The House Government Reform Committee began developing new legislation to overhaul the U.S. Postal Service less than 24 hours after hearing the impassioned pleas of top postal officials, DIRECT Newsline has learned.
At the Wednesday hearing both Postmaster General William J. Henderson and David S. Fineman, vice chairman of the postal service’s Board of Governors, essentially begged Congress to pass legislation giving the USPS the ability to react faster to competitive market changes by giving it the flexibility to adjust many of its rates and services.
Rep. John McHugh (R-NY), who formerly chaired the panel’s now defunct postal subcommittee, is spearheading development of a new postal reform bill that, while basically mirroring earlier legislation, would give the USPS the pricing freedom it wants, and the ability to tailor services to meet market demands.
A committee source said panel members were so impressed with the pleas, and with USPS threats of possibly eliminating Saturday delivery service and consolidating facilities, that they immediately began working on a new postal reform bill which, with bi-partisan support, they hope to see passed and signed into law some time this year.
McHugh, tried but failed to get three postal reform bills signed into law over the last six years, is developing the new legislation at the request of Committee Chairman Rep. Dan Burton (R-IN).
The USPS, which receives $96 million annually from the government for its costs of handling free and reduced-rate mail, is prohibited by that appropriation law from reducing service or consolidating facilities. The reform bill would not change that.
Burton was said by Committee spokesman Mark Corallo to be “pleased” with the results of the hearing because “it was the first time in years” that public attention really focused on the postal service’s financial situation.
Neal Denton, Alliance of Nonprofit Mailers executive director, assessing the hearing, said it was “a complete and total victory for the postal service.” He predicted that the panel is “prepared to grant the postal service an open checkbook on legislative reforms.”
Dave Weaver, Mail Advertising Services Association president, added that the hearing seemed to have produced “a unanimous feeling that something somewhat dramatic had to be done” legislatively to keep the USPS financially afloat.
“The entire focus of the hearing centered on how to get the postal service the legislative freedoms it wants as quickly as possible so as to avoid any of the threatened actions that we’ve been hearing from L’Enfant Plaza,” Denton said in assessing the hearing.
Both agreed that members of Congress, he added “don’t want small post offices closed; five day delivery instead of six, other cutbacks and they most certainly don’t want massive rate increases.”
In February, less than a month after the USPS raised its rates an average of 4.6%, postal governors ordered the preparation of a new rate case to be filed with the Postal Rate Commission that would hike rates between 10% and 15% by mid 2002.
The USPS has also taken action to cut employee work hours and has suspended billions of dollars worth of capital improvement projects.
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