Issa gets something right: wants Alaska to pay for bypass mail subsidy

They say even a stopped clock is correct twice a day, so it was probably inevitable that Darrell Issa would get at least something right in his otherwise devastating postal “reform” bill. Issa’s bill is the first to take on the so-called “bypass mail” subsidy enjoyed by the state of Alaska. The subsidy provides cheap air transport of commodities to remote parts of the state. It’s part of the legacy of the late longtime Alaska Senator Ted Stevens. While Alaskans defend the subsidy as vital to the poorer residents of the state, it’s never been clear why Alaska, one of the wealthiest states in the Union (#4 last year, ahead of places like Massachusetts and California), needs to have USPS customers in the rest of the country foot the bill for this perk. The Issa bill doesn’t eliminate the subsidy- it just requires the State of Alaska to reimburse the USPS for the added costs. Alaska Public Radio reported on the provision:

Alaska’s bypass mail subsidy is being targeted by a California lawmaker looking to trim costs and generate more revenue for the financially ailing U.S. Postal Service. Republican Congressman Darrell Issa the chairman of the House committee on Oversight and Government Reform is a primary sponsor of legislation called the Postal Reform Act of 2011. Within the legislation, section 408 would require the state of Alaska to reimburse the Postal Service for the cost of bypass mail. Congressman Issa was not available for comment today but Alaska district Postal Service spokesman Ernie Swanson says the subsidy costs USPS at least $70 million a year.

“That’s the amount that we lose basically on it. It undoubtedly costs us more than that, I know the representative was citing a number of about a hundred million dollars and that may be close to the total cost that it is to the postal service,” Swanson said.

via Alaska News Nightly: September 23, 2011 |