[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 22 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                 H. R. 22

            To reform the postal laws of the United States.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 7, 1997

  Mr. McHugh introduced the following bill; which was referred to the 
              Committee on Government Reform and Oversight

_______________________________________________________________________

                                 A BILL


 
            To reform the postal laws of the United States.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Postal Reform Act 
of 1997''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
                         TITLE I--ORGANIZATION

Sec. 101. Redesignations relating to the Governors and the Board of 
                            Governors.
Sec. 102. Redesignations relating to the Postmaster General and the 
                            Deputy Postmaster General.
Sec. 103. Clarification relating to execution of amendments.
                      TITLE II--GENERAL AUTHORITY

Sec. 201. Employment of postal police officers.
Sec. 202. Date of postmark to be treated as date of appeal in 
                            connection with the closing or 
                            consolidation of post offices.
     TITLE III--PRESIDENTIAL POSTAL EMPLOYEE-MANAGEMENT COMMISSION

Sec. 301. Presidential Postal Employee-Management Commission.
                           TITLE IV--FINANCE

Sec. 401. End of Treasury control of Postal Service banking.
Sec. 402. Postal Service investments.
Sec. 403. Exclusion from Federal Financing Bank.
Sec. 404. Elimination of Treasury preemption of borrowing by the Postal 
                            Service.
Sec. 405. Elimination of Postal Service ``put'' on Treasury.
               TITLE V--BUDGET AND APPROPRIATIONS PROCESS

Sec. 501. Repeal of provision relating to transitional appropriations.
Sec. 502. Provisions relating to benefits under chapter 81 of title 5, 
                            United States Code, for officers and 
                            employees of the former Post Office 
                            Department.
Sec. 503. Repeal of authorizations of appropriations for public service 
                            costs, revenue forgone, and certain 
                            compensatory appropriations.
Sec. 504. Congressional oversight preserved.
 TITLE VI--MISCELLANEOUS PROVISIONS RELATING TO POSTAL RATES, CLASSES, 
                              AND SERVICES

Sec. 601. Change-of-address order involving a commercial mail receiving 
                            agency.
Sec. 602. Rates for mail under former section 4358.
Sec. 603. Powers of the Postal Rate Commission.
Sec. 604. Volume discounts.
  TITLE VII--PROVISIONS RELATING TO THE TRANSPORTATION, CARRIAGE, OR 
                            DELIVERY OF MAIL

Sec. 701. Obsolete provisions.
Sec. 702. Expanded contracting authority.
Sec. 703. Private carriage of letters.
Sec. 704. Mailbox demonstration project.
TITLE VIII--DIRECT APPEAL OF DECISIONS OF THE MERIT SYSTEMS PROTECTION 
                                 BOARD

Sec. 801. Direct appeal of decisions of the Merit Systems Protection 
                            Board.
                       TITLE IX--LAW ENFORCEMENT

         Subtitle A--Amendments to Title 39, United States Code

Sec. 901. Make Federal assault statutes applicable to postal contract 
                            employees.
Sec. 902. Sexually oriented advertising.
Sec. 903. Allow Postal Service to retain asset forfeiture recoveries.
Sec. 904. Hazardous matter.
                      Subtitle B--Other Provisions

Sec. 911. Stalking Federal officers and employees.
Sec. 912. Nonmailability of controlled substances.
Sec. 913. Enhanced penalties.
Sec. 914. Postal burglary provisions.
Sec. 915. Mail, money, or other property of the United States.
  TITLE X--NEW SYSTEM RELATING TO POSTAL RATES, CLASSES, AND SERVICES

Sec. 1001. Establishment.
Sec. 1002. Termination of ratemaking authority under chapter 36 and 
                            related matters.

                         TITLE I--ORGANIZATION

SEC. 101. REDESIGNATIONS RELATING TO THE GOVERNORS AND THE BOARD OF 
              GOVERNORS.

    (a) References in Title 39.--Title 39, United States Code, is 
amended--
            (1) by striking ``Board of Governors'' each place it 
        appears and inserting ``Board of Directors'';
            (2) by striking ``Governors'' each place it appears (except 
        wherever it appears in ``Board of Governors'') and inserting 
        ``Directors''; and
            (3) by striking ``Governor'' each place it appears and 
        inserting ``Director''.
    (b) References Outside Title 39.--Any reference in any provision of 
law outside title 39, United States Code, enacted before the date of 
the enactment of this Act--
            (1) to the Board of Governors, within the meaning of 
        section 102(2) of title 39, United States Code, as in effect 
        before the date of the enactment of this Act, shall be treated 
        as referring to the Board of Directors, within the meaning of 
        such section 102(2), as amended by subsection (a); or
            (2) to any of the Governors, within the meaning of section 
        102(3) of title 39, United States Code, as in effect before the 
        date of the enactment of this Act, shall be treated as 
        referring to the corresponding Director or Directors, within 
        the meaning of such section 102(3), as amended by subsection 
        (a).

SEC. 102. REDESIGNATIONS RELATING TO THE POSTMASTER GENERAL AND THE 
              DEPUTY POSTMASTER GENERAL.

    (a) In General.--(1) Section 202(c) of title 39, United States 
Code, is amended by striking ``Postmaster General'' and inserting 
``Chief Executive Officer of the United States Postal Service''.
    (2) Section 202(d) of such title 39 is amended by striking ``Deputy 
Postmaster General'' and inserting ``Deputy Chief Executive Officer of 
the United States Postal Service''.
    (3) Section 102 of such title 39 is amended by striking ``and'' at 
the end of paragraph (2), by striking the period at the end of 
paragraph (3) and inserting a semicolon, and by adding after paragraph 
(3) the following:
            ``(4) `Chief Executive Officer', unless the context 
        otherwise requires, means the Chief Executive Officer of the 
        United States Postal Service appointed under section 202(c); 
        and
            ``(5) `Deputy Chief Executive Officer', unless the context 
        otherwise requires, means the Deputy Chief Executive Officer of 
        the United States Postal Service appointed under section 
        202(d).''.
    (b) Other References in Title 39.--Title 39, United States Code, is 
further amended--
            (1) by striking ``Postmaster General'' each place it 
        appears (except wherever it appears in ``Deputy Postmaster 
        General'') and inserting ``Chief Executive Officer''; and
            (2) by striking ``Deputy Postmaster General'' each place it 
        appears and inserting ``Deputy Chief Executive Officer''.
    (c) References Outside Title 39.--Any reference in any provision of 
law outside title 39, United States Code, enacted before the date of 
the enactment of this Act--
            (1) to the Postmaster General shall be treated as referring 
        to the Chief Executive Officer of the United States Postal 
        Service; and
            (2) to the Deputy Postmaster General shall be treated as 
        referring to the Deputy Chief Executive Officer of the United 
        States Postal Service.

SEC. 103. CLARIFICATION RELATING TO EXECUTION OF AMENDMENTS.

    Any amendment made in this title to a term ``each place it 
appears'' (or other words to the same effect) shall be considered to 
include such term when it appears in a table of contents or a section 
heading.

                      TITLE II--GENERAL AUTHORITY

SEC. 201. EMPLOYMENT OF POSTAL POLICE OFFICERS.

    Section 404 of title 39, United States Code, is amended by adding 
at the end the following:
    ``(c)(1) The Postal Service may employ guards for all buildings and 
areas owned or occupied by the Postal Service or under the charge and 
control of the Postal Service, and such guards shall have, with respect 
to such property, the powers of special policemen provided by the first 
section of the Act cited in paragraph (2), and, as to such property, 
the Chief Executive Officer (or his designee) may take any action that 
the Administrator of General Services (or his designee) may take under 
section 2 or 3 of such Act, attaching thereto penalties under the 
authority and within the limits provided in section 4 of such Act.
    ``(2) The Act cited in this paragraph is the Act of June 1, 1948 
(62 Stat. 281), commonly known as the Protection of Public Property 
Act.''.

SEC. 202. DATE OF POSTMARK TO BE TREATED AS DATE OF APPEAL IN 
              CONNECTION WITH THE CLOSING OR CONSOLIDATION OF POST 
              OFFICES.

    (a) In General.--Section 404(b) of title 39, United States Code, is 
amended by adding at the end the following:
    ``(6) For purposes of paragraph (5), any appeal received by the 
Commission shall--
            ``(A) if sent to the Commission through the mails, be 
        considered to have been received on the date of the Postal 
        Service postmark on the envelope or other cover in which such 
        appeal is mailed; or
            ``(B) if lawfully delivered to the Commission by an 
        enterprise in the private sector of the economy engaged in the 
        delivery of mail, be considered to have been received on the 
        date determined based on any appropriate documentation or other 
        indicia (as determined under regulations of the Commission).''.
    (b) Effective Date.--This section and the amendments made by this 
section shall apply with respect to any determination to close or 
consolidate a post office which is first made available, in accordance 
with paragraph (3) of section 404(b) of title 39, United States Code, 
after the end of the 3-month period beginning on the date of the 
enactment of this Act.

     TITLE III--PRESIDENTIAL POSTAL EMPLOYEE-MANAGEMENT COMMISSION

SEC. 301. PRESIDENTIAL POSTAL EMPLOYEE-MANAGEMENT COMMISSION.

    (a) In General.--Section 206 of title 39, United States Code, is 
amended to read as follows:
``Sec. 206. Presidential Postal Employee-Management Commission
    ``(a) There shall be established a Presidential Postal Employee-
Management Commission (hereinafter in this section referred to as the 
`Commission').
    ``(b)(1) The Commission shall study and make recommendations, in 
accordance with this section, on how employee-management relations 
within the Postal Service might be improved.
    ``(2) The Commission shall submit its recommendations--
            ``(A) to the President and the Congress, to the extent that 
        they involve any legislation; and
            ``(B) to the Postal Service, to the extent that no 
        legislation would be involved.
    ``(3) All recommendations shall be submitted in the form of a 
written report, with the first set of reports due within 18 months 
after the Commission is first constituted, and the second and third 
sets of reports in 12-month intervals thereafter.
    ``(4) The Commission shall terminate after submitting its third set 
of reports.
    ``(c)(1) The Commission shall be composed of 7 members, all of whom 
shall be appointed by the President. Of the members--
            ``(A) 2 shall be appointed from among persons who will 
        represent the views of nonpostal labor organizations familiar 
        with issues common to postal employees;
            ``(B) 2 shall be appointed from among persons who will 
        represent the views of the management of private corporations 
        similar in size to the Postal Service;
            ``(C) 2 shall be appointed from among persons well known in 
        the fields of employee-management relations, labor mediation, 
        and collective bargaining; and
            ``(D) 1 shall be appointed from among persons well known in 
        the fields described in subparagraph (C), who are also 
        generally viewed as not being predisposed to the interests of 
        employees or management.
    ``(2) All members shall be appointed for the life of the 
Commission.
    ``(3) Not more than 4 members may be of the same political party.
    ``(4) Members shall serve without compensation, but shall be 
reimbursed for necessary travel and reasonable expenses incurred in 
attending meetings of the Commission.
    ``(5) The member appointed under paragraph (1)(D) shall serve as 
chairman of the Commission.
    ``(d)(1) The Commission shall have a Director who shall be 
appointed by the Commission and paid at a rate not to exceed the rate 
of basic pay payable for level IV of the Executive Schedule under 
section 5315 of title 5.
    ``(2) Upon request of the Commission, the Federal Mediation and 
Conciliation Service may detail, on a reimbursable basis, any of the 
personnel of that agency to the Commission to assist it in carrying out 
its duties under this Act.
    ``(3) The Commission may not appoint or retain any staff, except as 
provided in paragraph (1) or (2).''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 2 of title 39, United States Code, is amended by striking the 
item relating to section 206 and inserting the following:

``206. Presidential Postal Employee-Management Commission.''.

                           TITLE IV--FINANCE

SEC. 401. END OF TREASURY CONTROL OF POSTAL SERVICE BANKING.

