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POST Act Summary

POST Act Summary

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Published by SenatorCarper
A short summary of my comprehensive Postal Service reform legislation, the POST Act.
A short summary of my comprehensive Postal Service reform legislation, the POST Act.

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Published by: SenatorCarper on Sep 06, 2011
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02/16/2014

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Summary of the Postal Operations Sustainmentand Transformation (POST) Act of 2011
There are seven provisions in the bill. All of them are based on thelegislative proposals the Postal Service made this past spring.
1.
Financial Relief 
– The heart of the bill would permanently addressthe pension and retiree health issues that have been a drain on postalfinances over the years. The Postal Service currently pays into the oldCivil Service Retirement System (CSRS) using a formula that the PostalService Inspector General, the Postal Regulatory Commission, and atleast two outside consulting firms have found unfairly allocates costsrelated to the former Post Office Department to the Postal Service. If true, this has resulted in the Postal Service overpaying its CSRSobligations over the few decades by between $50 billion and $75 billion.In addition, the Postal Service since FY2007 has been required to pay  between $5.5 billion and $5.9 billion a year in an effort to prefund itsfuture retiree health obligations. The draft bill would give the PostalService more than $5 billion in breathing room each year by makingthree changes to current law:
First, it would requires OPM to recalculate the Postal Service’sCSRS obligation in a way that makes the Treasury responsiblefor pension costs related to pay increases Post OfficeDepartment employees working for the Postal Service wouldhave gotten had they stayed on the federal payroll. This was theapproach recommended by the IG, the PRC, and theconsultants who looked at this issue. The recalculation willresult in a finding that the Postal Service has paid about $50 billion more into CSRS that it owed.
Second, it establishes a mechanism by which the Postal Servicecould be reimbursed for overpayments it’s made into theFederal Employees Retirement System (FERS). Thoseoverpayments are currently estimated to be about $6.9 billion.
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Finally, it would allows the Postal Service to use its CSRS andFERS overpayments to make the remaining seven retiree healthprefunding payments it owes between now and 2016.Remaining funds could also be used to fund the Postal Service’s workers compensation obligations or to pay down its debt to theTreasury.
2.
Saturday Delivery 
– The bill would remove the Appropriationsrider that currently prevents the Postal Service from moving forward with its proposal to eliminate Saturday delivery. Under the 2006 postalreform legislation, the Postal Service was given the authority to reducedelivery frequency when necessary after taking the proposal to the PostalRegulatory Commission and receiving an advisory opinion. The Appropriators, however, put language in their bill every year negatingthis authority. Eliminating that rider would allow the Postal Service toachieve the $3 billion or more a year in savings that the Postal Service believes it could achieve if it eliminated Saturday delivery. The bill would also speed the process by which the Commission considers servicechanges like the potential elimination of Saturday delivery, givingcustomers and the Postal Service additional certainty. TheCommission’s consideration of the Postal Service’s Saturday delivery proposal took nine months, three times longer than envisioned in eventhe Commission’s regulations.
3.
Post Office Closings
– The bill would eliminate several provisionsin law that the Postal Service believes forces it to maintain post officesthat are no longer necessary. If the Postal Service is able to close someof these facilities, postal management believes they could began theprocess of rolling out cheaper, more convenient retail options such asautomated kiosks or postal stations located in grocery stores or otherplaces where people go every day. At the same time, it requires thePostal Service to develop a plan for the expansion of alternate retailoptions and requires that the Postal Service develop a service standardthat would guarantee all postal customers – especially rural customers –a minimum level of postal retail access.
4.
 Arbitration
– Under current law, the Postal Service is required topay its employees wages and benefits that are comparable to those paidin the private sector. Arbitrators in labor disputes have made it clear inthe past that they think this is a legally binding requirement that should
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