NALC: Key GOP lawmakers playing “Russian roulette” with USPS
USPS pays another $5.5 billion for future retiree health
On Sept. 29, Congress adopted a “continuing resolution” (CR) that will fund the federal government through early December. Sens. Tom Carper (D-DE) and Dick Durbin (D-IL) worked tirelessly along with Senate Majority Leader Harry Reid (D-NV) to include an NALC-backed provision in the Senate version of the bill that would have deferred $4 billion of the $5.5 billion payment, due at midnight Sept. 30, to pre-fund future retiree health benefits. Unfortunately, Senate Republicans voted unanimously to block the postal measure, even though the U.S. Postal Service warned that making such a huge payment — which no other agency or private company is required to make — would seriously imperil its liquidity.
“It is very disappointing that GOP members of the Senate who have oversight responsibilities with regard to the Postal Service would take a party-line stance in this irresponsible action,” National Association of Letter Carriers President Fredric V. Rolando said.
Republican appropriators in the House took a similar partisan and irresponsible approach to both the CR and the Postal Service’s financial problems, blocking the inclusion of a deferral provision proposed by Reps. Stephen Lynch (D-MA) and Ed Towns (D-NY).
Rolando blamed the poisonous politics of the 2010 mid-term elections for scuttling the postal amendment.
“Too many politicians who know better have tried to deceive the public with claims that slowing the pre-funding payments represents a taxpayer bailout,” Rolando said. “No company has funded its post-retirement obligations as well as the Postal Service — our pensions are massively over-funded and we have put more away for future retiree health than any company in America.
“It simply makes no sense to force the USPS to use its limited borrowing authority and spend its limited cash reserves on liabilities that won’t come due for decades,” he added.
The Postal Service complied with the law and made the $5.5 billion payment as scheduled on Sept. 30, raising the balance in its Postal Service Retiree Health Benefits Fund to more than $41 billion, more than any company in the country and enough to cover retiree health care costs for decades to come. But the action reduces its end-of-the year cash position to just $2 billion and exposes the USPS to unnecessary financial risk.
Postmaster General Jack Potter observed: “The Postal Service sought a deferral of this $5.5 billion payment to minimize the risk of defaulting on our financial obligations in Fiscal Year 2011. Unfortunately, no legislative action has been taken at this time. The financial risk remains. We will carefully manage every dollar we spend in the upcoming fiscal year. Our current forecast shows that we will not have sufficient cash to make the $5.5 billion payment due on Sept. 30, 2011, and any major disruption, whether in volume loss or unforeseen circumstances, could cause us to default on financial obligations earlier in FY11.”
Pre-funding retiree health benefits is voluntary in the private sector. According to a survey by Towers Watson, only about one-third of all Fortune 1000 companies pre-fund at all. Those that do have put away far less than has the USPS to cover future costs (28 percent versus 46 percent).
No private company would voluntarily choose to make the kind of enormous pre-funding payment that the USPS did yesterday in current economic circumstances. “The legislators who blocked the pre-funding deferral are playing ‘Russian roulette’ with the Postal Service, a vital institution in the American economy,” Rolando said.
NALC: Carper Postal Legislation Includes Provisions We Cannot Support
Filed under: NALC, postal, postal news, postal reform, usps
From the National Association of Letter Carriers (NALC) e-Activist Network
9/24/10
Dear Supporter,
Late Thursday afternoon, Senator Tom Carper (D-DE) introduced legislation to address the CSRS pension overcharge as well as the Postal Service Retiree Health Benefit Fund (PSRHBF).
The bill-S. 3831, the Postal Operations Sustainment and Transformation (POST) Act of 2010-addresses the financial reforms the Postal Service needs in a comprehensive and commendable way.
Unfortunately, the legislation also includes a number of provisions that the NALC cannot support, including the elimination of Saturday delivery and directions to arbitrators to consider certain factors when rendering their decisions.
While the NALC will remain completely focused over the next several days on the inclusion of the $5.5 billion waiver of this year’s payment into the PSRHBF in the continuing resolution (CR) pending in Congress, once the CR is passed, we fully intend to shift our focus back to S. 3831. At that time, we are hopeful that we can work productively with Senator Carper and other members of the Senate Homeland Security and Governmental Affairs Committee to amend S. 3831 in way that will result in the NALC’s support for the legislation.
I will keep you posted as new developments unfold.
Thank you for your continued efforts as an NALC activist.
In Solidarity,
Fredric V. Rolando, President
National Association of Letter Carriers
Postal Letter Carriers Union President Rolando Reelected
Filed under: letter carriers, NALC, postal, postal news, press releases
ANAHEIM, Calif., Aug. 13- Letter Carriers union President Fredric V. Rolando was elected by acclamation to a four-year term as head of the 295,000-member postal union by delegates to the 67th Biennial Convention of the National Association of Letter Carriers, the union announced today.
