NAPS Leg/Reg Update: Obama Budget Would Help the Postal Service, Hurt Postal Workers

NAPS Leg/Reg Update – February 15, 2012

Democratic Senators Urge Improvements in Postal Bill

A group of 27 Democratic Senators on Tuesday called for “significant  improvements” to strengthen the Senate postal bill (S. 1789) that awaits floor action.  The improvements mirror those sought by NAPS.  The overture by more than half of the Senate’s Democrats will increase pressure on Democratic leaders to make changes to the bill.

NAPS urges all its members to contact their Senators to express support for strengthening S. 1789.  You can send a message to your Senators by clicking here.

The postal bill could come to the Senate floor at some point after Feb. 27, when Congressional lawmakers return from their Presidents’ Day recess, which occurs next week.

In the Feb. 14 letter to the Democrat and Republican leaders of the Senate postal oversight panel, Sen. Bernie Sanders (I-VT) and 26 other senators identified specific measures needed to strengthen the measure.  They involve: preserving First Class mail service standards, including local overnight delivery; retaining Saturday mail delivery; stopping widespread closings of mail processing centers and rural post offices; and sparing many of the 220,000 jobs that the Postal Service wants to cut.“Everyone understands that  the Postal Service is in the midst of a serious financial crisis that must be addressed,” the Senators wrote. “But we believe that this financial crisis can be solved in a way that does not substantially slow down the delivery of mail and harm rural America.”

The 27 senators said the Postal Service should be prohibited from slowing down First Class mail delivery, which would result under the current USPS plan to shutter 252 mail  processing centers. The shutdowns would leave the Postal Service with  fewer than half of the 508 mail sorting facilities currently in operation. “If USPS becomes inconvenient and slow, many of its most loyal     customers – from home delivery medication companies to newspaper publishers – will turn to private mailing options. Once those customers leave, they are most likely not coming back, and the Postal Service’s  financial woes will continue to spiral,” the Senators warned.

The Senators also said the Postal Service should be allowed to recover more than $10 billion in FERS overpayments and no longer be forced to put $5.5 billion a year into a retiree health care  account that is already flush with funds.

They also called for a Blue-Ribbon Entrepreneurial Commission to develop a new business model for the Postal Service.  The Commission would be comprised of entrepreneurs, innovators, postmasters, postal workers and others.

In addition to Sanders, the letter was signed by Sens. Max Baucus (D-Mont.) Mark Begich (D-Alaska) Mike Bennet (D-Colo.) Barbara Boxer  (D-Calif.) Richard Blumenthal (D-Conn.) Sherrod Brown (D-Ohio) Ben  Cardin (D-Md.) Robert Casey Jr., (D-Pa.) Diane Feinstein (D-Calif.) Al  Franken (D-Minn.) Kirsten Gillibrand (D-N.Y) Tom Harkin (D-Iowa) Tim Johnson (D-N.D.) Amy Klobuchar (D-Minn.) Herb Kohl (D-Wis.) Mary  Landrieu (D-La.) Patrick Leahy (D-Vt.) Claire McCaskill (D-Mo.) Jeff Merkley (D-Ore.) Barbara Mikulski (D-Md.) Ben Nelson (D-Neb.) Jeanne  Shaheen (D-N.H.) John Tester (D-Mont.) Mark Udall (D-Colo.) Tom Udall  (N.M.) and Ron Wyden (D-Ore.).

Obama Budget Would Help the Postal Service, Hurt Postal Workers 

The FY2013 budget unveiled by President Obama on Monday proposes financial relief for the Postal Service, but paycheck pain for postal and federal employees.  NAPS opposes the paycheck cuts.

Financial Relief for USPS

The President, warming-up proposals for postal reform that the White House originally provided to the deficit reduction super committee last fall, pushed Congress to enact comprehensive postal reform.

The White House recommended reforms that would: 1) restructure retiree health benefit pre-funding to reduce (but not end) USPS payments; 2) provide USPS with a refund of $10.9 billion for over-paid contributions to the FERS program; 3) authorize USPS to reduce mail delivery from six to five days starting in 2013; 4) allow USPS to increase collaboration with State and local governments; and 5) permit USPS to better align postage and mail delivery costs, while still operating within the current price cap; and 6) permit USPS to seek the one-time exigency postage increase it proposed in 2010.  The proposals mostly track the postal reform package promoted by NAPS.

The White House says these reforms would provide USPS with over $25 billion in cash relief over the next two years and in total would produce savings of $25 billion over 11 years.

Paycheck Pain for Postal and Federal Employees

The Obama budget also proposes to increase the postal and federal employee contribution towards retirement by 1.2% over three years beginning in 2013.  The budget also proposes to eliminate the FERS annuity supplement for new employees. The estimated savings of these proposals are $27 billion over 10 years. NAPS opposes thse measures.

The proposals revive those President Obama also proposed last September in a plan sent to the deficit reduction super committee.  Now that the White House is again advancing them, it potentially could bring some of them closer to becoming reality in Congress.

Under the White House proposal:

— The employee contribution toward retirement costs would increase by a total of 1.2 percent (0.4 percent a year over three years beginning in 2013), but the employee’s total pension would remain unchanged.  This would increase FERS employees’ contributions from 0.8 percent to 2 percent, and CSRS contributions from 7.0 percent to 8.2 percent. According to the budget document, the stated purpose of the proposed change is to “make reasonable changes to federal worker retirement while maintaining the ability to attract and retain highly qualified individuals [to the federal workforce].”

— The FERS Annuity Supplement for most new employees who retire before age 62 would be eliminated. That payment, worth about $8,000 annually on average according to a congressional estimate, replicates the portion of the Social Security benefit earned during federal employment. It is paid until those retirees are eligible to begin drawing Social Security benefits. The change would apply only to those hired after enactment and would exempt occupations subject to mandatory retirement before age 62, such as law enforcement. The administration’s proposal, first made last fall, differs from a House Republican plan that would eliminate the benefit for most retiring after this year.

NAPS opposes these retirement benefit cut proposals.


Bruce Moyer
Legislative Counsel to NAPS

  • Retired

    What about eliminating the Windfall Elimination Provision and the Government Pension Offset. I have paid into social security prior to retirement and pay into it after retirement working full time in private sector yet I can’t collect a dime due to these provisions. The rich with lucrative pensions paying less in to social security as a percentage can collect benefits. I make less than those in the private sector who are on company pensions and collecting social security. Once again stick it to the Government worker.

  • bob

    what ever they do to the goverment worker they should be required to do to them selves