    (a) In General.--Subsection (d) of section 2003 of title 39, United 
States Code, is amended to read as follows:
    ``(d)(1) The Postal Service, in its sole discretion--
            ``(A) may provide that amounts which would otherwise be 
        deposited in the revolving fund referred to in subsection (a) 
        shall instead, to the extent considered appropriate by the 
        Postal Service, be directly deposited in a Federal Reserve bank 
        or a depository for public funds selected by the Postal 
        Service; and
            ``(B) may provide for transfers of amounts under this 
        subsection between or among--
                    ``(i) Federal Reserve banks;
                    ``(ii) depositories for public funds; and
                    ``(iii) the revolving fund referred to in 
                subsection (a).
    ``(2) The Postal Service, after consultation with the Secretary of 
the Treasury, shall prepare and may from time to time revise a master 
plan for the exercise of any authority under this subsection. Such plan 
shall address--
            ``(A) the criteria that shall be applied by the Postal 
        Service in deciding when and how any such authority shall be 
        exercised;
            ``(B) matters such as risk limitations, reserve balances, 
        allocation or distribution of monies, liquidity requirements, 
        and measures to safeguard against losses;
            ``(C) the types of notification or consultation 
        requirements the Postal Service shall follow in connection with 
        any exercise or proposed exercise of authority under this 
        subsection; and
            ``(D) procedures under which the Postal Service shall, at 
        least annually, render a full accounting as to how any 
        authority under this subsection has been exercised during the 
        period involved.
    ``(3)(A) Authority under this subsection may not be exercised 
except in accordance with applicable provisions of the master plan 
under paragraph (2).
    ``(B) The Postal Service shall submit its master plan (and any 
revision thereof) to the President, the Secretary of the Treasury, and 
each House of Congress at least 30 days before the date of its proposed 
implementation.''.
    (b) Savings Provision.--Until the authority under section 2003(d) 
of title 39, United States Code, as amended by subsection (a), becomes 
available, the provisions of such section 2003(d), as last in effect 
before being so amended, shall be treated as if still in effect.
    (c) Status of Monies Unchanged.--(1) Any amounts invested under 
section 2003(c) of title 39, United States Code, as amended by this 
title, shall be considered to be part of the Postal Service Fund, to 
the same extent as if they had been invested under section 2003(c) of 
such title 39, as last in effect before the date of the enactment of 
this Act.
    (2) Any amounts deposited or transferred under section 2003(d) of 
title 39, United States Code, as amended by this title, shall be 
considered to be part of the Postal Service Fund, to the same extent as 
if they had been transferred under section 2003(d) of such title 39, as 
last in effect before the date of the enactment of this Act.

SEC. 402. POSTAL SERVICE INVESTMENTS.

    Section 2003(c) of title 39, United States Code, is amended by 
striking all after ``it may'' and inserting the following: ``invest 
such amounts as it considers appropriate in obligations of, or 
obligations guaranteed by, the Government of the United States.''.

SEC. 403. EXCLUSION FROM FEDERAL FINANCING BANK.

    Section 2005(d) of title 39, United States Code, is amended--
            (1) in paragraph (4) by striking ``and'' after the 
        semicolon;
            (2) in paragraph (5) by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(6) notwithstanding the provisions of the Federal 
        Financing Bank Act of 1973 or any other provision of law 
        (except as may be specifically provided by reference to this 
        paragraph in any Act enacted after this paragraph takes 
        effect), not be eligible for purchase by, or commitment to 
        purchase by, or sale or issuance to, the Federal Financing 
        Bank.''.

SEC. 404. ELIMINATION OF TREASURY PREEMPTION OF BORROWING BY THE POSTAL 
              SERVICE.

    Section 2006(a) of title 39, United States Code, is amended by 
striking all after the first sentence.

SEC. 405. ELIMINATION OF POSTAL SERVICE ``PUT'' ON TREASURY.

    Section 2006(b) of title 39, United States Code, is amended to read 
as follows:
    ``(b) The Secretary of the Treasury may purchase obligations of the 
Postal Service in such amounts as the Secretary of the Treasury and the 
Postal Service, in their discretion, may agree.''.

               TITLE V--BUDGET AND APPROPRIATIONS PROCESS

SEC. 501. REPEAL OF PROVISION RELATING TO TRANSITIONAL APPROPRIATIONS.

    (a) Repeal.--(1) Section 2004 of title 39, United States Code, is 
repealed.
    (2) The item relating to section 2004 in the table of sections at 
the beginning of chapter 20 of such title 39 is repealed.
    (3) Section 2003(e)(2) of such title 39 is amended by striking 
``sections 2401 and 2004'' each place it appears and inserting 
``section 2401''.
    (b) Clarification That Liabilities Formerly Paid Pursuant to 
Section 2004 Remain Liabilities Payable by the Postal Service.--Section 
2003 of title 39, United States Code, is amended by adding at the end 
the following:
    ``(h) Liabilities of the former Post Office Department to the 
Employees' Compensation Fund (appropriations for which were authorized 
by former section 2004, as in effect before the effective date of this 
subsection) shall be liabilities of the Postal Service payable out of 
the Fund.''.
    (c) Effective Date.--This section and the amendments made by this 
section shall take effect on October 1, 1998.

SEC. 502. PROVISIONS RELATING TO BENEFITS UNDER CHAPTER 81 OF TITLE 5, 
              UNITED STATES CODE, FOR OFFICERS AND EMPLOYEES OF THE 
              FORMER POST OFFICE DEPARTMENT.

    (a) In General.--Section 8 of the Postal Reorganization Act (39 
U.S.C. 1001 note) is amended by inserting ``(a)'' after ``8.'' and by 
adding at the end the following:
    ``(b) For purposes of chapter 81 of title 5, United States Code, 
the Postal Service shall, with respect to any individual receiving 
benefits under such chapter as an officer or employee of the former 
Post Office Department, have the same authorities and responsibilities 
as it has with respect to an officer or employee of the Postal Service 
receiving such benefits.''.
    (b) Effective Date.--This section and the amendments made by this 
section shall take effect on October 1, 1998.

SEC. 503. REPEAL OF AUTHORIZATIONS OF APPROPRIATIONS FOR PUBLIC SERVICE 
              COSTS, REVENUE FORGONE, AND CERTAIN COMPENSATORY 
              APPROPRIATIONS.

    (a) In General.--Section 2401 of title 39, United States Code, is 
amended by striking subsections (b), (c), (d), (f), and (g), and by 
redesignating subsection (e) as subsection (b).
    (b) Conforming Amendments.--(1) Section 2003 of title 39, United 
States Code, is amended--
            (A) in subsection (e) by striking paragraph (2) and by 
        redesignating subsection (e)(1) as subsection (e); and
            (B) by striking subsection (f) and by redesignating 
        subsection (g) as subsection (f).
    (2) Section 2009 of such title 39 is amended by striking the last 
two sentences.
    (3) Sections 2803(a) and 2804(a) of such title 39 are amended by 
striking ``2401(g)'' and inserting ``2401(b)''.
    (4) Section 3626(a)(2)(B) of such title 39 is amended by striking 
``paragraph (3)(A) or section 2401(c);'' and inserting ``paragraph 
(3)(A), section 3217, or sections 3403-3406;''.
    (5)(A) Section 3627 of such title 39 is repealed.
    (B) The item relating to section 3627 in the table of sections at 
the beginning of chapter 36 of such title 39 is repealed.
    (C) Section 3684 of such title 39 is amended by striking ``Except 
as provided in section 3627 of this title, no'' and inserting ``No''.
    (c) Effective Date.--This section and the amendments made by this 
section shall take effect on October 1, 1998.

SEC. 504. CONGRESSIONAL OVERSIGHT PRESERVED.

    Subsection (b) of section 2401 of title 39, United States Code, as 
so redesignated by section 503(a), is amended--
            (1) by striking ``Committee on Post Office and Civil 
        Service'' each place it appears and inserting ``Committee on 
        Government Reform and Oversight'';
            (2) by striking ``and the Committees on Appropriations of 
        the Senate and the House of Representatives'';
            (3) in the matter before paragraph (1)--
                    (A) by striking ``2009 of this title,'' and 
                inserting ``2009 for a fiscal year,''; and
                    (B) by striking ``for the fiscal year for which 
                funds are requested to be appropriated,'' and inserting 
                ``for such fiscal year,'';
            (4) in paragraph (3) by striking ``during the fiscal year 
        for which funds are requested to be appropriated,'' and 
        inserting ``during the fiscal year referred to in the matter 
        before paragraph (1),'';
            (5) by striking ``Not later than March 15 of each year,'' 
        and inserting ``Each year,''; and
            (6) by striking ``any such committee considers necessary to 
        determine the amount of funds to be appropriated for the 
        operation of the Postal Service,'' and inserting ``either such 
        committee considers necessary,''.

 TITLE VI--MISCELLANEOUS PROVISIONS RELATING TO POSTAL RATES, CLASSES, 
                              AND SERVICES

SEC. 601. CHANGE-OF-ADDRESS ORDER INVOLVING A COMMERCIAL MAIL RECEIVING 
              AGENCY.

    (a) In General.--Subchapter V of chapter 36 of title 39, United 
States Code, is amended by adding at the end the following:
``Sec. 3686. Change-of-address order involving a commercial mail 
              receiving agency
    ``(a) For the purpose of this section, the term `commercial mail 
receiving agency' or `CMRA' means a private business that acts as the 
mail receiving agent for specific clients.
    ``(b) Upon termination of an agency relationship between an 
addressee and a commercial mail receiving agency--
            ``(1) the addressee or, if authorized to do so, the CMRA 
        may file a change-of-address order with the Postal Service with 
        respect to such addressee;
            ``(2) a change-of-address order so filed shall, to the 
        extent practicable, be given full force and effect; and
            ``(3) any mail for the addressee that is delivered to the 
        CMRA after the filing of an appropriate order under this 
        subsection shall be subject to subsection (c).
    ``(c) Mail described in subsection (b)(3) shall, if marked for 
forwarding and remailed by the CMRA, be forwarded by the Postal Service 
in the same manner as, and subject to the same terms and conditions 
(including limitations on the period of time for which a change-of-
address order shall be given effect) as apply to, mail forwarded 
directly by the Postal Service to the addressee.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 36 of title 39, United States Code, is amended by adding after 
the item relating to section 3685 the following:

``3686. Change-of-address order involving a commercial mail receiving 
                            agency.''.

SEC. 602. RATES FOR MAIL UNDER FORMER SECTION 4358.

    Section 3626 of title 39, United States Code, is amended by adding 
at the end the following:
    ``(n) In the administration of this section, matter shall not be 
excluded from being mailed at the rates for mail under former section 
4358 solely because such matter does not meet the requirements of 
former section 4354(a)(5).''.

SEC. 603. POWERS OF THE POSTAL RATE COMMISSION.

