By Mark Pitts
Executive Director, Printing-Writing
As the current legislative session winds to a close, it appears that
one more year will pass without Congress addressing postal reform.
The financial condition of the U.S. Postal Service (USPS) puts the
future of mail in jeopardy and only Congress can provide the tools
necessary to bring solvency back to the Postal Service.
In 2006, a lame-duck session of Congress legislated that USPS prepay 75 years’ worth of future retiree health benefits over the following ten years. As a result, a law designed to keep the Postal Service solvent over the long-term is bankrupting it.
In the past six years USPS has incurred $41 billion in net losses, including $32 billion for the aforementioned prefunding requirement. The Postal Service does not have the authority or the tools to manage these massive obligations without comprehensive postal reform legislation. While both chambers of Congress have introduced postal reform bills, the process has stalled and there are significant differences that need to be reconciled.
In the meantime, the USPS has been executing its five-year financial improvement plan by streamlining operations, cutting hours of operation, and adjusting service levels. Absent legislative relief, the Postal Service is pursuing a 6.5% increase in First-Class postage rates and a 5.9 percent rate increase for business mail that, despite its intention to raise revenue, will result in accelerating the already alarming decline in mail volume. USPS said it would not need to increase rates to this degree if Congress passes postal reform legislation by the end of the month.
AF&PA advocates comprehensive postal reform that supports long-term cost reductions, allows new, innovative revenue sources and relieves the USPS of unfair financial obligations. But piecemeal measures that could have disruptive, negative effects on customers, employees and the availability of postal services will continue as long as Congress does not act.
We urge Congress to pass legislation that will change the USPS business model, preserve affordable mail service, and allow the Postal Service to focus on the business of delivering mail and packages instead of crisis management.