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Legislative Updates

Senate passes Inflation Reduction Act, includes $3 billion for postal vehicles

In a party-line vote of 51-50, with a tie-breaking vote from Vice President Kamala Harris, the Senate passed the Inflation Reduction Act (IRA) of 2022 (H.R. 5376) on Sunday. Using the process known as “budget reconciliation,” only a simple majority, instead of a 60-vote threshold, was required to move the legislation forward.

The vote came after Senate Majority Leader Chuck Schumer (D-NY) and Sen. Joe Manchin (D-WV) announced a deal at the end of last month on the comprehensive energy, climate, healthcare and tax package. The IRA would invest $433 billion in energy, climate and healthcare provisions, raise an estimated $739 billion through an updated corporate tax code, and reduce the national deficit by $300 billion over the next decade.

In relation to the Postal Service, the legislation includes $3 billion for the agency, with $1.29 billion for purchasing zero-emission delivery vehicles and $1.71 billion for installing the necessary infrastructure to support the vehicles at USPS facilities.

Several amendments regarding funding for the Postal Service vehicle fleet were introduced. Sen. James Lankford (R-OK) introduced an amendment that would require the Postal Service to conduct a publicly available cost-benefit analysis of the purchase of zero-emission vehicles compared to nonelectric vehicles. Sen. Bill Hagerty (R-TN) introduced three amendments that would move the Postal Service vehicle funding to other agencies and purposes, including to detain and deport illegal aliens and detect drugs at the border. An amendment was introduced by Sen. Joni Ernst (R-IA) that would require the Postal Service to sell non-political advertisements on its delivery vehicles, and Sen. John Kennedy (R-LA) introduced an amendment that would prohibit USPS from replacing vehicles with less than 100,00 miles. Finally, Sen. Jeff Merkley (D-OR) introduced an amendment to increase the Postal Service vehicle funding to $7.5 billion. None of these amendments passed and the original $3 billion for zero-emission vehicles for the Postal Service remains in the legislation.

Overall, the legislation would provide $369 billion in funding for climate provisions including investments in clean manufacturing and electric vehicle and clean energy tax credits for consumers. It would lower the cost of prescription drugs for many Americans by allowing Medicare to negotiate with pharmaceutical companies for lower prices and extend Affordable Care Act premium subsidies to 2025.

The legislation would offset these investments through an updated corporate tax code that would provide an estimated $739 billion in revenue. It would impose a 15% minimum tax on all corporations raising an estimated $313 billion and provide $80 billion for the Internal Revenue Service (IRS) for staffing and technology to increase audits. To get Sen. Kyrsten Sinema’s (D-AZ) support, the provision that would eliminate the “carried interest” tax loophole, a current workaround that allows wealthy fund managers to pay lower taxes than their staff, was removed from the final package. 

During the nearly 15-hour vote-a-rama on amendments, only two amendments were adopted. An amendment introduced by Sen. John Thune (R-SD) that would reverse the book tax minimum and an amendment from Sen. Mark Warner (D-VA) that addressed Thune’s amendment by replacing the SALT cap for two years.

The IRA is a scaled-down version of the original $3.5 trillion Build Back Better Act, a key part of the administration’s agenda that passed in the House last year but was ultimately stalled in the Senate. While the IRA includes funding for the Postal Service and provisions that will help letter carriers and their families, paid family leave, child tax credits and free early childcare and community college are notably excluded from this package.

“NALC is pleased to see the IRA and this critical funding for the Postal Service pass in the Senate,” NALC President Fredric Rolando said. “We urge the House to pass this legislation and send it to President Biden’s desk.”

The House plans to vote on the legislation this week. NALC will update letter carriers on any future action. 

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