A Senate panel on Wednesday will consider a bill that would restructure how the financially-strapped U.S. Postal Service pays for its employees' retirement health benefits.
S. 1507 would reduce the amount of money USPS must pay to the Treasury Department's Postal Service Retiree Health Fund, which covers future retirement payments, and provide the agency with a larger borrowing limit to meet its current payments. The legislation also would allow USPS to tap into the retiree health fund to cover retirement benefits for postal workers beginning in 2009 instead of 2017 -- the current date set by law.
Faced with a decline in printed mail during the recession and fiscal shortfalls in its budget, the Postal Service has been trying to cut costs and streamline operations. In its fiscal 2009 second quarterly financial report, USPS officials said they did not expect to meet a scheduled $5.4 billion payment for future retirements on Sept. 30, the end of the fiscal year. The 2006 Postal Accountability and Enhancement Act requires that payment.
Among other belt-tightening options, USPS officials have considered reducing service from six days per week to five.
Sen. Tom Carper, D-Del., introduced the retirement-related legislation, and the Senate Homeland Security and Governmental Affairs Committee will mark it up on Wednesday. According to his office, the bill would save the Postal Service $2.4 billion in 2009.
"This bill will put the Postal Service on more sound financial footing as we approach the crucial holiday shopping season," Carper said in a released statement. "But this bill is not a silver bullet that will fix everything wrong with the Postal Service. Its management also needs to find ways to attract new business and further streamline operations. And, Congress and postal employees need to work closely with management to keep the Postal Service running smoothly and reliably."
Carper expects to pass the bill before Congress leaves for recess in August.
The House Oversight and Government Reform Committee approved H.R. 22 on July 10, which also would afford the Postal Office some debt relief, though not as much as Carper's bill.