    Section 3604 of title 39, United States Code, is amended by adding 
at the end the following:
    ``(f)(1) Any Commissioner of the Commission, any administrative law 
judge appointed by the Commission under section 3105 of title 5, and 
any employee of the Commission designated by the Commission may 
administer oaths, examine witnesses, take depositions, and receive 
evidence.
    ``(2) The Chairman of the Commission, any Commissioner designated 
by the Chairman, and any administrative law judge appointed by the 
Commission under section 3105 of title 5 may, with respect to any 
proceeding under section 3624 or 3661 or chapter 37--
            ``(A) issue subpenas requiring the attendance and 
        presentation of testimony of any individual, and the production 
        of documentary or other evidence, from any place in the United 
        States, any territory or possession of the United States, the 
        Commonwealth of Puerto Rico, or the District of Columbia; and
            ``(B) order the taking of depositions and responses to 
        written interrogatories.
The written concurrence of a majority of the Commissioners then holding 
office shall, with respect to each subpena under subparagraph (A), be 
required in advance of its issuance.
    ``(3) In the case of contumacy or failure to obey a subpena issued 
under this subsection, upon application by the Commission, the district 
court of the United States for the district in which the person to whom 
the subpena is addressed resides or is served may issue an order 
requiring such person to appear at any designated place to testify or 
produce documentary or other evidence. Any failure to obey the order of 
the court may be punished by the court as a contempt thereof.
    ``(g)(1) If the Postal Service determines that any document or 
other matter it provides to the Commission pursuant to a subpena issued 
under subsection (f), or otherwise at the request of the Commission in 
connection with any proceeding or other purpose under this chapter or 
chapter 37, contains information which is described in section 410(c) 
of this title, 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, in writing, of its 
determination (and the reasons therefor).
    ``(2) No officer or employee of the Commission may, with respect to 
any information as to which the Commission has been notified under 
paragraph (1)--
            ``(A) use such information for purposes other than the 
        purposes for which it is supplied; or
            ``(B) permit anyone who is not an officer or employee of 
        the Commission to have access to any such information.
    ``(3) Paragraph (2) shall not prevent information from being 
furnished under any process of discovery established under this title 
in connection with a proceeding under this chapter or chapter 37 which 
is conducted in accordance with sections 556 and 557 of title 5. The 
Commission shall, by regulations based on rule 26(c) of the Federal 
Rules of Civil Procedure, establish appropriate administrative and 
other safeguards to ensure the security and confidentiality of any 
information furnished under the preceding sentence.''.

SEC. 604. VOLUME DISCOUNTS.

    (a) In General.--Subsection (c) of section 403 of title 39, United 
States Code, is amended by striking ``(c)'' and inserting ``(c)(1)'' 
and by adding at the end the following:
    ``(2) Nothing in this title shall be considered to preclude the 
Postal Service from offering any discount in a rate or fee, on the 
basis of volume, so long as--
            ``(A) all persons are, with respect to the class of mail or 
        postal service involved, eligible for the same volume discount; 
        and
            ``(B) the discounted rate--
                    ``(i) if a product in the noncompetitive category 
                of mail is involved, does not exceed the maximum rate 
                then allowable for such product under subchapter II of 
                chapter 37; or
                    ``(ii) if a product in the competitive category of 
                mail is involved, satisfies the requirement under 
                section 3742(b) that each such product bear the direct 
                and indirect postal costs attributable to such product 
                plus a reasonable contribution to all other costs of 
                the Postal Service.''.
    (b) Demonstration Project.--
            (1) In general.--
                    (A) Purpose.--As soon as practicable after the date 
                of the enactment of this Act, the United States Postal 
                Service shall conduct a demonstration project, the 
                purpose of which shall be to determine the feasibility 
                and desirability of affording volume discounts to 
                mailers on a negotiated basis.
                    (B) Limitation.--The demonstration project shall be 
                limited to products in the competitive category of mail 
                (within the meaning of section 3741(2) of title 39, 
                United States Code, as amended by section 1001).
                    (C) Discounts.--Under the demonstration project, 
                any discounts shall be on such terms and conditions as 
                may be mutually agreed to by the Postal Service and the 
                mailer, subject to section 403(c)(2)(B)(ii) of title 
                39, United States Code (as amended by subsection (a)).
            (2) Other requirements.--Subsections (c)(1)(A), (d)(1) 
        (excluding subparagraphs (A)(i), (B)(ii), and (C)(ii) thereof), 
        and (e) of section 704 shall apply with respect to the 
        demonstration project under this subsection.
    (c) Effective Date.--This section and the amendments made by this 
section shall take effect on the date on which section 1002 (relating 
to termination of ratemaking authority under chapter 36 and related 
matters) takes effect.

TITLE VII--PROVISIONS RELATING TO TRANSPORTATION, CARRIAGE, OR DELIVERY 
                                OF MAIL

SEC. 701. OBSOLETE PROVISIONS.

    (a) Repeal.--Chapter 52 of title 39, United States Code, is 
repealed.
    (b) Conforming Amendments.--(1) Section 5005(a) of title 39, United 
States Code, is amended--
            (A) by repealing paragraph (1); and
            (B) in paragraph (4) by striking ``(as defined in section 
        5201(6) of this title)''.
    (2) Section 10721(b)(1) of title 49, United States Code, is amended 
by striking ``chapters 50 and 52'' and inserting ``chapter 50''.
    (c) Eliminating Restriction on Length of Contracts.--(1) Section 
5005(b)(1) of title 39, United States Code, is amended by striking 
``shall be for periods not in excess of 4 years (or where the Postal 
Service determines that special conditions or the use of special 
equipment warrants, not in excess of 6 years) and''.
    (2) Section 5402(c) of such title 39 is amended by striking ``for a 
period of not more than 4 years''.
    (3) Section 5605 of such title 39 is amended by striking ``for 
periods of not in excess of 4 years''.

SEC. 702. EXPANDED CONTRACTING AUTHORITY.

    Subsection (d) of section 5402 of title 39, United States Code, is 
amended to read as follows:
    ``(d) Notwithstanding the provisions of subsections (a) through 
(c), the Postal Service may contract for the transportation of mail by 
aircraft, except as provided in subsections (f) and (g).''.

SEC. 703. PRIVATE CARRIAGE OF LETTERS.

    Section 601(a) of title 39, United States Code, is amended by 
inserting ``when the amount paid for private carriage of the letter is 
at least $2, or'' before ``when''.

SEC. 704. MAILBOX DEMONSTRATION PROJECT.

    (a) Purpose.--The purpose of this section is to determine the 
feasibility and desirability of allowing non-postage bearing matter to 
be deposited in private letterboxes.
    (b) Project.--As soon as practicable after the date of the 
enactment of this Act, the United States Postal Service shall--
            (1) develop a plan for the conducting of a demonstration 
        project under this section; and
            (2) within 18 months after the date of the enactment of 
        this Act, commence implementation of such plan.
    (c) Specifications.--
            (1) In general.--The demonstration project--
                    (A) shall be conducted over a 3-year period;
                    (B) shall include such areas as the Postal Service 
                considers appropriate, except that such project shall 
                include at least 1 urban area, 1 rural area, and 1 
                suburban area, each of which shall involve a sufficient 
                level of participation so as to ensure meaningful 
                results; and
                    (C) shall include provisions under which any person 
                may elect not to participate, or to cease to 
                participate, in the project.
            (2) Temporary suspension of section 1725 of title 18.--
        Section 1725 of title 18, United States Code, shall not apply 
        with respect to conduct occurring--
                    (A) within an area included in the demonstration 
                project; and
                    (B) while the demonstration project is ongoing.
    (d) Procedures.--
            (1) In general.--The Postal Service shall--
                    (A) develop a plan for the demonstration project 
                which identifies--
                            (i) the specific areas to be included in 
                        the project;
                            (ii) the commencement and termination dates 
                        of the project;
                            (iii) the legal authority for the project; 
                        and
                            (iv) specific details as to what the 
                        project will entail;
                    (B) at least 90 days before commencing 
                implementation of the project--
                            (i) publish the proposed plan in the 
                        Federal Register, including notice as to the 
                        time and manner in which interested persons may 
                        submit written comments; and
                            (ii) provide notification of the proposed 
                        plan to persons served within the areas to be 
                        included in the project, including the relevant 
                        information as to the time, form, and manner in 
                        which any such person shall have the 
                        opportunity to present their views, in writing 
                        or by oral presentation, as they may elect; and
                    (C) after considering the comments and views and 
                any other information received under subparagraph (B), 
                prepare the final version of the plan for such project 
                and, not later than 30 days before commencing 
                implementation of the project--
                            (i) publish the final plan in the Federal 
                        Register; and
                            (ii) provide notification of the final plan 
                        to persons served within the areas to be 
                        included in the project.
            (2) Factors to be taken into account in selecting areas for 
        inclusion.--In identifying areas for inclusion in the 
        demonstration project, the Postal Service shall take into 
        account--
                    (A) what types of data are needed in order to 
                permit a meaningful evaluation under subsection (e); 
                and
                    (B) such other factors as the Postal Service 
                considers appropriate.
            (3) Written determinations.--Any determination of the 
        Postal Service to commence implementation of the demonstration 
        project shall be in writing and shall include the findings of 
        the Postal Service with respect to the factors required to be 
        taken into account under paragraph (2). Such determination and 
        findings shall be made available to the persons served by the 
        Postal Service within each area included in the project.
    (e) Evaluation.--Not later than 1 year after the demonstration 
project ends, the Comptroller General of the United States shall submit 
to each House of Congress a written evaluation of such project, 
including recommendations as to whether or not the authority tested by 
the project should be broadened in scope and made permanent and, if so, 
with what modifications (if any).

TITLE VIII--DIRECT APPEAL OF DECISIONS OF THE MERIT SYSTEMS PROTECTION 
                                 BOARD

SEC. 801. DIRECT APPEAL OF DECISIONS OF THE MERIT SYSTEMS PROTECTION 
              BOARD.

    Section 7703 of title 5, United States Code, is amended by adding 
at the end the following:
    ``(e)(1) The Chief Executive Officer may, with respect to any 
employee of the Postal Service or applicant for employment with the 
Postal Service, and subject to the provisions of sections 409(b)-(e) 
and 411 of title 39, obtain review of any final order or decision of 
the Board by filing a petition for judicial review in the United States 
Court of Appeals for the Federal Circuit if the Chief Executive Officer 
determines, in his or her discretion, that the Board erred in 
interpreting a civil service law, rule, or regulation affecting 
personnel management and that the Board's decision will have a 
substantial impact on a civil service law, rule, regulation, or policy 
directive, as applied with respect to the Postal Service. If the Chief 
Executive Officer did not intervene in a matter before the Board, the 
Chief Executive Officer may not petition for review of a Board decision 
under this section unless the Chief Executive Officer first petitions 
the Board for a reconsideration of its decision, and such petition is 
denied. In addition to the named respondent, the Board and all other 
parties to the proceedings before the Board shall have the right to 
appear in the proceeding before the Court of Appeals. The granting of 
the petition for judicial review shall be at the discretion of the 
Court of Appeals.
    ``(2) For purposes of applying the provisions of section 7701(e) in 
the case of a decision that relates to an employee of the Postal 
Service or applicant for employment with the Postal Service, such 
provisions shall be applied by substituting `Director or Chief 
Executive Officer of the United States Postal Service' for `Director'.
    ``(3) For purposes of this subsection--
            ``(A) the term `Chief Executive Officer' means the Chief 
        Executive Officer of the United States Postal Service; and
            ``(B) the term `Postal Service' means the United States 
        Postal Service.''.

                       TITLE IX--LAW ENFORCEMENT

         Subtitle A--Amendments to Title 39, United States Code

SEC. 901. MAKE FEDERAL ASSAULT STATUTES APPLICABLE TO POSTAL CONTRACT 
              EMPLOYEES.

    Section 1008 of title 39, United States Code, is amended--
            (1) in subsection (a) by inserting ``or entrusted with mail 
        under contract with the Postal Service'' after ``mail''; and
            (2) in subsection (b) by inserting ``an employee of the 
        Postal Service for the purposes of sections 111 and 1114 of 
        title 18, and'' after ``deemed''.

SEC. 902. SEXUALLY ORIENTED ADVERTISING.

