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Postal Reform

On this page

-Postal Reform and Oversight witness list
-GAO 1/28/04 Testimony
-Bush Announces Principles for Postal Reform
-Lawmakers warn USPS may need bailout

-White House Lists Postal Overhaul Ideas
-Congress Schedules Hearings On USPS-Overhaul Legislation (APWU)
-Panel Begins Work on 1st President-Backed Reforms in 30 Years
-McHugh has major role in postal service revision 

related links:
Testimony, Statements and News from the Congressional Hearing 1/28/04
-Testimony of PMG Potter| McHugh Opening Statement
-
Testimony of PRC Chairman George Omas

-Testimony of Treasury Under Secretary Brian Roseboro

-Forecast Is Cloudy for USPS in 2004
-
Potter to Congress: USPS Needs Legislative Change
-
Postal Reform Committee Hears Challenge to Board Proposal
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Will Feds Pay For Post Office's Funeral Using E-Payments?
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Testimony of BOG Chairman David Fineman
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Postal Service wants out of paying military pension benefits
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USPS wants out of paying military pension benefits
-
Impending Postal Retirements To Expedite Expense Cuts
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Report Puts Spotlight on USPS Retirement Benefits

 

- Businesses Object to Provision in Postal-Reform Legislation -Lawmakers scrambled to rewrite sections of the bill in time to bring it to a vote next week. A long-awaited proposal to reorganize USPS hit a snag  when businesses objected to a provision backed by APWU (5/5/04)

- APWU News Bulletin: Senate Bill a Concern, $8 dues assessment takes effect

- Hopeful, Wary Mailers Study Postal Reform Draft

- Easy Come, Easy Go? Postal Bill Markup Postponed

- Draft Postal Overhaul Bill Draws Criticism from Mailers

- House bill calls for new postal rate-setting board-

- Sam Ryan: Postal Service Accountability

- Committee on Government Reform Press Release

- Jaffer: USPS pleased that Congress is focusing on postal legislative reform

- DST, Hallmark: USPS needs first-class reform

- Discussion Draft -Postal Accountability and Enhancement Act

- House Circulates Postal Reform Draft Bill

- Next Rate Hike Could Be a Whopper 

 Postal Reform Hearings-PMG John E. Potter, USPS Board Chairman David Fineman, and Treasury Secretary John W. Snow are expected to appear at the joint hearing on March 23rd .

Senate Hearing March 11th Witnesses: Fred Smith , Chairman and CEO , FedEX Michael Eskew , Chairman and CEO , United Parcel Service  Michael Eskew , Chairman and CEO , United Parcel Service Gary Mulloy , Chairman and CEO , ADVO, Inc. Gary Pruitt , Chairman, President and CEO of McClatchy Company , on behalf of the Newspaper Association of America Robert Wientzen , President and CEO , Direct Marketing Association

Senate Hearing March 9th Witnesses: Ann Moore , Chairman and CEO , Time, Inc. , Mark Angelson , Chairman, President and CEO , RR Donnelley, Chris Bradley , President and CEO , Cuddletown, Inc. ,Max Heath , Vice President of Landmark Community Papers , on behalf of the National Newspaper Association, William Ihle, SR. , Sr. Vice President, Public Relations , Bear Creek Corp., Shelley Dreifuss , Director, Office of the Consumer Advocate , Postal Rate Commission (updated 3/4/04)


Senate Governmental Affairs Committee Reschedules February 3 Hearing-  The February 3 hearing  "Preserving a Strong United States Postal Service: Workforce Issues." that was cancelled due to the ricin scare has been rescheduled for Tuesday, February 24, at 10am. Witnesses

Senator Susan M. Collins | Click here to view archived hearing | Download free real player

Mailers’ Group Tells Congress: True Postal Reform Must be More than ‘A Few Statutory Adjustments’

Panel 1
The Honorable Dan G. Blair , Deputy Director , Office of Personnel Management

