Remarks Of Paul Steidler To U.S. Postal Service Board of Governors

February 6, 2020 Meeting

Governors, thank you for this opportunity.

As Chairman Duncan and Postmaster General Brennan mentioned in their opening remarks, and as seen from the Integrated Financial Plan, it is clear that the Postal Service, and the American public, need comprehensive postal reform. I ask that the Board of Governors consider adopting a resolution calling on Congress and the Administration to work toward enactment of this by June 2021.

The foundations of reform should include a clear and measured definition of the Universal Service Obligation; a commitment to identifying granular costs for products as the Office of Inspector General discussed in its September 17, 2019 report and fully honoring the commitments made to current postal workers and postal retirees.

Yesterday the U.S. House of Representatives passed a one-page bill to end the Postal Service’s mandatory payments toward future retiree health benefits. Some see this as all that is necessary for postal reform. Such thinking is dangerous and irresponsible.

The independent U.S. Government Accountability Office warned 2 ½ years ago that the Retiree Health Benefits Fund will run out of money by 2030 unless it receives additional payments. Contributions have not been made to the fund since fiscal year 2010. While the House action would improve the Postal Service’s balance sheet, postal workers are right to be quite concerned as to whether they will receive important, hard earned benefits.

Reform is also important for re-capitalizing the Postal Service. There are two major initiatives that the Postal Service needs to put in place quickly. The first is having a world-class import system to help ferret out drugs and counterfeit items. On January 24 the Department of Homeland Security and Customs and Border Protection announced a major action plan to curtail counterfeit items, emphasizing the public safety risk. The President issued an executive order related to this last Friday, January 31.

The Postal Service also needs to replace its trucks. According to your 2019 10-K, USPS has, “approximately 144,000 vehicles that are at least 20 years old and need significant maintenance to stay in service.” This is more than 60 percent of the fleet. I don’t think any of us would want our teenagers driving a vehicle more than 20 years old, even if it cost a lot to maintained. Postal workers deserve at least the same treatment.

For all the above reasons and more, near-term comprehensive postal reform is essential. Thank you.

Paul Steidler is a Senior Fellow with the Lexington Institute, a public policy think tank based in Arlington, Virginia.