PRC Press Release

Washington, DC – The Postal Regulatory Commission yesterday issued a Notice establishing Docket SS2010-1 to conduct a review of the Civil Service Retirement System (CSRS) pension liability of the United States Postal Service.

“This is an important study which will provide information regarding the financial health and viability of the Postal Service, and it will assist the Commission as it analyzes the mounting financial losses the Postal Service is projecting,” said Chairman Ruth Y. Goldway.

The Commission action is called for under section 802(c) of the Postal Accountability and Enhancement Act, which directs the Commission, upon request of the Postal Service, to promptly procure the services of an actuary qualified to evaluate pension obligations to conduct a review in accordance with generally accepted actuarial practices and principles and to provide a report to the Commission containing the results of the review.

Upon the Commission’s receipt and approval of the actuary’s report, together with any comments the Commission may choose to make, the report shall be submitted to the Postal Service, the U.S. Office of Personnel Management (OPM), and Congress.

OPM is responsible for calculating the Postal Service’s CSRS pension liability. The Postal Service filed its request with the Commission on February 23, 2010.

NOTICE OF REQUEST FOR COMMISSION REVIEW PURSUANT TO SECTION 802(c) OF THE POSTAL ACCOUNTABILITY AND ENHANCEMENT ACT
(March 1, 2010)

On February 23, 2010, the United States Postal Service (Postal Service) filed a request with the Postal Regulatory Commission (Commission) pursuant to section 802(c) of
the Postal Accountability and Enhancement Act (PAEA). Pub. L. No. 109-435, 120 Stat. 3250 (2006), not codified; see 5 U.S.C. 8348 note.1 The Postal Service requests that the
Commission initiate a review of determinations made by the Office of Personnel Management (OPM) regarding the Postal Service’s Civil Service Retirement System (CSRS) liabilities and
matters raised in a recent report of the Postal Service’s Office of the Inspector General (OIG), The Postal Service’s Share of CSRS Pension Responsibility, January 20, 2010.2

Section 802(c) directs the Commission, upon request of the Postal Service, to promptly procure the services of an actuary qualified to evaluate pension obligations to conduct a review in accordance with generally accepted actuarial practices and principles and to provide a report to the Commission containing the results of the review. Upon the Commission’s receipt and approval of the report, together with any comments the Commission may choose to make, the report shall be submitted to the Postal Service, OPM, and Congress.

1 Request of the United States Postal Service for the Commission to Conduct a Review Pursuant to PAEA Section 802(c) of OPM Determinations Regarding CSRS, February 23, 2010 (Request). Although the Postal Service submitted its filing as Docket No. PI2010-2, the Request is for a “Special Study” and will be docketed as Docket No. SS2010-1, a designation the Commission has used previously.

2 The report is available at http://www.uspsoig.gov/foia_files/RARC-WP-10-001.pdf.

Section 802(c) directs OPM to reconsider its determinations in light of the report and make appropriate adjustments. Thereafter, OPM is to report the results of its reconsideration
to the Commission, the Postal Service, and Congress In support of the Request, the Postal Service states that the OIG report raises serious questions about the appropriate calculation of the Postal Service’s CSRS liabilities and that the magnitude of the amounts is more than sufficient to color debate on the true state of the Postal Service’s present and future financial health. Request at 1-2.

Pursuant to the Postal Service’s Request, the Commission shall acquire the services of an actuary, obtain a report, and take other actions consistent with the provisions of section 802(c) of the PAEA.

Shoshana M. Grove
Secretary