Postal Board endorses commission to oversee agency’s reform

The Postal Service Board of Governors Tuesday added its voice to a growing chorus of agency watchers and lawmakers calling for a presidential commission to oversee reform at the Postal Service.

"The governors support all efforts for appropriate reform, including a commission of distinguished citizens to review all aspects of the postal system and recommend changes that ensure affordable, universal service is maintained into the future," said Postal Service Board of Governors Chairman Robert Rider at the group's monthly meeting in Washington, D.C.

It's the first time the board of governors has publicly endorsed the idea of a commission. Agency watchers have been critical of the board in the past for failing to lead postal reform efforts.

Mailing industry officials have been meeting with the Bush administration for months trying to raise awareness of the Postal Service's plight, while Sen. Susan Collins, R-Maine, on July 18 introduced a bill (S. 2754) to create a commission.

There is near universal agreement that the 1971 Postal Reorganization Act is outdated. Agency officials complain that they cannot move quickly to respond to changing economic conditions. The Postal Service, which reported a $1.7 billion loss in 2001, expects to lose at least $1.5 billion this fiscal year, and predicts a $1 billion loss in fiscal 2003. Mail volume is down by nearly 6 billion pieces this year and mailing groups expect this fall's mailing season to be even worse than last year's.

The House Government Reform Committee failed to pass a bipartisan reform bill on June 21 when Democrats refused to support the measure without assurances that it would be voted on by the full House. Among other things, the reform legislation would have given the Postal Service more flexibility to change rates. A similar commission in 1968 led to the 1971 law that created the modern-day Postal Service.

White House officials would not comment on the prospect of a commission. Nonetheless, mailing industry sources are hopeful that the issue will gain some traction during August with Congress in recess. Industry officials said the Treasury Department is taking a keen interest in the Postal Service's financial situation, especially since its liabilities and obligations are approaching $100 billion. This includes liabilities for pensions, workers' compensation benefits and debt to the Treasury. By the end of the year, the agency's debt to the Treasury is expected to reach $12.9 billion, just $2.1 billion below its statutory limit, and the agency lacks a clear plan to pay it down.