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Postal Reform Effort Underway

(This article was first published in the March/April 2004 issue of The American Postal Worker magazine)

With both chambers of Congress hoping to pass postal 'reform' legislation this year, key committees in both the House and Senate invited postal stakeholders and experts to testify on issues under consideration.

At press time, five hearings have been held (See p. 6). In a letter inviting APWU testimony, House Special Panel on Postal Reform, Chairman John McHugh (R-NY) asked for discussion of the core problems the congressman thinks need to be addressed in the postal reform debate:

"The Postal Service is the center of an $871 billion industry employing 9 million workers nationwide, and representing more than 8 percent of the Gross Domestic Product. This industry is in trouble, and requires reform legislation to prevent a meltdown. Mail volume has declined during each of Fiscal Years 2001, 2002 and 2003. Conversely, the number of addresses to which the Postal Service delivers has increased by 5.2 million during the same three-year period. On-line bill paying, the anthrax mailings, and the sluggish national economy of the post-9/11 era, are other factors that have contributed to the Postal Service's declining revenues. Under the Postal Service's 30-year-old framework, the only response to declining volume and revenue is larger and more frequent rate increases, contributing to what GAO has called a 'death spiral'".

While the APWU disagrees with the "death spiral" scenario, we agree that some issues must be addressed if the USPS is to remain a healthy, vital, independent agency.

President's Budget Reiterates Position on Reform

On Feb. 2, President Bush released his proposed federal budget for Fiscal Year 2005. Included in the budget was a list of issues to be addressed in postal reform legislation:

"The Administration supports enactment of comprehensive postal reform legislation that reflects the sensible, balanced approach the Commission recommended and is guided by the following five clear principles:

• Implement Best Practices: Ensure that the Postal Service's governing body is equipped to meet the responsibilities and objectives of an enterprise of its size and scope.
• Transparency: Ensure that important factual information on the Postal Service's product costs and performance is accurately measured and made available to the public in a timely manner.
• Flexibility: Ensure that the Postal Service's governing body and management have the authority to reduce costs, set rates, and adjust key aspects of its business in order to meet its obligations to customers in a dynamic marketplace.
• Accountability: Ensure that a Postal Service operating with greater flexibility has appropriate independent oversight to protect consumer welfare and universal mail service.
• Self-financing: Ensure that a Postal Service operating with greater flexibility is financially self-sufficient, covering all of its obligations.

President Burrus told the House Special Panel that APWU supports the broad principles of the Administration. President Burrus, however, clarified our differences with the Bush Administration, noting, "The Devil is in the details." He added, "For long-term financial solvency, the Postal Service must be relieved of the burden of paying for military retirement, and must be permitted to make appropriate use of the savings from the re-calculations of its CSRS contributions. In addition, OPM's [Office of Personnel Management's] effort to shift federal service retirement costs to the Postal Service must be addressed."

What's Next?

Following the completion of hearings, the Senate Governmental Affairs Committee and the House Special Panel will begin the difficult process of drafting separate, and very likely, different bills. Throughout the hearing process, it has become clear that the priority issues in the House seem to be different from those in the Senate. Although a joint House/Senate hearing has been discussed, no further details are available at press time.

APWU members are encouraged to continue their contacts with their elected representatives, especially those who serve on the two panels. The message remains the same:

APWU Opposes Commission's Proposals to:

• Give a politically appointed Postal Regulatory Board the power to dictate employee compensation, set postal rates, and redefine "universal service"
• Rescind existing regulations that require citizen input before closing plants and small post offices through its 'Postal Network and Optimization Commission;'
• Encourage increased outsourcing of postal jobs through worksharing discounts that exceed the costs the Postal Service avoids when the work is done "in house", and
• Limit our right to engage in collective bargaining, undermine our job security, and remove us from existing federal retirement, health benefits, and workers' compensation programs.

APWU Supports:

• Expanding the services provided by the USPS;
• Improving flexibility in setting rates;
• Shortening the time it takes to set new rates;
• Providing regular rate increases, with advance notice, to enable mailers to better budget their costs;
• Permitting more appropriate salary levels for high-level postal officials;
• Strengthening the USPS Board of Governors and holding the management more accountable for its decisions;
• Reviewing and modifying the allocation of institutional costs among different classes of mail; and
• Transferring military service retirement costs to the Department of the Treasury to be borne as they are for all other federal employees.

We urge all APWU members to contact their U.S. Senators and Representatives about our union's concerns by calling the Capitol Hill Switchboard at 202-224-3121. APWU members should meet with their representatives when they are in the districts. Feedback from these meetings or phone calls should be forwarded to the APWU Legislative Department as soon as possible.

Members of the House Committee on Government Reform's Special Panel on Postal Reform and Oversight are:

Republicans John McHugh, (NY), Chair Dan Burton (IN) Tim Murphy (PA) Ed Schrock (VA) Candice Miller (MI) Marsha Blackburn (TN)

Democrats Danny Davis (IL) Major Owens (NY) Ed Towns (NY) Carolyn B. Maloney (NY) Wm. Lacy Clay (MO)

Members of the Senate Committee on Governmental Affairs are:

Republicans Susan M. Collins, (ME), Chair Ted Stevens (AK) George Voinovich (OH) Norm Coleman (MN) Arlen Specter (PA) Robert Bennett (UT) Peter Fitzgerald (IL) John Sununu (NH) Richard Shelby (AL)

Democrats Joseph Lieberman (CT) Tom Carper (DE) Carl Levin (MI) Daniel Akaka (HI) Richard Durbin (IL) Frank Lautenberg (NJ) Mark Dayton (MN) Mark Pryor (AR)

CORRECTION: The 2003 Medicare costs were mistakenly identified as 2004 costs in the January-February edition. The monthly premiums for 2004 are $66.60; the premiums for 2003 were $58.70.

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