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US House schedules debate on USPS rescue bill for July

Tuesday, May 29th, 2012

US postal reform proposals will have to wait until July to reach the floor of the US House of Representatives, according to House Republican leaders.

Majority leader Eric Cantor issued a memo on Friday laying out a timetable for the House through the summer, listing the Issa-Ross Bill (H.R.2309) on the agenda for consideration after America’s Independence Day on 4th July.

Cantor called the bill developed by Oversight Committee chairman Darrell Issa and postal subcommittee chairman Dennis Ross as a “responsible proposal” to reform the US Postal Service.

He said big changes were needed as he placed blame on USPS for not being able to pay its government bills.

“Our constituents have been—or will soon be—impacted by the closure and hours of operation changes to U.S. Postal Service (USPS) facilities across the country,” said Cantor.

“This is the result of yet another government backed entity that cannot meet its financial obligations and is in need of vast reforms to its business plan and operations.

The Democrat-controlled US Senate passed its version of postal reform legislation back at the end of April, offering an $11bn rebate to USPS from its pension surplus to help provide incentives to downsize the workforce, but also acting to protect mail service standards, particularly rural access to post offices.

The Republican-controlled House proposals call for more cost-cutting under a coordinating commission, as well as an immediate end to Saturday deliveries – something banned for two years by the Senate bill.

If the House does pass its bill following its floor debate, it would go to a conference committee along with its Senate counterpart, for a single compromise proposal to be agreed and voted on by both chambers of Congress before becoming law.

“Irresponsible”

“The longer the House delays action, the more losses the Postal Service racks up”

Commenting on the delay of House debate on postal reform until at least July, Senate postal reform advocate Senator Tom Carper said the Postal Service had already made around $700m in operational losses since the Senate bill was passed last month, and would lose another $1bn between now and July.

Carper said it was “irresponsible” of the House to postpone action on postal reform.

“The US Postal Service is haemorrhaging money at a historic pace, and Congress can’t stand idly by and allow it to continue. The longer the House delays action, the more losses the Postal Service racks up,” said the Democrat from Delaware.

Carper added a warning that Cantor’s memo to House Republicans “doesn’t even guarantee that the bill will get a vote”.

The Postal Service’s most recent financial statement, for April 2012, showed that losses for the month were double those seen in the same month last year. April saw a $1.6bn net loss, compared to $747m recorded in April 2011, the month’s loss some half a billion dollars worse than had been projected.

In the financial year to date, which began in October, USPS has so far lost just over $8bn, more than double the $3.3bn lost in the same period last year.

Most of those losses stem from mandated retiree healthcare pre-payments and workers’ compensation adjustments, rather than “controllable” operational losses, which amounted to $129m in April 2012 (compared to $88m in April 2011) and $275m for the year to date (compared to $187m the year before).

USPS is currently moving forward with plans to close dozens of mail plants later this summer, and more next spring, as it seeks to reduce its operating expenses. Plans for closing rural post offices have been curtailed.

Urgency

Postal unions in the US are continuing to urge their members to lobby their local representatives in the House to appreciate the urgency of the situation at USPS, which is projected to make a $14bn loss this year.

The American Postal Workers Union is firmly opposed to the Issa-Ross Bill in the House, saying it would “gut” collective bargaining agreements, particularly in removing lay-off protection clauses. It also opposes any downgrading of mail service standards, stating that as well as job losses such a move would risk losing mail customers.

The union does want USPS pension and healthcare arrangements addressed to return pension surpluses and halt the huge payments required by Congress for USPS to pre-fund future retiree healthcare liabilities.

“We have asked our members to reach out to their US representatives and to explain the urgency of the situation,” said APWU president Cliff Guffey today, adding that the House ought to use the Senate Bill as a starting point. “We must encourage legislators to address postal reform immediately.”

Source: James Cartledge, Post&Parcel

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