House Panel, DeJoy See Need to Address USPS Financial Woes

Postmaster General Louis DeJoy
Postmaster General Louis DeJoy by Tom Brenner/Reuters via Bloomberg News

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Postmaster General Louis DeJoy said some mail could be delayed under his plan to revitalize a U.S. Postal Service plagued by slow delivery and what he called a dire financial outlook.

DeJoy, embattled since deliveries slowed last summer ahead of an election that featured unprecedented volumes of mailed ballots, spoke Feb. 24 at a congressional hearing.

He divulged few details about the 10-year reform plan that’s still being crafted. But, he said, “If we move forward with the plan, only about 30% of first-class mail would be impacted with any additional delays.”

Mail delivery still hasn’t recovered from the drop in on-time delivery that began after DeJoy cut overtime and extra trips by delivery trucks in an effort to rein in costs. The changes were put on hold in August after an outcry, but performance lagged, with first-class mail falling below 63% on-time delivery the week before Christmas, according to a document posted online by the Oversight Committee.

Service has rebounded to 80% of first-class mail being delivered on time in early February, according to the committee document.

DeJoy also called the service’s congressionally imposed requirement to fund retiree health benefits decades in advance “unfair and unaffordable.”

“Many people — across the country and on this panel — have grave concerns, and recent events have aggravated them,” said Rep. Carolyn Maloney, chairwoman of the Committee on Oversight and Reform that held the hearing.

The Postal Service faces a decline in mail volume as well as the requirement to pay for health benefits for future retirees. Maloney called it “a dire financial situation that requires us to act.”

Newly selected postal Board of Governors Chairman Ron Bloom agreed that Congress should lift the retirees funding requirement. A bill under consideration would eliminate the mandate to fund retirees’ health care years in advance, and require Postal Service retirees to enroll in Medicare, at savings of $10 billion over 10 years, according to a summary released by the committee.

DeJoy on Feb. 9 said he was working on a 10-year plan, and Maloney said that lawmakers “have been trying to get information about the new strategic plan, which has yet to be made public.”

DeJoy on Feb. 23 said he wouldn’t divulge details because the plan is still being formed. He said the plan would be unveiled next month and would preserve delivery to every household, six days a week.

“Our dire financial trajectory” along with declining mail volume and other problems “all demand immediate action,” DeJoy said. “We see a path forward to sustainability, and good service.”

Mailed ballots were delivered on time, Bloom said Feb. 23.

Lawmakers remained critical of mail slowdowns. Some have called for President Joe Biden to name new postal governors to revive the struggling service and for DeJoy’s departure.

Three of nine presidentially appointed seats on the board are open, giving Biden a chance to assemble a Democratic majority. The governors select the postmaster general, and under Republican leadership last year chose DeJoy, a former XPO Logistics executive and donor to former President Donald Trump.

On-time delivery nationwide for first-class mail dropped to 64% in December, and was lower in many areas, 33 U.S. senators said in a Feb. 17 letter to DeJoy outlining what they called “unacceptable delays.”

The Postal Service has cited heavy package volume and worker absences due to COVID-19. The senators in their letter cited “concerning practices” including management rejecting overtime requests.

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