Rolando, who also is a vice president of the AFL-CIO, currently is leading the union’s fight to block the Postal Service’s proposal to end Saturday mail delivery. He also has focused in recent years on the restructuring of delivery routes of letter carriers in a manner that protects their contractual rights as employees while allowing the Service flexibility to meet the financial challenges posed by the economic crisis and changing communications technology.
A member of Sarasota, Florida Branch 2148, Rolando has served as president since July, 2009, when he was elevated from his post as executive vice president upon the retirement of former President William H. Young. His new full term will run until December 2014.
The NALC, which represents active and retired city delivery letter carriers in all 50 states and U.S. jurisdictions, concluded its convention Friday at the Anaheim Convention Center with an address by AFL-CIO President Richard Trumka. More than 7,300 delegates attended the convention.
SOURCE National Association of Letter Carriers
NALC: Memorandum signed on Joint Alternate Route Adjustment Process
President Rolando announced May 4 that the NALC and the Postal Service have reached an agreement on the next phase of a Joint Alternate Route Adjustment Process. However, the agreement makes it clear that finalizing a number of incomplete revisits of 2009 MIARAP adjustments must be given priority over the evaluation and adjustment of routes/zones under the new JARAP.
Included among several positive changes to the process are automatic reviews of specific forms to ensure the integrity of the data being reviewed. Additionally, rather than reviewing all routes/zones nationwide, only routes/zones requested by either party will be evaluated and/or adjusted under JARAP. Local parties may also submit locally developed alternatives for adjusting routes to the national parties for review and possible approval.
“NALC is pleased to reach an agreement that improves the joint alternative process,” Rolando said. “The new agreement builds on the key principles established in the IRAP and MIARAP—no decision at any level regarding the evaluation and/or adjustment of any route can be made without the agreement of both the union and management.”
- M-01720: The 23 page joint guidelines to the new Joint Alternate Route Adjustment Process (JARAP) This includes the shaded MOU language itself.
- M-01717: The JARAP Memorandum of Understanding itself
- M-01719: MOU on prioritizing incomplete 2009 MIARAP revisits first
- M-01718: MOU on Alternative Evaluation and Adjustment Processes.
source: The National Association of Letter Carriers, AFL-CIO
NALC: GAO Report Attacks Postal Labor, Stiffs Congress
Statement of NALC President Fred Rolando on the GAO Report
U.S. Postal Service: Strategies and Options
to Facilitate Progress toward Financial Viability
April 13, 2010
The Government Accountability Office was directed by the Congress in 2006 to produce a report by December 2011 “evaluating in-depth various options and strategies for the long-term structural and operational reforms of the United States Postal Service.” GAO was instructed by Congress in the Postal Accountability and Enhancement Act to make recommendations regarding how the “Postal Service’s business model can be maintained or transformed in an orderly manner that will minimize adverse effects on all interested parties and assure continued availability of affordable universal postal service throughout the United States.” The directive in the law also said: “The Government Accountability Office shall not consider any strategy or other course of action that would pose a significant risk to the availability of affordable, universal postal service throughout the United States.”
The Congress outlined, in detail, what it ordered GAO to do, and how to do it.
GAO ignored Congress.
Instead, it delivered an obviously hurried and haphazard audit report. GAO virtually ignored the most critical ingredient in the Postal Service’s current financial squeeze, the $5.5 billion per year payment, imposed by Congress in 2007, to pre-fund retiree health obligations. And its conclusion that the USPS business model was not viable was based on the false premise that the USPS has not been able to cut costs as much as its revenues have declined in recent years. In particular, the report states that “USPS lost $12 billion over this period [2007-2009], despite achieving billions in cost savings, reducing capital investments, and raising rates.” But this assertion is completely misleading. It glosses over the critical fact that if it were not for the excessive pre-funding payments, the USPS would have been profitable over the past three years—USPS prefunding payments totaled $12.4 billion over the past three years, more than accounting for the $11.7 billion in reported losses. In fact, the Postal Service has been able to adjust its costs to a decline in its revenue—a decline resulting from the worst recession in 80 years, which the GAO soft-pedals as a simple “economic downturn.”
Instead of the report requested by Congress, GAO has issued a full-throated attack on collective bargaining, our contractual COLA clause, our contractual limits on contracting out, our contractual protections of full-time career positions.
GAO outlines a series of disastrous future options, including moving part or all of USPS to “a private corporate model;” increasing “the percentage of part-time employees, who could work more flexible schedules” and allow the USPS to flexibly adjust to workload, “which varies greatly depending on the day of the week and the time of the year;” and changing the law’s interest arbitration rules to put a thumb on the scale for the Postal Service.
