Letter Carriers Association Sticks Up for Postal Service

Last week, the U.S. Postal Service reached its borrowing limit for the first time, but the association that represents its workers says the situation is "artificial" in nature.

For years, the United States Postal Service (USPS) has faced significant financial issues that have affected its future.

Now, the issues are mounting — with USPS announcing last week that it hit its $15 billion borrowing limit in September, according to Reuters.

But the National Association of Letter Carriers (NALC) says the situation has been strongly stacked against the agency.

Among other things, USPS has to pre-pay billions of dollars in future retiree health benefits, a mandate ordered by Congress in 2006 that has put the agency on the hook for billions in long-term payments as it deals with short-term financial struggles.

The agency recently missed a $5.6 billion payment on the health benefits — the second in a row it has missed. As a result, USPS, already struggling with financial troubles related to the transition from physical mail, is feeling further crimped.

“By mandating these payments and refusing to allow the Postal Service to access its own pension fund surplus, Congress has turned a manageable business challenge into a nightmare of artificial deadlines and unnecessary financial burdens,” the NALC said in a press release.

It recommends that Congress pass new legislation to help ease the burden on the agency. The USPS agrees. “We need passage of comprehensive legislation as part of our business plan to return to long-term financial stability,” USPS spokesman David Partenheimer said last week.

While some congressional action could happen this year — Rep. Darrell Issa (R-CA), a critic of the service’s current structure, says he’s working on a comprehensive reform bill — but if the delays continue, USPS could hit a wall.

“We’ve done a lot to reduce cost out of our system,” Postmaster General Patrick Donahoe told the Associated Press. “The problem now is this: There’s nowhere to go.”

USPS is expected to lose $15 billion this year.

(photo by Zena C/Flickr)

Ernie Smith

By Ernie Smith

Ernie Smith is a senior editor for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. MORE

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