    (a) Civil Penalty.--Section 3011 of title 39, United States Code, 
is amended--
            (1) by redesignating subsections (b) through (e) as 
        subsections (c) through (f), respectively; and
            (2) by inserting after subsection (a) the following:
    ``(b)(1) Upon a finding by the court that a sexually oriented 
advertisement has been mailed in violation of section 3010(b), the 
court may assess, on whoever made the mailing or caused it to be made, 
a civil penalty of not less than $500 and not more than $1,500 for each 
violation. Each piece of mail sent in violation of section 3010(b) 
shall constitute a separate violation.
    ``(2) For purposes of this subsection--
            ``(A) receipt of a sexually oriented advertisement after 
        the recipient's name and address have been listed (as described 
        in section 3010(b)) for at least 60 days shall create a 
        rebuttable presumption that such advertisement was mailed more 
        than 30 days after that individual's name and address became so 
        listed; and
            ``(B) receipt in the mail of a sexually oriented 
        advertisement addressed to `Occupant' or `Resident' (or any 
        other term permitted by Postal Service standards on simplified 
        addressing) at the recipient's address, or which is 
        specifically addressed to the recipient, but with an 
        inconsequential error or variation in the recipient's name or 
        address, shall, for purposes of applying the mailing 
        prohibition of section 3010(b), create a rebuttable presumption 
        that such advertisement was mailed to such recipient.
    ``(3) Any penalty assessed under paragraph (1) shall be paid to the 
Postal Service for deposit in the Postal Service Fund established by 
section 2003.''.
    (b) Repeal.--
            (1) In general.--Section 3008 of title 39, United States 
        Code, and the item relating to such section in the table of 
        sections at the beginning of chapter 30 of such title, are 
        repealed.
            (2) Conforming amendments.--(A) Subsection (f) of section 
        3011 of such title 39 (as so redesignated by subsection (a)) is 
        amended by striking ``section 3006, 3007, or 3008'' and 
        inserting ``section 3006 or 3007''.
            (B) Section 1737 of title 18, United States Code, is 
        amended--
                    (i) in subsection (a) by striking ``3008 or''; and
                    (ii) in subsection (b) by striking ``3008(a) or''.
    (c) Effective Date.--This section and the amendments made by this 
section shall take effect 90 days after the date of the enactment of 
this Act. The amendments made by this section shall be treated as if 
they had never been enacted for purposes of any mailing made or caused 
to be made before this section takes effect.

SEC. 903. ALLOW POSTAL SERVICE TO RETAIN ASSET FORFEITURE RECOVERIES.

    Paragraph (7) of section 2003(b) of title 39, United States Code, 
is amended to read as follows:
            ``(7) amounts (including proceeds from the sale of 
        forfeited items) from any civil forfeiture conducted by the 
        Postal Service and from any forfeiture resulting from an 
        investigation in which the Postal Service has primary 
        responsibility, except that nothing in this paragraph shall 
        preclude the Postal Service, on such terms as it may determine, 
        from sharing such amounts with any Federal, State, or local law 
        enforcement agency which participated in any of the acts which 
        led to the seizure or forfeiture of the property; and''.

SEC. 904. HAZARDOUS MATTER.

    (a) Civil Penalty.--Chapter 30 of title 39, United States Code, is 
amended by adding at the end the following:
``Sec. 3016. Civil penalty for prohibited mailing and deficient 
              packaging of hazardous matter
    ``(a) For the purposes of this section--
            ``(1) the term `parcel' includes any kind of package, 
        envelope, container, or other piece of mail;
            ``(2) the term `manner' includes the preparation and 
        packaging of a piece of mail;
            ``(3) a person shall be considered to have acted knowingly 
        if--
                    ``(A) such person had actual knowledge of the facts 
                giving rise to the violation; or
                    ``(B) a reasonable person acting in the same 
                circumstances and exercising due care would have had 
                such knowledge; and
            ``(4) the term `hazardous matter' has the meaning given 
        such term by section 1716 of title 18.
    ``(b) Any person--
            ``(1) who knowingly mails or causes to be mailed any 
        parcel, the contents of which constitute or include any 
        hazardous matter which has been declared by statute or Postal 
        Service regulation to be nonmailable under any circumstances;
            ``(2) who knowingly mails or causes to be mailed a parcel 
        in violation of any statute or Postal Service regulation 
        restricting the time, place, or manner in which hazardous 
matter may be mailed; or
            ``(3) who knowingly manufactures, distributes, or sells any 
        container, packaging kit, or similar device that--
                    ``(A) is represented, marked, certified, or sold by 
                such person for use in the mailing of any hazardous 
                matter; and
                    ``(B) fails to conform with any statute or Postal 
                Service regulation setting forth standards for 
                containers, packaging kits, or similar devices used for 
                the mailing of hazardous matter;
shall be liable to the Postal Service for a civil penalty in an amount 
not to exceed $25,000 per violation.
    ``(c) The Postal Service may enforce this section by commencing a 
civil action in accordance with section 409(d). The action may be 
brought in the district court of the United States for the district in 
which the defendant resides or any district in which the defendant 
conducts business or in which a violation of this section was 
discovered.
    ``(d) In determining the amount of any civil penalty to be assessed 
under this section, the district court--
            ``(1) shall treat as a separate violation--
                    ``(A) each parcel mailed or caused to be mailed as 
                described in paragraph (1) or (2) of subsection (b); 
                and
                    ``(B) each container, packaging kit, or similar 
                device manufactured, distributed, or sold as described 
                in subsection (b)(3); and
            ``(2) shall take into account--
                    ``(A) the nature, circumstances, extent, and 
                gravity of each violation committed; and
                    ``(B) with respect to the person found to have 
                committed such violation, the degree of culpability, 
                any history of prior offenses, ability to pay, effect 
                on ability to continue to do business, and such other 
                matters as justice may require.
    ``(e) All penalties collected under authority of this section shall 
be paid into the Postal Service Fund established by section 2003.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 30 of title 39, United States Code, is amended by adding at the 
end the following:

``3016. Civil penalty for prohibited mailing and deficient packaging of 
                            hazardous matter.''.

                      Subtitle B--Other Provisions

SEC. 911. STALKING FEDERAL OFFICERS AND EMPLOYEES.

    (a) In General.--Chapter 41 of title 18, United States Code, is 
amended by adding at the end the following:
``Sec. 881. Stalking Federal and postal officers and employees
    ``(a) Whoever--
            ``(1) repeatedly engages in a pattern of conduct (including 
        maintaining a visual or physical proximity or verbal or written 
        threat) directed at another person who is or was an officer or 
        employee--
                    ``(A) in the executive, legislative, or judicial 
                branch of the Federal Government; or
                    ``(B) in the United States Postal Service;
        while such other person is engaged in official duties or on 
        account of such duties;
            ``(2) knows that such conduct is likely to place that other 
        person in reasonable fear of sexual battery, bodily injury, or 
        death; and
            ``(3) thereby induces such fear in that other person;
shall be punished as provided in subsection (b) of this section.
    ``(b)(1) The punishment for an offense under subsection (a) of this 
section is the greatest of the following:
            ``(A) In the case of a first conviction under such 
        subsection, a fine under this title or imprisonment for not 
        more than 3 years, or both.
            ``(B) In the case of a second or subsequent conviction 
        under such subsection, a fine under this title or imprisonment 
        for not more than 15 years, or both.
            ``(C) If, during the commission of the offense, the 
        offender uses a deadly or dangerous weapon, a fine under this 
        title or imprisonment for not more than 10 years, or both.
            ``(D) If the offense violates a protective order, a fine 
        under this title or imprisonment for not more than 5 years, or 
        both.
    ``(2) If a sentence of probation is imposed for an offense under 
subsection (a) of this section, the court shall require the defendant 
to undergo appropriate psychiatric, psychological, or social 
counselling.
    ``(c) As used in this section, the term `protective order' means 
any court order that requires an individual--
            ``(1) to refrain from behavior prohibited by subsection (a) 
        of this section; or
            ``(2) to refrain from contact with the person who 
        subsequently is a victim of the offense under such subsection 
        that is committed by that individual.
    ``(d)(1) Whoever is or is about to be aggrieved by a violation of 
subsection (a) of this section may, in a civil action, obtain from the 
person engaging or about to engage in that violation, appropriate 
relief, including punitive damages in the case of a completed violation 
and reasonable attorney's fees.
    ``(2) If--
            ``(A) the court issues an injunction against the person 
        engaging or about to engage in a violation of subsection (a) of 
        this section;
            ``(B) such person is an officer or employee in the 
        executive branch of the Federal Government or in the United 
        States Postal Service; and
            ``(C) there is a nexus between the enjoined conduct and 
        such person's office or employment;
the court may order that the person be suspended or summarily 
discharged from such office or employment.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 41 of title 18, United States Code, is amended by adding at the 
end the following:

``881. Stalking Federal and postal officers and employees.''.

SEC. 912. NONMAILABILITY OF CONTROLLED SUBSTANCES.

    Section 1716 of title 18, United States Code, is amended by adding 
at the end the following:
    ``Whoever knowingly deposits for mailing or delivery, or knowingly 
causes to be delivered by mail, according to the direction thereon, or 
at any place at which it is directed to be delivered by the person to 
whom it is addressed, unless in accordance with the rules and 
regulations authorized to be prescribed by the Postal Service, any 
controlled substance, as that term is defined for the purposes of the 
Controlled Substances Act, shall, if the distribution of a like amount 
of such substance is a felony under such Act, be fined under this title 
or imprisoned not more than 5 years, or both.''.

SEC. 913. ENHANCED PENALTIES.

    Pursuant to its authority under section 994 of title 28, United 
States Code, the United States Sentencing Commission shall amend its 
sentencing guidelines to--
            (1) appropriately enhance penalties in cases in which a 
        defendant is convicted of stealing or destroying a quantity of 
        undelivered United States mail, in violation of sections 1702, 
        1703, 1708, 1709, 2114, or 2115 of title 18, United States 
        Code; and
            (2) establish that the intended loss in a theft of an 
        access device as defined in section 1029(e)(1) of title 18, 
        United States Code, shall be based on the credit line of the 
        access device or the actual unauthorized charges, whichever 
        amount is greater.

SEC. 914. POSTAL BURGLARY PROVISIONS.

    (a) Larceny Involving Post Office Boxes and Postal Stamp Vending 
Machines.--Section 2115 of title 18, United States Code, is amended--
            (1) by striking ``or'' before ``any building'';
            (2) by inserting ``or any post office box or postal 
        products vending machine,'' after ``used in whole or in part as 
        a post office,'';
            (3) by inserting ``or in such box or machine,'' after ``so 
        used''; and
            (4) by striking ``not more than $1,000'' and inserting 
        ``under this title''.
    (b) Receipt, Possession, Concealment, or Disposition of Property.--
Section 2115 of title 18, United States Code, is amended--
            (1) by inserting ``(a)'' before ``Whoever''; and
            (2) by adding at the end the following:
    ``(b) Whoever receives, possesses, conceals, or disposes of any 
mail matter, money, or other property of the United States, that has 
been obtained in violation of this section, knowing the same to have 
been unlawfully obtained, shall be fined under this title or imprisoned 
not more than 5 years, or both.''.

SEC. 915. MAIL, MONEY, OR OTHER PROPERTY OF THE UNITED STATES.

    (a) Enhanced Penalty for Robbery.--Subsection (a) of section 2114 
of title 18, United States Code, is amended to read as follows:
    ``(a) Assault.--Whoever assaults any person having lawful charge, 
control, or custody of any mail matter or of any money or other 
property of the United States, with intent to rob, steal, or purloin 
such mail matter, money, or other property of the United States, or 
robs or attempts to rob any such person of mail matter, or of any 
money, or other property of the United States, shall, for the first 
offense, be imprisoned not more than 10 years or fined under this 
title, or both. If, in effecting or attempting to effect such robbery 
the defendant wounds the person having custody of such mail, money, or 
other property of the United States, or puts that person's life in 
jeopardy by the use of a dangerous weapon, or the offense is a 
subsequent offense under this subsection, the defendant shall be 
imprisoned not more than 25 years or fined under this title, or both. 
If the death of any person results from the offense under this 
subsection, the defendant shall be punished by death or life 
imprisonment.''.
    (b) Attempt Offenses.--
            (1) The second paragraph of section 501 of title 18, United 
        States Code, is amended by striking ``uses or sells,'' and 
        inserting ``uses or sells or attempts to use or sell,''.
            (2) Section 1711 of title 18, United States Code, is 
        amended by inserting ``attempts to loan, use, pledge, 
        hypothecate, or convert to this own use,'' after ``converts to 
        his own use,''.

