Congress to weigh reforms to U.S. Postal Service over finance woes

FILE PHOTO: A United States Postal Service (USPS) mail carrier walks past the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar/File Photo

By David Shepardson

WASHINGTON (Reuters) – A panel of the U.S. House of Representatives will hear testimony on Wednesday from Postmaster General Louis DeJoy and other officials as lawmakers consider significant reforms to tackle the precarious finances of the U.S. Postal Service (USPS).

Delays in paychecks and other mail deliveries by USPS gained attention this summer as a record number of voters mailed in ballots to elect a new president.

DeJoy, a supporter of former President Donald Trump appointed to head the USPS last year, suspended operational changes in August after enormous criticism over postal delays. He plans to release a new 10-year strategic plan soon.

House Oversight and Government Reform chairwoman Carolyn Maloney will make the case for action on the finances of the USPS in the face of shrinking volumes of first-class mail, increased costs of employee compensation and benefits, and higher unfunded liabilities and debt.

“We need to pass meaningful reforms — and hopefully bipartisan reforms — to put the Postal Service on more sustainable financial footing for years to come,” Maloney will say, according to excerpts from her office.

USPS reported net losses of $86.7 billion from 2007 through 2020. One reason is 2006 legislation that it pre-fund more than $120 billion in retiree health care and pension liabilities, a requirement labor unions have called an unfair burden not shared by other businesses.

Maloney has circulated draft legislation on some USPS financial issues, such as eliminating a requirement to pre-fund retiree health benefits.

It would also require postal employees to enroll in government-retiree health plan Medicare, for a saving of roughly $10 billion over ten years.

Mark Dimondstein, president of the American Postal Workers Union, will urge Congress to include an additional $15 billion “to help stabilize the Postal Service during this crisis” in a COVID-19 relief package.

His testimony, seen by Reuters, calls for another USPS “modernization grant” of $25 billion to make “long overdue” investments in a clean postal fleet, modernizing postal facilities and providing electric vehicle charging stations for local post offices.

Also testifying is Joel Quadracci, chief executive of printing company Quad/Graphics.

DeJoy will testify alongside Ron Bloom, a former Obama administration official elected this month as the new chairman of the U.S. Postal Board of Governors.

In December, Congress converted into a grant a $10 billion U.S. Treasury loan that lawmakers gave to USPS in March.

(Reporting by David Shepardson; Editing by Clarence Fernandez)

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