Postal Updates

New USPS ‘Delivering for America’ plan calls for higher prices and slower deliveries

Mar 23, 2021, 4 PM

By Bill McAllister, Washington Correspondent

Postmaster General Louis DeJoy’s long-awaited 10-year plan to rescue the financially troubled United States Postal Service calls for higher stamp prices, slower deliveries and the revamping of how mail travels.

Details of the plan were released March 23. Ron Bloom, chairman of the Postal Service’s board of governors, hailed the plan as a way to “restore this American treasure,” the American mail system.

Democrats in the House of Representatives, many of whom have been angry with DeJoy, sought to put a brake on the plan, saying they were upset with the slower mail standards.

“Postmaster General DeJoy has put forth a draconian plan that guarantees the death spiral of the United States Postal Service,” said Rep. Gerald E. Connolly, D-Va., chairman of the House Subcommittee on Government Operations.

At an online unveiling of the plan, DeJoy and top postal officers insisted that the changes should start quickly and warned that any interruption to the planned overhaul would undermine the plan.

As DeJoy put it, “The need for the U.S. Postal Service to transform to meet the needs of our customers is long overdue.”

The agency’s future, as the plan describes it, lies more in packages and less in letter mail.

Details about stamp price increases and what postal facilities might be closed were not announced.

DeJoy said it was too soon to predict how much stamp prices will rise, but he promised the Postal Service would be judicious in implementing newly granted authority to let rates rise above the rate of inflation.

The plan calls for $44 billion in higher rates over 10 years.

What has happened to the USPS, DeJoy said, is the product of years of neglect as mail volumes plunged dramatically.

Now is the time to rebuild the organization with a remodeled transportation system that relies on trucks rather than airplanes to carry most letters and has new delivery standards, postal officials said.

Those standards will give the USPS five days to send a first-class letter across the country instead of the three-day standard, which is one of the delivery standards that DeJoy said the agency rarely has met.

Most local mail, which takes two days, will not be affected, the officials said.

Titled “Delivering for America,” the plan made clear that the need for widespread change had emerged in the past year.

“It was evident to us that the COVID-19 pandemic had exacerbated and highlighted the many long neglected shortcomings of our inflexible, misaligned, and underperforming business model and operating practices,” the report said.

Representatives of two large mail industry groups were critical of the plan, saying their organizations had not been consulted and warning that DeJoy’s price tag of $44 billion in higher stamp prices may be too high.

Mark Dimondstein, head of the American Postal Workers Union, praised some aspects of the plan but voiced “deep concerns” about “any proposals that would slow the mail, reduce access to post offices or further pursue the failed strategy of plant consolidation.”

National Association of Letter Carriers president Fredric Rolando also offered a mixture of praise and “obvious concerns with certain operational elements of the plan.”

“Mail users, who were not consulted during the plan’s development, are being asked to throw their support behind a plan that will have them pay an additional $44 billion over the next ten years, as service is degraded, so that the Postal Service can grow its package business,” said Michael Plunkett, president of the Association for Postal Commerce. “That sounds like a tall order to me.”

Stephen Kearney, executive director of the Alliance of Nonprofit Mailers and a former senior postal executive, also attacked the proposed rate increases, saying imposing those increases on “captive monopoly customers will not work.”

“Mailers will leave in droves,” Kearney added, saying the $44 billion increase “will prove to be the plan’s Achilles heel.”

DeJoy and his team were enthusiastic about the proposed changes, saying that the USPS will accumulate another $160 billion in debt during the next 10 years without the plan.

They did acknowledge that the Postal Service cannot make all the changes alone.

Some steps, such as dismissing the agency’s unpaid health care costs, will require congressional approval.

Other steps, including stamp price increases, must win support from the Postal Regulatory Commission as well as the board of governors.

But the five current postal governors, who were appointed by former President Donald Trump and selected DeJoy as postmaster general, are behind the changes.

In his presentation, DeJoy disclosed that he is expecting the agency will lose 60,000 administration positions as a cost-saving step that apparently is a result of the restructuring of regional and district offices that DeJoy announced March 3 (Linn’s, March 22, page 16).

Rep. Carolyn B. Maloney, D-N.Y., chairwoman of the House Committee on Oversight and Reform, expressed concern that DeJoy announced the plan without consulting with Congress.

“I am extremely concerned about the Postal Service’s unacceptable decision to make permanent slower mail delivery despite substantial public and Congressional opposition and its failure to fully engage with Congressional leaders and postal stakeholders during the development of Postmaster General DeJoy’s plan,” she said.

Maloney called on DeJoy to not implement the plan until lawmakers “have the opportunity to fully review it and provide substantive feedback.”

Rep. Stephen F. Lynch, D-Mass., urged lawmakers to “continue to develop a bipartisan postal reform plan.”

Lynch said the DeJoy plan cannot be viewed “as anything other than a gratuitous slap” at the nation’s postal workers.

Chris Allen, a spokesman for FedEx Corp., which has consistently been the Postal Service’s major air transport firm, said in a statement the company was aware of the new plan and was reviewing it.

“FedEx has long supported reforms that would give the U.S. Postal Service the ability to adapt and prosper in a rapidly changing market with ever-shifting customer needs,” Allen said.

In contrast to the Democrats’ condemnation, Rep. James Comer, R-Ky., the ranking Republican on the House Committee on Oversight and Reform, praised DeJoy’s action.

“Congress must objectively consider USPS’s plan before we take any other action,” Comer said. “I hope my Democratic colleagues will abandon their partisan postal politics and give the plan a fair shot.”

For more information about the plan, visit the USPS website.

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