Postal Service reform bill to be unveiled

By Ed O'Keefe
Wednesday, September 22, 2010; 10:43 PM

If a key Senate Democrat has his way, the U.S. Postal Service could soon end Saturday mail deliveries, close thousands of post offices and open new ones in grocery stores. The agency would also recover overpayments to a federal employee retirement fund and use the money to provide health benefits for retired postal workers.

Sen. Thomas R. Carper (D-Del.), a longtime supporter of postal leadership, on Thursday will unveil a bill designed to give the Postal Service more flexibility on major operational and financial decisions without congressional approval. It echoes proposals pushed by Postmaster General John E. Potter, who is seeking greater independence from lawmakers despite the Postal Service's quasi-government role.

On Wednesday, Potter voiced approval for the measure, saying it allows the Postal Service "to step into the 21st century."

The bill would lift restrictions on the types of products and services the Postal Service sells and when and where it operates. Potter wants to end Saturday mail deliveries, close post offices and open for business in nearby retail outlets. He also wants to explore selling banking or insurance services.

Carper's bill goes a step further. It would permit the Postal Service to work with state governments to provide voter registration forms and driver's license applications at postal locations.

The new proposals go beyond a House package introduced this year, and they come one week before the Postal Service is set to report billions in losses for fiscal 2010.

But with lawmakers tied up in tax cut debates and little else before the midterm election recess, Carper's legislation isn't likely to advance this year.

Lawmakers are expected to provide financial relief to the Postal Service in a temporary measure that would fund other federal agencies, according to multiple sources. The continuing resolution would reduce for one year the Postal Service's annual $6 billion payment to pre-fund retiree health benefits.

Those payments contribute to a projected debt load that is expected to reach about $230 billion in the next decade, postal officials say. The Postal Service hopes to pay down that debt in part with about $50 billion it overpaid to the Civil Service Retirement System in the past four decades.

Carper's bill would allow the Postal Service to recoup $5 billion a year of the $50 billion overpayment to prepay health benefits.

"If we do nothing, we face a future without the valuable services the Postal Service provides," Carper said. "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."

Rep. Darrell Issa (Calif.), the ranking Republican on the House committee that oversees postal issues, called Carper's proposal "a thinly disguised taxpayer-funded bailout" for an organization that was expected to pay for itself when it became a self-funding agency almost 40 years ago.

William Burrus, president of the American Postal Workers Union, said it was unfair and unnecessary for the bill to require that arbitrators consider the Postal Service's financial condition during labor negotiations.

"Anyone that would allege that arbitrators have not considered the financial health of the Postal Service in the past haven't been in negotiations," Burrus said.

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