December 20thPresident Bush signed the Postal Accountability and Enhancement Act (H.R. 6407) into law on Wednesday, December 20 in a White House ceremony.  He was joined by mail industry dignitaries, US Postal Service and Postal Rate Commission officials and members of Congress who worked for nearly 12 years to pass a postal reform measure and send it to the White House.


This new postal legislation will benefit both residential and business customers by ensuring predictable price increases tied to the rate of inflation. The Postal Accountability and Enhancement Act is the first major change to the Postal Service since 1971. The law enables the organization to continue its transformation efforts and cost-cutting measures. According to Post Master General John E. Potter, this new law could not have come at a better time. The Postal Service has never been stronger and this law enables us to build on our successes. The Postal Service has ended a fourth consecutive year with positive retained earnings, a seventh consecutive year of improved productivity, and has benefited from record service and customer satisfaction scores that are independently measured.


This is the culmination of a 12-year effort by Congress to secure changes to the laws governing the Postal Service. It will link future rate increases to the Consumer Price Index and give the Postal Service more flexibility for pricing competitive products. The Act also reconstitutes the existing Postal Rate Commission into a regulatory body with greater authority and responsibility. The current rate case under consideration will proceed as scheduled. The Postal Service will be able to file one last rate case under the current rules.


The new law directs the Department of the Treasury to resume the funding of military pensions for postal employees and abolishes a federally mandated escrow requirement, directing those monies to pre-fund retiree health benefits. Over the next decade, these changes will free the Postal Service of future legacy costs. We are now on firm financial footing for the future.


John E. Potter

Postmaster General