GAO: Postal Service must revamp operations to stay solvent

The Postal Service must revamp its operations to stay on firm financial footing, according to a Government Accountability Office report released Monday.

Requested by Reps. John McHugh, R-N.Y., and Danny Davis, D-Ill., co-chairmen of the Special Panel on Postal Reform and Oversight during the 108th Congress, the report makes some of the same recommendations aimed at transparency outlined in legislation approved unanimously by the House Government Reform Committee last month.

The report comes as the bills' stakeholders -- including unions, the mailing industry and the Postal Service's competitors -- are working to convince lawmakers to support the legislation on the floor, despite White House opposition.

The administration's objections to provisions that would give the Postal Service access to money slated for an escrow account and shift its military pensions back to the Treasury Department kept the House bill and a similar Senate measure from clearing either chamber last year.

Panel members and Senate Homeland Security and Governmental Affairs Committee Chairwoman Susan Collins, R-Maine, and Sen. Thomas Carper, D-Del., are continuing discussions with the administration on those sticking points.

In its report, GAO criticized the Postal Service for not providing enough information about its plans to overhaul the way it delivers and processes mail.

A senior McHugh aide said the recommendations could be implemented even without the legislation, but that the bills would "make it easier for them to adapt, survive, compete and make some of those changes in a way that might be difficult under the current 35-year-old structure."

He added that the legislation also "pushes [the Postal Service] in the same direction" advocated by GAO by requiring increased transparency and accountability.

"GAO has provided a thorough analysis with solid recommendations that will help improve services," McHugh said in a statement. "As Congress works to enact critical postal reform legislation, USPS must at the same time move forward with these recommendations, which will help improve efficiency and ensure that it is capturing cost savings wherever possible."

A spokesman for House Government Reform Committee Chairman Tom Davis, R-Va., agreed. "Legislatively, we must pass postal reform, so we can fix the big-picture structural problems that face the U.S. Postal Service," he said. "But if there are interim steps the Postal Service can take to improve its operations, such as those outlined in the GAO report, we would like to see those happen, too."

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