February 23, 2012
WASHINGTON, D.C. – Following reports that the U.S. Postal Service (USPS) plans to close eight Mail & Processing Distribution Centers (P&DC) in Ohio despite a moratorium aimed at preventing consolidation until Congress passes postal reform legislation, U.S. Sen. Sherrod Brown (D-OH) today called on the USPS to halt consolidation.
“The five-month moratorium was agreed to in good faith to provide time for the USPS, Congress, and local stakeholders to address issues with the current system,” Brown said. “Instead of taking steps that would lead to job loss and degradation of services for Ohio businesses and families, the USPS should focus on commonsense solutions that improve its fiscal solvency.”
“The Postal Service Protection Act would address the most immediate funding challenges USPS faces, while preserving jobs and Saturday mail delivery and finding innovative new ways for USPS to generate revenue,” Brown continued.
In December 2011, the U.S. Senate and USPS agreed to a five-month moratorium on closing postal facilities, providing Congress more time to enact postal reform legislation. Under the terms, the Postal Service would use the time to study the impact of proposed closures on service and costs and to solicit community input.
One hundred and twenty post offices and ten mail processing facilities have been targeted for closure in Ohio, and Brown has sent multiple letters to Postmaster General Patrick Donohue outlining concerns with the closures, which could lead to significant job losses, delayed mail, and deteriorated service. Brown has also sent representatives to public hearings across Ohio in recent months to stand with local residents in opposition to these closures.
Brown is working to pass legislation that would help the USPS return to fiscal solvency, while maintaining jobs and quality service for Ohio businesses. Brown cosponsored the Postal Service Protection Act, which preserves Saturday mail delivery, restricts the closure of rural and urban post offices, and protects mail processing facilities to ensure maintenance of timely service. The legislation would address the most immediate financial problem facing the postal service by eliminating the unique requirement that the postal service pre-fund 75 years worth of future retiree health benefits in just 10 years. This mandate costs USPS between $5.4 and $5.8 billion per year, and it accounts for 100 percent of the Postal Service’s $20 billion in losses from 2007-2008.
According to studies by the Hay Group and the Segal Company, the postal service has overpaid at least $50 billion into its pension plans. Because of these overpayments, USPS has been forced to subsidize retirement accounts for the entire Federal government. This bill would allow USPS to recover these pension overpayments to both fund its retiree health benefits and cover its operational expenses.
Specifically, the Postal Service Protection Act would:
- Fix the immediate fiscal problem of the postal service by allowing the postal service to recover the overpayments it made to its retirement programs. Additionally, this bill would allow the postal service to recover the overpayments that it has made to its pension plans.
- Establish new ways the Post Office can generate revenue, by ending the prohibition on USPS providing non-postal services, such as:
- Providing notary services, new media services, issuance of licenses (drivers licenses, hunting licenses, fishing licenses)
- Contracting with state and local agencies to provide services
- Shipping wine and beer
- Encouraging innovative ways to address the shift toward electronic mail and away from hard-copy mail
- Prevent the closure of rural post offices by giving the Postal Regulatory Commission (PRC) binding authority to prevent closures based on the effect on the community and the effect on employees. Right now, the Postal Regulatory Commission only has the authority to review a decision to close, but it does not have any binding authority to prevent the closure, even if it finds it was flawed. The bill would also ensure more transparency in the closure process by requiring USPS to inform the communities that are being studied for closure
- Protect six-day delivery
- Protect mail-processing facilities by ensuring strict standards for delivering first class mail delivery on time that would make it more difficult to close area mail processing facilities.