EcommerceBytes-NewsFlash, Number 3113 - July 22, 2013     5 of 6

Issa Trying Again with Postal Reform Bill

By Kenneth Corbin

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The chairman of the House Oversight and Government Reform Committee is taking another shot at trying to pass legislation to help the struggling U.S. Postal Service overhaul its operating structure to return to financial viability.

The Postal Reform Act of 2013, authored by Rep. Darrell Issa (R-Calif.), would authorize the agency to scale down to five-day weekly delivery of regular mail, while maintaining Saturday delivery of packages and medicines, for an estimated savings of $2 billion annually.

In a statement, Issa said the bill would enable the Postal Service to achieve "long-term financial solvency while maintaining high-quality universal service for all Americans."

"The legislation incorporates reforms offered by members of both sides of the aisle and builds upon months of bipartisan and bicameral discussions," Issa said.

In May, the Postal Service reported a $1.9 billion quarterly loss, saying that the agency is losing about $25 million each day. In fiscal 2012, the Postal Service reported an annual loss of $15.9 billion.

Postmaster General Patrick Donahoe testified before Issa's committee on Wednesday, where he once again offered a dire warning about the agency's fiscal situation and appealed for legislation that would pave the way for structural reforms to the Postal Service's operations and workforce.

"We need a bridge that gets us all the way to the other side. Half measures are about as useful as half a bridge," Donahoe told the committee. "We need legislation that, together with our planned changes, confidently enables at least $20 billion in savings by 2016. If not, we go over the edge."

Other provisions in the bill would authorize the Postal Service to expand its business activities to include the sale of advertising space on its vehicles and its stores, and to begin selling state and local services like fishing licenses.

Issa also noted language in the bill that would block the Postal Service from aggressively closing post offices in rural areas, and establish a set of criteria for the agency to consider when evaluating stores for closure, including broadband penetration in the area and the distance customers would have to travel for comparable service.

"Rural Americans and USPS employees have expressed concern that the burden of cost-cutting reforms will fall disproportionately on their shoulders," Issa said. "We have taken steps to address these concerns because there is no question these populations will be among those most severely affected by a financial collapse of USPS."

Unions representing postal workers took issue with several provisions of the bill that relate to the agency's workforce, including restrictions on unions' collective bargaining power. The American Postal Workers Union branded a draft of the bill "deeply disturbing," and the National Association of Letter Carriers warned that the legislation would undercut a vital part of the economy that still supports millions of jobs and growing industries like ecommerce.

"We believe it proceeds from a false premise that the Postal Service is irreversibly failing and must be dramatically downsized," the NALC wrote in a letter to Issa last week. "The reforms you propose would have a devastating impact on the jobs of 8 million American workers (7.5 million in the private sector) who work in the mailing industry, which includes ecommerce shippers, direct mailers, printers, publishers, paper manufacturing and associated industries."

Issa's committee is planning to begin marking up the bill at a business meeting on Wednesday.


About the author:

Kenneth Corbin is a freelance writer based in Washington, D.C. He has written on politics, technology and other subjects since 2007, most recently as the Washington correspondent for InternetNews.com, covering Congress, the White House, the FCC and other regulatory affairs. He can be found on LinkedIn here.


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