Postal Service Gets a Little Help on the Hill
A House committee has thrown the U.S. Postal Service a lifeline, but it won’t be enough to fully stop the financial quicksand that continues to pull the agency under.
Legislation the House Oversight and Government Reform Committee advanced on Friday would allow USPS to pay for the health benefits of current retirees out of its Retiree Health Benefit Fund instead of its operating budget. That would save about $2 billion a year, during the three years the bill covers.
That sounds good until you realize the Postal Service — which is funded by customers, not tax dollars — lost that amount in just the second quarter this year and expects to lose $6 billion this fiscal year. Changing the funding of retiree benefits will help, but it won’t stop the recession from sucking revenue from the agency.
That sucking sound is the financial stability of the Postal Service draining away as the recession cuts deeply into the volume of mail USPS delivers. But unless the economy makes a miraculous recovery, Postal Service officials say more drastic measures are needed than the retiree funding bill provides. Cutting delivery from six days to five is the drastic measure they have in mind.
The retiree funding bill, however, does allow officials the ability to continue to fight for the structural changes they insist are necessary. Lacking this temporary relief, people in the know spoke of the Postal Service’s death without exaggeration.
“Without this legislation the Postal Service will reach its mandated debt ceiling and could very well have to inconceivably end operations,” Bill Krejci,Ö legislative cochairman for the National League of Postmasters, said in a message to the organization’s members.
The measure “would help provide relief for three years at which time the economy hopefully will be on the road to recovery along with the mailing industry. Keep in mind, HR 22 [the bill’s number] alone will not save the Postal Service but it does provide some ‘breathing room’ and in effect could also be considered a jobs bill as well.”
July 13, 2009; 3:21 PM ET
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