Congressional "Prefunding" requirement is killing Postal Service
The controversy over the U.S. Postal Service’s efforts to close mail-processing facilities and thousands of small post offices and to lower delivery standards is being fought in almost every community in America. All across this country, business owners, citizens, community leaders and elected officials have demanded the Postal Service withdraw plans that will slow down mail delivery, hurt the local economy and kill jobs.
Postal management at the headquarters level says the change in delivery standards and the closure of the postal facilities is needed because of a large drop in first-class mail volume. In order to stay in business, these changes must occur.
While the drop in mail volume is a contributing factor, it is not the main reason for the Postal Service’s severe financial difficulty. In 2006, the Bush administration and Congress passed the Postal Accountability and Enhancement Act that required the Postal Service to fund future retiree health-care premiums for 75 years within a 10-year period ending in 2016. This mandate requires the Postal Service to pay $5.5 billion a year for a total of $55 billion.
No other government agency or private corporation has to make this kind of pre-fund payment. Because of this law, the agency is pre-funding health-care premiums for workers who haven’t even been hired. Basically, the Postal Service must start out each year $5.5 billion in debt. Independent audits have shown that without this pre-fund requirement, the Postal Service would have had income exceeding expenses for this time period.
In addition, audits completed by the Office of the Inspector General and the Office of Personnel Management have determined that the formula used to determine the amount of pre-funding was incorrect, and the Postal Service has overpaid by $10 billion to $25 billion. The Office of Personnel Management also concluded that the Postal Service has overpaid into its retirement accounts by billions of dollars, but it cannot return this money without congressional authorization.
Dismantling the Postal Service’s distribution network will have a severe impact on companies that rely on the Postal Service to conduct business: to deliver bills and catalogs, return payments, distribute information about products and services and deliver goods to customers. Closing postal facilities also would have a devastating impact on millions of citizens who rely on the mail to connect them to their communities.
Nearly 40 percent of Americans do not have broadband Internet access, and 28 percent still have no Internet access at all. More than 50 percent of consumers still receive hard-copy bills and statements. Small towns would lose their identity if their post office closes. People who rely on the mail for their Social Security check, annuity or prescription medication would see delays in delivery.
Utility companies could see their bills delayed. In fact, in Canton, the sewer department sent notice to its customers saying it will mail bills a week earlier in order to offset the proposed change in delivery standards.
In Ohio, there are nine mail-processing facilities and more than 100 post offices slated for closure or consolidation. The plan is to actually sort some Ohio mail in Michigan and Pennsylvania. It is estimated that more than 3,000 jobs will be affected if Congress does not take action.
Currently, more than two dozen pieces of postal legislation are pending in Congress. The problem is getting the House of Representatives and the Senate to take action. A moratorium on the processing consolidations and post-office closings is set to expire on May 15, and postal management has vowed to start the closure process immediately after the moratorium ends.
There is a simple solution. Congress must repeal the pre-funding requirement, allow the U.S. Postal Service to recover overpayments to its retiree funds and protect service to the American people. Resolving the Postal Service’s financial crisis would enable the agency to maintain service standards, protect the mail-processing network, prevent the closing of rural post offices, maintain six-day delivery and modernize.
Congress also must allow the agency to offer new products and services.
The U.S. Postal Service is the best in the world. It delivers more than 40 percent of the world’s mail volume quickly and efficiently. Why would our elected officials let it become obsolete? Because they are getting paid off by private investors, companies who would benefit if it went private. They are a bunch of crooks, this is added proof.
Our Founding Fathers expressly authorized the post office in the Constitution of the United States. How could their successors let it be destroyed? Congress created the Postal Service’s financial crisis, and Congress must fix it, now.