Oversight Panel Approves Postal Reform Bill Ending Saturday Delivery

Most daily to-the-door and Saturday mail delivery would be things of the past. But the local post office—if it remains open—could become a hub of new activity, such as offering notary services or issuing hunting and fishing licenses.

Such is the vision of how to help the U.S. Postal Service being offered by Rep. Darrell Issa, R-Calif., in his latest stab at a bill he hopes will return the ailing agency to financial solvency. The House Oversight and Government Reform Committee, which Issa chairs, approved his Postal Reform Act of 2013 by a 22-7 vote split along party lines on Wednesday.

From cutbacks in services, to new revenue streams, to putting the agency under the watch of a new control board, the legislation is a mixed bag of ideas. And early reaction from Democrats and some postal employee groups to Issa's bill is not positive.

Oversight Committee ranking member Elijah Cummings, D-Md., said in a statement that while he was encouraged some Democratic provisions to improve the Postal Service's financial outlook were included, "I am disappointed that Republicans once again chose to pass a partisan bill that includes a number of extreme provisions that would weaken the Postal Service and negatively impact service to all Americans." 

Still, there is a wide—and bipartisan—sense of urgency that something needs to be done. Last Congress, a bipartisan postal reform bill was passed in the Senate, but a House bill never reached the floor for a vote. Earlier this month, Postmaster General Patrick Donahoe testified that over the past 18 months, as Congress has remained unable to agree on a plan, the Postal Service has continued to bleed red, to the tune of another $19 billion in net losses.

Issa, in a statement, said, "the Committee has adopted a bill with broad input from all stakeholders that would bring USPS back to financial solvency with cost-cutting reforms and innovative new sources of revenue."

According to committee materials, one goal of the legislation is to prevent a taxpayer bailout. The bill would:

• Permit the phase-out of most remaining to-the-door delivery by 2022 (only a quarter of addresses nationally still get this service). Delivery would shift to curbside and to neighborhood cluster boxes, as the Postal Service proposes. The bill establishes a waiver to enable individuals with physical hardships to continue to receive door delivery. The estimated cost savings is more than $4 billion.
• Allow the shift to a modified Saturday schedule that would do away with most letter and magazine delivery, but would maintain Saturday delivery of packages and medicine. The estimated savings is at least $2 billion.
• Soften previous proposals to close rural post offices. It does so with new language requiring the Postal Service to consider broadband penetration, cellular phone service, and the distance to closest replacement service in determining whether to close postal facilities.
• Eliminate the ability of the national and state political committees to use the nonprofit mail rate.
• Allow the Postal Service to sell advertising space on vehicles, stores, and post offices and to offer state and local services, such as the sale of fishing licenses. The advertising must cover 200 percent of its overhead costs, while the new local- and state-related services must cover 150 percent of their costs.

The bill would also replace the part-time Board of Governors with a temporary panel of five full-time executives given a mandate to turn the agency around. And it would ease a requirement to prefund billions of dollars in pensions for future retirees.

Cummings takes issue with many of these items, including a provision that would allow people to choose to pay for continued "to-door" mail delivery. He said that threatens to create a "Cadillac Lane" within the nation's postal delivery system.

Cummings also objects to the bill's instruction to remove postal workers from the existing federal workers' compensation system, and its establishment, he says, of a postal-specific system that would provide lower benefits.

In a statement, Cummings said that as the bill moves to the House floor, "I continue to believe that we can and should pass a bipartisan bill that has the support of both Democrats and Republicans, that provides the Postal Service with the flexibility it needs to address its financial challenges, that ensures that customers continue to receive the service they expect, and that right-sizes the Postal Service's workforce with the compassion these employees have earned."

American Postal Workers Union President Cliff Guffey had said in a statement posted on the union's website before the hearing that "the legislation as written is totally unacceptable." He did, however, note that the bill--revised from an earlier discussion draft—omits a previous requirement to reopen contract negotiations and immediately eliminate protection against layoffs.

But Guffey complained that the revised version would prohibit postal unions and management from negotiating protections against layoffs in future contracts; increase health insurance costs; limit collective-bargaining rights; close post offices, stations, and branches; consolidate plants; and privatize operations.

Senate Homeland Security and Governmental Affairs Committee Chairman Thomas Carper, D-Del., said in a statement that he welcomed Issa's moving forward with a bill, and that "I am committed to introducing a bipartisan postal reform bill in the Senate as soon as possible."

This article appears in the July 25, 2013, edition of National Journal Daily.