With less than a month to go before the United States Postal Service shuts down more than 200 centers, the U.S. Senate has decided to begin debate on a bill to rescue the ailing system.
On Tuesday, Senators voted 74 to 22 to begin deliberation on The 21st Century Postal Service Act of 2012 (S. 1789). The bill, proposed by Sens. Joseph I. Lieberman (I-Conn.), Susan Collins (R-Maine), Tom Carper (D-Del.) and Scott Brown (R-Mass.), seeks to save the USPS $22.5 billion by 2016 and avert entering into bankruptcy, which could happen as soon as October of this year.
The Senate bill was drafted in response to a USPS proposal in February to reduce losses by ending Saturday and overnight delivery, closing 252 mail processing plants and offices, and eliminating up to 35,000 positions. The postal service struck an agreement with Congress to delay any closings or terminations until May 15.
Senator Lieberman’s bill seeks to reduce the severity of the postal service’s proposal while still providing the same savings over three years. The Senate bill would halve the number of closing offices to 125, requiring the USPS to downsize rather than close the poorly performing centers, and to also work with local communities to determine their postal needs before finalizing any closures. Many of the 252 offices under consideration are in remote or rural areas with limited access to mail or Internet technologies.
Further, S. 1789 would force the USPS to wait at least two years before ending Saturday delivery and to maintain overnight delivery for at least three more years.
In order to realize the dramatic cost reductions necessary to keep the system afloat, the Senate bill would receive an $11 billion cash infusion from the government. A majority of this ($7 billion) would be earmarked for the buyout of up to 100,000 postal employees. The buyout would reduce the workforce and allow the USPS to make smaller payments into its retiree benefit package, a program that costs the postal service $5 billion annually and is seen as a major component of its financial troubles. The U.S. suffered a $3.3 billion loss for the fourth quarter of 2011 and a $5.1 billion loss for the year.
Debate on the Senate bill is expected to begin this week. If an agreement is reached, it will move to the House, which is currently developing its own USPS-related bill offering considerably different solutions. The House bill would create more federal oversight for the postal service, in opposition to the Senate plan, with the creation of a national commission that would be in charge of cutting costs and closing facilities.
Postal employees have come out in strong opposition to both the Senate’s bill as well as the proposals made by Postmaster General Patrick Donahoe. The postal worker’s union, the National Association of Letter Carriers, held a nationwide protest last week in opposition of the Lieberman-sponsored legislation.
