In Letter to Chairman of the USPS Board of Governors, Hochul Calls for Cap On Salaries & Bonuses for Postmaster General and Executives, While Local Processing Facility Remains In Jeopardy

WASHINGTON, D.C. – Congresswoman Kathy Hochul today announced plans to introduce legislation limiting compensation for executive officers of the United States Postal Service to the same level of pay as the President’s Cabinet.

“American families all over this country are struggling to get by, the William Street Processing Center in Downtown Buffalo is in danger of shutting down, and 700 postal employees in Western New York are at risk of losing their jobs, but for some reason we are still providing the Postmaster General and other executive officers at the U.S. Postal Service with bonuses and salaries greater than that provided to the Secretary of Defense” said Congresswoman Hochul.  “In these tough economic times, Western New Yorkers are making necessary sacrifices and cutting back, and they expect their public servants to do the same.”

In 2006, a law was enacted providing senior officers of the USPS with salaries up to 120% of the Vice President’s salary, as well as authorizing bonuses for these postal executives if approved by the Postal Service Board of Governors.

Congresswoman Hochul’s legislation would reinstate the longstanding policy of paying the Postmaster General and other USPS executives at the same level of pay as the President’s Cabinet ($199,700 in FY2012).  Additionally, this bill would prohibit the issuance of bonuses to USPS executive officers in years that the Postal Service closes any retail or processing facility, such as the William Street Area Mail Processing Facility in Buffalo.

Hochul added, “The Postal Service cannot make the argument that they need to cuts costs and let go hard-working postal workers when their own management team continues to rake in bonuses and make more than the President’s Cabinet.  The jobs of over 700 Western New Yorkers and thousands of Americans across this country are worth more than bonuses for a handful of individuals at the United States Postal Service.”

Congresswoman Hochul has already written Thurgood Marshall, Jr., Chairman of the United States Postal Service Board of Governors, urging him to limit the compensation for the Postmaster General and other members of the USPS executive management team, while processing facilities across the nation are in danger of shutting down.  A copy of the letter sent to Chairman Marshall can be found here.

WASHINGTON, D.C. — With proposed U.S. Postal Service (USPS) office closures looming, U.S. Sen. Sherrod Brown (D-OH) met today with Postmaster General Patrick Donahoe to push the USPS to minimize the closure of processing centers and postal offices in Ohio, preserve rural post offices, and maintain six-day mail delivery.

“The local post office is more than just a place for Ohioans to drop off mail. In many communities, especially rural towns, they serve as town centers—and they provide good jobs for local residents,” Brown said. “The closure of dozens of postal processing centers and post offices would be devastating for thousands of Ohioans and could have a serious impact on local economies. I urge Postmaster Donahoe to do all he can to minimize closures in Ohio and maintain six-day delivery as Congress works on legislation to bring the USPS back to fiscal solvency.”

Brown is a cosponsor of the Postal Service Protection Act, which preserves Saturday mail delivery, restricts the closure of rural and urban post offices, and protects mail processing facilities to ensure maintenance of timely service. The legislation would address the most immediate financial problem facing the postal service by eliminating the unique requirement that the postal service pre-fund 75 years worth of future retiree health benefits in just 10 years. This mandate costs USPS between $5.4 and $5.8 billion per year, accounting for the Postal Service’s $20 billion in losses from 2007-2008.

Recently, the USPS announced plans to close nine Mail & Processing Distribution Centers (P&DC) in Ohio despite a moratorium aimed at preventing consolidation until Congress passes postal reform legislation, Brown called on the USPS to halt consolidation.  In December 2011, the U.S. Senate and USPS agreed to a five-month moratorium on closing postal facilities, providing Congress more time to enact postal reform legislation. Under the terms, the Postal Service would use the time to study the impact of proposed closures on service and costs and to solicit community input. Last month, Brown sent a letter to Senate Majority Leader Harry Reid to call for quick action to save jobs and maintain service for Ohio families and small businesses.

One hundred and twenty post offices and ten mail processing facilities were initially targeted for closure in Ohio, and Brown has sent multiple letters to Postmaster General Patrick Donohue outlining concerns with the closures, which could lead to significant job losses, delayed mail, and deteriorated service. Brown has also sent representatives to public hearings across Ohio in recent months to stand with local residents in opposition to these closures.

According to studies by the Hay Group and the Segal Company, the postal service has overpaid at least $50 billion into its pension plans. Because of these overpayments, USPS has been forced to subsidize retirement accounts for the entire Federal government. This bill would allow USPS to recover these pension overpayments to both fund its retiree health benefits and cover its operational expenses

Specifically, the Postal Service Protection Act would:

• Fix the immediate fiscal problem of the postal service by allowing the postal service to recover the overpayments it made to its retirement programs. Additionally, this bill would allow the postal service to recover the overpayments that it has made to its pension plans.
• Establish new ways the Post Office can generate revenue, by ending the prohibition on USPS providing non-postal services, such as:
•    Providing notary services, new media services, issuance of licenses (drivers licenses, hunting licenses, fishing licenses)
•    Contracting with state and local agencies to provide services
•    Shipping wine and beer
•    Encouraging innovative ways to address the shift toward electronic mail and away from hard-copy mail
• Prevent the closure of rural post offices by giving the Postal Regulatory Commission (PRC) binding authority to prevent closures based on the effect on the community and the effect on employees. Right now, the Postal Regulatory Commission only has the authority to review a decision to close, but it does not have any binding authority to prevent the closure, even if it finds it was flawed. The bill would also ensure more transparency in the closure process by requiring USPS to inform the communities that are being studied for closure
• Protect six-day delivery
• Protect mail-processing facilities by ensuring strict standards for delivering first-class mail delivery on time that would make it more difficult to close area mail processing facilities.