GovernmentExecutive.com

Postmaster General John Potter deflected criticism Wednesday over his compensation package at a time when the nation's mail service is running billion-dollar deficits.

At a House Oversight and Government Reform Federal Workforce, Postal Service and the District of Columbia Subcommittee hearing, Rep. Stephen Lynch, D-Mass., asked Potter to justify his salary rate. "I was not imploring people for a pay raise," said Potter, who by law has a basic salary limited to 2 percent above the vice president's salary.

But perks push the total much higher. Potter's base salary is $263,575, with a $381,496 deferred pension and a $135,041 incentive bonus. Potter said other perks come to $77,347, including $66,000 in security costs that the he argued should not be a part of the package.

When Rep. Elijah Cummings, D-Md., asked what he was being protected against, Potter said that the security detail was assigned after the 2001 anthrax attacks that targeted the postal system. He defended the bonus, which he said was based on his performance as the chief executive, high employee satisfaction and reduced accident rate.

Potter also denied receiving a "sweetheart" mortgage deal from Countrywide Financial Corp., which was a leading subprime mortgage lender before its sale to Bank of America. The Postal Service has hired an outside investigator to look into allegations Potter received 1 point shaved off a $322,700 mortgage loan and waived fees.

"I believe the terms of my loan were from a good credit history," Potter said. "There was no linkage to official acts."

Potter told the panel that the Postal Service's financial situation is deteriorating. Following a nearly $3 billion deficit in fiscal 2008, he said he expects a deficit of $6 billion this year. The Government Accountability Office testified that its updated analysis of the postal operations will show a record $6.4 billion net loss.

Potter appealed for congressional help, in particular to waive a prohibition that prevents imposition of five-day mail delivery. He also sought approval of a bill by Rep. John McHugh, R-N.Y., to save $2 billion annually in pre-paid future retiree health benefits.