EXCLUSIVE: Senator Introduces Bill in Yet Another Attempt to Save the U.S. Postal Service

A new attempt at overhauling the U.S. Postal Service will focus less on dramatic cuts to the mailing agency than previous failed legislative efforts, and more on stabilizing operations while freeing up cash in light of quickly declining mail volumes.

Sen. Tom Carper, D-Del., ranking member of the Homeland Security and Governmental Affairs Committee and longtime crusader for a legislative reform package to fix the ailing USPS, will once again take a crack at saving the Postal Service when he introduces the 2015 Improving Postal Operations, Service and Transparency (iPost) Act on Thursday. Carper promised a more inclusive approach to crafting his bill than in his previous efforts, and his measure reflects many of the concerns members of his own party had with its predecessors.

Unlike his 2013 Postal Reform Act, Carper is introducing his bill without Republican support or cosponsors from either party. Instead, aides told Government Executive, Carper wanted to get the language of the bill out there and allow all voices to weigh in. Carper held roundtables and meetings with stakeholders -- including other lawmakers, postal unions, large mailers and the agency itself -- throughout the year in an attempt to include issues important to each group.

Despite the boosted outreach efforts, aides conceded no one will be completely thrilled with the final product. A true compromise, they said, means everyone is unhappy.

The bill includes some familiar provisions from the last effort. It would create a unique Postal Service Health Benefits Program housed within the Federal Employees Health Benefits Program and managed by the Office of Personnel Management. All postal employees and annuitants would be enrolled in that new program. It would also require all Medicare-eligible postal annuitants to receive primary coverage from Medicare parts A, B and D, a USPS-backed proposal the agency has said will help save $33.2 billion in the first five years of implementation.

The legislation also eliminates the annual payments scheduled to prefund retiree health benefits, which the Postal Service has neglected to make in recent years but have still been a drag on the agency’s finances. The bill would amortize payments over the next 40 years and require accounts to be 80 percent, rather than 100 percent, prefunded. Postal unions and other advocates have pointed to the prefunding requirement as the driving force behind USPS’ dreary fiscal situation, and said its elimination would alone put the agency back in the black. Carper proposed moving the prefunded savings out of U.S. Treasury bonds and into more aggressive investment funds managed by the Thrift Savings Plan, a shift postal unions have supported.

Another major sticking point of postal reform has been stripped from the bill entirely, namely any mention of the requirement to deliver mail six days each week. The Postal Service has for years advocated the benefits of eliminating Saturday mail delivery, but Congress and the Government Accountability Office have stymied the change. Carper’s last bill allowed for five-day mail delivery after one year of the bill’s passage, but the updated version does not weigh in one way or the other. The reform measure will allow postal customers to voluntarily opt into cluster boxes or curbside delivery, rather than receiving mail at their doors.

One long popular provision would create postal-specific assumptions about the demographics of the USPS workforce to prevent possible overpayment into the agency’s Federal Employees Retirement System account. If any surplus were detected after the new formula was made, it would be gradually refunded to the agency.

Several more controversial provisions of the bill attempt to right-size the agency’s infrastructure, stabilize operations and boost revenues. The bill would place a five-year moratorium on closing post offices and reducing their hours below certain levels, a similar freeze on cutting delivery standards (though the Postal Service could opt to require faster mail delivery) and a two-year stoppage of closing mail processing plants. The Postal Service in 2012 slowed down its mail delivery standards to enable a dramatic consolidation of its processing network. Further closures scheduled for 2015 were postponed indefinitely after USPS was consistently missing even its more lax delivery windows.

In a move that will likely anger large-scale mailers, the bill would make permanent an emergency price increase instituted in 2013. The rate is currently set to expire next year, though the Postal Service is fighting that in court. The Postal Regulatory Commission would be tasked with establishing a new rate-setting process starting in 2018.

To appease lawmakers representing rural areas, many of whom opposed Carper’s previous efforts, the bill attempts to drill down on how the Postal Service is performing in specific ZIP code groupings and generally in rural, urban and suburban areas. Current metrics largely examine if the Postal Service is meeting its delivery standards at the national level, so little nuance is afforded.

The bill would also embrace new forms of revenue, through the creation of a chief innovation officer position and by providing new authority to offer non-postal products. It would allow for the currently prohibited shipping of alcohol.

Carper is also attempting to improve the morale of the postal workforce through studies into and working group discussions on workplace happiness. 

As have Carper’s previous postal reform proposals, the bill includes one element of reform affecting the entire civilian workforce. It would shift federal employees earning workers compensation to less generous benefits once they reach retirement eligibility. Unlike his last measure, however, the proposal would be prospective and not affect employees currently receiving the payment.

While aides said Carper avoided the insular approach to crafting his bill that opponents have said derailed his previous efforts, they said the senator is still open to changing his bill. The current language is just a first step, they said, adding Carper will continue working to make it better. 

Carper himself said the bill would help solve some of the "longstanding financial and legislative burdens" placed on the Postal Service. 

"My legislation offers a comprehensive solution to the Postal Service’s financial challenges that would put it on solid financial footing, improve service and allow the institution to adapt to a digital age," he said. "This legislation calls for shared sacrifice from all stakeholders and represents a thoughtful compromise while bringing badly-needed stability to the Postal Service’s finances."

For its part, the Postal Service said it is still reviewing the bill and declined to offer a further comment.