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LEGISLATIVE PROPOSALS TO PUT THE POSTAL SERVICE ON SUSTAINABLE FINANCIAL FOOTING HEARING BEFORE THE COMMITTEE ON OVERSIGHT AND REFORM HOUSE OF REPRESENTATIVES ONE HUNDRED SEVENTEENTH CONGRESS FIRST SESSION FEBRUARY 24, 2021 Serial No. 117–4 Printed for the use of the Committee on Oversight and Reform ( Available on: govinfo.gov, oversight.house.gov or docs.house.gov U.S. GOVERNMENT PUBLISHING OFFICE 43–780 PDF WASHINGTON : 2021 COMMITTEE ON OVERSIGHT AND REFORM CAROLYN B. MALONEY, New York, Chairwoman ELEANOR HOLMES NORTON, District of JAMES COMER, Kentucky, Ranking Minority Columbia Member STEPHEN F. LYNCH, Massachusetts JIM JORDAN, Ohio JIM COOPER, Tennessee PAUL A. GOSAR, Arizona GERALD E. CONNOLLY, Virginia VIRGINIA FOXX, North Carolina RAJA KRISHNAMOORTHI, Illinois JODY B. HICE, Georgia JAMIE RASKIN, Maryland GLENN GROTHMAN, Wisconsin RO KHANNA, California MICHAEL CLOUD, Texas KWEISI MFUME, Maryland BOB GIBBS, Ohio ALEXANDRIA OCASIO-CORTEZ, New York CLAY HIGGINS, Louisiana RASHIDA TLAIB, Michigan RALPH NORMAN, South Carolina KATIE PORTER, California PETE SESSIONS, Texas CORI BUSH, Missouri FRED KELLER, Pennsylvania DANNY K. DAVIS, Illinois ANDY BIGGS, Arizona DEBBIE WASSERMAN SCHULTZ, Florida ANDREW CLYDE, Georgia PETER WELCH, Vermont NANCY MACE, South Carolina HENRY C. ‘‘HANK’’ JOHNSON, JR., Georgia SCOTT FRANKLIN, Florida JOHN P. SARBANES, Maryland JAKE LATURNER, Kansas JACKIE SPEIER, California PAT FALLON, Texas ROBIN L. KELLY, Illinois YVETTE HERRELL, New Mexico BRENDA L. LAWRENCE, Michigan BYRON DONALDS, Florida MARK DESAULNIER, California JIMMY GOMEZ, California AYANNA PRESSLEY, Massachusetts VACANCY DAVID RAPALLO, Staff Director MARK STEPHENSON, Director of Legislation ETHAN VANNESS, Professional Staff ELISA LANIER, Chief Clerk CONTACT NUMBER: 202-225-5051 MARK MARIN, Minority Staff Director (II) CONTENTS Page Hearing held on February 24, 2021 ....................................................................... WITNESSES The Honorable Ron Bloom, Chairman, United States Postal Service Board of Governors Oral Statement ................................................................................................. 10 Mr. Louis DeJoy, Postmaster General, United States Postal Service Oral Statement ................................................................................................. 11 Ms. Tammy Whitcomb, Inspector General, United States Postal Service Oral Statement ................................................................................................. 13 Mr. Mark Dimondstein, President, American Postal Workers Union, AFL- CIO Oral Statement ................................................................................................. 15 Mr. Joel Quadracci, Chairman, President, and Chief Executive Officer, Quad/ Graphics Oral Statement ................................................................................................. 16 Mr. Kevin Kosar, Resident Scholar, American Enterprise Institute Oral Statement ................................................................................................. 