Panel 2
William Young , President , National Association of Letter Carriers
Dale Holton  , National President , National Rural Letter Carriers
William Burrus  , President , American Postal Workers Union
John Hegarty , President , National Postal Mail Handlers Union


CEOs Urge Congress to Enact Postal Reform as Special Panel Wraps Up Series of Hearings House Government Reform Committee- Postal Reform (Part III)  hearing on "Answering the Administration's Call for Postal Reform." Location: 2154 Rayburn House Office Building. Washington DC 1 p.m. (February 11, 2004)  The list of CEO’s ( and  members of the Mailing Industry Council) scheduled to testify  includes:

- Postcom's Essential Eight Principles of Postal Reform (pdf)
-
Gene A. Del Polito's letter to every Congress Member (pdf)

- Newspapers Support Postal Reform

- Pitney Bowes' CEO Testifies

- RR Donnelley CEO Calls for Immediate Postal Reform

- DMA Optimistic That 2004 Is The Year for Postal Reform

Gary Mulloy, Chairman and CEO, ADVO Inc., Fred Smith, Chairman and CEO, FedEx Corp, Michael Critelli, Chairman and CEO, Pitney Bowes Inc. ,Ann Moore, Chairman and CEO, Time Inc. William Davis, President and CEO, R.R. Donnelly & Sons, Nigel Morris, co-Founder and Vice Chairman, Capital One Financial Corp. Lester Hess, Chairman, Grand Lodge Advisory Committee Benevolent and Protective Order of the Elks Hamilton Davison, CEO, Paramount Cards Inc. Rebecca Jewett, President and CEO, Norm Thompson Outfitters Inc. This hearing is the final of three to be conducted by the Special Panel for Postal Reform and Oversight.

BACKGROUND:
The nine organizations providing testimony represent the major competitors, customers, and businesses that are reliant upon the United States Postal Service (USPS). These organizations are vital stakeholders in America’s postal system, and all agree with the President’s call for Congress to swiftly enact postal reform legislation. Executives of the organizations will provide input on key considerations for Congress as it moves forward in modernizing the nation’s postal laws.

FedEx Corporation is a global provider of transportation, e-commerce and supply chain management services. Pitney Bowes Inc. produces postage meters, mailing and shipping equipment. In addition, the company offers online postage services, financing for office equipment purchases, and facilities management services. Time Inc. publishes U.S. consumer magazines, with over 140 magazines in its collection. R.R. Donnelley & Sons prints and distributes catalogs, magazines, books and direct mail in the U.S. Capital One Financial Corp. is a holding company that offers consumer financial products and services through its subsidiaries.

The Benevolent and Protective Order of Elks of the United States of America is one of the oldest and largest fraternal organizations in the U.S. Paramount Cards Inc. produces and sells everyday and seasonal greeting cards. Norm Thompson Outfitters Inc. markets private-label and brand-name apparel, footwear, and accessories for men and women. ADVO Inc. is a full-service targeted direct mail marketing services company.  (2/9/04)
 

Senate Committee on Governmental Affairs Hearing

Preserving a Strong United States Postal Service: Workforce Issues (Updated: 2/04/04)

Special Panel on Postal Reform to Hear Employee Perspective on USPS Reform in Chicago, IL Hearing Thursday
Testimony to Come from Heads of Postal Unions and Management Organizations

WHAT: House Government Reform Committee, Special Panel on Postal Reform and Oversight Hearing: “Answering the Administration’s Call for Postal Reform – Part II”
WHEN: Thursday, February 5, 2004, 1 p.m. (CST)
WHERE: Room 2525, Dirksen Federal Courthouse
219 South Dearborn Street, Chicago, IL

WITNESSES:
William Burrus, President, American Postal Workers Union, William H. Young, President, National Association of Letter Carriers
Dale Holton, President, National Rural Letter Carriers Association ;John Hegarty, National President, National Postal Mail Handlers Union Walter Olihovik, National President, National Association of Postmasters of the United States Steve LeNoir, President, National League of Postmasters Vincent Palladino, President, National Association of Postal Supervisors

