Congressional Postal Hearing Puts USPS on Trial

Washington—On May 16, with the U.S. Postal Service staring at losses of more than $5 billion during the next two years, the House Committee on Government Reform held its second formal hearing on the USPS’s financial crisis. Catalogers were represented by Association for Postal Commerce president Gene Del Polito, Direct Marketing Association senior vice president, government affairs Jerry Cerasale, and R. R. Donnelley Logistics president John Campenelli. The hearing came just more than a week after the USPS announced it would raise its rates for the second time this year.

“I’ve never in my 18 years in this business seen people react to what they perceive to be the approach of the Board of Governors [BOG] and the Postal Service management with such anger,” Del Polito testified. “Mailers are tired of being the monkey in the middle between the Postal Service and the Postal Rate Commission. It’s nice to see that after six years, people are finally beginning to agree that reform is a necessity and now is the time to get it done.” Del Polito was referring to the Postal Reform Act (later retitled the Postal Modernization Act), which never made it to the floor of the House between 1996 and 2000.

Campenelli of R.R. Donnelley Logistics, which oversees the zone-skipping courier known as CTC. Distribution Direct before Donnelley bought it last year, suggested several improvements that could be made without the need for congressional approval:

*Offer worksharing discounts to mailers who use more-efficient containers or insert mail deeper into the system, saving the USPS money.

*Reexamine the rules governing sortation, containerization, and acceptance scheduling to allow multiple classes of mail to be combined to achieve the densities required for drop-ship and presort discounts.

*Allow the use of mixed mail pallets to control costs by maximizing cube and weight loads when transferring mail.

*Introduce less expensive and faster electronic filing formats.

*Establish a real-time communications system that enables shippers to organize their schedules to ensure that mail and products get to consumers on time.

A day before the hearing, BOG chairman Robert Rider proposed to Congress a mail classification system that would enable the agency to maintain its monopoly for basic mail delivery but give it more flexibility with other services. Rider told Congress that the BOG wants the USPS to operate like a private company with regard to labor, so that it can remove salary caps and change the salary bargaining system.

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