Postal Service Reform Act introduced in US Senate

Postal Service Reform Act introduced in US Senate

US Senators Tom Carper, Jerry Moran, Heidi Heitkamp and Claire McCaskill have introduced The Postal Service Reform Act of 2018: Improving Postal Operations, Service, and Transparency.

In a statement sent to Post&Parcel yesterday (22 March), the Senators said that the bipartisan bill aims to “stabilize, preserve and improve the Postal Service”.

According to the Senators: “The financial condition of the Postal Service, which operates at the center of a $1.4 trillion industry and employs more than 7 million people, has been deteriorating for years.

“Despite the Postal Service setting a record on Dec. 18, 2017, when more than 37 million packages were delivered, the most packages delivered in a single day in their over 200-year history, the Postal Service saw a net loss for the first quarter totaling $540 million.

“In addition to reporting net losses for the 11th year in a row and defaulting on their legally mandated multi-billion-dollar retiree health prefunding payments yet again, the Postal Service also, for the first time, missed payments they owe to the federal retirement system in 2017  ̶  for a combined total of $6.9 billion.

“For years now, the onerous prefunding schedule for future retiree healthcare obligations has put the Postal Service in a place where it must cut costs  ̶  often at the price of service  ̶  and ultimately prevents them from investing in the infrastructure they so desperately need. While the situation is one that is dire, it is also one that can be fixed through needed legislative reforms.”

The Senators claims that the bill is proposing reforms that would “put the Postal Service on firm financial footing, stabilize and improve service performance, allow for the development of new products and services, and enhance transparency”.

The specific measures in the bill include proposals to eliminate the existing statutory payment schedule, cancel any outstanding payments, and amortize payment over 40 years.

The Senators added: “The bill would also create a new Postal Service Health Benefits Program (PSHBP) within FEHBP, implemented and administered by OPM, for all postal employees and annuitants and require all Medicare-eligible postal annuitants and employees enrolled in the PSHBP to also enroll in Medicare, including parts A, B and D. This is essential for protecting the American taxpayer from a future bailout and for protecting the employees’ benefits in retirement.”

As part of the plan to stabilize USPS finances, the bill has proposals for pricing. According to the Senators: “The price of postage is decreased pursuant to federal court orders last Congress, eliminating the positive revenue stream from the exigent rate case in 2014.  As the result of a compromise among the postal community, the bill restores the half of the temporary rate increase while freezing any further rate increases until a new rate system can be finalized by the Postal Regulatory Commission.”

The bill also includes “strong service reforms” that would aim to “improve mail service performance across the country”, and “especially in rural America”. In addition, the bill aims to give USPS new opportunities for revenue generation by allowing it to “introduce new non-postal products and services, ship beer, wine and distilled spirits, and partner with state and local governments in offering government services”.

 

 

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