Panel advances bipartisan postal reform bill

A bipartisan postal reform measure cleared a key Senate oversight panel Wednesday with several modifications.

Members of the Senate Homeland Security and Governmental Affairs Committee voted 9-1 in favor of the 21st Century Postal Service Act, which would allow the U.S. Postal Service to recoup a $7 billion overpayment to the Federal Employees Retirement System and to use those funds to offer buyouts and separation incentives to about 100,000 employees. The bill also would restructure prefunded retirement health benefits, reducing the payment goal to 80 percent, and require USPS to negotiate with its unions to develop a new employee health care plan.

Committee members approved several of the 40 amendments introduced, including a provision by Sen. Mark Pryor, D-Ark., requiring USPS to respond in writing to Postal Regulatory Commission recommendations and detail implementation plans.

The panel also approved an amendment by Sen. Jerry Moran, R-Kan., which tackles the issue of post office closures.

The amendment, which had bipartisan backing, creates national retail service criteria for the Postal Service to use in deciding which offices to close. It also allows community members to appeal closure decisions with the Postal Regulatory Commission.

The postmaster general has agreed to the provision, according to Sen. Susan Collins, R-Maine. It applies only to the post offices currently under consideration for closure.

Committee members were less receptive to a proposal by Sen. John McCain, R-Ariz., to immediately cut Saturday delivery service rather than abiding by a waiting period outlined in the bill. The legislation allows USPS to switch to five-day delivery after two years if other measures don't produce enough savings.

"You're preventing them from keeping up with the 21st century." McCain said to the committee. "Vote to give the Postal Service the flexibility to do what's necessary to get back on the path of fiscal stability."

Members nonetheless rejected the amendment. Sen. Joe Lieberman, I-Conn., chairman of the committee, said he doubted the USPS could achieve adequate savings without the service reduction, but supported the two-year waiting period as a reasonable compromise.

Another amendment proposed by Sen. Jon Tester, D-Mont., would reduce executive compensation at USPS, making the postmaster general's annual salary $174,000 a year. Postmaster General Patrick Donahoe earns $276,840 a year, while other USPS executives are paid more than $200,000 annually.

Tester estimated the amount saved through the amendment could keep five rural post offices open in Montana. "If our employees have to sacrifice, then there's no reason why the leaders shouldn't sacrifice too," he said.

Opponents argued it would diminish the Postal Service's capacity to attract and retain talented leadership.

"There's a reason why FedEx and UPS pay their [chief executive officers] $1 million or more a year," said Sen. Tom Carper, D-Del. "We need excellent people and the best talent leading the organization to be successful in the 21st century."

Lieberman said committee staff would confer and work out a compromise.