Wednesday, February 6, 2013

The Law Is On Donahoe's Side Regarding Saturday Delivery

Postmaster General Patrick Donahoe confused both the news media and fuming Congress members today with his explanation of why Saturday mail service can be ended without Congressional approval. But he appears to be on solid ground legally. In fact, the case for the U.S. Postal Service making this move was laid out more than three years ago.

Here is Donahoe's somewhat cryptic statement at today's press conference on the legal question: "Is it legal? Yes it is. It is our opinion that the way that the law is set right now with the continuing resolution that we can make this change. The good news is that the continuing resolution that governs the Postal Service that way expires on the 27th of March, so there is plenty of time in there so if there is some disagreement we can get that resolved. I encourage Congress to take any language out that stops us from moving to this five-day mail schedule."

That was interpreted in some circles as meaning that Donahoe was basing his claim on the federal government not currently operating under an approved budget. But some reporters managed in the question-and-answer session to untangle, at least partially, Donahoe's case.

Bloomberg News, for example, reported that Donahoe "said the service decided it can ignore language, first placed in appropriations law in 1981, requiring it to deliver mail six days a week, because it receives its money from Congress differently than other U.S. agencies do."

Rep. Gerald Connolly, an influential Virginia Democrat, accused Donahoe
of "directly violating Public Law 112-74, the Consolidated Appropriations Act of 2012, which states that '6-day delivery and rural delivery of mail shall continue at not less than the 1983 level.'" That quotation, however, takes on a different meaning when read in context.

The law Connolly cites calls for "payment to the Postal Service Fund for revenue forgone on free and reduced rate mail, pursuant to subsections (c) and (d) of section 2401 of title 39, United States Code, $78,153,000, which shall not be available for obligation until October 1, 2012: Provided, That mail for overseas voting and mail for the blind shall continue to be free: Provided further, That 6-day delivery and rural delivery of mail shall continue at not less than the 1983 level."

A small price to pay
What Donahoe was apparently saying today was the same thing the USPS Office of Inspector General pointed out in 2009: The six-day requirement is a condition of the Postal Service receiving a measly $78 million appropriation. If it chooses not to accept the money, it doesn't have to abide by the requirement, as explained by a 2009 article in Dead Tree Edition.

In the words of the OIG report, opting out of the appropriation "would be a small price to pay for cementing the financial independence of the Postal Service and would free it from riders to appropriations acts." (Emphasis added.) Given the Postal Service's estimated savings of $2 billion annually, that would indeed be a small price. (But note that curtailing Saturday delivery is not a question of savings but of additional profit -- that is, cost savings minus lost revenue.)

Congress still has the power to prevent the ending of Saturday delivery (for all but parcels) by passing legislation that specifically requires six-day delivery. But lately Congress hasn't been able to pass much other than the naming of post offices.


Mark Jamison said...

The issue of the Revenue Forgone payment is extraneous. The language may or not be contingent or it may be severable.
Donahoe could argue that since the continuing resolution expires on March 27th that the specific requirement to deliver six days also expires on that date. By selecting August 5th as the beginning date of five day, the PMG is likely arguing that there is no language in law compelling six day deliver beyond March 27th. He is therefore daring Congress to put that language back in or not.
This becomes little more than a political ploy designed to goad the legislature into action.
You make a good point with the $2 billion in supposed savings. That figure is questionable and unproven but more important, the Postal Service has been over optimistic when predicting revenue and volume losses from service cutbacks.
Finally, there ought to be some serious concern about the Postal Service's operational capacity to pull this off without making a mess. Too often the management of the Postal Service confuses a goal with a plan. With 100 plants closing, hours being reduced at offices and new sort plans due to route realignments there has to be some genuine concern about how this will work absent some pretty firm and detailed operational plans coming from L'Enfant Plaza.

Anonymous said...

