Postal worker Rex Harrison unloads his vehicle at the post office at Soda Springs, Calif., in 2016.

Postal worker Rex Harrison unloads his vehicle at the post office at Soda Springs, Calif., in 2016. Rich Pedroncelli/AP

Trump Suggests USPS Cut Retirement, Health Benefits in $80B Savings Package

Proposal includes a rate hike and cutting delivery frequency.

President Trump proposed overhauling the U.S. Postal Service in his fiscal 2019 budget released Monday, calling for a slew of changes that would provide the agency with an additional $80 billion over 10 years.

Trump’s proposals largely mirrored those submitted in his last budget, as well as legislation that has been introduced in Congress. While lawmakers have sought to maintain delivery standards, however, Trump would allow USPS to “reduce mail delivery frequency from six days to five days where there is a business case for doing so.” That proposal would likely face pushback in Congress, especially from lawmakers representing rural areas, and even postal management has dropped its proposal to eliminate mail delivery on Saturdays.

The White House suggested USPS bring its retirement benefits in line with the same changes proposed for the rest of the federal workforce, which would save the agency $35 billion over the next decade. Under Trump’s plan, the postal service also would increase employees’ contributions toward their health and life insurance.

Similar to reform legislation in Congress, Trump suggested USPS increase collaboration with state and local governments, reduce to-the-door mail delivery “where appropriate,” change its governance structure and create postal-specific assumptions about the demographics of the USPS workforce to prevent possible overpayment into the agency’s Federal Employees Retirement System account. The proposal said the Postal Service should institute a one-time price hike and have more flexibility in setting its rates, something postal management has also advocated.

The operational changes to the Postal Service would improve the agency’s financial position $45 billion over 10 years, according to the budget, while the benefits changes would reduce costs by an additional $35 billion. The total unified budget impact would be just $44 billion over the next decade.

Former Rep. Jason Chaffetz, R-Utah, who authored a bill approved by the House Oversight and Government Reform Committee last year, went to the White House in 2017 to discuss overhauling the mailing agency with Trump. His bill has yet to receive a vote on the House floor, despite having widespread support from an array of postal stakeholders.