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Postal reform bill unlikely to pass this year

Nov. 9, 2012 - 04:10PM   |  
By SEAN REILLY   |   Comments

Even as the U.S. Postal Service prepares to announce record-setting year-end losses approaching $15 billion next week, Congress appears unlikely to deliver on a comprehensive rescue bill this year.

There are no concrete plans for reaching a final deal in the lame-duck session starting Nov. 13, according to a spokeswoman for Sen. Joe Lieberman, I-Conn., the lead sponsor of a Senate-passed measure that would give the Postal Service billions of dollars in financial relief.

During the upcoming lame-duck session, lawmakers are likely to be consumed with averting the double-whammy of tax increases and spending cuts scheduled to take effect in January. “They’re going to find it easier to let the next Congress deal with postal issues,” said Louis Atkins, president of the National Association of Postal Supervisors.

More optimistic is Tony Conway, executive director of the Alliance of Nonprofit Mailers, who puts the odds of congressional action at “maybe 50-50.” But Conway foresees an added hurdle if lawmakers have to approve more money to pay for Hurricane Sandy relief. That could add to the federal budget deficit, making it harder to persuade lawmakers to go along with any help for the Postal Service that adds red ink to government ledgers, he said.

On Nov. 15, the mail carrier will release its final financial results for fiscal 2012, with predicted losses in the $15 billion range. Since July, the Postal Service has defaulted on $11.1 billion in legally required payments to a future-retiree health care fund. It has also hit a $15 billion borrowing ceiling with the U.S. Treasury, raising the risk of a cash-flow crisis.

In an email, USPS spokesman Dave Partenheimer acknowledged that many issues are competing for lawmakers’ attention, but added that it is “extremely important” that comprehensive postal reform legislation be addressed “as part of our plan to return to long-term financial stability.”

Legislative options

Under its own reform proposal, unveiled in February, the Postal Service would end most Saturday mail delivery, no longer have to pre-pay some $5.5 billion each year into the retiree health care fund and create its own health insurance plan for current workers separate from the Federal Employees Health Benefits Program.

To date, lawmakers have not approved any of those proposals.

Under Lieberman’s bill, approved by the Senate in April, the Postal Service could tap some $11 billion in surplus pension contributions for employee buyouts and other purposes. But the bill would only stretch out, not eliminate, the retiree health care pre-funding requirement and make the Postal Service wait at least two years before halting Saturday delivery.

The House has not taken up that legislation, but it also has not addressed a competing bill by Rep. Darrell Issa, R-Calif., that would let the Postal Service go to five-day delivery in six months and also give a specially appointed board responsibility for putting the agency back in the black.

In a September letter, Issa, who heads the House Oversight and Government Reform Committee, urged the Obama administration to push for five-day delivery, a revamp of the retiree health care funding schedule and a ban on future union contracts that would protect postal workers from layoffs. The White House never replied to the letter, according to Issa’s office.

If the current Congress doesn’t deal with postal legislation, a new cast of Senate players will confront the issue next year.

Lieberman, chairman of the Senate Homeland Security and Governmental Affairs Committee, is retiring, and Sen. Susan Collins of Maine, the committee’s top Republican, will have to step down from that post at year’s end because of party term limits.

Sen. Tom Carper, D-Del., is expected to replace Lieberman. Carper, who currently heads the subcommittee that oversees the Postal Service, is the leading advocate of giving USPS leaders more management freedom.

Collins’ probable replacement, Sen. Tom Coburn, R-Okla., backs five-day delivery as part of the more aggressive cost-cutting approach promoted by Issa.

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