Carper Introduces Comprehensive Postal Service Act

WASHINGTON – Today, Sen. Tom Carper (D-Del.) introduced the Postal Operations Sustainment and Transformation (POST) Act of 2011. The POST Act addresses the current budget issues plaguing the U.S. Postal Service by proposing a series of provisions including: easing postal employee pension and retiree health costs; addressing postal employee wages and benefits; allowing partnerships with state and local governments; continuing and enhancing efforts to preserve its existing business; and giving the Postal Service leeway to close post offices, market certain non-postal items, and eliminate Saturday delivery.

“For decades, Americans have taken the Postal Service for granted. We’ve assumed that it would always be there. But our troubled economy – coupled with the continued migration to electronic forms of communication – is putting the future of the Postal Service in jeopardy,” said Sen. Carper. “Furthermore, if the Postal Service were to shut down, the impact on our economy would be dramatic. The Postal Service operates at the center of an industry that employs some 7 million people and generates more than $1 trillion in sales and revenue each year. At such a difficult and fragile time for our economy, we can’t afford to lose those jobs and that kind of productivity.”

“The current financial crisis the Postal Service faces is more urgent now than it ever has been,” continued Sen. Carper. “If we do nothing, we face a future without the valuable services the Postal Service provides. However, if we act quickly, we can turn things around by passing this necessary bill that would give the Postal Service the room it needs to manage itself and avoid it becoming the latest victim of Congressional gridlock. Putting the Postal Service back on stronger financial footing is something I’ve been trying to do for a long time now. My bill requires all parties – postal management, employees and customers – to make sacrifices. It also gets Congress out of the way by providing the flexibility and tools necessary to address the problems plaguing the Postal Service in an effective way. I hope my colleagues and the Administration will join me in pushing for this much needed reform so we can prevent the Postal Service from going broke by the end of the year.”

Sen. Carper’s bill attempts to permanently address the pension and retiree health issues that have been a drain on postal finances over the years. The Postal Service currently pays into the old Civil Service Retirement System (CSRS) using a formula that recent studies by the Postal Service’s Inspector General, the Postal Regulatory Commission, and at least two outside consulting firms found resulted in gross overpayments. In addition, the Postal Service since FY2007 has been required to pay between $5.5 billion and $5.9 billion a year in an effort to prefund its future retiree health obligations. Sen. Carper’s bill would require the Office of Personnel Management to recalculate the Postal Service’s CSRS obligations using a modern formula that more fairly divides responsibility for pension costs related to pay increases granted to former Post Office Department employees who transitioned to the Postal Service. This recalculation would result in a finding that the Postal Service has overfunded CSRS by about $50 billion. Sen. Carper’s bill would give the Postal Service access to more than $5 billion each year from this $50 billion overpayment to help it make its retiree health payments.

Another provision of Sen. Carper’s bill would reaffirm the Postal Service’s authority to change delivery frequency when it felt like doing so was necessary. Based on the Postal Service’s proposal to eliminate Saturday delivery, such authority could save the Postal Service $3 billion or more a year. The bill would also eliminate several provisions in law that force the Postal Service to maintain post offices that are no longer necessary, allowing the Postal Service to expand more convenient and cost-effective retail options such as automated kiosks or postal stations located in grocery stores or other places where people go every day.

Under current law, the Postal Service is prohibited with a few exceptions from offering “non-postal” products and services; however, Sen. Carper’s bill would revise the prohibition, allowing the Postal Service to offer non-postal products that are in the public interest and make use of the existing postal network. Additionally, the new bill would allow the Postal Service to ship wine and beer, a service UPS and FedEx already provides, and to work with state and local governments seeking to use postal retail locations to serve citizens seeking to access services such as voter registration or driver’s license renewal.

Further, at a time when mail volume is falling and many postal customers are turning to electronic forms of communication, the bill would give the Postal Service additional freedom to negotiate service agreements with individual mailers aimed at preserving its existing business. It would also place a time limit on the Postal Regulatory Commission’s consideration of Negotiated Service Agreements to provide customers and the Postal Service with certainty.