Witnesses & Testimony Day 2-Feb. 4, 2004 @ 2:00 pm ET  (Washington DC)

Wally Olihovik, President , National Association of Postmasters of the U.S. Steve LeNoir [View PDF] President , National League of Postmasters Ted Keating  , Executive Vice President , National Association of Postal Supervisors John Calhoun Wells , Private Consultant , Former Director of Federal Mediation and Conciliation Service James L. Medoff PH.D. , Meyer Kestenbaum Professor of Labor and Industry , Harvard University -Pay Comparability (NALC and Professor. Medoff,) submitted paper to Postal Commission Michael L. Wachter [View PDF], PH.D. , Co-Director, Institute of Law and Economics , University of Pennsylvania Law School

***note:  links added by postalreporter are directed to the official websites, postal commission testimony or general comments

Highlights of GAO-04-397T, a testimony before the Special Panel on Postal Reform and Oversight, House Committee on Government Reform
Testimony of GAO Comptroller General David Walker

Key Elements of Comprehensive Postal Reform
Why GAO Did This Study
Both the Presidential Commission on the U.S. Postal Service and GAO’s past work have reported that universal postal service is at risk and that reform is needed to minimize the risk of a significant taxpayer bailout or dramatic postal rate increases

GAO has testified that Congress should enact comprehensive postal reform legislation that would clarify the Postal Service’s (the Service) mission and role; enhance governance, transparency, and accountability; improve regulation of postal rates and oversight; help to ensure the rationalization of the Service’s infrastructure and workforce; and make needed human capital reforms.

The administration has also supported postal reform, outlining guiding principles intended to ensure that the Service: implements best practices with a governing body equipped to meet its responsibilities; enhances transparency of timely and accurate data on postal costs and performance; provides greater flexibility for the Service to meet its customer obligations; ensures accountability through appropriate independent oversight; and keeps the Service financially self-sufficient, covering all of its obligations. GAO was asked to discuss comprehensive postal reform in light of these principles.
 

What GAO Found

GAO believes that comprehensive postal reform is urgently needed. The Service achieved notable success in fiscal year 2003, but this respite is likely to be short­lived. The outlook is for continuing declines in the core business of First-Class Mail, while some key costs are rising and productivity gains are likely to slow.

First-Class Mail Volume Growth, Fiscal Years 1984 through 2003

Key postal reform issues that need to be addressed are:

The Service’s Mission and Role as a Self-Financing Federal Entity

The Service has a broadly defined mission that enables it to engage in unprofitable and costly endeavors. In our view, the time has come for Congress to clarify the Service’s core mission and ensure continuity across changes in its management. Key issues include what should be the scope of the postal monopoly, and should the Service retain its regulatory functions.

  Governance, Transparency, and Accountability Mechanisms

Better governance, transparency, and accountability mechanisms are needed. Qualification requirements are too general to ensure that board appointees have the experience needed to oversee a large business-like operation. Enhanced transparency and accountability mechanisms are also needed for financial and performance information, such as reporting requirements.

  Flexibilities and Independent Oversight

The Service needs additional flexibilities so it can generate needed revenues, contain costs, and provide quality service. Major changes to the rate-setting structure are needed to enhance flexibility, encourage greater cost allocation, provide better cost data, and strengthen independent oversight. Also, current legal and other constraints serve to limit the Service’s ability to rationalize its infrastructure and workforce, including closing unnecessary post offices.

  Human Capital Reforms, Including Pension, Benefit, and Escrow Issues Outstanding human capital issues include the Service’s responsibility for pension costs related to military service, funding the Service’s significant obligations for retiree health benefits, and determining what action to take on the escrow account established as a result of the enactment of P.L. 108-18. Other key areas for reform include workers’ compensation and pay comparability.

U.S. Postal Service: Key Elements of Comprehensive Postal Reform, by David M. Walker, comptroller general of the United States, before the Special Panel on Postal Reform and Oversight, House Committee on Government Reform.

