Postal Service calls off cost-cutting plan to eliminate Saturday deliveries — for now

By Nick McCrea, BDN Staff
Posted April 10, 2013, at 7:16 p.m.

BANGOR, Maine — Maine political delegates are expressing pleasure about the decision by the U.S. Postal Service’s to postpone its plan to eliminate Saturday deliveries to cut costs.

“It is clear that Congress believes that slashing customer service should be the last resort, not the first option, chosen by the Postmaster General,” Republican U.S. Sen. Susan Collins said Wednesday afternoon. “I have long maintained that cutting service for five-day delivery would drive away more customers, causing postal revenues to decline further, and push the Postal Service into a financial death spiral.”

The Postal Service has been bleeding money, losing $16 billion in 2012. Frustrated by a lack of movement in Congress to restructure the agency to make it more nimble, Postmaster General Patrick Donahoe announced in February that the Postal Service would switch to a five-day schedule starting in August. USPS expected the move would save $2 billion per year.

Congress balked at the idea, backing late-March legislation that maintained a six-day delivery schedule, effectively forcing USPS to continue Saturday service. A number of lawmakers and trade groups said the plan to cut Saturday mail service is illegal because the Postal Service requires Congress’ approval before it makes such a decision.

“I’m pleased that the U.S. Postal Service has announced that it will comply with the law and abandon plans to eliminate Saturday mail delivery in August,” U.S. Rep. Mike Michaud said Wednesday. “Mainers depend on six-day delivery for prompt receipt of time-sensitive items like prescription drugs, paychecks, and mail-order services.

“I agree with the Board of Governors that Congress must quickly pass meaningful and comprehensive postal reform legislation. But it’s critical that Congress include provisions that protect Saturday delivery.”

USPS reacted with disappointment in its Wednesday announcement.

“Although disappointed with this congressional action, the board will follow the law and has directed the Postal Service to delay implementation of its new delivery schedule until legislation is passed that provides the Postal Service with the authority to implement a financially appropriate and responsible delivery schedule,” the Postal Service said in a prepared statement.

Collins argued that the 21st Century Postal Service Act, which she co-authored in 2012 and received “strong support in the Senate,” would have allowed for a better approach to fiscal solvency. It would have required USPS to implement other cost-saving measures over a two-year period before cutting a day of deliveries. The bill never passed in the House.

“Before the Postal Service even considers moving to five-day delivery, reducing customer service, and giving up its competitive edge over other delivery services, it should first reduce its other costs,” Collins said.

“I am pleased that the postal service has delayed its proposal to eliminate Saturday delivery,” U.S. Sen. Angus King, an Independent, said Wednesday afternoon. “Now it’s time for Congress to review the underlying causes of the Postal Service’s financial woes and make it work again for the American people.”

A recent Pew Research Center study found that most Americans didn’t mind that they might only receive five days of mail — with 54 percent approving of the Postal Service’s decision and 32 percent opposing it.

Lawmakers who have been supportive of a Postal Service overhaul such as Democratic Sen. Tom Carper of Delaware and Republican Rep. Darrell Issa of California said they were disappointed in the decision to backtrack on the plan.

Issa, who had previously instructed the Postal Service to move forward with plans despite the new spending resolution, said in a statement that the Postal Service had given in to pressure.

“Despite some assertions, it’s quite clear that special interest lobbying and intense political pressure played a much greater role in the Postal Service’s change of heart than any real or perceived barrier to implementing what had been announced,” Issa said in a statement.

The Postal Service has said it loses $25 million each day and could soon run out of money if Congress does not allow it more flexibility to modify its business model and become more profitable.

Reuters contributed to this report.

http://bangordailynews.com/2013/04/10/news/state/postal-service-calls-off-cost-cutting-plan-to-eliminate-saturday-deliveries-for-now/ printed on December 17, 2014