Congressional action is needed now to preserve small-town mail service

February 4, 2016

WASHINGTON—If Congress does not act quickly to reform the U.S. Postal Service, small-town America can expect a further slow-down of the mail, said Chip Hutcheson, publisher of The Times-Leader in Princeton, KY, when he testified to a U.S. Senate committee Jan. 21.

Hutcheson, president of the 130-year-old National Newspaper Association, told the Senate Committee on Homeland Security and Governmental Affairs that the closing of many mail processing plants by the troubled Postal Service over the last decade has already hurt mail service, which in turn damages local economies. He said a survey of his 2,300-member association of community newspapers indicated more than 92 percent said they have had recent problems getting newspapers through the mail on time. Nearly half report problems with First-Class or Priority Mail as well. NNA represents community newspapers, including more than 2,000 weeklies that largely depend upon mail distribution to reach readers.

Congress has been trying since 2008 to reach agreement on legislation to help the Postal Service address falling mail volumes, but still serve every household in America. Postmaster General Megan Brennan testified that the Postal Service had incurred $56.8 billion in net losses since 2007.

The testimony was offered by NNA in a hearing called by Committee Chair Ron Johnson, R-WI, entitled “Laying Out the Reality Of the Postal Service.” Johnson and his committee are being asked by a coalition of businesses that use the mail and of postal workers to prevent further mail cutbacks.

Sen. Thomas Carper, D-DE, has introduced the Improving Postal Operations, Service and Transparency
(iPOST) Act, to prompt action on Capitol Hill. Hutcheson told the committee the bill could serve as a foundation for congressional action this year, but urged Congress to act before April, when USPS finances are expected to worsen by $1 billion because of a court-ordered postage rollback.

One aspect of iPOST is to end the double-funding of retiree health benefits for postal workers, which is funded by postage payments. iPOST would shift postal retirees onto Medicare upon retirement, to which postage-payers contribute on workers’ behalf. A separate federal health care package for postal workers is also supported by postage payments. USPS employee groups have supported the shift to Medicare integration to help USPS address its financial troubles. By streamlining the payments, USPS would no longer be required to pay into the separate benefit fund, mailers would not have to support a dual track system and more money would be available to support postal operations.

Hutcheson said the change would give the Postal Service the relief it needs to keep the mailing system fluid and effective without damaging taxpayers. He objected to the current funding mandate, which he said makes small businesses like his contribute extra postage payments while struggling to provide benefits for their own workers.

“The taxpayers have benefitted for some years now by our extra postage obligations. It is time for Congress to end this unfair hit on small businesses,” he said.

Finding financial solutions for USPS such as the Medicare integration is critical, Hutcheson said, so that more service cutbacks can be avoided, which he called particularly damaging for smaller communities.

Hutcheson addressed the digital divide, in which a third of rural residents do not have broadband service. Dependence upon print communications and the mail in general is heavy among minorities, the poor and in rural areas, he said. Where newspapers are concerned, the printed newspaper in the mail supplies the revenue to support the digital news that younger and more affluent readers may use.

“All of this makes the mail absolutely critical. In small-town America, we need it for medicines, to apply for jobs, to vote and to receive the newspaper,” he told the committee.

He commended the Postal Service for initiating a new study to measure on-time delivery for rural areas, and he said NNA looks forward to the results of the study this year.

In April, USPS is under court order to lower postage rates so it is no longer collecting extra funds permitted during the Great Recession. The rollback is expected to deepen the agency’s financial woes. Hutcheson said his organization had reluctantly concluded that the rollback should not occur and urged the committee to pass legislation in time to prevent it.

“NNA’s support for suspending the mandate to roll back postage rates in April is contingent upon the Postal Service’s commitment to enact no further systematic service cuts and to live within its means without more exigency increases. To us, that translates into suspending further plant closings and continuing the postmaster general’s commendable efforts to trim costs without risking more mail volume loss through service cuts,” Hutcheson said.

A copy of the publisher’s full statement is available at www.nnaweb.org.

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