GAO-04-397T, January 28. Highlights The report includes the following:



 
GAO: Congress Could Consider SEC-Like Rules For Postal Service
WASHINGTON -- The head of the General Accounting Office said Congress could consider mandating Securities and Exchange Commission-type reporting requirements for the U.S. Postal Service if it determines the service's plans to enhance disclosure are inadequate.

Comptroller General David Walker, in testimony presented Wednesday to a House subcommittee, expressed pleasure at the Postal Service's recent steps to enhance its financial reporting and noted that the chairman of the Postal Service Board of Governors recently indicated that the service would make further enhancements along the lines of some SEC reporting requirements.

"In our view, it will be important for Congress to obtain clarification from the service of how and when it intends to develop financial statements and disclosures comparable to those provided by publicly traded companies," Walker said.

"If Congress determines that the service's proposed approach is not acceptable or timely, or if the service does not fulfill the commitment it makes in this regard, Congress could consider mandating SEC-type reporting requirements for the service, or giving a regulatory body authority in this area," he added.

GAO is a Congressional watchdog agency.

"In addition," Walker said, "there are areas where stakeholders still have little information, such as the service's financial needs for maintaining and modernizing its infrastructure, and the true market value of the service's vast real estate holdings."

STATEMENT OF S. DAVID FINEMAN, CHAIRMAN BOARD OF GOVERNORS REGARDING ENHANCED FINANCIAL REPORTING
January 6, 2004

The President's Commission on the United States Postal Service stated that the Postal Service should set the standard for financial transparency by which all other Federal entities are judged.

In furtherance of this goal, the Commission recommended that the Postal Service voluntarily comply with applicable provisions of the major Securities and Exchange Commission (SEC) reporting requirements.

Last August, at the Board's direction, the Postal Service initiated an effort to enhance financial reporting. I am pleased to report that significant progress has been made. The 2003 Annual Report, which is posted on our web site and will be distributed this week in hard copy, includes enhanced disclosures in the footnotes and the Management Discussion and Analysis section. Also, in the First Quarter of Fiscal Year 2004, the Postal Service has begun to publicly report significant events, on our web site, in accordance with SEC Form 8-K reporting requirements. Additional progress will be achieved with the issuance of the Quarter 1, Fiscal Year 2004 Financial Report in February.

Consistent with SEC Form 10-Q, this report will include an enhanced Management Discussion and Analysis section and expanded financial statements.

Finally, earlier today the Board reviewed with the Postmaster General and his principal officers the topic of annual disclosures as they are reported through SEC Form 10-K. In the coming months we will complete plans to further enhance our annual financial reporting. - end -
- Statement of Board Chairman Fineman on Enhanced Financial Reporting


Lawmakers warn US Postal Service may need bailout
WASHINGTON, Jan 28 (Reuters) - U.S. lawmakers warned on Wednesday that taxpayers might need to bail out the U.S. Postal Service unless drastic legislative changes are made to allow the embattled agency to withstand attacks from the Internet and private carriers. "A meltdown is inevitable," Rep. Dan Burton, an Indiana Republican, said at a House government reform committee hearing. "Something has to be done otherwise we're going to have a huge government bailout (paid for by the taxpayers), and it won't be a one-time thing." The Postal Service, saddled with $7.3 billion in debt and billions more in other liabilities, such as retirement related benefits and operating leases, said it will become more difficult to cover its operating expenses as mail volume in its lucrative first-class business falls. Last year, the post office saw first-class mail volume, which contributes more than half of its revenue, drop by a record 3 billion pieces to 100 billion, down from a peak of 104 billion in 2001. In an effort to cut $5 billion in costs by 2005, the Postal Service has cut thousands of jobs through attrition, modernized equipment and consolidated sorting facilities. The post office has long pushed Congress to give it greater flexibility to change postage rates when it deems it necessary. "We cannot wait until the Postal Service is in such financial crisis that drastic service or delivery reductions are our only options," David Fineman, chairman of the board of governors, told lawmakers. Efforts to reform the 229-year old agency received another jolt last July after an independent committee established by President George W. Bush questioned whether the Postal Service could continue to deliver mail to every American address as currently required by law. Even with added revenue generated from postage rate increases, the commission report said, "the 15-year outlook for the Postal Service remains grim and makes a powerful case for a far more ambitious overhaul." Postal officials have pledged not to raise stamp prices until 2006 at the earliest. "We should not measure the success of the Postal Service by how long we're able to delay rate increases,' U.S. Comptroller General David Walker, the government's chief auditor, said. "If the results of the delay is to reposition more significant and dramatic rate increases in the future in the face of a competitive (environment), that is not a success."

