Senate Passes Carper Postal Reform Bill

Bill Would Modernize Postal Service for the 21st Century

WASHINGTON (Feb. 9, 2006) — The Senate on Thursday unanimously approved legislation, authored by Sen. Tom Carper, D-Del., to modernize the United States Postal Service and make it viable for the 21st century. The legislation, the first major overhaul of the USPS since 1970, would help stabilize mail volume and stamp prices, securing thousands of Delaware postal jobs and helping area businesses, like the banking industry, that rely heavily on the mail. The Postal Service is in a period of transition. When it was created in 1971, nobody had access to fax machines, cell phones, pagers and email. After nearly three decades of success, these new communications technologies have caught up with the agency. In recent years, the volume of First Class mail has steadily decreased. At the same time, more than 1 million new addresses are added to delivery routes each year. The result: Delivery costs have increased at the same time that revenues are being threatened. The legislation, written by Carper and Homeland Security and Governmental Affairs Committee Chairwoman Susan Collins, R-Maine, would force the Postal Service to concentrate on what it does best – processing and delivering mail to all Americans. The bill, entitled the Postal Accountability and Enhancement Act, would dramatically rethink the way the Postal Service prices its products by giving it the same ability any other business has to change prices whenever it needs to do so. But to protect businesses and mailers from sudden and dramatic price hikes, the legislation would ensure that price increases be kept below an inflation-based ceiling. In addition, the bill would give the Postal Service the freedom to introduce new, innovative products or tailor existing products to meet customers’ needs, which should help attract new business and increase revenues. The bill would also shore up the Postal Service’s finances by repealing a provision in current law that makes the Postal Service the only agency in the federal government responsible for its employees’ military pension benefits, returning this obligation to the U.S. Treasury. Another provision will permanently correct the Postal Service’s flawed pension formula, a formula that was leading to significant overpayments and contributing to higher rates. These provisions will free up billions of dollars, giving the Postal Service the ability to begin paying down its debts. “If we want to avoid disastrous future postal rate hikes and put the Postal Service on firm financial footing, then we need to get comprehensive postal reform legislation signed into law this year,” said Senator Carper. “It’s been more than 30 years since we’ve considered major postal reform legislation. We need to bring the Postal Service into the 21st century. This legislation would give the Postal Service the tools it needs to survive at a time when more and more people communicate through faxes, email and electronic bill-pay. We need to make structural changes in the Postal Service to make sure it can accommodate these trends and remain successful. Just as postal workers don’t let anything stand in their way of delivering the mail every day, Congress shouldn’t adjourn this year without passing real postal reform.” According to a study by the Envelope Manufacturers Association, more than 780,000 American jobs will be at risk if mail volume declines another 10 percent. More than 2,000 of those jobs are in Delaware. The impact of a 20 percent drop would be even more severe, resulting in a loss of 1.5 million jobs, including about 4,000 in Delaware. “When mail volume declines, the Postal Service has more difficulty fulfilling its obligations and making sure that all Americans have access to the vital services the Postal Service provides,” said Carper. “We need to act now to make sure the Postal Service becomes more efficient and business-like and that it has the flexibility it needs to compete in the new economy.” The Carper-Collins bill has been endorsed by the 21st Century Coalition on Postal Reform, compromised of more than 150 businesses and association, as well as the National Association of Postmasters of the United States, and two postal unions – the National Association of Rural Letter Carriers and the National Association of Letter Carriers.