Government affairs

On April 16, the Senate Committee on Homeland Security and Governmental Affairs held a hearing on oversight of the Postal Service. The hearing focused on service issues, network modernization, implementation of the Postal Service’s 10-year strategic Delivering for America (DFA) plan, USPS’s finances and other topics.

Postmaster General Louis DeJoy, Chairman of the USPS Board of Governors Roman Martinez, Chairman of the Postal Regulatory Commission Michael Kubayanda and USPS Inspector General Tammy Hull testified at the hearing.

In his opening statement, Postmaster General DeJoy acknowledged the success of the Postal Service Reform Act of 2022 but emphasized that it was only the first step: “What we need now is for our stakeholders to support us in the implementation of key self-help initiatives outlined in the Delivering for America plan that are critically necessary and that will ultimately enable our operational and financial success.”

In his opening remarks, Chairman Martinez focused on the Postal Service’s finances and referenced “uncontrollable factors” that negatively affect the agency’s bottom line, such as the requirement for postal retirement funds to be invested in low-yield U.S. Treasury bonds, which produce minimal returns, and the Postal Service’s disproportionate obligation to Civil Service Retirement System pension funds.

Chairman Kubayanda expressed concern with the Postal Service’s performance in his opening statement and encouraged the agency’s leaders to be “transparent with stakeholders.”

In her opening statement, Inspector General Hull discussed ongoing audits of regional processing and distribution centers in Virginia, Georgia and Oregon, as well as service performance reviews in Missouri, Minnesota, North Dakota, California and Washington, DC.

Many of the questions posed by senators focused on the implementation of the plan and its effects on service. Sens. Maggie Hassan (D-NH), Jacky Rosen (D-NV), Jon Ossoff (D-GA), Laphonza Butler (D-CA), Josh Hawley (R-MO), Roger Marshall (R-KS) and Richard Blumenthal (D-CT) all referred to specific local issues related to service delays or problems with postal facilities.

DeJoy acknowledged issues in the plan’s rollout, especially in Atlanta, GA, and Richmond, VA. “We apologize to the constituents that have received that service. But in the long term, if we don’t make these changes, that will be every day everywhere around the nation,” he said. While the postmaster general recognized the “significant obstacles” that lie ahead for the DFA plan, he also cited the “significant progress” that has been made.

Outside of service questions, Ranking Member Rand Paul (R-KY) criticized the Postal Service’s labor practices. He called converting non-career. postal workers to career “nonsensical” since it makes their pay and benefits more expensive for the agency. DeJoy defended the decision, saying that it was the “right thing to do,” and that it improved employee retention.

In their questioning, Chairman Gary Peters (D-MI), Sen. James Lankford (R-OK) and Ranking Member Paul all stated that the Postal Service needed a new investment strategy for its retirement funds instead of keeping them in low-yield Treasury bonds. NALC has had productive conversations on Capitol Hill with lawmakers about an updated, responsible, more-profitable investment strategy for these funds.

Sen. Tom Carper (D-DE) brought up the Postal Service Health Benefits Program, which is set to launch this year under the Postal Service Reform Act. When asked if the Postal Service and the Office of Personnel Management were prepared to implement this program, DeJoy said it “is moving nicely along and we’ll be ready to implement.”

Sens. Butler and Rosen also brought up the upcoming election and the Postal Service’s immense responsibility to deliver tens of millions of ballots. Postmaster General DeJoy ensured that the agency was prepared and committed to another successful election season. Inspector General Hull agreed that this is a top priority. She said that the OIG will release its election mail readiness audit in late summer and will visit delivery units and plants across the country to observe operations and flag problems in advance of November’s Election Day.

The hearing concluded with Chairman Peters saying he remains “laserfocused” on service. He emphasized the need for transparency and requested a list of locations the Postal Service plans to change with specific timelines for implementation, full-service data on every location implemented so far, and documentation for any cost projections from Postmaster General DeJoy by May 1. The two did not reach an agreement on that.