Rather than conducting the five-year “in depth” detailed review and analysis of this key national institution that Congress directed, GAO “conducted this performance audit from August 2009 to April 2010 in accordance with generally accepted government audit standards.” (p. 3). An “audit,” not an “in-depth” evaluation. But even with that crabbed green eyeshade view of its mission, GAO cut corners: “[W]e did not assess the reasonableness of these projections [retiree health valuations] or OPM’s actuarial assumptions and methodology. We utilized OPM’s valuation results to analyze the financial impacts of selected options for funding USPS’s retiree health benefit obligations. We did not assess the validity of USPS’s financial and mail volume projections due to time and resource constraints.” (p. 2).
The problem with this quick once-over approach is that it is precisely OPM’s “actuarial assumptions and methodology” that are at the heart of a dispute between the USPS Office of Inspector General and OPM over whether the USPS has been over-charged by $75 billion in pension costs—funds that could be returned and transferred to the Postal Service Retiree Health Benefits Fund to relieve the USPS of the need to make crushing pre-funding payments. If the OIG is right (and NALC believes OIG is right), that $75 billion cures USPS’ principal financial problem … and then some.
And it is precisely the validity of USPS’s “financial and mail volume projections” that define the extent of the long-term challenge facing the USPS and establish what the future needs may be. To simply accept USPS projections—notoriously and regularly off-target—due to “time and resource constraints” is simply irresponsible—not what Congress ordered, and not what the public interest requires.
The media’s appetite for news of any threatened disaster being what it is, the GAO report will make an initial big splash.
But it is Congress, not the news media or the GAO, that will decide whether the Postal Service is worth saving, and how.
And it is the NALC that will spare no effort in bringing the truth—and the real data—to the Congress for its deliberation. And it is NALC’s membership that will rise to the challenge to make sure that the real public, their patrons, and the mailers, know the facts and act on them. The country deserves nothing less.
source: National Association of Letter Carriers
Letter Carriers union assails Postal Service for lobbying public to end Saturday delivery
Filed under: mail delivery, NALC, postal, press releases, usps
Rolando says only Congress can authorize cutback
NALC launches “5-Day is the Wrong Way” website to keep public informed
WASHINGTON — The national president of the 295,000-member National Association of Letter Carriers union (NALC) today criticized the U.S. Postal Service for arrogantly lobbying the general public with a misleading Internet web site to win approval of elimination of Saturday mail delivery despite the fact that Congress has shown little interest in such a move.
NALC President Fredric V. Rolando said the recently announced postal web site offers misleading information and planning guides for businesses and households regarding its plan to cut Saturday collection and mail delivery services.
“The arrogance of the Postal Service in this campaign to lobby the public to embrace five-day delivery as the answer to the Postal Service’s problem is astounding,” he said. “Given that Congress has shown very little interest in eliminating Saturday service and must approve any change, the Postal Service should focus its energies on real solutions, not risky and counterproductive service cuts.”
“The Postal Service should stand down on this reckless drive to end Saturday delivery,” Rolando added. “It would do more harm than good and it distracts us from the real solution, eliminating the crushing burden of a deeply flawed health benefits pre-funding policy.”
Rolando said the Postal Service’s move has forced the union to set up its own special web site that will provide the news media and general public with complete information on why the proposed change to five-day delivery is the wrong way to go to secure the long-term viability of the Postal Service.
The NALC special web site is http://nalc.org/postal/reform/index.html.
“What makes matters worse is that the Postal Service is sending a very confusing message to Congress,” Rolando said. “Just a week ago, Postmaster General John Potter told a Senate hearing that ‘we wouldn’t have to go to five-day delivery’ if Congress corrected the deeply flawed retiree health pre-funding policy.”
Rolando emphasized that the decision to reduce the level of service and slow mail service in America is not the Postal Service’s to make.
“Only the Congress can authorize this change. The web site and the public relations campaign launched by the Postal Service appears designed to fool mailers and the American people that 5-day delivery is a done deal,” Rolando added.
He said the Postal Service took the outrageous step to launch the deceptive web site:
- Despite the fact that current law requires 6-day delivery and that Congress has not given its approval to the Postal Service’s proposal to cancel delivery and collections services on Saturday;
- Despite the fact that neither the Appropriations Committees nor the Postal Service’s oversight committees have even held hearings on the radical proposal to slow service and destroy 50,000 to 80,000 good jobs in the middle of a jobs crisis; and
- Despite the fact that the Postal Service had not yet filed for an advisory opinion from the Postal Regulatory Commission (PRC), which must hold hearings and subject the Postal Service’s questionable financial claims to democratic scrutiny.
Over the past few years, the NALC has led the drive to reform the pre-funding policy. That drive has been assisted in recent months by reports of the Postal Service’s own Inspector General that show that, measured accurately, the USPS surplus in the Civil Service Retirement Fund is large enough to fully fund future retiree health benefits. Fixing this problem would save the USPS at least $8 billion annually — far more than the speculative $3 billion annual savings the USPS claims it can get from reducing service.