Saturday mail delivery on chopping block
Saturday mail delivery on chopping block
By Kim Geiger
Copyright © 2010, Chicago Tribune
7:00 p.m. CST, March 2, 2010
http://www.chicagotribune.com/business/sc-biz-0303-mail--20100302,0,4188261.story
WASHINGTON - — Neither snow nor rain nor heat nor gloom of night prevents mail couriers from the swift completion of their appointed rounds.
Saturdays might be tough, however.
Facing a projected $238 billion loss over the next decade, due in part to the rise of the Internet, the U.S. Postal Service on Tuesday proposed a 10-year plan to bring it into financial health, including putting an end to Saturday mail delivery.
The Postal Service, which is regulated by Congress and the administration but operates without federal assistance, faces "a severe income gap that we absolutely have to close," said Postmaster General John Potter.
Such cost-cutting measures have been proposed, and largely ignored, in the past. Last year, post office representatives pushed multiple times at hearings on Capitol Hill for the authority to end Saturday delivery, change the way the service pays out retiree health benefits and raise prices, all actions that require congressional approval.
The Postal Service predicted that first-class mail volume will drop 37 percent by 2020. Bob Bernstock, the agency's president of mailing and shipping services, said that "creates an urgency that was not there before." The post office generates about half its revenue from first-class mail.
The service has identified measures within its authority to close the shortfall by about $123 billion over 10 years. It cannot eliminate the remaining $115 billion without being granted the authority to implement additional measures, including ending Saturday delivery, estimated to save $40 billion, Bernstock said.
Other savings would come from personnel changes and price hikes, though the price for a first-class stamp will remain at 44 cents through 2010. Post offices would remain open on Saturdays.
U.S. Rep. Danny Davis, D-Ill., a member of the subcommittee that oversees the Postal Service in the House, said that the proposal was "heading in the right direction," but that it is by no means a done deal.
"I think there's going to be a great deal of negotiation, a lot of haggling, if you will, before plans are actually set in stone," Davis said.
Sen. Tom Carper, D-Del., who heads the Senate subcommittee with jurisdiction over the Postal Service, said the service "must be allowed to make the business decisions they need to stay competitive and viable in the years to come."
Some businesses that rely on mail delivery said they worried about how an end to Saturday service would hurt time-sensitive deliveries.
"The persons it really impacts are my customers, the people who are looking forward to receiving their packages," said Laura Lombardi, who runs an online jewelry store.
But reaction overall appeared mixed, reflecting the growing preference for e-mail and social networking.
Muriel Rogers, a retired bookseller, said she doesn't care about the possible Saturday elimination.
She receives personal mail and bills online and most of her mail isn't worth keeping.
The unions that represent mail carriers and post office workers oppose ending Saturday delivery.
"I do not believe that weakening our commitment of six-day service to the public will enhance the long-term position of the Postal Service as a critical element in our nation's economic infrastructure," said Fredric Rolando, president of the National Association of Letter Carriers.
Rolando pointed to a recent report that found the Postal Service had overpaid $75 billion for postal pension costs. Fixing that would provide the service with the "financial breathing room needed to develop a more successful plan."
Davis said those savings would "last a certain period of time," but that more would need to be done.
Tribune Newspapers reporter Kiah Haslett contributed to this report.
xcxkgeiger@tribune.com
By Kim Geiger
Copyright © 2010, Chicago Tribune
7:00 p.m. CST, March 2, 2010
http://www.chicagotribune.com/business/sc-biz-0303-mail--20100302,0,4188261.story
WASHINGTON - — Neither snow nor rain nor heat nor gloom of night prevents mail couriers from the swift completion of their appointed rounds.
Saturdays might be tough, however.
Facing a projected $238 billion loss over the next decade, due in part to the rise of the Internet, the U.S. Postal Service on Tuesday proposed a 10-year plan to bring it into financial health, including putting an end to Saturday mail delivery.
The Postal Service, which is regulated by Congress and the administration but operates without federal assistance, faces "a severe income gap that we absolutely have to close," said Postmaster General John Potter.
Such cost-cutting measures have been proposed, and largely ignored, in the past. Last year, post office representatives pushed multiple times at hearings on Capitol Hill for the authority to end Saturday delivery, change the way the service pays out retiree health benefits and raise prices, all actions that require congressional approval.
The Postal Service predicted that first-class mail volume will drop 37 percent by 2020. Bob Bernstock, the agency's president of mailing and shipping services, said that "creates an urgency that was not there before." The post office generates about half its revenue from first-class mail.
The service has identified measures within its authority to close the shortfall by about $123 billion over 10 years. It cannot eliminate the remaining $115 billion without being granted the authority to implement additional measures, including ending Saturday delivery, estimated to save $40 billion, Bernstock said.
Other savings would come from personnel changes and price hikes, though the price for a first-class stamp will remain at 44 cents through 2010. Post offices would remain open on Saturdays.
U.S. Rep. Danny Davis, D-Ill., a member of the subcommittee that oversees the Postal Service in the House, said that the proposal was "heading in the right direction," but that it is by no means a done deal.
"I think there's going to be a great deal of negotiation, a lot of haggling, if you will, before plans are actually set in stone," Davis said.
Sen. Tom Carper, D-Del., who heads the Senate subcommittee with jurisdiction over the Postal Service, said the service "must be allowed to make the business decisions they need to stay competitive and viable in the years to come."
Some businesses that rely on mail delivery said they worried about how an end to Saturday service would hurt time-sensitive deliveries.
"The persons it really impacts are my customers, the people who are looking forward to receiving their packages," said Laura Lombardi, who runs an online jewelry store.
But reaction overall appeared mixed, reflecting the growing preference for e-mail and social networking.
Muriel Rogers, a retired bookseller, said she doesn't care about the possible Saturday elimination.
She receives personal mail and bills online and most of her mail isn't worth keeping.
The unions that represent mail carriers and post office workers oppose ending Saturday delivery.
"I do not believe that weakening our commitment of six-day service to the public will enhance the long-term position of the Postal Service as a critical element in our nation's economic infrastructure," said Fredric Rolando, president of the National Association of Letter Carriers.
Rolando pointed to a recent report that found the Postal Service had overpaid $75 billion for postal pension costs. Fixing that would provide the service with the "financial breathing room needed to develop a more successful plan."
Davis said those savings would "last a certain period of time," but that more would need to be done.
Tribune Newspapers reporter Kiah Haslett contributed to this report.
xcxkgeiger@tribune.com
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