Shot updates with you to highlight emerging efforts to govern data privacy, tax policies that influence a donor’s charitable giving and other issues impacting nonprofit fundraising. For now, stay tuned.
August 2021 Briefing prepared by The Nonprofit Alliance – Government Affairs Committee:
Overview
On August 29th, postal rates will increase 6.5% to 8.5% (depending on the class of mail) and this is on top of the 1.5% increase this past January. Worse still, nonprofit organizations could face similarly large rate increases in the coming year!
Our Court Challenge
On September 13, the DC Federal Court of Appeals will hear the oral argument on the lawsuit of the Alliance of Nonprofit Mailers, with the support of The Nonprofit Alliance as an “intervenor”, and other mailer organizations, challenging the new rate-making authority of the Postal Regulatory Commission.
The suit claims the Postal Regulatory Commission’s granting of authority to the USPS to raise postal rates beyond the Consumer Price Index (CPI) actually violates the limit set in law, and creates an authority not found in the Postal Reform Act of 2006. A decision is expected later this year or early next year.
In most litigation of this type the courts generally defer to the regulator – in this case the Postal Regulatory Commission – but in this situation folks that have followed postal litigation for years think we have a genuine chance to win.
On the Hill
On May 13, the House Committee on Oversight & Reform unanimously reported out of committee for consideration on the House Floor H.R. 3076, the Postal Service Reform Act of 2021. The legislation will likely come to the House Floor after the August Recess in September. Key provisions:
- Moving the enormous postal retiree healthcare cost away from the USPS and onto Medicare, where most retiree healthcare costs reside.
- Eliminating the requirement that the Postal Service prefund its retiree healthcare benefits for 75 years into the future. No private company or federal agency is required to comply with such a burdensome and unfair prefunding requirement.
- However, the legislation does NOT include a requirement that future postal rate increases cannot increase faster than the rate of inflation or CPI. Limiting future rate increases to the CPI is a top priority for TNPA.
In the Senate, on May 20 Senator Gary Peters (D-MI), who chairs the Homeland Security & Governmental Affairs Committee (HSGAC) introduced S. 1720, which has identical language to the House Postal Reform Bill.
Importantly, Senator Rob Portman (R-OH), the Ranking Republican on the HSGAC, is the lead Republican cosponsor on the bill, which has a total of 24 cosponsors on the bill – 12 Republicans and 12 Democrats.
It appears the House will move first with its postal reform bill, but true to form, the Senate is expected to act much slower. Importantly, in the Senate we will likely have an opportunity to amend the legislation and perhaps get language added to provide some form of protection against future rate increases beyond the rate of inflation (CPI).
But here is the Catch-22… We are four-square behind our position in the Federal Appeals Court case that the Postal Regulatory Commission does NOT have authority to grant rate increases in excess of the CPI, so it would be awkward and inconsistent if we were to advocate for some kind of new rate formula before the Appeals Court renders its decision.
The Bottom Line
We will “hope for the best and plan for the worst” on the court decision. Accordingly, if we lose at the Appeals Court, we absolutely want to be in a position to have made clear to folks on the Hill – in advance of the court decision, particularly in the Senate – that we strongly oppose an environment where the Postal Service can raise rates above (and potentially significantly above) the CPI.
It will be ALL ABOUT the Senate – with the House all but certain to pass its version of the legislation without amendment.
There are five critical Senators we are focusing on.
- Gary Peters (D-MI and Chair of the committee with postal jurisdiction, the Homeland Security & Governmental Affairs Committee)
- Rob Portman (R-OH and Ranking Republican on the postal committee)
- Tom Carper (D-DE and co-author of the 2006 Postal Reform Act)
- Susan Collins (R-ME and co-author of the 2006 Postal Reform Act)
- Roy Blunt (R-MO, who was active on the enactment of the 2006 Postal Reform Act)
What is the optimal time to weigh in with the five key Senators?
Timing is everything in politics and now is not that time, with the Senate expected to shortly take its long August Recess. But September and October could be the time to have the maximum impact on these Senators.
Source: The Nonprofit Alliance, TNPA.org
