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By Catholic Online (NEWS CONSORTIUM)

2/6/2013 (2 years ago)

Catholic Online (www.catholic.org)

Policy change seeks to reduce post office's operating budget

Relaxing with a pile of freshly delivered mail on Saturdays will become a thing of the past this summer. The United States Postal Service, in an attempt to curb operating costs, will discontinue mail deliveries this August 5. The decision ends an era for the agency, which started Saturday delivery in 1863.

The decision ends an era for the agency, which started Saturday delivery in 1863.

The decision ends an era for the agency, which started Saturday delivery in 1863.

Highlights

By Catholic Online (NEWS CONSORTIUM)

Catholic Online (www.catholic.org)

2/6/2013 (2 years ago)

Published in U.S.

Keywords: Postal Service, Saturday delivery, post offices, postmaster


LOS ANGELES, CA (Catholic Online) - The Postal Service unveiled its cost-saving plan this week after Congress failed to act. The policy is expected to save $2 billion a year, which is but a drop in the bucket compared to a loss of $16 billion the Postal Service reported in 2012.

"It's a responsible decision. It makes common sense," Postmaster General and CEO of the Postal Service Patrick Donahoe says.

Donahoe says that the move will impact 22,500 jobs, which he says will avoid layoffs. Donahoe says he would offer buy outs, eliminate overtime and rely more on the part-time workforce. He assures that there will be no changes to post offices that are currently open on Saturday and mail will continue to be delivered to PO boxes.

Advances in communications, such as email and cell phone technology, mail delivery has become cumbersome in the modern age. Many feel that the key culprit for the Postal Service's woes has been a 2006 congressional mandate, which pre-funds healthcare benefits for future retirees. In the meantime, the USPS has been borrowing billions of dollars from taxpayers to make up for the shortfalls.

The agency twice defaulted on payments totaling $11 billion in 2012, and it exhausted a $15 billion line of credit from the U.S. Treasury.

The post office has cut hours at thousands of offices, some of which are open for only two hours a day. It has also merged some of its plants, which led to a 28,000 drop in its workforce through retirements and departures by employees who couldn't relocate or take up other postal jobs.

By law, the United States Postal System is an "independent establishment" of the executive branch. The agency doesn't normally use tax dollars for operations, except for its $15 billion loan from Treasury. The Postal Service had no debt in 2005.

If Congress fails to act, the Postal Service could come dangerously close to running out of cash next month. A report last year projected that by mid-March, the agency would have about $1 billion in cash which is barely enough to keep the agency running for four days.

Rep. Darrell Issa, a California Republican, and Sen. Tom Carper, a Delaware Democrat is assuring the agency that they are working together to come up with a resolution.

But Issa and Carper have not shared specific details of when, or how, they plan to achieve that goal. Congressional aides say they're hopeful it'll get passed soon.


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