U.S. House to vote to provide Postal Service with $50 bln in relief

Author of the article: WASHINGTON — The U.S. House of Representatives is set to vote on Tuesday on a bipartisan reform bill aiming to help Postal Service (USPS) save about $50 billion over a decade and requiring future retirees to enroll in a government health insurance plan. USPS has reported net losses of more than…
U.S. House to vote to provide Postal Service with $50 bln in relief

Author of the article:

WASHINGTON — The U.S. House of Representatives is set to vote on Tuesday on a bipartisan reform bill aiming to help Postal Service (USPS) save about $50 billion over a decade and requiring future retirees to enroll in a government health insurance plan.

USPS has reported net losses of more than $90 billion since 2007. One reason is 2006 legislation mandating it pre-fund more than $120 billion in retiree healthcare and pension liabilities.

House Oversight Committee chair Carolyn Maloney said Monday the bill would put USPS on a stronger footing and save $50 billion over 10 years.

If approved, the legislation moves to the U.S. Senate.

The bill eliminates requirements USPS pre-fund retiree health benefits for current and retired employees for 75 years, a requirement no business or other federal entity faces. USPS projects it would sharply reduce its pre-funding liability and save it roughly $27 billion over 10 years.

It requires future retirees to enroll in Medicare. About 25% of postal retirees do not enroll in Medicare even though they are eligible, which results in USPS paying higher premiums than other employers. USPS estimates the change could save it about $22.6 billion over 10 years.

The White House and postal unions support the bill as does the Greeting Card Association and Hallmark

One of the service’s biggest customers, Amazon.com, said https://oversight.house.gov/sites/democrats.oversight.house.gov/files/PSRA%20Support%20Letters.pdf it strongly backs the legislation.

“Americans across the country have long depended on the USPS for its reliable and affordable delivery options,” Amazon Public Policy Vice President Brian Huseman wrote in a Feb. 2 letter to lawmakers.

Postmaster General Louis DeJoy in March 2021 proposed cutting $160 billion in predicted losses over the next decade, which included https://about.usps.com/what/strategic-plans/delivering-for-america/assets/USPS_Delivering-For-America.pdf#:~:text=The%20Plan%E2%80%99s%20strategic%20initiatives%20are%20designed%20to%20reverse,next%20ten%20years%20by%20achieving%20break-even%20operating%20performance financial reforms in the House bill. USPS also adopted new delivery standards in October https://www.reuters.com/world/us/slower-us-mail-standards-take-effect-friday-2021-09-29 that slow some first-class mail deliveries.

The bill requires USPS to maintain six-day a week mail deliveries and develop an online weekly performance data dashboard by zip code, and expands special rates for local newspaper distribution. (Reporting by David Shepardson; Editing by Stephen Coates)

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