Sen. Akaka, Rep. DeFazio Introduce Postal Bills

Several bills were introduced in Congress this month that would help resolve the Postal Service’s financial crisis and improve service to the American people, APWU Legislative and Political Director Myke Reid reports.

Sen. Daniel Akaka (D-HI) introduced the Postal Investment Act of 2011 (S. 2014) on Dec. 16, which is intended to strengthen the USPS and provide the agency short- and long-term financial relief. Sen. Akaka’s bill would alter a provision of the 2006 law that requires the USPS to pre-fund healthcare benefits for future retirees. No other government agency or private company is required to make these payments, which cost the Postal Service approximately $5.5 billion annually.

The legislation would set the target funding level for retiree health benefits at 80 percent, instead of the current requirement of 100 percent, and would allow the Postal Service to use any funds in excess of 80 percent for capital investments. The Postal Investment Act also would create a board to invest the money the USPS has already paid into the retiree health benefits fund. Investing the funds — which currently total more than $40 billion — in a mix of government and non-government securities, could earn a return that is significantly higher than current earnings, according to a summary by Sen. Akaka. The bill would allow the Postal Service to suspend the pre-funding obligation in any year the USPS lacks revenues sufficient to make the payment. The legislation also would require the Office of Personnel Management (OPM) to recompute USPS payments to the fund.

Sen. Akaka’s bill also would require the OPM to recalculate the Postal Service’s overpayment to the Federal Employees Retirement System (FERS), which is currently estimated to be approximately $11 billion, and to transfer the overpayment to the USPS. The overpayment would be used to incentivize employees who voluntarily leave the Postal Service before Oct. 1, 2014. If funds remain after paying incentives to departing employees, USPS could use the remaining funds to pay for other obligations and debt.

The bill clarifies that there are no limits to the issues an arbitration board can consider when rendering a decision on a collective bargaining agreement. During hearings of the Senate Homeland Security and Governmental Affairs Committee, at least one senator mistakenly stated that arbitrators are forbidden from considering the financial condition of the Postal Service. Of course, that is incorrect.

Sen. Akaka is chair of the Senate Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia. His measure has been referred to the Senate Homeland Security and Governmental Affairs Committee, which is chaired by Sen. Joe Lieberman (I-CT).

Rep. DeFazio Introduces Two Important Postal Bills

Rep. DeFazio introduced the Postal Service Protection Act (H.R. 3591) in the House on Dec. 7, which is a companion to S. 1853, a bill introduced in the Senate by Sen. Bernie Sanders (I-VT) on Nov. 10. The Postal Service Protection Act would fix the immediate fiscal problems faced by USPS, prevent the closure of many rural post offices, and establish standards for first-class mail delivery that would thwart USPS efforts to eliminate overnight mail.

The legislation would allow the Postal Service to recover overpayments to the Federal Employees Retirement System (FERS) and Civil Service Retirement System (CSRS). The USPS has overpaid FERS by more than $11 billion, and two independent actuarial studies have concluded that the agency has overpaid CSRS by $50 billion to $75 billion. It also would eliminate the requirement to pre-fund healthcare benefits for future retirees. This mandate, which forces the Postal Service to pay a 75-year liability in just 10 years, costs the USPS approximately $5.5 billion per year. No other government agency or private company is required to make such payments.

In addition, the bill would prevent the closure of many rural post offices by giving the Postal Regulatory Commission (PRC) binding authority to prevent closures based on the effect on the community and on employees. Currently, the PRC acts only in an advisory role.

The bill also would establish strict delivery standards for first-class mail that would prevent the Postal Service from implementing wholesale closures of mail processing facilities, and would require the continuation of six-day delivery. The legislation also would establish new ways for USPS to generate revenue by providing non-postal services like new media services, issuance of licenses, shipment of beer and wine, and shifting more toward electronic mail.

Joining Rep. DeFazio as original co-sponsors were Rep. Maurice D. Hinchey (D-NY) and Rep. Louise M. Slaughter (D-NY).

Rep. DeFazio also introduced the Protecting Rural Post Offices Act of 2011 (H.R. 3592), which is to the House version of a bill (S. 1668) introduced by Sen. Jeff Merkley (D-OR) on Oct. 6. The bill precludes USPS from closing any post office which results in more than 10 miles between any 2 post offices.

Click here for more information on the bills introduced by Rep. DeFazio.