The U.S. Postal Service does not rely on tax dollars for its operation. Its revenues come from sales of products and postage.
So, to an extent, it makes sense to not close small post offices: If you eliminate the services people and businesses are paying for, you eliminate revenue.
But, while the postmaster’s announcement Wednesday was encouraging for rural post office users and sent a message that it’s listening to its customers, much more is needed to prevent the agency from becoming insolvent.
Postmaster General Pat Donahoe announced that rural post offices nationwide scheduled for closure last year — including 30 in Maine — will remain open. To cut costs, the self-supporting government agency will reduce retail window hours to match customer use.
And post offices will have the option to co-locate in nearby businesses or merge with another location. The service will also offer a voluntary early retirement incentive. After the two years needed to implement the strategy, the agency says it will save a half billion dollars each year.
It’s good that the postal service is listening to the people and businesses it serves. Research conducted in February showed 54 percent of customers in rural areas would prefer to maintain a local office. An additional 20 percent preferred having the office in a local business; 15 percent supported providing services at a nearby office; and 11 percent prefered expanded rural delivery.
But the announcement should not take the pressure off the U.S. House to act on its postal reform bill. After losing more than $13 billion during the past two years, the postal service is scheduled to max out its statutory credit limit of $15 billion by the end of this year.
Another scary thought: The agency says it’s at risk of not being able to pay all its employees as early as this fall.
The rate of first-class mail purchases has decreased 26 percent since 2006, and revenue has dropped almost 10 percent, from $72.8 billion in 2006 to $65.7 billion in 2011. People across the world rely on the postal service; it delivers nearly 40 percent of the world’s mail.
Two weeks ago, the U.S. Senate approved legislation — authored by Sens. Susan Collins, R-Maine; Joe Lieberman, I-Conn.; Tom Carper, D-Del.; and Scott Brown, R-Mass. — to reform the service.
The House must now vote on its reform bill, sponsored by Rep. Darrell Issa, R-Calif., in order for members of both branches to sit down and outline compromises on things such as Saturday delivery, employer retirement contributions and employees’ health insurance premiums.
We’ll also be paying attention to an expected announcement by the postmaster next Thursday — likely regarding the consolidation of 183 processing and distribution plants nationwide. Lawmakers, including Collins, have asked him to extend a facility-closing moratorium set to end May 15.
One of the plants, the Eastern Maine Processing and Distribution Center in Hampden, is slated to have its duties shifted to the Scarborough processing facility, meaning the loss of 170 jobs. We hope the postmaster will reveal a plan similar to part of the Senate bill — that there must be overnight delivery in some areas in order to ensure the Hampden plant remains open and businesses aren’t forced to find a more expensive alternative.
Restructuring the postal service will not be easy, as it must balance services and demand. But it would do well to get creative, possibly by selling more products online or through energy efficiencies. It should be allowed to ship wine and beer as private competitors do. It must also address its largest expense: its work force.
A vote in the House will allow important decisions to be made. It should postpone no longer.