USPS and senior politicians yesterday held further discussions over the future of the US PostalService, with a senior Democrat representative introducing new draft legislation aiming to return
the US Postal Service to long-term solvency and sustainability while Postmaster General PatrickDonahoe warned against postal reform “half-measures”.Elijah Cummings claimed his ‘Innovate to Deliver’ bill would address the agency’s financialchallenges through innovative structural changes, strengthening the Postal Service by creating anew Chief Innovation Officer position, authorising the Postal Service to develop new sources ofrevenue by providing expanded non-postal services, such as new technology and media services,warehousing and logistics, and requiring that each class or type of mail bear the direct andindirect costs attributable to it.
The bill also proposes modifying the costly health pre-funding requirement by amortisingpayments over 40 years, although it made no mention of a move to a five-day mail delivery schedule,strongly favoured by USPS.
Donahoe, meanwhile, yesterday told the House Oversight and Government Reform Committee that thePostal Service was “moving quickly down a road that leads straight to a large financial chasm”,because it had a business model that did not allow it to adapt to changes in the marketplace and itdid not have the legal authority to make the fundamental changes that are necessary to achievelong-term financial stability.
He said postal reform legislation “can be the bridge over that chasm”, but warned: “Weneed a bridge that gets us all the way to the other side. Half measures are about as useful as halfa bridge.”
Donahoe added: “We need legislation that, together with our planned changes, confidently enablesat least $20 billion in savings by 2016. If not, we go over the edge.”
Donahoe’s warnings are understood to be directed at Cummings’ bill and draft legislation plannedby Darrell Issa, chairman of the House Oversight and Government Reform Committee, who is reportedto be introducing a new bill next week that he believes will be acceptable to both sides of theHouse. Like Cummings’ bill, Issa’s draft legislation is expected to propose re-amortising ratherthan eliminating health pre-funding payments, although it does support a move to five-day deliveryfor first-class mail.
Issa issued a ‘discussion draft’ of a postal reform bill in May that included compromises hehopes will win bipartisan approval. However, Donahoe remains adamant that any new legislationremoves USPS’s obligation to prefund its employee health and retirement programmes.
Donahoe told the committee: “We can completely eliminate the need for Retiree Health Benefitprefunding if we can move to our proposed solution. Our goal should be the elimination… not justre-amortisation… of any prefunding, and this is achievable.”
The House Oversight and Government Reform Committee will hold a full business meeting next week,at which Issa’s postal reform bill is expected to be marked up for a vote by the full House ofRepresentatives.