Finally, Sen. Carper’s legislation seeks to reform the way in which Postal employees’ wages and benefits are determined. Wages and benefits currently account for roughly 80 percent of the Postal Service’s expenses. On top of this, the Postal Service is required under the law to pay its employees wages and benefits that are comparable to those paid in the private sector. At times, arbitrators have awarded postal employees what they believe are comparable pay and benefits without taking the Postal Service’s financial condition into account. Recognizing that this situation cannot continue in a world where the Postal Service operates under a rate cap and faces stiffer competition from electronic communication, the bill requires arbitrators to take the Postal Service’s financial condition into account along with other factors such as the comparability requirement and the details of the rate system.

  • Navy Veteran

    VERA now Please!

  • JY

    This is a BAD idea. Sen Carper only tips the scale in management’s favor.

  • Hal Zapken

    The bill does not address the benefits issue. The benefits are “purchased” by each employee. This can not be considered as earnings, thus real dollars are currently below private sector. If the benefits are being used as a salary indicator, this bill will ultimately push the worker close to the poverty line and result in more social aid in the form of food stamps and other forms.of assistance.

  • Reagen

    Pass it now, its about time some one has common sense, are you sure this is coming from Washington.

  • Rich

    Senator Carper please make sure that when you run for re-election you get that one little detail right. Yea, that’s right you figured it out good for you. Now go ahead change that D to an R. A wolf in sheeps clothing, you Republican you.

  • Mr. Knowitall

    “At times, arbitrators have awarded postal employees what they believe are comparable pay and benefits without taking the Postal Service’s financial condition into account.”
    When did that supposedly occur?

  • annie

    Return the money that the USPS overpaid to funds.
    Is congress willing to pay itself wages and benefits that are comparable to those in the private sector? $11-$13 dollars an hr, no pension, 50% toward medical with high out of pocket expenses.

    Most important keep 6 day delivery!
    W/O 6day delivery our federal protected mailboxes will be open to anyone.

  • brian

    Hal Zapken- The benefits part of “salary and benefits” is the money the USPS (or any other employer) pays for benefits it provides to employees. Annual and sick leave, employer contributions to retirement and your health insurance are the big ones. That IS money the USPS pays out for your benefit, so it IS correct to count it towards the total paid out for employees. You don’t “purchase” those benefits. Obviously you also pay into your retirement and health benefits, but that’s not what we’re talking about- just the amount of real, actual dollars the USPS pays out on your behalf. (Hint- you don’t pay for all of your health insurance by a LONG shot!)

  • Hal Zapken

    Brian- You are wrong. The retiree cost of the Postal Services expenses are what is at issue here.The service does not pay for our retirement benefits. That is wholly financed through our pensions. The OPM negotiated rates are used. By “pre paying” retirement expenses has resulted in what some say is a $6-7 B over paymeht and that is what the service needs to have re-instated. The contributions to the health care during employment is on par with other corporations, and just slightly better than the GS elements of government service. I espect that the formula or ratio used to ascertain cost sharing for health benefits will change during the next round of contract negotiations which I am sure will please you. Perhaps what needs to be looked at is the special considerations that benefit only some sectors of the mailing public, the educational and experience qualifications of all managers throughout the districts and the inherent structure of the management of the postal Service’s competing entities of the Processing and Customer Services divisions.

  • brian

    And exactly what am I wrong about, Hal? You say that “the service does not pay for our retirement benefits. That is wholly financed through our pensions.”, which makes no sense at all. In the first place, your pension IS the bulk of your retirement benefits. And obviously the USPS DOES pay its share of your pension (i.e. the employer contributions made while you’re employed) and retiree health benefits (i.e. the federal share of retiree health benefit premiums). Both of those items come directly from USPS revenues.
    If you don’t think the USPS is paying for your retirement benefits, here are two things to try:
    – find a financial institution that will take your biweekly employee retirement contribution, and guarantee you an annuity equal to what the USPS offers.
    – find a health insurance plan that will offer you the same coverage FEHB does, at the price USPS retirees pay
    Good luck with that!
    Your original suggestion that benefits are somehow “purchased” by employees is nonsense. All of your benefits are paid for, or subsidized, by the USPS. The easy way to understand that is to opt out of all your benefits- see how much health insurance you can get on the open market for your FEHB contribution. See what kind of retirement nest egg you’ll have if you just save your CSRS or FERS contributions on your own.