  TITLE X--NEW SYSTEM RELATING TO POSTAL RATES, CLASSES, AND SERVICES

SEC. 1001. ESTABLISHMENT.

    (a) In General.--Title 39, United States Code, is amended by adding 
after chapter 36 the following:

 ``CHAPTER 37--NEW SYSTEM FOR ESTABLISHING POSTAL RATES, CLASSES, AND 
                                SERVICES

                ``SUBCHAPTER I--BASELINE RATES AND FEES

``Sec.
``3701. Establishment of baseline rates and fees.
  ``SUBCHAPTER II--RATES AND FEES FOR PRODUCTS IN THE NONCOMPETITIVE 
                            CATEGORY OF MAIL

``3721. Definitions.
``3722. Maximum rates.
``3723. Adjustment factor.
``3724. Action of the Directors.
   ``SUBCHAPTER III--RATES AND FEES FOR PRODUCTS IN THE COMPETITIVE 
                            CATEGORY OF MAIL

``3741. Definitions.
``3742. Action of the Directors.
``3743. Transfers of products from the noncompetitive category of mail.
``3744. Application of antitrust laws.
         ``SUBCHAPTER IV--MARKET TESTS OF EXPERIMENTAL PRODUCTS

``3761. Market tests.
     ``SUBCHAPTER V--REPORTING REQUIREMENTS AND RELATED PROVISIONS

``3781. Definition.
``3782. Reporting requirements.
``3783. Use of profits.

                ``SUBCHAPTER I--BASELINE RATES AND FEES

``Sec. 3701. Establishment of baseline rates and fees
    ``(a) Requirement That a Ratemaking Request Be Made.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        Postal Service shall, within 18 months after the effective date 
        of this chapter, request the Postal Rate Commission to submit a 
        recommended decision on appropriate changes in rates of postage 
        and in fees for postal services, in accordance with section 
        3622(a).
            ``(2) Exception.--A request under this subsection may not 
        be made if, on the effective date of this chapter--
                    ``(A) a new schedule of rates and fees takes effect 
                under subchapter II of chapter 36 pursuant to a 
                previous request under section 3622(a); or
                    ``(B) a recommended decision or further recommended 
                decision pursuant to a previous request under section 
                3622(a), or judicial review of any such decision or 
                recommended decision, is pending.
    ``(b) Baseline Rates and Fees Established Pursuant to This 
Section.--
            ``(1) In general.--For purposes of this title, the baseline 
        rates and fees established pursuant to this section shall be--
                    ``(A) the rates and fees taking effect pursuant to 
                a request made under subsection (a)(1), subject to 
                subparagraph (C)(i) or paragraph (2)(A) (as 
                applicable);
                    ``(B) the rates and fees--
                            ``(i) that, by virtue of subsection 
                        (a)(2)(A), preclude the making of a request 
                        under subsection (a)(1); or
                            ``(ii) that take effect upon completion of 
                        all proceedings referred to in subsection 
                        (a)(2)(B), subject to subparagraph (C)(ii) or 
                        paragraph (2)(B) (as applicable); or
                    ``(C)(i) if a request under subsection (a)(1) is 
                made, but proceedings pursuant to such request have not 
                been completed by the end of the 18-month period 
                beginning on the date on which such request is made, 
                the rates and fees in effect at the end of such period 
                (including any temporary rate or fee then in effect 
                under subchapter III of chapter 36); or
                    ``(ii) if a request under subsection (a)(1) is 
                precluded by virtue of the provisions of subsection 
                (a)(2)(B), but the proceedings referred to in such 
                provisions have not been completed by the end of the 
                18-month period referred to in subsection (a)(1), the 
                rates and fees in effect at the end of such period 
                (including any temporary rate or fee then in effect 
                under subchapter III of chapter 36).
            ``(2) Applicable statutory deadline not changeable by 
        administrative or other action.--Rates and fees established 
        under chapter 36 pursuant to--
                    ``(A) a request made under subsection (a)(1) shall 
                take effect as of the date determined in accordance 
                with section 3625(f) or otherwise applicable provisions 
                of such chapter, except that in no event may the date 
                so determined be later than the last day of the 18-
                month period referred to in paragraph (1)(C)(i); or
                    ``(B) a previous request, as referred to in 
                subsection (a)(2)(B), shall take effect as of the date 
                determined in accordance with section 3625(f) or 
                otherwise applicable provisions of such chapter, except 
                that in no event may the date so determined be later 
                than the last day of the 18-month period referred to in 
                subsection (a)(1).
    ``(c) Priority of Ratemaking Factors if Pursuant to a Request Under 
This Section.--If a request under subsection (a)(1) is made, then, for 
purposes of all proceedings under chapter 36 relating to such request, 
subsection (b) of section 3622 shall be considered to be amended to 
read as follows:
    ```(b) Upon receiving a request, the Commission shall make a 
recommended decision on the request for changes in rates or fees in 
each class of mail or type of service in accordance with the policies 
of this title and the following factors, set forth in descending order 
of priority:
            ```(1) The requirement that each class of mail or type of 
        mail service bear the direct and indirect postal costs 
        attributable to such class or type plus that portion of all 
other costs of the Postal Service reasonably assignable to such class 
or type.
            ```(2) The value of the mail service to senders, as 
        reflected by the volume response of classes of mail and types 
        of service to changes in postal rates and fees, and, as 
        appropriate, the price and quality of alternative means of 
        sending mail.
            ```(3) The quality of mail service actually provided each 
        class or type of mail service, including the collection, mode 
        of transportation, priority of delivery, and timeliness of 
        delivery (as measured by reference to standards established by 
        the Postal Service).
            ```(4) The available alternative means of sending and 
        receiving letters and other mail matter at reasonable costs.
            ```(5) The degree of preparation of mail for delivery into 
        the postal system performed by the mailer and its effect upon 
        reducing costs to the Postal Service.
            ```(6) The effect of rate increases upon users of the mail 
        and the general public.
            ```(7) 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.
            ```(8) The educational, cultural, scientific, and 
        informational value to the recipient of mail matter.
            ```(9) The establishment and maintenance of a fair and 
        equitable schedule.
            ```(10) Such other factors as the Commission deems 
        appropriate.'.

