Summary of Discussion On Markup of 21st Century Postal Service Act
Post Com.org summary (non-verbatim) of comments offered at the markup of S1789, The 21st Century Postal Service Act
Senator Carl Levin:
Amendment: On the transparency of contracts between the USPS and contractors. I was told I can’t look at the contracts the USPS has with UPS and Fedex. The only person who can see the contracts is the House subcommittee chairman with postal oversight responsibility. This is offensive to the Senate. This amendment very simply that UPS cannot enter into a contract with the USPS without Senate oversight. Passed.
Senator Tom Coburn:
We were here five years ago. We thought the USPS would be fixed. We’re making the same mistake again by not allowing the Postal Service to run as a business. We’re going to be back again, because this bill won’t fix it. You have got to let the USPS do what it needs to do, such as go to five-day delivery. We’re putting the USPS on a path to a slow death.
To not allow the Postal Service to close the facilities they think they need to close ensures the USPS will not succeed.
If we want them to compete, then give them to tools they need.
see full summary: Association Of Postal Commerce
Senate Hearing Today On USPS Crisis
U.S. Postal Service in Crisis: Proposals to Prevent a Postal Shutdown -Live video will not be available until approximately 15 minutes prior to the scheduled hearing start time.
Tuesday, September 6, 2011
02:00 PM
Dirksen Senate Office Building, room SD-342 Read more
NAPUS: Senate Committee Chairman Lieberman to Conduct Emergency Postal Hearing
From National Association of Postmasters of the United States (NAPUS) e-newsletter
On Tuesday afternoon, Senate Homeland Security and Governmental Affairs Committee Chairman Joseph Lieberman (I-CT) intends to conduct a hearing on legislative proposals that seek to avert a “Postal shutdown.” This is the first time in recent memory that the full Committee, rather than its Postal Subcommittee, will convene a postal hearing. The impending USPS default on its $5.6B payment to prefund its retiree health obligations, the legislative bottleneck that has delayed passage of postal relief, as well as three new and highly-controversial USPS proposals played a role in scheduling this forum. Beginning at 2:00 PM EDT, the hearing may be viewed on the Senate Committee website here. Read more
Guffey: Request For Legislators To Take Action on USPS Pre-Funding Is Not A Bailout
Guffey to Senate Subcommittee: Legislators Must Apply Pension Overpayments to Pre-Funding Bill
APWU News Bulletin 09-2011, May 17, 2011
In testimony before a Senate Subcommittee on May 17, APWU President Cliff Guffey urged legislators to take immediate action to restore financial stability to the cash-strapped agency.
“This is not a request for a subsidy or bailout of the Postal Service,” Guffey said at the hearing before the Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security.
“The Postal Service is very capable of dealing with the challenges it is facing because of declining mail volumes and a shift to electronic transmissions,” the union president said. “What it cannot sustain is the burden of the unique and unreasonable requirement that it pre-fund its retiree health benefits over a 10-year period.” No other government agency or private company bears this burden. Read more
Updated: Postal Service’s History of Seeking Five-Day Delivery to Cure Financial Woes
Documents submitted by PostalReporter reader shows the Postal Service’s History of requesting 5-day delivery to relieve its financial woes.
The 94th and 95th Congresses
Representative Tom Corcoran stated at a congressional hearing that the Postal Service took its first formal step toward eliminating one delivery day per week in 1976 when it conducted a study to examine the possible effects of such delivery reduction.That study, according to Corcoran, was completed, but a formal proposal stemming from the study was not drafted. Instead, in 1977, the congressionally created Commission on Postal Service (created in 1975) submitted to Congress and the President a report that discussed the possibility of transitioning to five-day delivery. The members of the congressional commission were divided on whether to recommend eliminating a day of Postal Service delivery. The commission’s final report said that five of the seven commissioners reluctantly recommended the reduction in delivery, but did not say which day of the week would be the optimal day off.
