Postal Updates

GOP breaks with DeJoy over postal banking

Oct 28, 2021, 12 PM

Washington Postal Scene by Bill McAllister

Two senior Republican leaders in the House of Representatives have broken with Postmaster General Louis DeJoy over the United States Postal Service’s test of limited check cashing services at four East Coast locations.

In an Oct. 22 letter to DeJoy, the ranking House GOP members of the Committee on Oversight and Reform and the Committee on Financial Services expressed shock that the USPS would have embarked on the test without informing Congress.

“Not only does USPS lack the statutory authority to expand its non-postal services without congressional approval, but USPS has neglected to share information about this pilot program [with the two committees],” said Rep. James Comer, R-Ky., and Rep. Patrick McHenry, R-N.C.

They also called the action “a significant deviation from what USPS communicated to Congress in public and private.”

During what they called “lengthy negotiations,” the two lawmakers said the postmaster general had “never once raised the Postal Service’s intention to expand into banking services.”

In addition they noted that DeJoy’s 60-page Delivering for America plan makes no mention of postal banking.

“It is unclear why the Postal Service believes itself to be ready for the added responsibility of offering expanded financial services,” Comer and McHenry said, citing the agency’s prolonged effort to end its annual multibillion dollar deficits.

On Oct. 4, the USPS confirmed that it had begun offering limited check cashing services at four locations on Sept. 13. (Linn’s reported on the check cashing test in the Oct. 25 issue.) The locations are Washington, D.C.; Falls Church, Va.; Baltimore, Md.; and the Bronx, N.Y.

The test, which is being conducted with the support of the American Postal Workers Union, allows customers to use either business or payroll checks to purchase gift cards with a value of up to $500.

Until now, House Republicans have tended to support DeJoy, who was a major GOP financial supporter before he was named to the top postal job in June 2020.

The agency said that its check cashing program “aligns with the Postal Service’s Delivering for America 10-year plan to achieve financial sustainability and service excellence.”

The Postal Service once had an extensive banking program, but it abandoned it in 1967.

Banking organizations have been opposed to the agency re-entering banking, but a number of Democratic lawmakers have urged the USPS to offer banking in communities that are not well served by commercial banks.

Tatianna Roy, a Postal Service spokeswoman, said the USPS had promised to brief the congressmen in the coming weeks.

“We believe once we have an opportunity to clarify both the limited nature and scope of the pilot program the concerns expressed will be allayed,” she said.

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