  ``SUBCHAPTER II--RATES AND FEES FOR PRODUCTS IN THE NONCOMPETITIVE 
                            CATEGORY OF MAIL

``Sec. 3721. Definitions
    ``For purposes of this subchapter--
            ``(1) Year.--The term `year' means a calendar year.
            ``(2) GDPPI.--The term `GDPPI' means the Gross Domestic 
        Product Chain-Type Price Index (published quarterly by the 
        Bureau of Economic Analysis of the Department of Commerce).
            ``(3) Product.--The term `product' means a class of mail or 
        type of postal service, including--
                    ``(A) a subclass or other similar subordinate unit 
                thereof; and
                    ``(B) any further subordinate unit thereof (below 
                the first level of subordinate units referred to in 
                subparagraph (A)).
            ``(4) Products in the noncompetitive category of mail.--The 
        term `products in the noncompetitive category of mail' means 
        the respective products in the first, second, third, and fourth 
        baskets of products (within the meaning of section 3723(a)).
            ``(5) Rate.--The term `rate', used with respect to a 
        product, means--
                    ``(A) for a class of mail, the rate for such class 
                of mail; and
                    ``(B) for a type of postal service, the fee for 
                such service.
            ``(6) Noncompetitive product.--The term `noncompetitive 
        product' means a product in the noncompetitive category of 
        mail.
``Sec. 3722. Maximum rates
    ``(a) In General.--Except as otherwise provided in this subchapter, 
the rate for a noncompetitive product may not, in any year, exceed the 
maximum rate allowable for such product in such year under this 
section.
    ``(b) Computation of Maximum Rate Allowable.--
            ``(1) In general.--The maximum rate allowable for a 
        noncompetitive product in any year shall be computed by 
        multiplying--
                    ``(A) the change in the GDPPI for such year, 
                adjusted by the adjustment factor for such year, times
                    ``(B) the maximum rate allowable for such product 
                in the preceding year (determined disregarding 
                paragraph (4), any exercise of authority under section 
                3724(d), and any alternative limitation under section 
                1002(e) of the Postal Reform Act of 1997).
            ``(2) Definitions.--For purposes of this subsection--
                    ``(A) Change in the gdppi.--The change in the GDPPI 
                for any year shall be equal to the percentage (if any) 
                by which--
                            ``(i) the GDPPI for the preceding year, 
                        exceeds
                            ``(ii) the GDPPI for the second preceding 
                        year.
                    ``(B) GDPPI for any year.--The GDPPI for any year 
                is the average of the GDPPI for the 4 consecutive 
                calendar quarters ending on September 30th of such 
                year.
                    ``(C) Adjustment factor.--The adjustment factor for 
                any year shall be determined in accordance with section 
                3723.
            ``(3) Special rule for first computation.--For purposes of 
        the first computation of a maximum rate allowable under this 
        section for any product, the rate applied under paragraph 
        (1)(B) shall be the baseline rate established for such product 
        under section 3701.
            ``(4) Rounding.--Any maximum rate computed under this 
        section shall be rounded to the nearest cent (rounding \1/2\ of 
        a cent to the next higher cent).
``Sec. 3723. Adjustment factor
    ``(a) Definitions.--For purposes of this section--
            ``(1) Ratemaking cycle.--
                    ``(A) In general.--The term `ratemaking cycle' 
                means--
                            ``(i) the 5-year period beginning on the 
                        first day of the second year beginning after 
                        the effective date of the baseline rates and 
                        fees established pursuant to section 3701; and
                            ``(ii) each 5-year period beginning on the 
                        day after the last day of the immediately 
                        preceding 5-year period under this paragraph.
                    ``(B) Earlier initial date.--The Postal Rate 
                Commission may, by written determination, advance the 
                date applicable under subparagraph (A)(i) to the date 
                which occurs 1 year earlier, but only if that earlier 
                date does not precede the date on which all 
                requirements of this section have been completed with 
                respect to the ratemaking cycle involved.
            ``(2) Basket of products to which this section applies.--
        The term `basket of products to which this section applies' 
        means the first, second, third, and fourth baskets of products.
            ``(3) First basket of products.--The term `first basket of 
        products' means--
                    ``(A) single-piece first-class letters (both 
                domestic and international);
                    ``(B) single-piece first-class cards (both domestic 
                and international); and
                    ``(C) single-piece first-class parcels (both 
                domestic and international).
            ``(4) Second basket of products.--The term `second basket 
        of products' means all first-class mail not in the first basket 
        of products.
            ``(5) Third basket of products.--The term `third basket of 
        products' means periodicals.
            ``(6) Fourth basket of products.--The term `fourth basket 
        of products' means standard mail (except for parcel post).
            ``(7) Rule of construction.--
                    ``(A) In general.--Mail matter referred to in 
                paragraphs (3) through (6) shall, for purposes of such 
                paragraphs, be considered to have the meaning given 
                them under the mail classification schedule (within the 
                meaning of section 3623) as of the effective date of 
                this chapter.
                    ``(B) Updates.--The Board of Directors shall, 
                whenever any relevant change occurs (pursuant to a 
                reclassification under chapter 36, a transfer of a 
                product from the noncompetitive category of mail under 
                section 3743, or the conversion of an experimental 
                product under subchapter IV to a permanent one), 
                prescribe new lists of products within the baskets 
                under paragraphs (3) through (6), respectively. The 
                revised lists shall indicate how and when any previous 
                lists are superseded.
    ``(b) Procedures Relating to Determining Adjustment Factors.--
            ``(1) Commencement.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the Postal Rate Commission shall, 
                beginning in December of the second year before the 
                start of each ratemaking cycle, provide the opportunity 
                for a hearing on the record under sections 556 and 557 
                of title 5 to the Postal Service, users of the mails, 
                and an officer of the Commission who shall be required 
                to represent the interests of the general public, with 
                respect to the adjustment factors to be established for 
                the upcoming ratemaking cycle.
                    ``(B) Exception.--For purposes of the first hearing 
                under this subsection, proceedings shall be commenced 
                during the second month beginning on or after the 
                effective date of the baseline rates and fees 
                established pursuant to section 3701.
            ``(2) Rules of proceedings.--In order to conduct its 
        proceedings with utmost expedition consistent with procedural 
        fairness to the parties, the Commission may (without 
        limitation) adopt rules which provide for--
                    ``(A) the advance submission of written direct 
                testimony;
                    ``(B) the conduct of prehearing conferences to 
                define issues, and for other purposes to insure orderly 
                and expeditious proceedings;
                    ``(C) discovery both from the Postal Service and 
                the parties to the proceedings;
                    ``(D) limitation of testimony; and
                    ``(E) the conduct of the entire proceedings off the 
                record with the consent of the parties.
            ``(3) Printing and notice requirements.--
                    ``(A) In general.--The Commission's decision and 
                the record of the Commission's hearings shall be made 
                generally available at the time the decision is issued 
                and shall be printed and made available for sale by the 
                Public Printer within 10 days following the day the 
                decision is issued.
                    ``(B) Timing.--All actions required of the 
                Commission under this section, including those under 
                subparagraph (A), shall be completed as expeditiously 
                as possible, but in no event later than the end of the 
                year before the commencement of the ratemaking cycle to 
                which the decision relates.
    ``(c) Factors.--Adjustment factors shall be established in 
accordance with the policies of this title and the following:
            ``(1) The value of the product to senders, as reflected by 
        the volume response of classes of mail and types of service to 
        changes in postal rates and fees, and, as appropriate, the 
        price and quality of alternative means of sending mail.
            ``(2) Cost to the Postal Service of providing the product.
            ``(3) Productivity of the Postal Service in providing 
        postal services.
            ``(4) The level of postal revenues attributable to the 
        product.
            ``(5) The actual level of service (described in terms of 
        speed of delivery and reliability) provided with respect to the 
        product.
            ``(6) Such other considerations as the Postal Service and 
        the Commission mutually agree to be appropriate.
    ``(d) Separate Adjustment Factor Required for Each Basket of 
Products.--A separate adjustment factor shall be established for each 
basket of products to which this section applies, and, except as 
provided in section 3724(d), the adjustment factor applicable to any 
basket shall be uniformly applied to all products within such basket.
    ``(e) How Each Adjustment Factor Is To Be Expressed and Applied.--
            ``(1) Expression.--Each adjustment factor established under 
        this section shall be expressed as a percentage.
            ``(2) Application.--For purposes of section 3722(b)(1)(A), 
        to adjust a change in the GDPPI by an adjustment factor, the 
        adjustment factor shall be added to or subtracted from such 
        change in the GDPPI, as the case may be.
    ``(f) Exigent Circumstances.--
            ``(1) In general.--Upon a majority vote of the Directors 
        then holding office, the Postal Service may request the Postal 
        Rate Commission to render a decision on changing the adjustment 
        factors to be applied during the then current ratemaking cycle 
        (after having previously been established under this section 
        for such cycle).
            ``(2) Conditions.--A request made under paragraph (1) may 
        be considered only upon written certification by the Directors 
        that--
                    ``(A) the Postal Service faces severe financial 
                exigencies; and
                    ``(B) the change is warranted to restore the Postal 
                Service to fiscal soundness.
            ``(3) Effect; duration.--A change granted under this 
        subsection--
                    ``(A) shall supersede the adjustment factors which 
                would otherwise apply under this section; and
                    ``(B) shall remain effective for the remainder of 
                the ratemaking cycle involved, subject to paragraph 
                (5).
            ``(4) Expedited consideration.--A request made under 
        paragraph (1) shall be acted on in the same manner as if 
        initiated under subsection (b)(1), except that a decision on 
        such request shall be rendered not later than 6 months after 
        the date on which such request is made.
            ``(5) Frequency.--Nothing in this section shall be 
        considered to limit the number of times that authority under 
        this subsection may be invoked or exercised during any 
        particular ratemaking cycle.
            ``(6) Finality.--A decision of the Postal Rate Commission 
        under this subsection shall be final and shall not be subject 
        to administrative or judicial review.
    ``(g) Appellate Review.--Except as provided in subsection (f)(6), a 
decision of the Postal Rate Commission under this section may be 
appealed to any court of appeals of the United States, within 15 days 
after its publication by the Public Printer, by an aggrieved party who 
appeared in the proceedings under subsection (b). The court shall 
review the decision, in accordance with section 706 of title 5, and 
chapter 158 and section 2112 of title 28, except as otherwise provided 
in this subsection, on the basis of the record before the Commission. 
The court may affirm the decision or order that the entire matter be 
returned for further consideration, but the court may not modify the 
decision. The court may not suspend the effectiveness of the adjustment 
factors, or otherwise prevent them from taking effect until final 
disposition of the suit by the court. No court shall have jurisdiction 
to review a decision made by the Commission under this section except 
as provided in this subsection.
``Sec. 3724. Action of the Directors
    ``(a) In General.--The Directors, with the written concurrence of a 
majority of all of the Directors then holding office, shall establish 
rates for products in the noncompetitive category of mail in accordance 
with the requirements of this subchapter and the policies of this 
title.
    ``(b) Procedures.--
            ``(1) In general.--Rates under this section shall be 
        established in writing, complete with a statement of 
        explanation and justification.
            ``(2) Publication.--The Directors shall cause each such 
        decision and statement to be published in the Federal Register 
        at least 45 days before the rate or rates to which they pertain 
        take effect.
    ``(c) Limitations on Authority.--
            ``(1) In general.--Except as provided in paragraph (2)--
                    ``(A) Frequency.--Ratemaking authority under this 
                section may not be exercised more than once for 
                purposes of any year.
                    ``(B) Uniform effective date.--All changes in rates 
                pursuant to this section shall take effect beginning on 
                the same date.
            ``(2) Exception for change due to exigent circumstances.--
                    ``(A) In general.--If the maximum rate allowable 
                for a product in a year changes pursuant to a request 
                granted under section 3723(f), then, in the event that 
                ratemaking authority under this section was previously 
                exercised with respect to such product for such year, 
                such rate may be modified, not more than once more in 
                such year, based on the change in the maximum rate 
                allowable.
                    ``(B) Uniform effective date.--All changes in rates 
                pursuant to this paragraph shall, to the extent based 
                on the same change in the maximum rate allowable, take 
                effect beginning on the same date.
    ``(d) Exception to Requirement Relating to Uniform Applicability of 
Each Maximum.--
            ``(1) Definitions.--For purposes of this subsection--
                    ``(A) Subordinate unit.--The term `subordinate 
                unit', with respect to a product, means a subclass or 
                other similar subordinate unit of such product, as 
                described in subparagraph (A) of section 3721(3).
                    ``(B) Further subordinate unit.--The term `further 
                subordinate unit', with respect to a subordinate unit, 
                means a further subordinate unit thereof, as described 
                in subparagraph (B) of section 3721(3).
            ``(2) Applicability.--This subsection applies with respect 
        to the second, third, and fourth baskets of products.
            ``(3) Rule.--
                    ``(A) In general.--Notwithstanding the uniformity 
                requirement in section 3723(d), for purposes of 
                establishing rates for further subordinate units of any 
                particular subordinate unit of a product, rates may be 
                established at such levels as the Directors consider 
                appropriate, subject to subparagraph (B).
                    ``(B) Requirement.--The rates so established may 
                not exceed the maximum rates established for such 
                further subordinate units in accordance with 
                subparagraph (C).
                    ``(C) Alternative maximum rates.--Alternative 
                maximum rates may be established under this 
                subparagraph by using adjustment factors (other than 
                those that would otherwise apply absent this 
                subsection) fixed at levels which the Directors 
                consider appropriate, so long as the resulting average 
                maximum rate, for the further subordinate units 
                comprising such subordinate unit (determined separately 
                for each successive level, if there are 2 or more 
                levels of further subordinate units), remains equal to 
                the maximum rate that would otherwise apply with 
                respect to those further subordinate units.
    ``(e) Finality of Decisions.--Decisions of the Postal Service under 
this section shall be final and shall not be subject to administrative 
or judicial review.

   ``SUBCHAPTER III--RATES AND FEES FOR PRODUCTS IN THE COMPETITIVE 
                            CATEGORY OF MAIL

``Sec. 3741. Definitions
    ``For purposes of this subchapter--
            ``(1) Year, product, rate, etc.--The terms `year', 
        `product', `rate', and `product in the noncompetitive category 
        of mail' each has the meaning given such term by section 3721, 
        unless the context otherwise requires.
            ``(2) Products in the competitive category of mail.--The 
        term `products in the competitive category of mail' means--
                    ``(A) priority mail;
                    ``(B) expedited mail;
                    ``(C) mailgrams;
                    ``(D) international mail;
                    ``(E) parcel post;
                    ``(F) special services; and
                    ``(G) any product transferred to the competitive 
                category of mail under section 3743;
        except that such term does not include any product then 
        currently in the noncompetitive category of mail.
            ``(3) Rule of construction.--
                    ``(A) In general.--Mail matter referred to in 
                paragraph (2) shall, for purposes of such paragraph, be 
                considered to have the meaning given them under the 
                mail classification schedule (within the meaning of 
                section 3623) as of the effective date of this chapter.
                    ``(B) Updates.--The Board of Directors shall, 
                whenever any relevant change occurs (pursuant to a 
                reclassification under chapter 36, a transfer of a 
                product from the noncompetitive category of mail under 
                section 3743, or the conversion of an experimental 
                product under subchapter IV to a permanent one), 
                prescribe a new list of products under subparagraphs 
                (A) through (G) of paragraph (2). The revised list 
                shall indicate how and when any previous list is 
                superseded.
``Sec. 3742. Action of the Directors
    ``(a) In General.--The Directors, with the written concurrence of a 
majority of all of the Directors then holding office, shall establish 
rates for products in the competitive category of mail.
    ``(b) Requirements.--Rates under this section shall be established 
in accordance with the policies of this title and the requirement that 
each product in the competitive category of mail bear the direct and 
indirect postal costs attributable to such product plus a reasonable 
contribution to all other costs of the Postal Service.
    ``(c) Procedures.--Subsections (b), (c)(1), and (e) of section 3724 
shall apply with respect to rates and decisions under this section.
``Sec. 3743. Transfers of products from the noncompetitive category of 
              mail
    ``(a) In General.--The Postal Service or users of the mails may 
from time to time request the Postal Rate Commission to submit, or the 
Commission may submit to the Directors on its own initiative, a 
recommended decision on transferring one or more products in the 
noncompetitive category of mail to the competitive category of mail.
    ``(b) Criteria.--A recommended decision under this section shall be 
made in accordance with the policies of this title and taking into 
consideration the availability and nature of enterprises in the private 
sector engaged in the delivery of the product involved.
    ``(c) Procedures.--If the Commission receives a request under 
subsection (a) or decides to act on its own initiative, the Commission 
shall, after proceedings in conformity with section 3624, issue a 
recommended decision which shall be acted upon in accordance with the 
provisions of section 3625 and subject to review in accordance with the 
provisions of section 3628.
``Sec. 3744. Application of antitrust laws
    ``(a) Applicability of the Antitrust Laws.--The antitrust laws 
shall apply with respect to the Postal Service to the extent that the 
Postal Service engages in conduct with respect to--
            ``(1) any product in the competitive category of mail; and
            ``(2) any product offered pursuant to a market test under 
        subchapter IV.
    ``(b) Definition.--For purposes of subsection (a), the term 
`antitrust laws' has the meaning given such term in subsection (a) of 
the first section of the Clayton Act (15 U.S.C. 12(a)), but includes 
section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the 
extent that such section 5 applies to unfair methods of competition.
    ``(c) Effective Date.--This section shall not apply with respect to 
conduct occurring before the effective date of this chapter.

