Nashville – Deputy Postmaster General Pat Donahoe told attendees of the National Catalog Forum that “we need action around catalogs.”
With talk of an impending exigent rate case next year, Donahoe said it’s imperative that the U.S. Postal Service receives resolution involving two key issues: the requirement for the USPS to annually prefund about $5.4 billion from its operating budget for retiree health benefits — an annual payment through 2016 as dictated by the 2006 Postal Reform legislation.
What’s more, the USPS needs Congress to approve five-day mail delivery that would save the Postal Service about $3.1 billion in the first year and as much as $5.2 billion by 2020. “We’ve lost way too much volume in the system,” Donahoe said.
During the spirited session at the forum, put on by the American Catalog Mailers Association, Donahoe added that those two measures — if approved — could greatly reduce potential losses for the USPS, paving the way to potential price relief for catalogers.
Donahoe said the implementation of FSS (Flats Sequencing System) machines — a $1.5 billion investment designed to improve efficiencies and control costs by automating the sorting of flat mail. The Postal Service believes FSS will eventually enable it to sort flat mail in carrier walk sequence at speeds of 16,500 pieces per hour.
This means that carriers will no longer have to case flat mail; large envelopes, magazines and catalogs will arrive in walk sequence order in the same way that letter mail arrives to carriers today.
An animated Donahoe said that he was sorry catalogers got hit so hard with the 2007 postal rate hike. He told the catalogers in the audience that he is working for them and desperately wants action. “We need to make some decisions and move on. Don’t take your eye off the ball. There’s a lot of value in catalogs.”