A USPS letter carrier makes the rounds in Washington in 2018.

A USPS letter carrier makes the rounds in Washington in 2018. Alex Brandon/AP

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Trump Proposes Cutting Postal Employees’ Pay, Benefits in $100B Savings Package

The compensation reforms would be coupled with operational changes proposed by the president’s task force.

President Trump has once again proposed a slew of changes to the operations of the U.S. Postal Service and its employees’ benefits, with the White House estimating the plan would save $98 billion over the next decade.

In addition to a renewed push for offering postal employees lower pay and benefits, Trump pushed changes proposed by the task force he created last year. Those include raising prices for mail and packages not deemed “essential,” reducing delivery frequency, outsourcing some mail processing and licensing access to individuals’ mailboxes.

Additional savings would result from governmentwide efforts to require federal employees to contribute more toward their pensions and health insurance benefits. Trump also suggested making specific changes to USPS employee compensation to align it more closely align with the rest of the federal workforce. His task force previously proposed eliminating pay and benefit issues from collective bargaining negotiations, as is the case for all non-postal unions representing federal employees.

Many of the task force’s proposed reforms were met with criticism from lawmakers and postal management just last week at a hearing before the Senate Homeland Security and Governmental Affairs Committee. David Williams, for example, one of only two members sitting in the nine Senate-confirmed slots on the Postal Service’s board of governors, accused Trump’s task force of doing the bidding of the agency’s competitors through “discredited economic theory.”

“Private shipping companies find value in using cost attribution models to weed out unprofitable customers,” Williams said. “In contrast, we deliver to each American doorway.”

Trump’s previous budgets largely mirrored legislative proposals to put USPS on firmer financial footing, in addition to the compensation cuts. The fiscal 2020 document called for the Postal Service to re-amortize its outstanding liabilities for future retirees’ health care. The administration has rejected a popular proposal in Congress to require all eligible retirees to use Medicare as their primary health insurance provider.

While the White House said in budget documents that its proposed reforms mirrored the recommendations from the task force Trump created by executive order last year, not everything aligned. The document broke with testimony Gary Grippo, a Treasury Department official who spearheaded the task force, delivered last week. Grippo said the Postal Service should not take on any new business unrelated to its “core competencies,” while the budget suggested USPS provide additional services at post offices.