         ``SUBCHAPTER IV--MARKET TESTS OF EXPERIMENTAL PRODUCTS

``Sec. 3761. Market tests
    ``(a) In General.--The Postal Service may conduct market tests of 
experimental products. Subject to the provisions of this section, the 
conducting of any such market test by the Postal Service shall not be 
limited by any lack of specific authority under this title to take the 
action contemplated, or by any provision of this title or any rule or 
regulation prescribed under this title which is inconsistent with the 
action.
    ``(b) Procedural Requirements.--Before conducting a market test, 
the Postal Service shall--
            ``(1) develop a plan for such test which identifies--
                    ``(A) the purposes of the test (and how they 
                comport with the provisions of section 101);
                    ``(B) the duration;
                    ``(C) the anticipated costs for each year;
                    ``(D) the anticipated revenues for each year;
                    ``(E) a specific description of any aspect of the 
                test for which there is a lack of specific authority; 
                and
                    ``(F) a specific citation to any provision of law, 
                rule, or regulation which, if not waived under this 
                section, would prohibit the conducting of the test, or 
                any part of the test as proposed;
            ``(2) at least 60 days in advance of the date any test 
        proposed under this section is to take effect--
                    ``(A) publish the plan in the Federal Register;
                    ``(B) submit such plan to each House of Congress; 
                and
                    ``(C) provide notification of the proposed test to 
                officers and employees likely to be affected by the 
                test.
    ``(c) Restrictions.--No market test under this section may provide 
for a waiver of--
            ``(1) any provision of section 410(b)-(d) (or any law 
        applicable to the Postal Service by virtue of any such 
        provision);
            ``(2) section 412 or any other provision of law (not 
        otherwise covered by paragraph (1)) providing for the 
        nondisclosure of names or addresses or any other information or 
        matter by the Postal Service;
            ``(3) the limitation on compensation under the last 
        sentence of section 1003(a);
            ``(4) any provision of chapter 10 (relating to employment 
        within the Postal Service);
            ``(5) any provision of chapter 12 or of any collective-
        bargaining agreement under such chapter;
            ``(6) any provision of section 3623(d) (relating to 
        maintaining one or more classes of mail for the transmission of 
        letters sealed against inspection);
            ``(7) any provision of law--
                    ``(A) providing for equal employment opportunity 
                through affirmative action; or
                    ``(B) providing any right or remedy available to 
                any officer or employee or applicant for employment in 
                the Postal Service; or
            ``(8) any rule or regulation prescribed under any provision 
        of law referred to in any of the preceding paragraphs of this 
        subsection.
    ``(d) Limitations.--
            ``(1) Duration.--Each market test under this section shall 
        terminate not later than 3 years after such project takes 
        effect, except that the project may continue beyond the date on 
        which it would otherwise terminate, if proceedings under 
        subsection (g) are then pending with respect to the product 
        involved.
            ``(2) Dollar limitation.--A market test under this section 
        may not be conducted if the anticipated revenues attributable 
        to such test would, for any calendar year, exceed $100,000,000.
    ``(e) Employees Within Bargaining Units.--Employees within a unit 
with respect to which a labor organization is accorded exclusive 
recognition under chapter 12 shall not be included within any market 
test under this section--
            ``(1) if the test would violate a collective-bargaining 
        agreement under such chapter between the Postal Service and the 
        labor organization, unless there is another written agreement 
        with respect to the test between the Postal Service and the 
        organization permitting the inclusion; or
            ``(2) if the test is not covered by such a collective-
        bargaining agreement, until there has been consultation or 
        negotiation, as appropriate, by the Postal Service with the 
        labor organization.
    ``(f) Other Employees.--Employees within any unit with respect to 
which a labor organization has not been accorded exclusive recognition 
under chapter 12 shall not be included within any market test under 
this section unless there has been consultation by the Postal Service 
regarding the test with the employees in the unit.
    ``(g) Conversion to Permanence.--A request to make an experimental 
product (as referred to in subsection (a)) permanent--
            ``(1) shall be made in accordance with the same 
        requirements as set forth in section 3743(b);
            ``(2) shall be subject to the same procedures (including 
        review) as set forth in section 3743(c), except as provided in 
        subsection (h); and
            ``(3) may not be considered unless it is made by the Postal 
        Service.
    ``(h) Time Limitation on Commission Deliberations.--For purposes of 
applying section 3624 (pursuant to subsection (g)(2)) with respect to a 
request to make an experimental product permanent--
            ``(1) section 3624(c) (as deemed to have remained in effect 
        under paragraph (2)) shall be applied with respect to such 
        request in the same manner as would have applied in the case of 
        a request made under section 3622 (as last in effect before 
        being repealed by section 1002); and
            ``(2) section 3624 (as last in effect before being repealed 
        by section 1002) shall be deemed to have remained in effect, 
        except that subsection (c) of such section (as then in effect) 
        shall be applied by substituting--
                    ``(A) `6 months' for `10 months' in paragraph (1) 
                thereof; and
                    ``(B) `6-month period' for `10-month period' in 
                paragraph (2) thereof.

     ``SUBCHAPTER V--REPORTING REQUIREMENTS AND RELATED PROVISIONS

``Sec. 3781. Definition
    ``For purposes of this subchapter, the term `product' has the 
meaning given such term by section 3721(3).
``Sec. 3782. Reporting requirements
    ``(a) In General.--No later than 3 months after the last day of 
each fiscal year, the Postal Service shall submit sufficient 
information to the Postal Rate Commission to demonstrate that the then 
current rates for products are in compliance with all applicable 
requirements of this title.
    ``(b) Audits.--
            ``(1) In general.--Before submitting any information under 
        subsection (a), the Postal Service shall have such information 
        audited by an independent professional accounting organization 
        (from outside of government), and such audit shall be submitted 
        along with the information to which it relates.
            ``(2) Access to papers and supporting materials.--
                    ``(A) In general.--The Commission shall have access 
                to the working papers and supporting materials of an 
                auditor in connection with any audit conducted by such 
                auditor under this subsection.
                    ``(B) Confidentiality.--Any information described 
                in paragraph (3) to which the Commission gains access 
                under subparagraph (A) shall be subject to section 
                3604(g)(2) in the same way as if the Commission had 
                received notification with respect to such information 
                under section 3604(g)(1).
            ``(3) Identification of protected information.--
                    ``(A) In general.--The Postal Service shall, in 
                accordance with regulations which it shall prescribe, 
                ensure that--
                            ``(i) any protected information shall, 
                        before being furnished to an auditor under this 
                        section, be appropriately identified 
                        (including, to the extent practicable, by being 
                        appropriately stamped, labelled, tagged, or 
                        otherwise physically marked); and
                            ``(ii) appropriate measures are taken (such 
                        as the inclusion of appropriate terms in any 
                        contract or other agreement with the auditor) 
                        to safeguard the security and confidentiality 
                        of protected information.
                    ``(B) Protected information defined.--For purposes 
                of this paragraph, the term `protected information' 
                means any information which, in the judgment of the 
                Postal Service, is information of a type which is 
                described in section 410(c) of this title, or exempt 
                from public disclosure under section 552(b) of title 5.
    ``(c) Additional Requirements.--The Postal Service shall submit to 
the Commission, at the time of making its submissions under subsections 
(a) and (b)--
            ``(1) a copy of the then most recent comprehensive 
        statement under section 2401(b);
            ``(2) a copy of the then most recent performance plan and 
        program performance reports required under sections 2803 and 
        2804, respectively; and
            ``(3) for the most recently completed fiscal year, with 
        respect to each product in the competitive category of mail, 
        each product in the noncompetitive category of mail, and each 
        product under subchapter IV--
                    ``(A) market information, including mail volumes;
                    ``(B) postal financial information, including costs 
                to the Postal Service and revenues;
                    ``(C) measures of the speed and reliability of 
                postal service, including--
                            ``(i) the service standard applicable to 
                        each product;
                            ``(ii) the actual level of service 
                        (described in terms of speed of delivery and 
                        reliability) provided; and
                            ``(iii) the degree of customer satisfaction 
                        with the service provided; and
                    ``(D) any other information that the Commission and 
                the Postal Service mutually agree upon.
    ``(d) Regulations.--The Commission shall prescribe regulations 
specifying the form and detail of the information required under this 
section, consistent with otherwise applicable provisions of this title. 
Such regulations shall give due consideration to avoiding unnecessary 
or unwarranted administrative effort and expense on the part of the 
Postal Service.
``Sec. 3783. Use of profits
    ``(a) Definition of Profits.--For purposes of this section, the 
term `profits', with respect to any fiscal year, means the amount by 
which total income of the Postal Service attributable to such year, 
exceeds total costs of the Postal Service attributable to such year, as 
determined by the Directors, in writing, in accordance with generally 
accepted accounting principles.
    ``(b) Determination of Noncompliance.--Not later than 90 days after 
receiving all the submissions required under section 3782 with respect 
to a fiscal year, the Postal Rate Commission shall make a written 
determination as to--
            ``(1) whether any rates or fees were placed in effect 
        during such fiscal year which were not in compliance with 
        applicable provisions of this title;
            ``(2) whether any performance goals, established under 
        section 2803 or 2804 for such fiscal year, were not met; and
            ``(3) whether any service standards for such fiscal year 
        were not met, based on the information under section 
        3782(c)(3)(C).
    ``(c) If No Noncompliance Is Found.--If the Commission does not 
make a timely determination of noncompliance under subsection (b), or 
if a timely determination is made under subsection (b) to the effect 
that no instances of noncompliance occurred, up to 100 percent of the 
profits (if any) from the preceding fiscal year may be used by the 
Postal Service for the purposes described in subsection (e).
    ``(d) If Any Noncompliance Is Found.--If the Commission makes a 
timely determination of noncompliance under subsection (b)--
            ``(1) the Commission may order, based on the seriousness of 
        the noncompliance, that a specific percentage of the previous 
        fiscal year's profits (if any), not to exceed 50 percent, be 
        set aside for the purposes described in subsection (f); and
            ``(2) up to 100 percent of the remainder of the previous 
        fiscal year's profits (if any) may be used by the Postal 
        Service for the purposes described in subsection (e).
    ``(e) Bonuses.--
            ``(1) In general.--The Postal Service shall establish a 
        program under which cash bonuses may be paid to officers and 
        employees of the Postal Service out of any profits which are 
        available for that purpose.
            ``(2) Requirements.--Under the program--
                    ``(A) bonuses may be paid to officers and employees 
                of the Postal Service under criteria which shall be 
                fair and equitable;
                    ``(B) the sole source of funding shall be any 
                profits from any fiscal year, subject to the 
                application of subsection (d)(1) with respect to such 
                fiscal year; and
                    ``(C) subject to subsection (h), bonuses shall not 
                be precluded by the limitation on compensation under 
                the last sentence of section 1003(a).
            ``(3) Discretionary nature of program.--Nothing in this 
        section shall be considered to create any entitlement to 
        receive bonuses or to require that any portion of the profits 
        from any fiscal year be used for bonuses in excess of whatever 
        amount the Postal Service considers appropriate (if any).
            ``(4) Considerations relating to the portion of profits to 
        be available for bonuses.--In any decision relating to what 
        portion of the available profits from any fiscal year shall be 
        available or used for purposes of the payment of bonuses under 
        this subsection, there shall be taken into consideration--
                    ``(A) the duty on the part of the Postal Service to 
                provide efficient and economical postal services in 
                accordance with the requirements of section 101, 
                section 403, and this chapter; and
                    ``(B) what portion of those profits (if any) should 
                be used--
                            ``(i) to retire debts or other obligations 
                        of the Postal Service;
                            ``(ii) to limit future increases in postal 
                        rates or fees for products in the 
                        noncompetitive category of mail; or
                            ``(iii) to carry out any other purpose.
    ``(f) Dedication of Funds Toward Reducing Rates and Fees.--
            ``(1) In general.--Any amounts ordered to be set aside 
        under subsection (d)(1) may not be used for any purpose other 
        than to defray increases in future rates and fees for products 
        in the noncompetitive category of mail or to reduce the rates 
        and fees already in effect for such products.
            ``(2) Compliance.--Whenever an order under subsection 
        (d)(1) is issued, the Postal Service shall include in its next 
        comprehensive statement under section 2401(b) (and each 
        subsequent statement thereunder until the order has been fully 
        complied with)--
                    ``(A) a statement of the measures which have been 
                or will be implemented in order to comply with the 
                order;
                    ``(B) the amount of savings actually passed on to 
                mailers during the reporting period, as compared to the 
                estimated savings for such period; and
                    ``(C) what measures, if any, have been or will be 
                implemented in order to reconcile any difference 
                identified under subparagraph (B).
            ``(3) Nonredundant information.--Nothing in paragraph (2) 
        shall be considered to require that the same information be 
        reported if included in a previous report under this 
        subsection.
    ``(g) Procedures.--The provisions of sections 556 and 557 of title 
5 shall not apply to any review carried out by the Commission under 
this section.
    ``(h) Reporting Requirement.--Included in its comprehensive 
statement under section 2401(b) for any period shall be--
            ``(1) the name of each person receiving a bonus during such 
        period which would not have been allowable but for the 
        provisions of subsection (e)(2)(C);
            ``(2) the amount of the bonus; and
            ``(3) the amount by which the limitation referred to in 
        subsection (e)(2)(C) was exceeded.''.
    (b) Representation in an Antitrust Action.--Section 409(d) of title 
39, United States Code, is amended by striking ``(d) The'' and 
inserting ``(d)(1) Except in any instance in which the Postal Service 
elects to employ attorneys under paragraph (2), the'' and by adding at 
the end the following:
    ``(2)(A) As used in this paragraph, the term `antitrust laws' has 
the meaning given to it by section 3744(b).
    ``(B) The Postal Service may, in connection with any litigation 
brought against the Postal Service under any of the antitrust laws, 
employ attorneys by contract or otherwise to conduct litigation on its 
behalf without regard to any provision of paragraph (1).''.
    (c) Technical and Conforming Amendments.--
            (1) Section 410(c)(4) of title 39, United States Code, is 
        amended by inserting ``or 37'' after ``36''.
            (2) Section 409(a) of title 39, United States Code, is 
        amended by striking ``section 3628'' and inserting ``section 
        3628 (or any provision of this title incorporating such section 
        by reference) or section 3723(g)''.