Committee on Government Reform

Special Panel on Postal Reform and Oversight

Congressman John M. McHugh, Chairman

MEDIA ADVISORY

FOR IMMEDIATE RELEASE Contact: Brynn Barnett (Rep. McHugh)

202-225-4611

David Marin (Govt. Reform)

202-225-5074

SPECIAL PANEL ON POSTAL REFORM AND OVERSIGHT TO CONSIDER NEED AND PROSPECTS FOR REFORM OF THE U.S. POSTAL SERVICE

Panel Begins Work on First President-Backed Reforms in More Than 30 Years

Washington, Jan 26- How must the postal industry adapt to ongoing changes in communication technology?

 

What reforms are needed to keep the Postal Service operating as a viable entity?

 

How must the Postal Service prepare for upcoming changes required by the Postal Civil Service Retirement System Funding Reform Act of 2003?

WASHINGTON, D.C. (Jan. 26)
WHAT: House Government Reform Committee, Special Panel on Postal Reform and Oversight Hearing: "Answering the Administration’s Call for Postal Reform"

WHEN: Wednesday, January 28, 2004, 2 p.m.

WHERE: Room 2154, Rayburn House Office Building

WITNESSES:

Brian C. Roseboro, Acting Under Secretary for Domestic Finance, U.S. Department of the Treasury

S. David Fineman, Chairman, U.S. Postal Service Board of Governors (accompanied by The Honorable John E. Potter, Postmaster General of the U.S.] George A. Omas, Chairman, U.S. Postal Rate Commission The Honorable David M. Walker, Comptroller General of the United States, U.S. General Accounting Office.

BACKGROUND:

The United States Postal Service (USPS) is the center of an $871 billion industry employing nine million workers nationwide and representing more than eight 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. Online 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. Overall, the Postal Service has lost $2.3 billion in the last three years. Under the Postal Service’s 30-year-old legal 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."

The creation of an escrow account by the Postal Civil Service Retirement System Funding Reform Act of 2003 makes passage of postal reform legislation urgent. Beginning in 2006, the Act requires USPS to collect and place into escrow funds equivalent to the amount saved due to the Act. Without a change, the Postal Service will be required to file a rate case in late 2004, raising rates an additional 5.4 percent (on top of whatever rate increases are necessary to fund their operations) in order to fund this escrow account.

On July 31, 2003, the President’s Commission on the Postal Service released its recommendations for maintaining the viability of the Postal Service. Roughly half of these require legislative changes, and most of the recommendations concern issues addressed in earlier Postal Reform proposals. New issues raised by the Commission include reform of the collective bargaining process and legislative changes making it easier to close post offices and processing centers. In addition, the Commission recommended that the Postal Service not be responsible for funding the portion of CSRS employees’ pensions that are attributable to their prior military service.

Administration Recommendations

On December 8, 2003, President Bush met with members of the President’s Commission on the Postal Service. Later that day, the Department of the Treasury released five principles that should guide Congress’s effort to reform the Postal Service. Those principles are:

  • Implement Best Practices: Ensure that USPS'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 USPS's product costs and performance is accurately measured and made available to the public in a timely manner.
  • Flexibility: Ensure that USPS'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 USPS operating with greater flexibility has appropriate independent oversight to protect consumer welfare and universal mail service.
  • Self-Financing: Ensure that a USPS operating with greater flexibility is financially self-sufficient, covering all of its obligations.