A series of congressional hearings were held on six-day delivery from November 1977 through March 1978. According to Representative Patricia Schroeder, who opened the hearings, the Postal Service prompted the hearings by proposing a cut back in delivery service.36 Although the Postal Service had made no formal indication that it supported the elimination of one service day, one Member of Congress said that “statements made by postal officials indicate[d] they [were] leaning toward making such a recommendation.”In all, Congress held 12 hearings in as many cities with more than 500 testimonies offered between November and March. Those who testified included Members of Congress, union representatives, editors and publishers, the general public, and representatives of the aging. Most of those who testified did not support a reduction in Postal Service deliveries, finding such cuts a “disservice”38 that could result in “possible delay in the receipt of welfare, social security, pension checks, and so forth—the kind of mail that people receive … on weekends and through Saturday mail.”
In addition to concerns about mail delivery in general, much of the testimony framed the debate over six-day delivery as a tension innately embedded in the mission of the Postal Service: is it a profit-driven organization, or a public service? Representative Timothy E. Wirth stated at one hearing that the six-day service was a “social value,” and that cutting a day of service at a time when people were “losing some of their faith in what government can do for them” would exacerbate their disillusionment.
1977 House Report on Saturday Mail Delivery
Early this year, the Commission on Postal Service, a special study commission created by Public Law 94-421 to study the public service aspects of the Postal Service and other subjects, issued a report recommending that Saturday mal delivery be discontinuance of Saturday delivery service would reduce postal costs by $412 million annually. Through attrition, approximately 18,000 full-time positions would be eliminated. The Commission attempted to support its recommendation in part on the basis of a small survey of public opinion which showed that 79 percent of the individuals surveyed would be willing to give up Saturday mail delivery if such a reduction in service helped hold down postal costs.
Immediately following the Commission’s report on April, the Postmaster General summoned the leaders of major postal union to discuss the discontinuance of Saturday mail delivery.
The 96th and 97th Congresses
In 1980, the House Committee on the Budget was expected to propose an $836 million reduction in Postal Service appropriations for FY1981.42 According to Representative James M. Hanley, the chairman of the House Committee on Post Office and Civil Service, the reduction in appropriations would have eliminated “all of the public service appropriations” and other subsidies for the Postal Service.43 At a March 26, 1980, hearing before the House Committee on Post Office and Civil Service, then-Postmaster General William F. Bolger stated that eliminating Saturday delivery was one option the Postal Service was considering to ensure its economic stability in the face of the budget cuts. Bolger estimated the service reduction could result in the elimination of 15,000 to 20,000 Postal Service jobs, but would save the Service about $588 million.
The 1980 Task Force
On March 25, 1980, Postmaster General William F. Bolger established a task force to analyze the possible effects of moving from a six- to a five-day delivery schedule. The task force conducted a study, which consisted of telephone interviews of 320 major mailers and 13 selected industries and government agencies. It found that moving to five-day delivery could save $588 million in the first full year of implementation.85 The savings were estimated to “exceed $1 billion annually in future years.”With the cost savings, however, were predicted increases in other stresses for the Postal Service, like loss of patrons to private mailing services or adverse effects on “the levels of service provided to mail on the remaining delivery days.”87 In spite of the projected cost and fuel savings, the task force stopped short of endorsing a reduction in delivery service, saying “[t]he potential cost reduction is extremely attractive; but it is clear that the risks to service and future postal revenues are high.”
The task force recommended a 12- to 18-month planning period if any action to move to five-day delivery was to be made. No such planning period occurred. In addition, the task force suggested that if five-day delivery were to occur, Saturday should be the eliminated day because it “will not greatly affect the majority of … business mailers.”89
April-May 1980 Senate Hearing
There are, of course, a number of factors which have contributed to the operating deficit; however, inflation has undoubtedly been the great factor. The sharp rise could not have been foreseen when the 1970 law was enacted, and it has has a major impact not only on labor costs, which comprise 86 percent of the USPS budget, but on construction, materials and equipment, and operations in general. Also unforeseen was the relentless rise in the cost of energy. The USPS estimates that for every 1-cent increase in the cost of a gallon of gasoline, the transportation costs increase by $3 million.