SEC. 1002. TERMINATION OF RATEMAKING AUTHORITY UNDER CHAPTER 36 AND 
              RELATED MATTERS.

    (a) Authority To Fix Rates and Classes.--Section 3621 of title 39, 
United States Code, is amended--
            (1) in the first sentence by striking ``this chapter'' and 
        inserting ``this chapter and chapter 37'';
            (2) by repealing the last 2 sentences.
    (b) Rates and Fees.--
            (1) In general.--Section 3622 of title 39, United States 
        Code, is repealed.
            (2) Clerical amendment.--The item relating to section 3622 
        in the table of sections at the beginning of chapter 36 of such 
        title 39 is repealed.
    (c) Recommended Decisions of Commission.--Section 3624 of title 39, 
United States Code, is amended--
            (1) in subsection (a) by striking ``section 3622 or 3623'' 
        and inserting ``section 3623'';
            (2) by repealing subsection (c); and
            (3) in subsection (d)--
                    (A) by striking ``rate, fee, or''; and
                    (B) by striking ``section 3622 or 3623, as the case 
                may be.'' and inserting ``section 3623.''.
    (d) Action of the Governors.--Section 3625 of title 39, United 
States Code, is amended--
            (1) in the third sentence of subsection (d)--
                    (A) by striking ``(1)''; and
                    (B) by striking ``chapter, and (2)'' and all that 
                follows through the period and inserting ``chapter and 
                chapter 37, respectively.''; and
            (2) by amending subsection (f) to read as follows:
    ``(f) Except as otherwise provided in this title, the Board shall 
determine--
            ``(1) the date on which any changes in the mail 
        classification schedule (whether made under this chapter or 
        chapter 37) shall become effective; and
            ``(2) the date on which new rates and fees under chapter 37 
        shall become effective.''.
    (e) Reduced-Rate Categories of Mail.--
            (1) Continued applicability of relevant provisions of 
        chapter 36 for the limited purpose of computing alternative 
        rate limitations for noncompetitive products.--Notwithstanding 
        any other provision of this Act (or any amendment made by this 
        Act), the rate of postage established under subchapter II of 
        chapter 37 of title 39, United States Code, as amended by this 
        Act, for a class of mail or kind of mailer referred to in 
        section 3626(a)(1) of such title may not, at any time, exceed 
        the lesser of--
                    (A) the maximum rate then otherwise allowable under 
                chapter 37 (determined as if this subsection had not 
                been enacted) for such class of mail or kind of mailer; 
                or
                    (B) the rate determined under paragraph (2) for 
                such class of mail or kind of mailer.
            (2) Determination of rates which would then otherwise apply 
        under chapter 36.--
                    (A) In general.--For purposes of paragraph (1)(B), 
                the United States Postal Service shall determine, and 
                subsequently revise whenever necessary in order to keep 
                determinations under this paragraph current, the rate 
                of postage which would then otherwise apply with 
                respect to each class of mail or kind of mailer 
                referred to in section 3626(a)(1) of such title 39.
                    (B) Methodology.--Subparagraph (A) shall be carried 
                out--
                            (i) by applying the provisions of 
                        paragraphs (2) through (5) of section 3626(a) 
                        and of section 3642 of such title 39; and
                            (ii) by using the then most recent 
                        information available to the Postal Service 
                        relating to costs attributable and 
                        institutional costs (within the meaning of the 
                        provisions referred to in clause (i)).
            (3) Limitation under this subsection to be used instead of 
        (and to be treated as) the limitation under section 3722.--The 
        maximum rate determined for a product under this subsection 
        shall, for all purposes (except paragraph (1)(A)), be used 
        instead of (and shall be treated as) the maximum rate allowable 
        for such product under section 3722 of such title 39.
            (4) Statement of limited purpose.--Section 3626(a) of such 
        title 39 is amended by adding at the end the following:
    ``(6) Neither this subsection nor section 3642 shall have any force 
or effect, except for purposes of section 1002(e) of the Postal Reform 
Act of 1997. Nothing in the preceding sentence shall be considered to 
affect any baseline rate established pursuant to section 3701.''.
            (5) Regulations.--The United States Postal Service shall 
        prescribe such regulations as may be necessary to carry out the 
        provisions of sections 3626 (including subsections (b) through 
        (n) thereof) and 3642 of such title 39 (as amended by this Act) 
        in a manner consistent with chapter 37 of such title 39 (as 
        amended by this Act) and with the purposes of this Act.
    (f) Other Temporary Rates.--
            (1) In general.--Section 3641 of title 39, United States 
        Code, is amended--
                    (A) by repealing subsections (a) through (d); and
                    (B) in subsection (f) by striking ``in rates of 
                postage, and fees for postal services, or''.
            (2) Clerical amendments.--
                    (A)(i) The heading for section 3641 of such title 
                39 is amended to read as follows:
``Sec. 3641. Temporary changes in classes''.
                    (ii) The item relating to section 3641 in the table 
                of sections at the beginning of chapter 36 of such 
                title 39 is amended to read as follows:

``3641. Temporary changes in classes.''.
                    (B)(i) The heading for subchapter III of chapter 36 
                of such title 39 is amended to read as follows:

                 ``SUBCHAPTER II--TEMPORARY CLASSES''.

                    (ii) The analysis for chapter 36 of such title 39 
                is amended by striking the item relating to subchapter 
                II and inserting the following:

                 ``SUBCHAPTER II--TEMPORARY CLASSES''.

    (g) Rate and Service Complaints.--Section 3662 of title 39, United 
States Code, is amended to read as follows:
``Sec. 3662. Rate and service complaints
    ``(a) Interested parties who believe the Postal Service is charging 
rates which do not conform to the policies set out in this title or who 
believe that they are not receiving postal service in accordance with 
the policies of this title may lodge a complaint with the Postal Rate 
Commission in such form and in such manner as it may prescribe. The 
Commission may in its discretion hold hearings on such complaint.
    ``(b)(1) If the Commission, in a classification matter covered by 
subchapter II, determines the complaint to be justified, it shall, 
after proceedings in conformity with section 3624, issue a recommended 
decision which shall be acted upon in accordance with the provisions of 
section 3625 and subject to review in accordance with the provisions of 
section 3628.
    ``(2) If a violation of a limitation under section 3722 or 3724(d) 
(relating to the maximum rate allowable for products in the 
noncompetitive category of mail) or section 3742(b) (relating to 
requirements applicable with respect to rates established for products 
in the competitive category of mail) is involved, it may issue an 
appropriate order under section 3783.
    ``(3) If a matter other than a matter covered by paragraph (1) or 
(2) is involved, and the Commission after a hearing finds the complaint 
to be justified, it shall render a public report thereon to the Postal 
Service which shall take such action as it deems appropriate.''.
    (h) Limitations.--Section 3684 of title 39, United States Code, is 
amended by striking ``or 34'' and inserting ``34, or 37''.
    (i) Mail Classification.--Section 3623 of title 39, United States 
Code, is amended--
            (1) by repealing subsection (a);
            (2) in subsection (b) by striking ``Following the 
        establishment of the mail classification schedule requested 
        under subsection (a) of this section, the'' and inserting 
        ``The'';
            (3) in subsection (c) (in the matter before paragraph (1)) 
        by striking ``this title'' and inserting ``this title, 
        subsection (e),''; and
            (4) by adding at the end the following:
    ``(e)(1) Any change under this subchapter in the mail 
classification system shall be in accordance with the requirements of 
paragraph (2).
    ``(2) The requirements of this paragraph are as follows:
            ``(A) A product may not be reclassified from the 
        competitive to the noncompetitive category of mail.
            ``(B) The reclassification of a product from one basket to 
        another basket of the noncompetitive category of mail shall not 
        be effective during a ratemaking cycle unless notice of the 
        final decision on the reclassification is given to the Postal 
        Rate Commission before the start of proceedings under section 
        3723(b) in connection with such cycle.
            ``(C)(i) A new product may not be made available to the 
        public before it has been placed in--
                    ``(I) either the competitive or the noncompetitive 
                category of mail; and
                    ``(II) if placed in the noncompetitive category of 
                mail, the appropriate basket thereof.
            ``(ii) Any decision as to whether a new product should be 
        placed in the competitive or the noncompetitive category of 
        mail shall be made in accordance with the requirements set 
        forth in section 3743(b). Such requirements shall be 
        specifically addressed in any statement required under section 
        3624(d) with respect to such decision.
    ``(3) For purposes of this subsection--
            ``(A) the term `product' has the meaning given such term by 
        section 3721(3);
            ``(B) the term `noncompetitive category of mail' refers to 
        the category of mail under subchapter II of chapter 37;
            ``(C) the term `competitive category of mail' refers to the 
        category of mail under subchapter III of chapter 37;
            ``(D) the term `basket' refers to a basket under paragraph 
        (3), (4), (5), or (6) of section 3723(a);
            ``(E) the term `ratemaking cycle' has the meaning given 
        such term by section 3723(a)(1); and
            ``(F) the term `new product' means a product which, as of 
        the effective date of this subsection, is not available to the 
        public through the Postal Service.''.
    (j) Effective Date.--This section and the amendments made by this 
section shall become effective on the effective date of the baseline 
rates and fees established pursuant to section 3701 of title 39, United 
States Code, as amended by section 1001.
                                 <all>