The House on Tuesday advanced a major financial overhaul of the ailing U.S. Postal Service, relieving it of tens of billions of dollars in liabilities that agency leaders said prevented it from modernizing and providing efficient service.
The Postal Service has implored Congress to help fix its balance sheet for nearly 15 years, and agency leaders are cautiously optimistic about prospects for the Postal Service Reform Act in the Senate. It has 27 co-sponsors in the upper chamber, including 14 Republicans, sufficient support to defeat a potential filibuster.
Senate Majority Leader Charles E. Schumer (D-N.Y.) said the chamber would vote on the legislation by the end of next week, citing its bipartisan popularity.
Democrats have hailed the legislation as crucial to the preservation of the Postal Service and its ability to reach nearly every American household six days a week. Republicans say the bill vindicates DeJoy’s initiatives and a conservative approach for a smaller mail service.
“We need to take steps to make our post office stronger,” Rep. Carolyn B. Maloney, the bill’s sponsor and chair of the House Oversight and Reform Committee, told The Washington Post. “This bill helps and it will help in every way. It’s a reform bill that will save taxpayers’ dollars while at the same time making the operations of the post office more financially stable and sustainable, and making postal jobs and employee health benefits more secure.”
The Postal Service is required to prepay its retirees’ health-care costs, a mandate instituted in 2006 when mail volume was steady and the agency was profitable. But decades of falling mail use have turned it into a perpetual financial loser, and the pre-funding requirement has accounted for $152.8 billion of its $206.4 billion in liabilities.
Tuesday’s legislation, advanced by leaders of both parties, wipes clean $57 billion of that amount, and will save the agency another $50 billion over the next decade. The bill installs new timely delivery transparency requirements for the Postal Service, which has struggled with on-time service since DeJoy took office, and allows the agency to contract with local, state and Indigenous governments to offer basic nonpostal services, such as hunting and fishing licenses.
“Congress just doesn’t want to put a Band-Aid on the post office,” Rep. James Comer (R-Ky.), the top Republican on the House Oversight Committee, told The Post. “We want to try to have a permanent solution to the post office, and that all predicates on having a reform plan. The former postmaster general never did come up with a reform plan.
“Now we have Louis DeJoy. He came up with a reform plan. … As evidenced by the support for this bill from Democrats, these reforms are working. The employees have bought into these reforms, and this bill will codify a lot of those reforms and help make the post office sustainable into the future.”
The bill is the result of months of negotiations between Democrats and Republicans on the House Oversight and Reform Committee, DeJoy and the Postal Service’s powerful unions.
The liberal wing of the House Democratic caucus had pushed Maloney (D-N.Y.) to pass a broader bill that included provisions to protect mail-in voting, funding for electric vehicles and restrictions on political campaign activities for the postmaster general and members of the agency’s governing board.
DeJoy’s past fundraising for former president Donald Trump has long rankled Democrats, who have accused him of hampering the agency’s ability to collect mailed ballots during the 2020 presidential election.
But after negotiations with Comer, DeJoy and the postal unions, the House passed a much narrower bill that appears to have a pathway to Senate approval.
“This was an agreement bill,” Maloney said. “From Day One, we could have passed a bill with just Democratic votes, but it would have been dead in the Senate.”
“The Postal Service Reform Act is about the only thing we agree with Louis DeJoy on,” Porter McConnell, campaign director of the consumer rights group Take on Wall Street and co-founder of the Save the Post Office Coalition, said in a statement. “Now it’s time for the Senate to pass the bill and send it to the president’s desk.”
DeJoy in a statement thanked the House leadership for its work on the bill and said that if it was passed by the Senate, "this legislation will have the same operational and financial impacts as the self-help steps we are taking at the Postal Service to provide the American people with the delivery service they expect and deserve.”
Sen. Gary Peters (D-Mich.), the sponsor of the Senate version of the bill and chair of the Homeland Security and Governmental Affairs Committee, said in a statement that he expected “to move quickly” to advance the legislation in the upper chamber.
“I have worked hand in hand with the bipartisan leaders of my committee and the House Oversight and Reform Committee to craft this bipartisan bill that will help the Postal Service overcome unfair and burdensome financial requirements, provide more transparency and accountability to the American people, and continue its nearly 250-year tradition of service to every community in our nation,” Peters said.
DeJoy made postal legislation the largest component of his controversial “Delivering for America” 10-year plan for the agency. To make up for a $160 billion projected shortfall over the next decade, DeJoy raised postage costs and lengthened delivery times. The agency banked on Congress taking liabilities off its balance sheet and growth in its package shipping business to make up the difference.
The bill eliminates the Postal Service’s retiree health care pre-funding mandate and instead requires future postal retirees to enroll in Medicare, drawing some criticism that the legislation amounts to a congressional bailout.
“The truth is the post office isn’t lacking liquidity. It is bankrupt,” Rep. Darrell Issa (R-Calif.) said on the House floor. “And nothing in this bill will make the post office truly solvent. It just wipes out and wipes away debt and shifts the burden on to taxpayers.”
The Congressional Budget Office, Congress’s nonpartisan bookkeeper, projected that the bill would save taxpayers $1.5 billion over the next 10 years, because postal retirees would boost Medicare’s prescription drug discounts.
But the vote on Tuesday has not thawed tensions between DeJoy and congressional Democrats, who are sparring anew over the Postal Service’s plan to replace its aging mail delivery fleet with up to 148,000 gas-powered vehicles, instead of electric trucks.
The White House and Environmental Protection Agency wrote to DeJoy last week saying the Postal Service’s environmental analysis of the fleet replacement was fundamentally flawed. DeJoy’s response over the weekend was defiant; he said in a statement that the Postal Service would consider purchasing electric vehicles only if Congress provided the funding.
Otherwise, he said, “We will be resolute in making decisions that are grounded in our financial situation and what we can realistically achieve, while pushing hard to take delivery of safer, cleaner vehicles by next year.”
Democrats are scrambling to find accountability measures to block the mail agency’s gas-powered truck purchases, but worry they are short on options. Proponents of Tuesday’s financial overhaul bill worried that a brewing fight over the fleet would imperil support for the Postal Service Reform Act. Instead, House Democratic leaders convinced members to separate the two issues.
“Get this passed,” Maloney said of the Tuesday vote, “and then we’ll work on that.”
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