House Subcommittee takes first step towards financial relief for Postal Service

July 29, 9:48 PMSt. Louis Postal Service ExaminerStanley CravensPrevious  

The Postal Service and its bleak financial situation is starting to get some much-needed attention on Capitol Hill. For the USPS, that's very welcome news.

By a vote of 8-1, the House Subcommittee on the Federal Workforce, Postal Service, and the District of Columbia, approved legislation that would require the Office of Personnel Management (OPM) to review the Postal Service's Civil Service Retirement System (CSRS) liability using a new methodology - a recalculated formula which could yield a $50 billion surplus in the CSRS system. The bill then would require OPM to determine how and when to transfer that money to the Postal Service Retiree Health Benefit Fund.

The bill does not, however, address the annual prefunding payment for future retiree health benefits that is due Sept. 30 each year. The prefunding requirement is scheduled to continue through 2016, with each payment averaging $5.5 billion dollars, an amount the Postal Service claims is unnecessarily high. As a result of the Postal Service's dire financial condition in 2009, the annual prefunding payment was reduced by Congress to $1.4 billion, which brought the fiscal year 2009 deficit down to $3.7 billion dollars. The USPS is forecasting a nearly $7 billion dollar deficit for fiscal year 2010, but it remains to be seen if the same prefunding relief will be given to the organization again.

At this point, the proposal to recalculate the Postal Service's CSRS liability has only been approved by the House Subcommittee on the Federal Workforce, Postal Service and the District of Columbia. It still has a long way to go before it could be signed into law by the President, but the United States Postal Service is viewing this as a hopeful first step towards some much-needed financial relief.