EDITORIALS

Toward a Postal Solution

Hampden resident Crissy Rowe mails letters outside the U.S. Postal Service Eastern Maine Processing and Distribution Facility in Hampden in 2008.
Hampden resident Crissy Rowe mails letters outside the U.S. Postal Service Eastern Maine Processing and Distribution Facility in Hampden in 2008.
Posted April 19, 2012, at 3:55 p.m.
Last modified April 20, 2012, at 2:25 p.m.

A bipartisan compromise bill is off to a good start to preserve mostly overnight mail service in Maine and stave off the planned closing of about 100 of the mail processing plants that had been slated for shuttering.

After impassioned pleas by Maine’s Sens. Susan Collins, a Republican, and Joe Lieberman, an independent from Connecticut, the Senate voted 74-22 on a motion to proceed to debate on S. 1789, the 21st Century Postal Service Act of 2012. That was 14 votes more than necessary to prevent a fatal filibuster.

Provisions of the bill would give the postmaster general the tools he needs to delay and perhaps prevent the announced closing of postal facilities including the Eastern Maine Processing and Distribution Facility in Hampden. Its closure would mean that a letter mailed from one address to another in Bangor would have to go to another processing center in Scarborough and back, causing delay of a day or two and an end to overnight delivery.

The $14 million Hampden postal plant was dedicated with great fanfare in 1994, with a planned work force of 306 people. It has been handling mail from post offices covering two-thirds of the state. Sen. Collins has worked repeatedly to keep it open.

The measure was a negotiated combination of parts of several bills including proposals by Sens. Collins and Bernie Sanders, I-Vt.

A provision in the bill would reduce the annual $5.5 billion prefunding of retiree health benefits required by Sen. Collins’s 2006 law to about $3.5 billion. It also would allow current premiums to be paid from that fund starting right away instead of in 2017. The prefunding mandate is a major cause of the Postal Service’s financial crisis.

The revised bill partly reflects proposals by the Postal Service Office of Inspector General, which has long advocated restructuring the service including a complete end of the annual $5.5 billion health-benefit prefunding. Inspector General David C. Williams, in a Feb. 6 letter to Sen. Sanders, told of his office’s finding that the prefunding of the Postal Service’s pension and health care benefits “significantly exceeded” the funding levels of organization in both public and private sectors.

He wrote: “Using ratepayer funds, it has built a war chest of over $326 billion to address its future liabilities. This is a astonishingly high figure for a company with such a large employee base.”

He noted that the Postal Service is currently over 100 percent funded in its pension funds, while the federal government is funded at a much lower 42 percent level and the military at 27 percent. He wrote that the average Fortune 1000 pension plan is funded at 80 percent, while only 6 percent of those plans are 100 percent funded.

Mr. Williams wrote that prefunding of retiree health care is rare in public and private sectors, unlike the current 100 percent requirement for the Postal Service.

The shock of the Postal Service’s crisis plan for a drastic cutback in mail service may have jolted lawmakers into backing the new bill.

By the inspector general’s reasoning, the new postal bill falls short of what is necessary, but it is a strong step in the right direction. It should pass.

CORRECTION:

Friday’s editorial, “Toward a Postal Solution,” requires clarification. A letter from the postal inspector general said the postal service used ratepayer, not taxpayer, money to build up funds to pay future pension liabilities.

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