Sec. 301. Postal rates

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Chapter 36 of title 39, United States Code, is amended by striking section 3622 and inserting the following: The Board of Governors of the Postal Service shall establish, and may from time to time thereafter revise, a system of classes and rates for market-dominant products, consistent with the requirements of this section. The authority under this section may not be delegated to the Postmaster General or to any other individual or body. Such system shall be designed to achieve the following objectives, each of which shall be applied in conjunction with the others:

To maximize incentives for the Postal Service to reduce costs and increase efficiency. To create predictability and stability in rates through the establishment of a schedule whereby rates change at regular intervals by predictable amounts. To maintain high quality service standards established under section 3691. To assure adequate revenues, including retained earnings, to maintain financial stability. To establish and maintain a just and reasonable schedule for rates and classifications, however the objective under this paragraph shall not be construed to prohibit the Board of Governors from making changes of unequal magnitude within, between, or among classes of mail.

To enhance mail security and deter terrorism. To allocate the total institutional costs of the Postal Service appropriately between market-dominant and competitive products, in accordance with regulations established by the Postal Regulatory Commission under section 3633. In establishing or revising such system, the Board of Governors shall take into account— the value of the mail service actually provided each class or type of mail service to both the sender and the recipient, including but not limited to the collection, mode of transportation, and priority of delivery; the direct and indirect postal costs attributable to each class or type of mail service through reliably identified causal relationships and that portion of all other costs of the Postal Service reasonably assignable to such class or type; the effect of rate increases upon the general public, business mail users, and enterprises in the private sector of the economy engaged in the delivery of mail matter other than letters; the available alternative means of sending and receiving letters and other mail matter at reasonable costs; the 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; the relative value to the people of the kinds of mail matter entered into the postal system and the desirability and justification for special classifications and services of mail; the importance of providing classifications with extremely high degrees of reliability and speed of delivery and of providing those that do not require high degrees of reliability and speed of delivery; the desirability of special classifications for both postal users and the Postal Service in accordance with the policies of this title; the educational, cultural, scientific, and informational value to the recipient of mail matter; the need for the Postal Service to increase its efficiency and reduce its costs, including infrastructure costs, to help maintain high quality, affordable postal services; the value to the Postal Service and postal users of promoting intelligent mail and of secure, sender-identified mail; and the policies of this title as well as such other factors as the Board of Governors determines appropriate.

The Board of Governors shall provide notice of any adjustment in classes or rates proposed to be made under this section— not less than— 90 days before implementation of any class or rate adjustment that affects all or substantially all market-dominant products; and 45 days before implementation of any other class or rate adjustment; and to— the public, including by— publication in the Federal Register; and posting on Postal Service’s website; and the Postal Regulatory Commission.

The Board of Governors shall solicit and receive public comments on any proposed rate or class adjustment, and shall take such comments into account in making its final determination as to a rate or class adjustment. Not later than 10 days before a rate or class adjustment takes effect, the Board of Governors shall issue a final decision on the adjustment which shall— be published in the Federal Register and on the Postal Service’s website; and include an explanation responding to all relevant comments received.

Any adjustment made by the Board of Governors under this section shall be subject to review by the Commission under section 3662. The Board of Governors may not increase rates under this section for market-dominant products as a whole by an annual percentage that exceeds the percentage change in the Consumer Price Index for All Urban Consumers unadjusted for seasonal variation over the most recent available 12-month period preceding the date the Board of Governors provides notice of its intention to increase rates.

Nothing in this subsection shall preclude the Board of Governors from rounding rates and fees to the nearest whole integer, if the effect of such rounding does not cause the overall rate increase for any class to exceed the Consumer Price Index for All Urban Consumers. In this subparagraph, the term unused rate adjustment authority means the difference between— the maximum amount of a rate adjustment that the Board of Governors is authorized to make in any year subject to the annual limitation under paragraph (1); and the amount of the rate adjustment the Board of Governors actually makes in that year.

