Marketing and Direct Mail Tips

2011 Postal Reform

The USPS is in need of reform. The success of our industry which not only includes mail providers and the post office, but printers, paper vendors, software providers, publishers, equipment manufacturers, greeting card providers and millions of businesses that rely on the post office for distributing communications, depends on a successful post office. We are very concerned about the harm that could be done to our company and the economy if Congress fails to address the problems facing the USPS.

Congress must pass postal reform legislation in 2011. This legislation is critical to the health of our company and millions like it in the U.S. We are part of a mailing industry that contributes nearly one trillion dollars to the economy and employs over nine million people. Over one million of those jobs are in California.

While the Postal Service is an important part of our industry, it is crucial for businesses and individuals who rely on USPS to deliver a wide range of products including bills statements, invoices, insurance information, periodicals, greeting cards, prescriptions and advertising for large and small businesses.

The Postal Service is a user fee based system, funded almost entirely by postage and 90 percent of that postage comes from commercial sources. Action is needed to insure the viability of the Postal Service.

Key elements to consider in any postal legislation include:

  • In 2006 congress mandated that the USPS pre-fund its retiree medical system on an accelerated schedule. Those payments exceed $5 billion per year for a ten year period that began in 2007. In the severe recession we have faced, these payments have assured the USPS incurs annual deficits.
  • In 2010, two independent actuarial studies showed that the portion of federal retirement attributed to postal employees is over funded by between $50 and $75 billion.
  • The USPS will not be able to make its scheduled retiree medical payment this year and will literally run out of cash before the end of the year if no action is taken.
  • If the USPS collapses, the impact on the mailing industry will be severe. This industry includes paper, printing, mail service, equipment manufacturers, software developers, internet sales, publishers, greeting card manufactures and the millions of businesses that rely on mail to communicate with customers and potential customers.
  • If Congress takes no action and the USPS collapses, the taxpayer will be obligated for the entire failure of the system since previous Congresses guaranteed all of the retirement benefits of postal employees.
  • Congress created the Postal Service as an independent federal service forty years ago. At the same time, it created an arbitration system that compromises the ability of the USPS to reduce labor costs, limits the ability of the USPS to close and consolidate facilities while requiring universal service six days per week.

Key Provisions necessary for effective postal reform:

  • Allow 5 day delivery service, which is estimated to save the USPS $3 billion per year.
  • Enable the USPS to close or consolidate facilities and relocate money-losing post offices into existing retail businesses, saving millions of dollars.
  • Allow USPS leadership to make crucial cost cutting business decisions, including downsizing the workforce and exploring alternative ways to administer benefits.
  • Equitable retiree health care funding including credit for overfunding of CSRS and FERS.
  • Avoid large postage increases which will discourage businesses from using the mail and result in further erosion of mail volumes. Any postal reform should achieve USPS solvency by cost cutting, not by postage increases over and above the CPI cap now in place.

Legislation is pending in the House and Senate to address many of these critical issues. PIA/SD is currently working on a strategy to mobilize the print, mail and communication industries.

PIA/SD members and staff recently met with Congressman’s Issa’s office on this important issue. We need your help to bring this issue to the attention of our elected leaders. We need you to urge your customers, and urge your employees to write about preserving jobs in this industry by cutting costs rather than raising postal rates.

The quickest and easiest way is to go to www.capwiz.com/printing where you can simply input your zip code and the district contact match for both federal and state elected officials will display. Simply copy the letters at the bottom of the linked page here and paste into the body of the form. Hit send and your email will be sent. We also encourage you to copy the letters at the bottom of the page liked Here on your letterhead, sign and send in the mail.

Stay tuned for the next steps you can take to impact postal reform.

If you have any questions or concerns call 619-448-6111 or email info@eyecomm.org. We are glad to help!

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Comments on: "2011 Postal Reform" (2)

  1. There are other alternatives to shutting Saturday USPS delivery. See my blog at:

    http://didiooo.com/2011/09/26/saturday-mail-delivery-by-the-united-states-postal-services-usps/

  2. […] This postage increase along with structural changes are helping the post office cut into their deficit. Taxpayers do not fund the USPS, postage does. However, it is an agency that is closely linked to the government and needs special approvals prior to making many business decisions, including job cuts and price increases. Due to these restrictions, the post office cannot operate like other private businesses are able to, and this impacts both profitability and efficiency. For more information on postal reform check out this blog post. […]

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