Keep USPS Out of Non-Postal Business 

October 12, 2011

U.S. House of Representatives
Washington, DC  20515

Dear Representative,

Rep. Darrell Issa (R-Calif.) recently introduced H.R. 2309, the Postal Reform Act of 2011.  On behalf of the more than one million members and supporters of the Council for Citizens Against Government Waste (CCAGW), I urge you to support this important legislation.  During tomorrow’s markup, it will be critical that you and your colleagues on the House Oversight and Government Reform Committee work to ensure the legislation is crafted with strong language that prevents the postal service from providing non-postal goods and services that are already being provided by the private sector.  The goal of Rep. Issa’s bill is to dig the postal service out of the financial hole in which it has buried itself; any attempt to allow the postal service to enter new lines of business is risky for taxpayers and should be struck from the legislation. 

Decades of unmanageable labor costs and excess infrastructure have left the United States Postal Service (USPS) in financial ruin.  The USPS lost $8.5 billion in 2010 and is projected to lose $8.3 billion in 2011, followed by another $8.5 billion in 2012.  In April 2010, Postmaster General John Potter announced that the USPS will lose $238 billion over 10 years.  Furthermore, the agency expects to hit its $15 billion debt limit by the end of the year.  In order to avoid another massive taxpayer-funded bailout, the organization must be fundamentally restructured.

H.R. 2309 would modernize the USPS and reform its outdated business model.  The bill would create the Commission on Postal Reorganization to eliminate costly excess capacity and facilities.  It would also establish the Postal Service Financial Responsibility and Management Assistance Authority (Authority), whose mandate would be to cut costs and return the USPS to fiscal solvency.  The Authority would be automatically created upon a USPS default on any obligation to the federal government for more than 30 days, and would be disbanded after the USPS has met pre-established benchmarks set to guarantee financial health.

Other provisions of the legislation include the elimination of the six-day mandate for mail delivery; greater freedom to manage retail operations and sell advertising space; and reduced employee benefits to levels received by other federal employees, which would have produced savings of $700 million in 2010.  The changes made by H.R. 2309 are estimated to save at least $6 billion per year.

Taxpayers cannot afford to continue to bolster an organization that is projected to consistently run annual deficits of more than $8 billion.  I strongly urge you to support the Postal Reform Act of 2011 to advance necessary, commonsense reforms to the USPS and prevent further financial burdens from being placed on Americans.  All votes on H.R. 2309 will be among those considered in CCAGW’s 2011 Congressional Ratings.

Sincerely,

Thomas Schatz,
President