Mr. Chairman, these hearings are taking place in concert with the Senate’s consideration of the fiscal year 1981 budget. There has been a great deal of discussion about reducing mail delivery delivery from 6 to 5 days in order to meet the anticipated cut in the postal budget. I am concerned that such a decision could exacerbate the current trend of mailers seeking alternate delivery systems and thus decrease further the revenues of the Postal Service.
The President’s Commission on the Postal Service
In 2003, the President’s Commission on the United States Postal Service, created by President George W. Bush, anticipated an “unstable financial outlook” for USPS.90 The commission, however, adamantly rejected any action that would reduce delivery days to five. The Commission firmly recommends continuing the Postal Service’s current Monday
through Saturday delivery regimen. While the Postal Service could save as much as $1.9 billion (less than 3% of its annual budget) by reducing its delivery schedule by one day a
week, its value to the nation’s economy would suffer. Beyond the universal reach of the nation’s postal network, the regularity of pick-up and delivery is an essential element of its
worth in the current climate. Elimination of Saturday delivery, for example, could make the mail less attractive to business mailers and advertisers who depend upon reaching their target audience on that day. In addition, given the volume of mail the nation sends each day, scaling back to a five-day delivery regimen could create difficult logistics, mail flow, and
storage problems.
While the report advised continuing six-day service, the commission noted that increasing use of electronic mail was leading to “a reduction in the demand for mail services” that could lead to a “relaxation of the six-day delivery requirement” in the future.
Documents
May1976HouseHearingsMailCutback
1977HouseReportSatMailDelivery
Nov1977-Mar1978House6DayHearings
Apr-May1980SenateHearings (PDF)
My Five-Day Experience, by Postal Pete
On the day I was born June 12, 1957:
“Postmaster General Summerfield today outlined for Congress a series of cuts in postal service which he plans to put into effect July 1 if his department is not given more money … The list, submitted at a closed meeting, was reported to include: Elimination of Saturday mail deliveries … (and) closing of 2,000 small fourth-class post offices.”
When I was almost five years old :
Feb 19 1962
The Kennedy administration has studied the discontinuance of Saturday mail delivery but fears any publicity might adversely affect its proposals for raising mail raise, Postmaster General J. Edward Day has told Congress …
(Day) said the (post office) department estimated it could save $100 million a year by ending Saturday mail delivery.
When I was eighteen:
Nov 24 1975
With the United States Postal Service losing more that $250,000 an hour, Postmaster General Benjamin F. Bailar is considering further economic moves such as discontinuing Saturday mail deliveries …. The Postal Service … ran up a $1.5 billion debt as of last July.
The year I took the postal exam:
March 29 1977
“The Commission on Postal Service … voted 5 to 2 to recommend elimination of Saturday delivery, a step that would save $400 million a year … Elimination of Saturday delivery is likely to be unpopular on Capitol Hill. Numerous legislators denounced the idea when the service said it was being considered a year ago.”
and so it continued throughout my postal career:
Feb 7 1981
Saturday mail deliveries, Amtrak train service and urban programs, survivors of last year’s spending cuts, face a new threat from President Reagan’s budget ax, according to internal administration documents obtained Friday … (The documents say), “The possible reduction of service to five-day delivery is a symbol of the seriousness of the fiscal austerity being imposed by reductions throughout the federal government.
December 15, 1987:
The Postal Service lost $223 million in the fiscal year that ended Sept. 30 … Possible major effects … include … Seeking congressional permission to eliminate delivery on Saturdays … closing 10,000 to 12,000 small post offices, primarily in rural areas.