The Post Office should have cancelled Saturday mail a decade ago to save money. And close all those post offices. Do like they do in Europe where small mom and pop shops function as post offices in addition to being grocers, stationers, etc. Waste of time, energy and money belaboring the obvious. And scrap guaranteed pensions asap.

Anonymous said...

There are numerous private enterprises that will serve as postal resources - yes this will require a huge change in how the USPS does its business but its time for this entity to start acting like a business. A good start is the Saturday delivery which should be followed by the appropriates downsizings, fair concessions with the unions, shrinkage of middle management, and continued focus on cost saving opportunities.

Unknown said...

@ Anonymous, Perhaps you have never had the chance to encounter a Contract Postal Unit or the newer concept of a Village Post Office. These operate just as you suggest, in places of business outside of a Post Office.

However, I have to take a stand with your proposal to scrap "guaranteed pensions". Perhaps you are also under the misconception that these pensions are just handed out to us. No sir, we pay throughout our careers for the pension. Civil Service employees pay an amount equal to the Social Security withholding for their pension and are not eligible to collect Social Security.

FERS Employees do contribute to Social Security and pay a smaller amount, for a smaller pension, for our pensions.

In case the second Anonymous is a different person, the Unions have made concessions and givebacks. APWU just came off a 2 year wage freeze. Cost of Living adjustments were completely waived for 2011 and will never be paid. We are paying a greater portion of our health insurance premiums.

The NALC just had a similar contract arbitrated and the NPMHU will likely come out of arbitration with similar concessions and givebacks.

About the only thing that you propose that has not yet been done is shrinking middle management.

Anonymous said...

Please note who wrote this article. Enough said.

Anonymous said...

The problem with the idea of ending Saturday delivery by declining the revenue forgone for overseas voting and free mail for the blind is that USPS could arguably end those free services as well. How do you think the politicians would react to that? Also, there seems to be plenty of support for Rep. Connolly's position. It's no surprise that the mouthpiece for the dissenters is one Rep Issa, who has been using his House Chairmanship to try to dismantle and privatize the Postal Service. It is this writers' opinion that Donohoe is carrying the water for Issa and his cohorts.

L.Larke said...

Why doe's every one assume that Postal workers don't earn their pay or pensions? I've carried mail for 25 years and believe me I am very greatful, but it has been no picknick. Unlike when I first started management has captured every free minute of free time that carriers used to have. Now it seems to me with eliminating routes, extending routes, ect, their after our alloted time. You recieve a lunch, and a break, don't you? The Postal service wastes so much money on so many failed programs (technology) it ain't funny. Starting this one and scrapping that one. Donahoe better be glad that he's a
government employee, because if he was in private business he would have been fired. Why won't they just go private like they want to they've stole all the overpayment money.

Anonymous said...

someone please explain to me how the carriers are going to get their cars or privet jeeps serviced, have a vacation,go to docters appointments,or take care of any other private business that they may have. none of this has even been thought about. (LIKE ANYONE CARES) I GUESS WE ALL ARE RED HEADDED STEP CHILDREN.

Anonymous said...

I don"t understand the above comment!!
Letter carriers will love to have weekends off all the time.The NALC is predicting the on coming doom to it's membership and tell them that 5 day delivery is not in their best interest.
The NALC is worried about reduced dues paying members and nothing else. Bring on the 5 day delivery!!!!!

Anonymous said...

After reading all the comments left by seemingly left by Postal critics, where are the comments that refer to the fact that the USPS is a critical service for the American people. We have seen most of our military turned over to contractors who have the right to say no whenever the going gets rough. The USPS is a very lucrative enterprise when you look at the cities and towns, but is very costly for sparsely populated areas. I have watched Postal executives jump ship and then allude to taking over some operations for profit. Will Halliburton become our next mail mover? To whose benefit is the move privatize the USPS? The only thing that I am sure of is that once this benefit to the American people is dismantled, it will be gone forever.

Anonymous said...

Exactly. Union just worried about fewer memebers and that means fewer days.... lets get to five day asap