Reforming the USPS

Senators Joe Lieberman (I-CT), Tom Carper (D-DE), Susan Collins (R-ME) and Scott Brown (R-MA) at press conference announcing postal reform plan (Photo: Charles Dharapak/Associated Press)

In a 62–37 vote late last month (April 25), the Senate approved the 21st Century Postal Service Act (S. 1789), a bipartisan bill that promises financial relief for the U.S. Postal Service (USPS) but would bar it from closing thousands of post offices and hundreds of mail processing facilities.  The bill, sponsored by Senators Joe Lieberman (I- Conn.), Susan Collins (R-Maine), Tom Carper (D-Del.) and Scott Brown (R-Mass.), would  allow the Postal Service to use $11 billion in surplus contributions to the Federal Employees Retirement System to offer buyout and early retirement packages to as many as 100,000 USPS employees by October 2015, and would extend the timeline for the Postal Service to grow a healthcare fund for future retirees, saving the agency billions of dollars over the next few years.  It also would guarantee citizens access to retail postal services, impose a one-year delay in closing rural post offices, allow the USPS to end most Saturday deliveries within two years (but only if it can show that it must do so to become financially solvent), and require it to maintain an overnight delivery standard for first-class mail sent and delivered by the same processing facility, which would keep open about half of the 223 plants now scheduled for closure or consolidation.

In a letter to Postmaster General Patrick Donahoe released on May 1, the four sponsoring senators called on the USPS to extend its moratorium on closings beyond May 15, saying, “We believe an attempt to proceed with the planned closures—to “get in under the wire” while legislation to the contrary is being considered—would be counterproductive and would violate the clear intent of the Senate.”

“We therefore urge you to extend the current moratorium to delay the closure or consolidation of post offices and mail processing facilities that would be kept open were S. 1789 to be enacted into law,” they continued, “while we work together with our House colleagues to enact comprehensive postal legislation as quickly as possible.”  Whether that will happen before the May 15 deadline is debatable, since the Senate bill faces serious opposition from both the USPS Board of Governors and the House of Representatives.

The Board of Governors believes that the bill “does not provide the Postal Service with the flexibility and speed that it needs to have a sustainable business model,” said Board Chairman Thurgood Marshall Jr. at a board meeting earlier this week (Monday, May 7). Marshall and Donohoe continue to advocate for the five-year business plan the Postal Service proposed in February, which Marshall claims “would better position the Postal Service to pursue vital and promising revenue opportunities and also achieve a cost reduction of $22.5 billion by the year 2016.” Donohoe added that “we would have preferred the Senate allow the Postal Service to move further and faster in addressing its cost reduction goals.”

The Senate-approved measure has gone to the House, where a very different postal overhaul bill co-sponsored by Representatives Darrell Issa (R.-Calif.) and Dennis Ross (R-Fla.) already is pending. Their Postal Reform Act (H.R. 2309) includes a proposal to create a panel similar to the Defense Department’s Base Closure and Realignment Commission to make decisions about closings and finances.  It also contains much steeper cuts to postal operations than the Senate bill, setting Congress up for what could become a grueling showdown between the two chambers, when and if the House moves on the measure—something the Senate bill’s sponsors have said they hoped will happen very soon.

**Update**  Nearly simultaneous with our post of this article, Postmaster General Patrick Donohoe announced a revised plan to to cut the operating hours of 13,000 locations with little traffic (mostly rural locations) to between two and six hours a day.  The Postal Service reports that this new plan will actually save more money than the old one – $500 million versus $200 million.  Perhaps more importantly, it will placate the lawmakers who have been critical of the USPS’ various campaigns to close post offices, end Saturday mail delivery and raise postage rates.

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