October 16, 1992:
Postmaster General Marvin Runyon said Thursday that he backs continuing Saturday deliveries but wonders whether home delivery could be cut from six to four days a week…
His suggestion was to eliminate Tuesday and Thursday mail for home deliveries, keeping deliveries on Monday, Wednesday, Friday and Saturday. Business deliveries would remain six days a week.
April 9, 2001:
The U.S. Postal Service is thinking about ending Saturday deliveries — and shutting down post offices in rural and remote areas, and raising the price of stamps even more … because it finds itself in almost exactly the position the railroads were in after commercial jet travel became commonplace…
Something quicker came along: regularly scheduled jets. We said we loved the railroads — but we headed to the airports. We gave the railroads our hearts, but not our money… This country will feel different — diminished — without Saturday mail.
But the country already feels different. Fax machines, privately owned overnight delivery services, and — most significantly — the huge growth in e-mail have transformed the way that we write to each other.
December 31 , 2008:
After thirty years of service I take the early out and talk of five day delivery resurfaces.
Postal Pete
Pete Countryman
Sectional Center Facility
Elizabethtown, Kentucky 42701
30 yrs USPS / APWU
House and Senate to Hold Joint Hearing On Customer and Employee Views Of USPS
On Wednesday, June 23, 2010, at 2:30 p.m. in room 342 of the Dirksen Senate Office Building, the House Subcommittee on Federal Workforce, Postal Service, and the District of Columbia and the Senate Subcommittee on Federal Management, Government Information, Federal Service, and International Security will hold a joint hearing entitled, “Having Their Say: Customer and Employee Views on the Future of the U.S. Postal Service.”
The economic downturn and the continued electronic diversion of mail, coupled with an aggressive retiree health pre-payment schedule have combined to put the Postal Service in financial crisis. A recent analysis of the future of the mail conducted on behalf of the Postal Service showed that mail volume may not recover along with the economy – further deteriorating the Postal Service’s financial condition in the years to come. Moreover, in its April 12 report entitled, “U.S. Postal Service: Strategies and Options to Facilitate Progress Toward Financial Viability,” the Government Accountability Office (GAO) found the Postal Service’s current business model is not viable. To that end, the upcoming joint hearing is intended to provide customer and employee stakeholders an opportunity to discuss the economic difficulties currently facing the Postal Service and to respond to plans postal management and GAO have put forth to address them.
“Having their say: customer and employee views on the future of the US Postal Service
PRC Chairman Urges Caution before Nation Cuts Mail Service
Washington, DC – Postal Regulatory Commission Chairman Ruth Y. Goldway today cautioned against deciding on major cuts in universal mail service until Congress considers possible changes to Postal Service funding of employee pensions and future retiree health benefits.
In remarks before the Senate postal oversight subcommittee, Goldway said, “These are two unresolved issues that could have major immediate impact on the Postal Service’s financial crisis, as well as a material effect on the five-day delivery issue.” The Commission is currently conducting extensive public proceedings to gather evidence and analyze the impact of eliminating Saturday mail service. She emphasized that no decision has been made. “This important matter requires the consideration of both the Commission and the Congress.”
A recent Commission study for Congress found that a recalculation of the Postal Service’s liability for future retiree health benefits payments would reduce the total by nearly $35 billion, allowing currently mandated annual payments to be lowered by $2 billion a year while still meeting the original prefunding goals. The Commission has also initiated a review of OPM’s calculation of Postal Service pension funding, which the Postal Service Inspector General contends is overfunded by $75 billion.
The potential near-term savings from delivery cuts has significantly less impact on the Postal Service than addressing retiree healthcare liabilities and pension funding, and such cuts could add to the pace of mail declines. With regard to the healthcare liabilities, Goldway said: “My colleagues and I support readjusting the payments to an affordable level, perhaps over a longer period of time and/or tied to the Postal Service’s ability to pay. We see this as an essential part of any plan to help the Postal Service in the future.”
