Trump budget calls for $47B in retirement benefits, operational cuts at USPS

President Donald Trump has weighed in on the ongoing postal reform debate with a fiscal 2018 budget proposal that would save the U.S. Postal Service $47 billion over 10 years through cuts in retirement benefits and mail delivery costs.

The majority of the cost savings outlined in Trump’s postal reform plan, as written in his May 23 budget proposal, come from retirement benefit changes that would also affect the rest of the federal workforce, but would save the Postal Service $33 billion over 10 years. The Postal Service would also save an additional $1 billion by increasing postal workers’ contributions to their health and life insurance.

The president’s USPS budget plan reflects some of the provisions in a bipartisan postal reform bill that passed the House Oversight and Government Reform Committee in February, but goes further in reductions to delivery standards.

The White House plan would let the Postal Service “reduce mail delivery frequency where there is a business case for doing so,” which could include the elimination of Saturday delivery, even though the idea has been rejected repeatedly by lawmakers. The Trump plan would also reduce door-to-door delivery, and allow the Postal Service to move toward centralized “cluster box” delivery.

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While the bill received broad support from the postal unions, the mailing industry, lawmakers and USPS management, the White House’s proposal could upset this tenuous compromise. Fredric Rolando, president of the National Association of Letter Carriers, said in a May 24 statement that the president’s plan would “threaten the long-term viability of the Postal Service.”

“It is unfortunate and disappointing that the administration would so recklessly attack the livelihoods of active and retired federal retirees who have devoted their lives to our country,” Rolando said. “NALC will vigorously fight any budget proposal that attacks our members or the Postal Service.”

Rep. Jason Chaffetz, the postal reform bill’s sponsor and the chairman of the oversight committee, said he briefed the president about the need to overhaul the Postal Service during a February visit to the White House.

Trump’s plan also calls for greater price flexibility for postal products, an idea Postmaster General Megan Brennan said would help the Postal Service regain firmer financial footing. USPS recently announced that it ended its second quarter of 2017 with a $562 million loss. Meanwhile, the Postal Regulatory Commission is currently reviewing the rate-setting system that determines the price of a first-class postage stamp.

“The U.S. Postal Service appreciates that the president’s proposed 2018 budget recognizes the need to enact postal legislative and regulatory reform,” Postal Service spokesman David Partenheimer said in a statement. “Both are essential to enabling the Postal Service to meet its obligations in a financially sustainable manner. The Postal Service looks forward to continuing to work with the administration and with Congress to enact postal reform legislation.”

While the president’s FY 2018 budget proposal would make significant changes to postal benefits and business operations, USPS doesn’t go through the congressional appropriations process like other federal agencies. Instead, the agency is largely self-funded through postage revenue.