Other Special Panel Hearings

This hearing is the first of three to be conducted by the Special Panel for Postal Reform and Oversight. The Panel will hold a hearing in Chicago, Illinois on February 5 to hear testimony given by leaders of postal labor and management groups. On February 11, chief executives of USPS clients and competitors will testify before Panel Members.

  ABOUT THE SPECIAL PANEL ON POSTAL REFORM AND OVERSIGHT:

The House Government Reform Committee’s Special Panel on Postal Reform and Oversight is charged with helping reform the outdated postal system, currently mired in almost $15 billion of debt and in the midst of the biggest overhaul since it became an independent government entity under the Postal Reorganization Act of 1970.

The panel is chaired by Rep. John M. McHugh (R-NY), and will work closely with the nine-member commission appointed by President Bush. Rep. McHugh and the panel will report directly to Government Reform Committee Chairman Tom Davis, making postal reform a full committee issue.

Other Committee members appointed to the panel are: Reps. Dan Burton (R-IN) Edward L. Schrock (R-VA), Candice Miller (R-MI), Tim Murphy (R-PA), Marsha Blackburn (R-TN), Danny K. Davis (D-IL), Major R. Owens (D-NY), Edolphus Towns  (D-NY) Carolyn B. Maloney (D-NY), and Wm. Lacy Clay (D-MO).

###

 

Congress Schedules Hearings On USPS-Overhaul Legislation

January 13, 2004

Two key congressional committees will hold a series of hearings through early next month on  proposals to change how the USPS operates and treats its workers and customers.

 The hearings will consider a wide range of recommendations – including those made last summer by the President’s Commission on the U.S. Postal Service – that could be incorporated into legislation and considered for passage later this year.

 On Jan. 28, The House Government Reform Committee’s Special Panel on Postal Reform and Oversight (chaired by John McHugh, R-NY) will hear testimony from the Postal Service, the General Accounting Office (GAO), and the Treasury Department.

 APWU President William Burrus will be among those testifying on Feb. 5, in Chicago, where the panel will convene to hear the views of postal employee organizations. A third session has been set for Feb. 11, in Washington, to hear from mailing industry representatives and USPS competitors.

  The Senate Governmental Affairs Committee (chaired by Susan Collins, R-ME) has tentatively scheduled hearings in Washington on Feb. 3 and 4. The Senate hearings are expected to feature many of the same witnesses – including Burrus – invited by the House panel.

 Both Sen. Collins and Rep. McHugh have announced that they will draft postal reform legislation for introduction early this spring. 

(source: APWU)

 

Majority Members:

John M. McHugh, Chairman
Dan Burton
Edward L. Schrock
Candice S. Miller
Tim Murphy
Marsha Blackburn
 

 

Minority Members:

Danny K. Davis, Ranking Member
Major R. Owens
Edolphus Towns
Carolyn Maloney
Wm. Lacy Clay

 


-Bush Administration Announces Principles for Postal Reform-(Treasury.gov)

FROM THE OFFICE OF PUBLIC AFFAIRS

December 8, 2003
JS-1044
 

Bush Administration Announces Principles for
Postal Reform


The Bush administration today called on Congress to enact comprehensive postal reform to ensure that the United States Postal Service can continue to provide affordable and reliable universal service, while limiting exposure of taxpayers and operating appropriately in the competitive marketplace.  United States Postal Service reform should be guided by a set of clear principles outlined by the administration:

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.   (source:  http://www.ustreas.gov/press/releases/js1044.htm)


White House Lists Postal Overhaul Ideas
The Associated Press
Monday, December 8, 2003; 4:06 PM

WASHINGTON - The Bush administration urged Congress on Monday to approve wide-ranging changes in the operations of the Postal Service - something the agency has been seeking for years.

