USPS: What's left to cut?

Monday - 6/27/2011, 10:08am EDT

Ron Stroman, Deputy Postmaster General, U.S. Postal Service

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By Suzanne Kubota
Senior Internet Editor
FederalNewsRadio.com

The cash-strapped Postal Service is giving mixed grades to a new bill aimed at saving its bottom line.

Bill sponsor, House Oversight and Government Reform Committee Chairman Darrell Issa (R-CA), says it would save $6 billion a year, wiping out much of the agency's shortfall.

Deputy Postmaster General Ron Stroman told Federal News Radio the Postal Service agrees with the bill's proposal to cut Saturday deliveries, but that more legislation is not the answer.

"We know how to cut costs," said Stroman. "We've reduced headcount here at the postal service about 115,000 over the last three to four years, in fact 34 percent since 2000, so we know how to take costs out of the system. From our standpoint, the problem is less an ability to shrink our system. It's more a question of some of the mandates that we've seen put on us from the Congress and the legislation that we're seeking is really an effort to impart to get us away from some of those mandates and allowing us to act like a business. If we can act like a private sector organization; where we can make quick, fast decisions; I think we can move to profitability."

Stroman said the focus for the USPS as a starting point continues to be the amount of money the Postal Service is required to set aside for retirements. "We are $6.9 billion dollars over funded. Everyone agrees with that including OPM, and quite honestly they've been very helpful. [OPM Director] John Berry has really been helping to see if we could find a solution to our over payment problem. To date they haven't been able to do it."

Stroman explained OPM's lawyers say one thing about the funding requirements, while the USPS's say another. The Justice Department has been asked to decide who's right.

The Issa bill, noted Stroman, doesn't mention the retirement contributions. He said the USPS thinks "if we can resolve these mandates, that you don't need more complicated regulatory schemes. One of the concerns I think we have with Chairman Issa's bill is that it puts additional regulation on top of existing regulation, and that's really not what we need. We need really less regulation. If we can function more efficiently, more like a business, more like our competitors - people like FedEx and UPS - if we had the same level playing field that they have, we'll be able to compete successfully."

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