If the U.S. Postal Service wants to keep delivering mail in the snow, rain, heat, and gloom of night, it will have to do it on a smaller budget—something even a bipartisan group of senators can agree on.
The Postal Service is on track to lose $10 billion in 2011, according to Postmaster General Patrick Donahoe, a projection that is the basis for a bill introduced on Wednesday by Sens. Joe Lieberman, ID-Conn.; Susan Collins, R-Maine; Thomas Carper, D-Del.; and Scott Brown, R-Mass., all members of the Homeland Security and Governmental Affairs Committee. The bill, called the 21st Century Postal Service Act, is scheduled for markup next week.
The USPS reported losses of $5.1 billion in 2007; $2.8 billion in 2008; $3.8 billion in 2009; and $8.5 billion last year. Since 2008, it has cut its workforce by about 100,000 employees, to 572,000—the fewest postal workers in more than 20 years.
“We are asking the Postal Service to make painful choices about internal costs and not simply slash services and raise prices, which would only add to its death spiral,” Collins said at a press conference. “This bipartisan legislation gives the Postal Service the authority it needs to restructure, modernize, survive, and thrive.”
This would mean setting up a buyout program to reduce the workforce by 100,000. Money for the buyouts would come from nearly $7 billion the Postal Service has overpaid into the Federal Employee Retirement System. The senators estimate that such a move could save $8 billion a year.
The bill would also look to reform workers’ compensation benefits. More than 2,000 employees older than 70 receive compensation even though many have no plans to return to work. The Senate measure would try to move them to retirement programs in an effort to save money.
Further savings would come from tweaking the employees’ health plan and recalibrating prefunding requirements for retiree health benefits by amortizing those payments.
“The U.S. Postal Service is not an 18th-century relic; it is a 21st-century national asset,” Lieberman said. “But times are changing rapidly and so too must the Postal Service, if it is to survive. The bottom line is, we must act quickly to prevent a Postal Service collapse and we must act boldly to secure its future.”
The bill could also affect the way USPS delivers mail, authorizing, where possible, curbside, sidewalk, or centralized mailboxes rather than door-to-door delivery no later than 2015.
It would, however, prohibit the elimination of Saturday delivery for at least two years.
But it’s not all bad news for the Postal Service. The measure would also allow USPS to do something that FedEx, UPS, and other private delivery companies have been able to do for years: deliver beer and wine.
Fans of the Postal Service and alcohol will drink to that.
This article appears in the Nov. 3, 2011, edition of National Journal Daily.