The administration listed general criteria, including rate-change flexibility, postal self-sufficiency and continued operation of universal service.

The statement in many ways reflected recommendations of the President's Commission on Postal Reform, which issued a detailed report in July proposing a series of changes in postal operations.

The White House statement did not endorse any specific proposals. Instead, it set forth general principles for congressional action.

Postal officials have long sought changes in the basic law under which they operate, complaining of limited flexibility in changing rates and services.

Postmaster General John E. Potter has sharply cut staff and increased efficiency but still says changes are needed. A postal reform bill worked out in a House committee two years ago died without reaching the floor for a vote.

Postal finances have suffered in recent years with increases in the amount of mail sent by electronic commerce.

But the agency could finish fiscal 2003 some $4 billion in the black after last year's rate increase and cost cuts. That money could be used to reduce the agency's outstanding debt.

While the post office has received an appropriation to assist with losses and damage attributed to the Sept. 11, 2001 and later anthrax attacks, it does not receive any taxpayer money for operations.

Postal reform principles announced by the administration Monday were:

-Ensure that the Postal Service's governing body is equipped to meet the responsibilities and objectives of an enterprise of its size and scope.

-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.

-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.

-Ensure that a Postal Service operating with greater flexibility has appropriate independent oversight to protect consumer welfare and universal mail service.

-Ensure that a Postal Service operating with greater flexibility is financially self-sufficient, covering all of its obligations.


McHugh has major role in postal service revision
December 12, 2003 - The Post-Standard
By Peter Lyman - Washington bureau

Momentum is building in Washington for the first major overhaul of the U.S. Postal Service since the Nixon administration. A Central New York congressman will take a leading role in writing the legislation and pushing it through Congress next year.

Rep. John McHugh, R-Pierrepont Manor, heads the special panel on postal reform and oversight for the House Government Reform Committee. He met with colleagues this week to make plans to introduce a bill after Congress returns.

The effort to make wide-ranging changes in the operation of the postal service gained strength this week when the Bush administration formally urged Congress to act. The White House statement echoed the recommendations of the President's Commission on Postal Reform, which released its findings last summer.

The pushfrom the White House is likely to move the matter closer to the top of congressional priorities for 2004, McHugh said Thursday. "Commission reports tend to gather dust" without the president's active support, he said.

McHugh has been working on postal reform for nearly a decade. He was chairman of a House committee that oversaw postal operations before it was rolled into the Government Reform Committee.

Last year, McHugh was the chief sponsor of a postal reform measure that attracted bipartisan support but never made it out of committee.

"It was a procedural issue," he said. "We had the votes, but we couldn't get floor time."

The presidential commission's report included "90 percent of the outlines we had constructed over the last eight years," McHugh said.

The goal is to give the postal service more flexibility to adapt to technology-driven changes in the marketplace. Postal officials would have more power to adjust rates, reduce costs and make other business decisions. They have been asking Congress for that kind of authority for many years.

The presidential commission also called for measures to ensure the postal service is financially self-sufficient. Currently, the agency is $11 billion in debt, though estimates have it finishing some $4 billion in the black for 2003, a refection of recent rate increases and personnel cuts.

The White House and key members of Congress also have called for formal independent oversight of the postal service to protect consumers' interests and ensure that universal mail service is maintained.

One proposal that probably won't make it into the legislation would establish a body - similar to the military base-closing commission - to target individual post offices for closure. Inclusion of such a provision probably would doom the bill, McHugh said.

"That's a tough thing to take to 435 members of the House," who all have post offices in their districts, McHugh said. "It becomes an anxiety-inducing process" that probably would cause support to melt away.

McHugh said he expected the Government Reform Committee, chaired by Rep. Tom Davis, R-Va., to hold hearings on the matter before spring.

A bill now before the Senate Governmental Affairs Committee, introduced in June by Sen. Thomas Carper, D-Del., includes many of the features of the McHugh bill.


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