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Federal Eye
Posted at 10:45 AM ET, 09/19/2011

Postal Service could end Saturday mail under Obama’s deficit plans


The White House is joining the debate over the future of the U.S. Postal Service. (Justin Sullivan - GETTY IMAGES)
President Obama supports allowing the U.S. Postal Service to stop delivering mail on Saturdays and to start selling items other than stamps and shipping supplies at post offices nationwide, according to his deficit reduction proposals released Monday.

The White House is also calling on Congress to return $7 billion that USPS paid into a federal retirement fund to the delivery service to help pay for other retirement and health-care costs. Obama’s plans also would allow the Postal Service to raise stamp prices beyond the rate of inflation to better match the cost of delivery.

The White House said its proposals would provide USPS with more than $20 billion in savings in the next few years and cut the federal deficit by more than $18 billion over the next decade.

Though the Postal Service is a self-funding entity that doesn’t accept taxpayer dollars, it is a significant piece of the unified federal budget because its workers and retirees draw benefits from federal workers’ compensation, retirement and health-care accounts.

The plans to assist the Postal Service are expected to be considered by the congressional fiscal supercommittee charged with identifying at least $1.5 trillion in deficit reduction in the next decade. Similar debt-reduction meetings chaired by Vice President Joe Biden this summer included discussions — and general agreement — on how to resolve the Postal Service’s challenges, according to several congressional sources. Those agreements are expected to be picked up by the supercommittee, the sources said.

The White House’s plans would help USPS meet its goal of saving $20 billion in the next decade by closing post offices and mail processing facilities, ending Saturday mail deliveries and overhauling how it pays for worker retirement and health benefits.

Obama's official endorsement of ending Saturday mail is not unexpected, as lawmakers have signaled a willingness to go along with the plan, and polling suggests more than seven in 10 Americans also support the change if it helps solve the Postal Service’s woes.

USPS expects to lose as much as $10 billion when its fiscal year ends Sept. 30. The White House and House Democrats are calling on Congress to give the Postal Service 90 extra days to make its year-end retirement and health-care payments and to consider a series of legislative proposals.

Ending Saturday delivery requires Congress to remove language from annual appropriations legislation that explicitly requires USPS to deliver mail six days a week. Some, but not all, of the legislative proposals released in the House and Senate in recent month would allow the Postal Service to end Saturday delivery, set its own prices and explore selling non-postal goods and services, including allow state residents to renew drivers’ or hunting licenses at a local post office.

Follow Ed O’Keefe on Twitter: @edatpost

Related:

The Federal Eye’s coverage of the U.S. Postal Service

Poll: Most Americans back halting Saturday mail

Obama’s new debt-reduction plan to draw contrasts with Republican vision

For more news, visit PostPolitics and The Fed Page.

By  |  10:45 AM ET, 09/19/2011

Categories:  Budget, Postal Service

 
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