Senate Post Office Reform Delays Local Closures


This week the U.S. Senate finally passed a major piece of legislation to reform the operation of the U.S. Postal Service.  As Northern Ag Network has been reporting for several months, this issue involved thousands of rural communities.  

The much-amended Senate Bill 1789 now will be considered the House, which has taken quite a different approach.  Following is a summary of the story written by the Associated Press:

WASHINGTON — (Associated Press) The Senate offered a lifeline to the nearly bankrupt U.S. Postal Service on Wednesday, voting to give the struggling agency an $11 billion cash infusion while delaying controversial decisions on closing post offices and ending Saturday delivery.

By a 62-37 vote, senators approved a measure that had divided mostly along rural-urban lines. Over the past several weeks, the bill was modified more than a dozen times, adding new restrictions on closings and cuts to service that rural-state senators said would hurt their communities the most.


The issue now goes to the House, which has yet to consider a separate version of the bill.


“The Postal Service is an iconic American institution that still delivers 500 million pieces of mail a day and sustains 8 million jobs,” said Sen. Joe Lieberman, I-Conn., a bill co-sponsor. “This legislation will change the USPS so it can stay alive throughout the 21st century.”


The mail agency, however, criticized the measure, saying it fell far short in stemming financial losses. Postmaster General Patrick Donahoe said if the bill became law, he would have to return to Congress in a few years to get emergency help.


“It is totally inappropriate in these economic times to keep unneeded facilities open. There is simply not enough mail in our system today,” the Postal Service’s board of governors said in a statement. “It is also inappropriate to delay the implementation of five-day delivery.”


The Senate bill would halt the immediate closing of up to 252 mail-processing centers and 3,700 post offices, part of a postal cost-cutting plan to save some $6.5 billion a year. Donahoe previously said he would begin making cuts after May 15 if Congress didn’t act, warning that the agency could run out of money this fall.


The measure would save about half the mail processing centers the Postal Service wants to close, from 252 to 125, allowing more areas to maintain overnight first-class mail delivery for at least three more years.

It also would bar any shutdowns before the November elections, protect rural post offices for at least a year, give affected communities new avenues to appeal closing decisions and forbid cuts to Saturday delivery for two years.


At the same time, the Postal Service would get an infusion of roughly $11 billion, basically a refund of overpayments made in previous years to a federal retirement fund. That would give it immediate liquidity to pay down debt to forestall bankruptcy and finance buyouts to 100,000 postal employees.


The agency could make smaller annual payments into a future retiree health benefits account, gain flexibility in trimming worker compensation benefits and find additional ways to raise postal revenue under a new chief innovation officer.


Other bill provisions would:

  • Place a one-year moratorium on closing rural post offices and then require the mail agency to take rural issues into special consideration. Post offices generally would be protected from closure if the closest mail facility was more than 10 miles away. The exception would be cases in which there was no significant community opposition.
  • Shut five of the seven post offices on the Capitol grounds.
  • Take into account the impact on small businesses before closing mail facilities.
  • Cap postal executive pay through 2015 at $199,000, the same level as a Cabinet secretary, and create a system under which the top people at the Postal Service are paid based on performance.

The Senate bill faces an uncertain future. The House version, approved in committee last year, would create a national commission with the power to scrap no-layoff clauses in employee contracts and make other wide-ranging cuts.


“This of course kicks the can down the road,” complained Sen. John McCain, R-Ariz., who unsuccessfully pushed for a commission in the Senate bill. He said the current proposal failed to address longer-term fixes and delayed major decisions. “We’ll be on the floor in two years addressing this issue again, because it is not a solution.”


Noting that more people every year are switching to the Internet to send letters and pay bills, Donahoe called the Postal Service’s business model “broken.” The agency has estimated that the Senate bill would only provide it enough liquidity to continue operating for two years or three years.


At stake are more than 100,000 jobs, The agency, $12 billion in debt, says it could run out of money for day-to-day operations as soon as this fall, forcing it to shut down some of its services. The mail agency forecasts a record $14.1 billion loss by the end of this year; without changes, it says annual losses will exceed $21 billion by 2016.


On Tuesday, the Postal Service circulated a smaller list of mail processing centers that probably would close under the Senate bill; many in more rural or small states would be spared. For instance, centers would survive in Connecticut, Delaware, Maine, Missouri and Vermont, whose senators were sponsors of the postal bill or pushed amendments, according to the preliminary list obtained by The Associated Press.


A facility in Easton, Md., also would stay open. Sen. Barbara Mikulski, D-Md., previously attempted to block the postal bill in protest of that specific closure.


