USPS board finally reaches quorum as 10-year postal reform plan comes into focus

No matter what path Congress takes in reaching what some members have called an urgent need for postal reform, the Postal Service, for the first time since December 2014, has enough members on its Board of Governors to reach a quorum.

The Senate confirmed three governors Thursday before leaving for their six-week August recess. The governors operate much like a company’s board of trustees and make important business decisions for USPS, such as selecting the next postmaster general and approving postal products.

The board is also supposed to be the driving force behind a major financial course-correction for USPS, according to the recommendations reached by a White House postal task force.

The new members include Ron Bloom and Roman Martinez IV, both former investment bankers, and John Barger, former director of the Investment and Retirement Boards of the Los Angeles County Employees Retirement Association, the country’s largest pension fund.

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They’ll join current governors David Williams, a former USPS inspector general, and Robert Duncan, a former White House official during the George W. Bush administration.

The board and its new members will work together to finalize a 10-year business plan for the Postal Service. The Huffington Post first reported in June that the plan, in its current form, would save the agency $5 billion by combing vacation and sick days for postal workers and require employees to pay more into their pension plan, saving USPS $7 billion.

Rep. Gerry Connolly (D-Va.), chairman of the House Oversight and Reform Committee’s subcommittee on government operations, said in an interview with Federal News Network that Postmaster General Megan Brennan submitted a draft version of the 10-year business plan to the committee earlier this summer.

But Congress is running out of time to respond — Brennan warned committee members in April that USPS could run out of cash by 2024 if Congress fails to address its struggling business model.

“What’s been lacking is a sense of urgency, even though the facts scream at us that something has to be done,” Connolly said in a July interview.  “I am very concerned that we are beginning to run out of time. We’ve got to act first, and the Senate is going to need a lot of time to act. I think we’ve probably got to give them the whole calendar year next year.”

‘Past is prologue’ on postal reform bill

Congress and the Trump administration agree on the urgent need for postal reform, but disagree on what the fundamentals of what that change should look like.

Members of the Senate and the House have proposed several postal reforms bills over the past few years that would focus on addressing a requirement since 2006 for the Postal Service to pre-fund health care benefits for future postal retirees. Most of the bills would require postal retirees to enroll in Medicare Part B.

USPS has defaulted on more than $43 billion in scheduled payments to that fund over the past decade.

Administration officials, however, have recommended keeping the pre-funding mandate in place, and have instead suggested rolling back postal unions’ collective bargaining rights on compensation.

The White House’s postal task force report also recommends further defining the agency’s universal service obligation, which outlines how many days a week the agency must make deliveries.

Sen. Kyrsten Sinema (D-Ariz.), ranking member of the Homeland Security and Governmental Affairs Subcommittee on Regulatory Affairs and Federal Management, expressed concern about the USPS draft business plan at a recent confirmation hearing for two Postal Regulatory Commission members.

“Given the recent reports of the Postal Service’s new business plan, and the cuts to service and infrastructure contained in the plan, it’s critical that leaders of postal oversight bodies understand the importance of consistent postal service to customers and the impacts that misguided service cuts could have on local economies,” Sinema said.

Connolly said the path going forward for postal reform resembles a bill he and a bipartisan group of committee members introduced in January 2017.

“I would say the past is prologue,” Connolly said about the need to address the pre-funding mandate. “I believe it’s incumbent upon Congress to fix the problem Congress created.”

But lawmakers are mulling some changes, the most significant of which is whether to make the Medicare provision “prospective only,” so that current postal retirees wouldn’t have to enroll in Medicare Part B.

“We’re looking at the cost implications of that, but there seems to be broad consensus that would be desirable, because it would eliminate hardship in a lot of people who didn’t sign up [and] didn’t count on incurring the expenses of Medicare,” Connolly said.

The National Active and Retired Federal Employees Association has expressed concerns about previous bills that require postal retirees to enroll in Medicare Part B.

Connolly added that the committee is trying to “minimize changes” to the bill in its current form to keep the bipartisan consensus that members of Congress had in the last session, and to move the legislation forward “as expeditiously as possible.”

USPS spokesman David Partenheimer told Federal News Network the agency is pleased to have enough governors to reach a quorum.

“The public interest and the Postal Service are best served by a Board made up of well-qualified individuals with diverse perspectives and experience,” he said.

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