A key House leader has opened up negotiations again over the United States Postal Service’s future. But is the move too little, too late for a national institution that could run out of cash by the fall?
Representative Darrell Issa of California and Senator Tom Carper of Delaware are overseeing efforts in the Senate and the House to come up with bipartisan postal legislation, an effort that failed in the 112th Congress.
Issa made a compromise last week in a draft version of a Postal Service overhaul bill, the Postal Reform Act of 2013.
The draft from the House Oversight Committee would greatly reduce a financially crippling annual requirement to prefund health costs for future retirees.
In 2006, Congress passed a law that required the Postal Service to fund retirement health benefits in advance. The Postal Service says the prefunding requirement, along with the growth of email, have kept it from being a profitable business.
Ending the prefunding requirement won’t bring about a compromise by itself, but it would be one less major issue for Congress, the Postal Service and the unions that represent postal workers to debate.
In April, the Postal Service gave up temporarily its battle with Congress to end Saturday mail deliveries, but it’s also hinted that taxpayers could pay a price for the move, such as a taxpayer bailout in the end.
“It is not possible for the Postal Service to meet significant cost reduction goals without changing its delivery schedule–any rational analysis of our current financial condition and business options leads to this conclusion. Delaying responsible changes to the Postal Service business model only increases the potential that the Postal Service may become a burden to the American taxpayer, which is avoidable,” the service’s Board said in April.
In Issa’s draft bill, there would be an end to Saturday mail delivery while package delivery remains in place on Saturdays.
And there are several other plans that would face hurdles. The act replaces temporarily replaces the Postal Service board of governors with an appointed panel of outside executives who could make any moves necessary to “ensure the long-term solvency” of the Postal Service.
It also would allow the Postal Service to lay off employees, and it would phase out home delivery of mail to customer’s doorsteps (replacing home delivery with a series of group neighborhood drop boxes).
Not surprisingly, union leaders weren’t thrilled with Issa’s draft bill.
“The draft bill would turn the USPS into a private, for-profit operation. It would do virtually nothing to strengthen the Postal Service’s ability to serve the communications needs of our nation,” said American Postal Workers Union president Cliff Guffey.
“The NALC is disappointed that Chairman Issa did not take a fresher approach to postal reform with this discussion draft,” said Fredric Rolando, president of the National Association of Letter Carriers.
“We hope that we will be able to work with the chairman on legislation to provide alternative approaches to postal reform that seek to modernize and strengthen the Postal Service—an agency with roots in the U.S Constitution—rather than to destroy it brick by brick,” said Rolando.
The Postal Service gets limited direct funding from Congress, but Congress has oversight of the agency through its constitutional powers. It was established by the Constitution in 1787. Article 1, Section 8 of the Constitution enumerates the powers of Congress, including the power to establish and maintain post offices, along with roads to support the service.
Senator Carper is expected to introduce his own draft bill, and the debate over the Postal Service’s future will be a contentious one in Congress.
Issa’s draft also eliminates preferential postal rates for political parties.
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