Also surviving were all four mail processing centers in Nevada, home to Senate Majority Leader Harry Reid, as well as all eight centers in Colorado and all five centers in Utah.


“This bill is a vital first step in pulling the Postal Service back from the edge of a fiscal abyss,” said Art Sackler, coordinator of the Coalition for a 21st Century Postal Service, a group representing the private sector mailing industry.


“It’s now critical that the House follow suit quickly or we risk a shutdown of the Postal Service and an ensuing economic calamity,” he said.

The Postal Service, an independent agency of government, does not receive taxpayer money for its operations but is subject to congressional control.


Source:  Associated Press

Posted By:  Northern Ag Network

April 26, 2012



No Post Office Closures For One Year

Senator Baucus Secures Important Amendments

Montana’s senior U.S. Senator Max Baucus announced today key victories for rural customers and post offices as the Senate voted 62 to 37 to pass the Postal Reform Bill. Baucus’ efforts will keep Montana processing facilities open –specifically those previously proposed for closure in Wolf Point, Helena and Butte. Baucus worked to secure amendments to the bill to provide additional protections to keep rural post offices open and protect Montana voters. 

“Today, Montanans won a hard fought victory in our ongoing battle to make sure rural America is not unfairly targeted by postal reform,” said Baucus, who brought the Postmaster General to listening sessions in Montana earlier this month. “Montanans rely on their local post office for life saving medications, doing business and voting. Our rural post offices provide jobs, support jobs and serve as community centers. They deserve the protections we worked to include in this bipartisan bill and I hope the House follows suit by passing our legislation.”

Baucus’ amendments included in the Senate’s Postal Reform Bill would: 

  •  Prevent any rural Post Office from being closed for the next year and put specific requirements in place to protect rural offices after the one-year moratorium expires.
  •  Ensure that postal facility closures or changes in service do not affect the outcome of elections in Montana and other states where many voters vote via mail.
  •  Ensure that the Postal Service would not close a rural post office unless the nearest post office is within 10 miles driving distance. This is particularly significant because the Postal Service estimated that, nationwide, 90 percent of the 3,700 post offices it proposes closing are within 10 miles of another post office.  However, in Montana, the opposite is true.  Of the 85 post offices proposed for closure, almost 90 percent of them are more than 10 miles from another post office.

The Postmaster General has stated that in order to become financially stable, the Postal Service must reduce spending by $20 billion by 2015, but closing all 3,700 post offices nationwide is only estimated to save $240 million. Closing all 85 of the Montana post offices on the list was only projected to save approximately $4.7 million annually. 

Baucus’ First Amendment to the Postal Reform Bill: 

  • Places a one-year moratorium on the closure of rural post offices.  After the moratorium, the amendment would prevent the Postal Service from closing a rural post office unless each of the following conditions are satisfied:
  • The next nearest post office is within 10 miles driving distance, as measured on roads with year-round access. 

This is particularly significant because the Postal Service estimated that, nationwide, 90 percent of the 3,700 post offices it proposes closing are within 10 miles of another post office.  However, in Montana, the opposite is true.  Of the 85 post offices proposed for closure, almost 90 percent of them are more than 10 miles from another post office. 

  • Seniors and persons with disabilities will receive the same or substantially similar service — including access to prescription medication sent through the mail. 
  • Businesses in the community will not suffer economic loss, and, the economic loss to the community resulting from the closure will not exceed the savings the Postal Service obtains by closing the post office. 
  • The area served by the post office has adequate access to wired broadband Internet service.

Senator Tester is cosponsoring this amendment. 

Baucus’ Second Amendment to the Postal Reform Bill:  

  • Ensures that postal facility closures or changes in service do not affect the outcome of elections in states where many voters use the mail to cast their votes. Senators are concerned that changes in postal operations potentially could delay the delivery of ballots and campaign related mail to voters and the return of ballots to election officials, particularly in rural areas that will be most impacted by the proposed closures.  Specifically, the amendment: 
  • Places a moratorium on the closure of postal facilities until November 13, 2012 in states that conduct all elections by mail or permit no-excuse absentee voting. 
  • Requires the USPS to notify election officials of closings and consolidations. 
  • Requires that the Postal Service study the effect of closing or consolidating a mail processing facility on the ability of the affected community to vote by mail, and the ability of the Postal Service to deliver ballots on time in accordance with applicable State law. 
  • Requires that ongoing or completed mail processing center studies that did not consider the effect of closure on vote by mail be amended to include that consideration. 
  • Prevents facilities from closing until the amended study has been completed and made public by the Postal Service, allowing for time for a public comment period and a Postal Service response to public comments. 

Senator Tester is cosponsoring this amendment.

Source: Senator Max Baucus

Posted by Northern Ag Network

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