Senate gives U.S. Postal Service new life

Washington Postal Scene by Bill McAllister

Congress has corrected a multibillion-dollar mistake that nearly sent the United States Postal Service — the country’s most beloved federal agency— into insolvency.

By a vote of 79 to 19, the Senate on March 8 endorsed a House-passed bill that erases a 2006 requirement that the Postal Service must prepay the expected health care costs of all its future retirees, a provision that no other federal agency and few corporations have faced.

The Postal Service Reform Act, which President Joe Biden has promised to sign, should give the financially beleaguered Postal Service what Senate Majority Leader Charles Schumer, D-N.Y., called “a much-needed reset.”

Sen. Rob Portman, R-Ohio, one of the architects of the bipartisan measure, was more outspoken.

“It saves the Postal Service,” he declared.

The final approval came after more than a week of behind-the-scenes negotiations between Democrats and Republicans over what amendments could be tacked onto the bill.

In the end, no Senate amendments were approved, sending the bill directly to the White House.

The vote marked an end to what Sen. Gary Peters, D-Mich., said have been 15 years trying to resolve a financial crisis that was in large part created by the 2006 Postal Accountability and Enhancement Act.

The 2006 law required the USPS to prepay the expected health care costs of future postal retirees at the same time that email was undermining first-class mail revenues.

The new bill wipes out prepayments and will require future postal retirees to depend on Medicare for their primary health insurance.

That provision and the end to retiree health care prepayments are expected to save the USPS about $49.7 billion over 10 years, according to the House Committee on Oversight and Reform, which drafted the bill.

Postmaster General Louis DeJoy, a Republican, lobbied members of his party to support the bill, which he called essential to his 10-year Delivering for America plan. The plan received some, but not overwhelming, GOP support in both houses of Congress.

The bill commits the USPS to six-day mail deliveries, something that Congress has imposed annually in budget bills.

It also requires the USPS to give greater transparency to its mail delivery schedules by posting mail arrival times by ZIP code on its website.

The bill would also permit the USPS to allow state, local and tribal governments to offer “non-commercial” services in post offices, but it rules out postal banking, a step some Democrats have endorsed.

In the final debate, Sen. Rick Scott, R-Fla., said the bill would “add $6 billion” to the federal budget by increasing Medicare costs.

Peters countered that postal workers had been paying for Medicare all their careers. The bill would produce a relatively small increase in Medicare costs, he said.

When the bill arrived from the House on March 2, Scott objected to its immediate consideration, blocking Democrats’ initial desire for quick Senate action.

He complained that Medicare costs would soar with more postal retirees.

Scott offered an amendment that would require the Postal Service to reimburse the government “for any increased federal costs” from the added number of postal workers using Medicare.

The irony of his proposal is that it resembled the provision that the George W. Bush White House demanded for passage of the 2006 postal law.

That 2006 provision, which required the USPS to prepay the health care costs of all its future retirees on an accelerated basis, came close to pushing USPS into insolvency.

Portman said the retiree payments had proved “burdensome and unique” and had “crippled” the USPS at the same that email was eroding first-class mail, long the agency’s most profitable mail product.

DeJoy welcomed the Senate action, saying that when it is “combined with our own self-led operational reforms, we will be able to self-fund our operations and continue to deliver to 161 million addresses six days per week for many decades to come.”

The Senate debate was spread over a week and included some barbs at DeJoy.

Sen. Ed Markey, D-Mass., charged that the postmaster general should be fired for his plan to purchase mostly gasoline-powered mail delivery trucks to deliver mail.

“Save money and save our planet with an all-electric postal fleet,” read an oversized airmail cover Markey brought to the Senate floor.

He argued the all-electric trucks would be cleaner and cheaper than the gasoline trucks DeJoy wants.

“DeJoy is looking at the world with rear view window,” Markey said.

Portman looked more kindly on DeJoy, saying his 10-year plan was a critical part of saving the Postal Service from financial ruin.

Sen. Tom Carper, D-Del., who argued for the bill, cautioned that “this is not the end of what we need to do on postal.”

Other senators said the next action may be to provide more taxpayer dollars to help the USPS buy a new fleet of electric delivery trucks.

Connect with Linn’s Stamp News: 

    Sign up for our newsletter
    Like us on Facebook
    Follow us on Twitter