Postal Service exec retires amid relocation scandal
The U.S. Postal Service's chief financial officer announced his retirement on Friday, one day after the USPS Inspector General released a report finding fault with the Postal Service's relocation practices in 1998.
M. Richard Porras was one of two headquarters executives to receive a total of $248,128 in relocation benefits in 1998. Porras received $142,311 while agency controller John H. Ward was given $105,817 to move to new homes in Northern Virginia. Both executives moved less than 50 miles from their old homes. The relocation benefits included $25,000 each for "miscellanous expenses."
Relocation expenses are covered for Postal Service officers who change official duty stations. The policy stipulates a 50-mile distance requirement, but exceptions to this rule can be made when it is in the best interest of the Postal Service to do so. In this particular case, both Porras and Ward continued to work at the agency's L'Enfant Plaza headquarters.
In his statement, Porras did not address the relocation controversy. "After a fulfilling 37-year career, I have advised the Postmaster General that I will be retiring from the Postal Service to pursue opportunities in the private sector," he said.
Postmaster General William J. Henderson praised Porras' leadership and dedication to the Postal Service during his tenure, but also spoke directly on the matter regarding the relocation benefits.
"As chief executive officer, I have a responsibility to maintain the public trust the American people expect from their Postal Service. Therefore, effective immediately, no deviations from our relocation policy will be granted when the move does not involve a change in the work location," Henderson stated in a press release.
Henderson said he understood Porras' decision to retire.
Rep. John McHugh, R-N.Y., Chairman of the House Subcommittee on the Postal Service, asked the IG to investigate the matter involving Porras and Ward in late 1999, after McHugh's office received an anonymous complaint alleging misuse of the relocation benefit.
"The IG's report is alarming. Perhaps the most troubling part is the evidence that postal management played fast and loose with the current statutory limits on the salaries paid to postal executives," McHugh said.
Porras and Ward were promoted in 1998 to chief financial officer and controller, respectively. They claimed their new positions would call for longer working hours, so they asked for moving expenses to decrease the time spent commuting. According to the IG report, Porras' commute after the move is one minute shorter, while Ward's commute shrunk by 30 minutes.
"This decision to provide benefits to these individuals was reviewed at the time from both a legal and an ethical standpoint, and was found to be consistent with our policies, which establish benefit programs comparable to those in the private sector," said Henderson in a statement, prior to the IG's finding.
"We compared the Postal Service's relocation policy with that of four Fortune 500 companies and relocation agencies used by major corporations, and found that the decision to pay these relocation benefits was inconsistent with industry practices," according to the IG report.
The Postal Service plans on raising postage for first-class stamps one cent next year.
The IG's report, the first in a series examining relocation and other benefits of Postal Service executives, can be found at www.uspsoig.gov.