April 2020
As the USPS continues to struggle financially, its difficulties are being significantly compounded by a sharp decline in mail volume due to the COVID-19 pandemic. The House version of the Coronavirus Aid, Relief and Economic Security Act (CARES Act), H.R. 748, included provisions that sought to relieve financial pressure on the USPS resulting from the pandemic. Those provisions were largely omitted from the version of the bill passed by the Senate, which became law on March 27, 2020.
Unfortunately, the assistance for the USPS approved in the CARES Act (a $10 Billion expansion of the authority of the USPS to borrow from the U.S. Treasury) is widely considered to be inadequate to enable the USPS to continue operations past the end of summer. The USPS had sought additional emergency funding through the Act. Moreover, the additional borrowing authority includes a requirement that new loans cannot be used to repay existing debt. USPS Manager of Public Relations David Partenheimer said, “Under a worst-case scenario, [the downturn in the USPS’s core business] could result in the Postal Service having insufficient liquidity to continue operations.”
In an effort to both recognize the critical role the USPS plays in the US economy, and to ensure the long-term viability of the Postal Service, House members are working to include in the next stimulus package additional financial assistance for the USPS. A letter from leading House Democrats to Speaker Pelosi and Leader McCarthy in the House, and Leaders McConnell and Schumer in the Senate requests significant increases to aid provided to the USPS. The letter seeks:
- $25 billion in emergency funding;
- The elimination of outstanding debt owed by the USPS to the Department of the Treasury;
- Authorization to borrow up to an additional $15 billion from the Treasury;
- Prioritization of the delivery of medical supplies pursuant to the National Emergency President Trump declared on March 13, 2020 under the Stafford Act;
- Authorization of appropriations of up to $250 million per year to cover unfunded mandates, including the cost of paid parental and family leave;
- A requirement that postal employees enroll in Medicare, which would provide significant long-term reductions in retiree health care costs; and
- Allowing the Postal Service to engage in additional non-postal business, particularly with state and local governments.
The letter points out that aid given to the airline industry amounted to $50 billion in loans and grants, a figure the letter claims represents $110,000 per airline industry employee. Aid provided to the US Postal Service at a similar rate per postal employee would exceed $68 billion in the aggregate.
The need for financial relief for the USPS has been critical for many years. According to the letter, the current pandemic has intensified the problem and compressed the time frame for rescuing the USPS. Relief from Congress is more important than ever, and supporters of the USPS have encouraged Congress to adopt the recommended path to financial stability for the USPS.
Read Letter here
Read text of CARES Act here