Subject to clause (iii), the Postal Service may use any unused rate adjustment authority for any of the 5 years following the year such authority occurred. In exercising the authority under clause

(ii)in any year, the Postal Service— may use unused rate adjustment authority from more than 1 year; may use any part of the unused rate adjustment authority from any year; shall use the unused rate adjustment authority from the earliest year such authority first occurred and then each following year; and may not exceed the annual limitation under paragraph

(1)by more than 2 percentage points. Notwithstanding any limitation under subsection (d)(1) and paragraph

(1)of this subsection, and provided there is not sufficient unused rate authority under paragraph (2)(B), the Board of Governors may adjust rates on an expedited basis due to either extraordinary or exceptional circumstances, provided that the Board of Governors unanimously determines, after notice and opportunity for public comment, that such adjustment is reasonable and equitable and necessary to enable the Postal Service, under best practices of honest, efficient, and economical management, to maintain and continue the development of postal services of the kind and quality adapted to the needs of the United States. Any system of rates and classes established or revised by the Board of Governors under subsection

(a)after December 20, 2016, shall not be subject to the limitation in paragraph

(1)of this subsection. In this subsection, the term workshare discount refers to rate discounts provided to mailers for the presorting, prebarcoding, handling, or transportation of mail, as further defined by the Board of Governors under subsection (a). The Board of Governors shall ensure that such discounts do not exceed the cost that the Postal Service avoids as a result of workshare activity, unless— the discount is— associated with a new postal service, a change to an existing postal service, or with a new work share initiative related to an existing postal service; and necessary to induce mailer behavior that furthers the economically efficient operation of the Postal Service and the portion of the discount in excess of the cost that the Postal Service avoids as a result of the workshare activity will be phased out over a limited period of time; the amount of the discount above costs avoided— is necessary to mitigate rate shock; and will be phased out over time; the discount is provided in connection with a category of mail consisting exclusively of mail matter of educational, cultural, scientific, or informational value; or reduction or elimination of the discount would— impede the efficient operation of the Postal Service; lead to a loss of volume in the affected category of mail and reduce the aggregate contribution to the institutional costs of the Postal Service from the category subject to the discount below what it otherwise would have been if the discount had not been reduced or eliminated; or result in a further increase in the rates paid by mailers not able to take advantage of the discount. Whenever a workshare discount is established, the Board of Governors shall ensure that the notice provided under subsection (d)(1) includes— the reasons for establishing the discount; the data, economic analyses, and other information relied on by the Board of Governors to justify the rate; and a certification that the discount will not adversely affect rates or services provided to users of postal services who do not take advantage of the discount rate. The Board of Governors shall ensure that any agreement between the Postal Service and a mailer that adjusts rates or classes in a manner that is specific to the mailer— is available on public and reasonable terms to similarly situated mailers; either— improves the net financial position of the Postal Service through reducing Postal Service costs or increasing the overall contribution to the institutional costs of the Postal Service; or enhances the performance of mail preparation, processing, transportation, or other functions; and does not cause unreasonable harm to the marketplace. In making any determination under this section, including the construction and interpretation of the terms used in this section, the Board of Governors shall give consideration to decisions of the Commission made prior to the date of enactment of the Postal Reform Act of 2013, and shall include an explanation of any deviation from such decisions in the notice required under subsection (d)(1). . The table of sections for chapter 36 of title 39, United States Code, is amended by striking the item relating to section 3622 and inserting the following: 3622. Postal services for market-dominant products. . Section 3626 of title 39, United States Code, is amended— by striking subsection (e); by redesignating subsections (f), (g), and

(h)as subsections (e), (f), and (g), respectively; by redesignating subsections

(j)through

(n)as subsections

(h)through (l), respectively; and in subsection (h), as redesignated by paragraph (3)— in paragraph (1)(D), by striking subsection (m)(2) and inserting subsection (k)(2) ; and in paragraph (3)(B), by striking subsection

(m)and inserting subsection

(k). Section 3629 of title 39, United States Code, is amended— by striking is available and inserting was available ; and by striking section 3626 and inserting section 3626, as in effect on the day before the date of enactment of the Postal Reform Act of 2013, .