Postal Reform

The U.S. Postal Service (USPS) is the fundamental component of a $1 trillion mailing industry that employs about 8 million Americans in large and small business enterprises. However, with a net loss of $5.5 billion in fiscal 2014, USPS remains in a financially precarious position without action from Congress. In addition, approximately one-third ($6 billion worth) of communications papers produced in the U.S. are delivered through the mail system.

The mailing industry and the U.S. economy depend on a healthy Postal Service. Serving 153 million residents, offices and businesses across the country, the Postal Service connects people and business transactions through a sophisticated delivery infrastructure no other entity can provide. While first class letter mail volumes are declining, commercial customers are vital to the long-term viability of the Postal Service, representing 71 percent ($46 billion) of USPS revenue in FY 2013.

AF&PA supports legislative measures that will enable USPS to become financially self-sufficient and compete in today’s business environment.

AF&PA advocates postal reform solutions that:

• Ensure the fiscal viability of the USPS by eliminating unreasonably imposed financial obligations;

• Modernize the business model to enable innovation and new revenue sources;

• Support service models that meet the needs of citizens and customers;

• Ensures postal rate setting has checks and balances that provide price predictability for mailers and cost-control incentives for USPS; and

• Enable mail as a cost competitive option for business communications.

Raising rates and reducing services are counter-productive in an economy where industry and consumers are seeking faster and cheaper delivery options for communications and business transactions. These actions would simply make mail less competitive and further accelerate volume and revenue losses.

• AF&PA opposes postal rate increases as the path to restore USPS financial viability, as increases above inflation level will drive commercial mailers away from the mail system.

• AF&PA opposes reducing weekly mail service delivery to 5 days until other cost-saving options are considered before implementing service level reductions.

• AF&PA believes USPS should not have unchecked authority to set postal rates, as it has a monopoly on delivery of market dominant products.

• AF&PA supports the elimination of unreasonable USPS financial obligations (benefit pre-funding) and the return of Federal Employees’ Retirement System overpayments to the Postal Service.

USPS is a vital service relied upon by all Americans and AF&PA supports reform that allows the
USPS to continue serving its mission. Only Congress can provide the necessary tools through
comprehensive legislation that will provide USPS with the flexibility and authority to quickly adapt
to changing market needs.