Elaine Thompson/AP

Union proposes commission to help USPS ‘work smarter’

Cash-strapped agency could use objective input on cost-cutting strategies, NALC leader says.

The leader of a letter carriers union said a comprehensive bill to reform the U.S. Postal Service should include a mandate to establish a business commission with representatives from the agency’s many stakeholders.

Fredric Rolando, president of the National Association of Letter Carriers, told Government Executive that such a panel would ensure that ideas for new revenue streams and ways to deal with USPS’ mandate to prefund retirees’ health care benefits were handled objectively.

The commission would not, he said, resemble the Base Closure and Realignment Commission-like panel proposed in the House Republican-favored postal reform bill, slated for debate sometime after July 4.

The Postal Service faces an Aug. 1 deadline for its annual $5.5 billion health care prepayment, required by a 2006 law. Officials estimate that $21 billion of the $25 billion USPS has lost in the past five years is due to the prefunding mandate. The agency also has an $11 billion surplus in pension funds, which lawmakers in both chambers, and USPS officials, disagree on how to use.

“If you’re going to [continue to] prefund, recognize the surplus as you do that, and work with the shareholders to figure out what needs to be done to maintain the revenues and to maintain universal service,” Rolando said, speaking as part of a panel on the future of USPS in Washington on Wednesday.

Gene DelPolito, president of the Association for Postal Commerce, said USPS has a long history of “not playing well with others,” in industry, and that must change in order for the service to realize its opportunities for expansion.

Current legislative proposals don’t do much to explore different revenue streams and move the service into the future, Rolando said. Opportunities for increasing revenue such as public-private partnerships with banks and local businesses must be expanded and explored, he added. Despite labor unions frequently pointing to the prefunding mandate as the primary source of the agency’s woes, Rolando advised looking beyond that as the sole source of the problem.

“It’s a matter of working smarter,” he said, suggesting USPS look into options such as partnering with pharmacies, retail stores, banks and other government services, particularly in more remote areas that are difficult for USPS to reach. “It makes sense to utilize and share the brands,” he added.

NALC represents about 195,000 USPS mail carriers, mostly in urban areas. It has lost about 25 percent of its active employees in the past two years, “pretty much through normal attrition,” Rolando said.

It is still unclear whether any of Rolando’s ideas will come to fruition by the Aug. 1 prepayment deadline -- if at all. The Senate passed its postal reform bill in April. The House bill, approved by the Oversight and Government Reform panel, awaits consideration by the full chamber, but officials say it will come up sometime after July 4. USPS officials and labor unions have criticized both proposals. The House plan does not eliminate the prefunding requirement and includes bigger cuts and more postal facility consolidations than any other proposal.