While commending postal management and employees for implementing cost reductions without sacrificing service, Goldway challenged the Postal Service’s ten-year plan for dire forecasts of steep volume declines and huge debt, projections that have been questioned by Commission staff and by the Congressional Research Service. “By concentrating on cuts at the expense of service and innovation, the Postal Service plan offers the path to obsolescence,” she said.
The Chairman offered a positive vision of wide-ranging growth ideas, adjustments in postal retiree benefit outlays and confidence in the improving economy helping to stabilize the Postal Service and maintain high levels of customer service. She recommended that the Postal Service expand government partnerships, improve retail activities, make better use of the postal workforce and enhance its mailing products, including the provision of industry standard tracking and tracing services.
First among a list of 11 specific ideas included in her testimony, Goldway called for the Postal Service to develop mail products based on value to the customer and not just volume. “This is the fundamental tenet needed to fix the Postal Service’s broken business model,” she said.
“The Postal Service should reposition its goals to meet the needs of an evolving society and its historical obligation to bind the Nation together,” Goldway said. “These are questions that the Postal Accountability and Enhancement Act requires the Commission to ask. What does the Constitution and the law require? What is best for the Nation? How can the Postal Service maintain and improve its universal service to citizens and the business community who rely on the mail. I believe it is possible to create a positive plan that envisions a future with a vibrant communications network, reengineered and reenergized to provide universal service for a new century of customers.”
A copy of the Chairman’s testimony is available at www.prc.gov.
Statement of PMG On USPS Finances Before The Senate Appropriations Subcommittee
STATEMENT OF JOHN E. POTTER
POSTMASTER GENERAL/CEO
BEFORE THE SUBCOMMITTEE ON FINANCIAL SERVICES AND GENERAL GOVERNMENT
OF THE COMMITTEE ON APPROPRIATIONS
UNITED STATES SENATE
MARCH 18, 2010
Good afternoon, Chairman Durbin, Ranking Member Collins, and members of the Subcommittee. I appreciate the opportunity to discuss the serious financial situation facing the United States Postal Service and to provide details of our plan for reducing the number of mail delivery days, should a frequency change be approved by Congress. I also would like to share aspects of our new action plan for the next decade titled, “Ensuring a Viable Postal Service for America.”
For over 235 years, the Postal Service has provided trusted, affordable universal service to the nation. Our goal is to continue to do so. As the members of this Subcommittee are well aware, the Postal Service is in a dire financial situation. The situation has occurred despite the efforts of Congress through passage of the Postal Accountability and Enhancement Act of 2006 (Postal Act of 2006). Our current financial circumstances have come about in spite of the massive efforts of Postal Service management and employees who have adopted aggressive cost-cutting measures to save over $1 billion each year since 2001. For 2009 alone, the savings exceeded $6 billion.
Our financial situation has many causes: a severe national recession that significantly affected the financial and housing sectors, which were important users of the mail; the powerful and rapid evolution of new technologies that have diverted mail to other channels; and the changing use of the mail to communicate and conduct business. This situation could not have been avoided and no one is to blame. No one could have envisioned the economic crisis that has rocked this country. Read more
Senate Subcommittee To Meet On Proposals for Addressing USPS Current Financial Condition
The U.S. Senate Subcommittee On Appropriations (Financial Services and General Government Subcommittee) has scheduled a hearing today at 2:30 p.m.
Agenda: Proposals for addressing the current financial situation facing the United States Postal Service.
Witnesses:
Panel 1:
The Honorable John E. Potter
Postmaster General, CEO
United States Postal Service
Panel 2:
The Honorable Ruth Y. Goldway
Chairman
Postal Regulatory Commission
The Honorable David C. Williams
Inspector General
United States Postal Service
Office of Inspector General
Phillip Herr
Director
Physical Infrastructure Issues
U.S. Government Accountability Office