November 2, 2011 / 7:25 PM / 8 years ago

Bill would let US Postal Service tap fund surplus

* Key issue is $7 billion surplus in retirement fund

* Committee set to mark up bill next week - Lieberman

By Emily Stephenson

WASHINGTON, Nov 2 (Reuters) - The U.S. Postal Service would be allowed to tap into an estimated multibillion-dollar retirement fund surplus to ease its financial troubles under a bipartisan bill unveiled in the Senate on Wednesday.

The measure also would make the independent agency wait at least two years before attempting to end Saturday delivery.

The bill, introduced by senators Joe Lieberman, Susan Collins, Tom Carper and Scott Brown, likely will form the basis of Senate plans to revamp the Postal Service.

The agency has struggled with falling mail volumes due to the Internet and the recession, as well as a massive annual payment to prefund retiree health benefits imposed by Congress in 2006.

“Too many people still rely on the Postal Service for us to sit back and allow it to collapse,” said Lieberman, whose committee oversees the Postal Service and plans to debate the bill next week.

“The Postmaster General made it very clear to us that he needs the ability to cut $20 billion from the Postal Service’s annual budget. We’re giving him and his employees ... the tools to achieve that significant amount of savings,” he said.

Absent action from Congress, the Postal Service has little flexibility to cut costs and restructure its business.

The world’s largest mail carrier, which receives no taxpayer money to pay for operations, has announced cost-cutting moves including possibly closing thousands of post offices.

The bill largely represents a compromise between earlier bills from Democrat Carper and Republican Collins.

It incorporates ideas Postmaster General Patrick Donahoe had asked Congress to consider, including giving back to the agency an estimated $7 billion surplus in a Postal Service retirement fund.

BUYOUTS, DEBT PAYMENTS

The agency would be able to use about a quarter of that money to offer buyouts and retirement incentives to cut the postal workforce. The rest could be used to make payments to the federal government or pay off about $15 billion borrowed from the U.S. Treasury in recent years, Collins said during a press conference at the U.S. Capitol.

Republican Representative Darrell Issa, chairman of the House of Representatives Oversight Committee, has warned returning the surplus could be problematic if the agency later runs a deficit and needs those funds. [ID:nN1E79C1FJ]

Collins applauded provisions to protect six-day mail delivery for at least two years and transition older workers from disability compensation to retirement.

She has criticized proposals to scrap Saturday mail and wants to overhaul workers’ compensation at the federal level.

The compromise bill also retains proposals from Carper’s bill, including allowing the Postal Service to offer some services for state governments and deliver wine and beer.

“From what we’ve seen so far, this bill is a smart and balanced approach that can shore up the Postal Service and help preserve the 8 million private-sector jobs that rely on the mail,” said Art Sackler of mailing group the Coalition for a 21st Century Postal Service. (Reporting by Emily Stephenson; Editing by Xavier Briand)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below