The Postal Accountability and Enhancement Act: Overview and Issues for Congress

Congressional Research Service Report


President George W. Bush signed the Postal Accountability and Enhancement Act (PAEA; P.L.109-435; 120 Stat. 3198) on December 20, 2006. The PAEA was the first broad revision of the 1970 statute that replaced the U.S. Post Office with the U.S. Postal Service (USPS), a selfsupporting,independent agency of the executive branch.

This report describes Congress’s pursuit of postal reform, and summarizes the major provisions of the new postal reform law. The report also suggests PAEA-related oversight issues for Congress.

Legislatively, the pursuit of reform of the U.S. Postal Service (USPS) began during the 104th Congress, in 1996. A number of factors encouraged the movement for postal reform. Perhaps foremost were the financial challenges of the USPS.

A decade later, Congress enacted the PAEA, which made over 150 changes to postal law. Some of the more significant alterations are defining the term “postal service”; restricting the USPS’s authority to provide nonpostal services; altering the USPS’s budget submission process; requiring the USPS to prefund its future retiree health benefits by establishing the Postal Service Retiree Health Benefits Fund; and replacing the USPS’s regulator, the Postal Rate Commission, with the more powerful Postal Regulatory Commission.

The inherent complexity of lawmaking and the execution thereof invites disagreement and confusion over what a law means and how it should be implemented. In the three years since the enactment of the PAEA, some issues and questions concerning the law’s provisions have arisen. These include, but are not limited to, possible executive branch concerns about the PAEA and the separation of powers; the cost of prefunding USPS future retiree health benefits; the role of the public in the closure of nonretail postal facilities; the USPS’s authority to provide nonpostal products and services, and the viability of the USPS’s business model.

This report will be updated should events warrant.

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