18 Written opening statements and the written statements of the witnesses are available on the U.S. House of Representatives Document Repository at: docs.house.gov. (III) INDEX OF DOCUMENTS * Rep. Connolly’s Statement for the Record. * Rep. Lynch’s Statement for the Record. * Rep. Lawrence’s Statement for the Record. * Letter, Peters and Portman Letter of Support; submitted by Chairwoman Maloney. * ‘‘How to Fix the US Postal Service,’’ article, Roll Call; submitted by Chairwoman Maloney. * Letter, National Association of Postal Supervisors; submitted by Chair- woman Maloney. * Letter, Alliance of Nonprofit Mailers; submitted by Chairwoman Malo- ney. * Letter, Federal Law Enforcement Officers Association; submitted by Chairwoman Maloney. * Letter, Postal Regulatory Commission; submitted by Chairwoman Malo- ney. * Letter, United Postmasters and Managers of America; submitted by Chairwoman Maloney. * Letter, MPA-The Association of Magazine Media; submitted by Chair- woman Maloney. * Letter, National Active and Retired Federal Employees Association; sub- mitted by Chairwoman Maloney. * Letter, The Association for Postal Commerce; submitted by Chairwoman Maloney. * ‘‘Protestors Gather Outside of Postmaster General DeJoy’s Home,’’ article, WUSA 9; submitted by Rep. Biggs. * ‘‘Burned Post Offices Destroyed in Minneapolis Unrest Leave a Void,’’ article, StarTribune; submitted by Rep. Biggs. * Statement, National Association of Letter Carriers; submitted by Rep. Biggs. * ‘‘USPS Shuts Down Mail Delivery at 7 Post Offices in Twin Cities for Friday,’’ article, Fox 9; submitted by Rep. Biggs. * ‘‘Reward Offered for Details in Post Office Looting,’’ article, Chicago Sun Times; submitted by Rep. Biggs. * ‘‘Rep. Ayanna Pressley Calls for ‘Unrest in the Streets’ Over the Failures of the Trump Administration,’’ article, Black Enterprise; submitted by Rep. Biggs. * ‘‘Antifa Lay Siege to Lancaster Police Precinct Following Latest Officer- Involved Shooting,’’ article, RT.com.usa; submitted by Rep. Biggs. * ‘‘Kenosha’s Main Post Office Closes Indefinitely Due to Violent Riots,’’ article, Breitbart; submitted by Rep. Biggs. * ‘‘US Postal Service Vans Stolen and Torched by Rioting Minneapolis Protestors,’’ article, The Gateway Pundit; submitted by Rep. Biggs. * Testimony, American Catalog Mailers Association (ACMA); submitted by Rep. Comer. * USPS IG Report, Mail Delivery and Customer Service Issues - Select Chicago Stations, Chicago, IL; submitted by Rep. Davis. * Letter, Chicago Delegation USPS Inquiry; submitted by Rep. Davis. (IV) * National Association of Letter Carriers PAC Profile; submitted by Rep. Foxx. * American Postal Workers Union PAC Profile; submitted by Rep. Foxx. * National Postal Mail Handlers Union Profile; submitted by Rep. Foxx. * Letter, Postal Operations Response Letter; submitted by Rep. Gibbs. * Questions for the Record: to Mr. Bloom; submitted by Chairwoman Malo- ney. * Questions for the Record: to Mr. Quadracci; submitted by Chairwoman Maloney. * Questions for the Record: to Mr. DeJoy; submitted by Chairwoman Malo- ney. The documents listed above are available at: docs.house.gov. (V) LEGISLATIVE PROPOSALS TO PUT THE POSTAL SERVICE ON SUSTAINABLE FINANCIAL FOOTING Wednesday, February 24, 2021 HOUSE OF REPRESENTATIVES, COMMITTEE ON OVERSIGHT AND REFORM, Washington, D.C. The committee met, pursuant to notice, at 10:13 a.m., 2154 Ray- burn House Office Building, Hon. Carolyn Maloney [chairwoman of the committee] presiding. Present: Representatives Maloney, Norton, Lynch, Cooper, Con- nolly, Krishnamoorthi, Raskin, Mfume, Porter, Tlaib, Bush, Davis, Wasserman Schultz, Welch, Sarbanes, Speier, Kelly, Lawrence, DeSaulnier, Gomez, Pressley, Comer, Jordan, Foxx, Hice, Grothman, Cloud, Gibbs, Higgins, Keller, Sessions, Biggs, Donalds, Herrell, LaTurner, Fallon, and Clyde. CHAIRWOMAN MALONEY. The committee will come to order. With- out objection, the chair is authorized to declare a recess of the com- mittee at any time. I now recognize myself for an opening state- ment. Good morning, and I want to welcome all of our witnesses and thank everyone for participating in this important hearing on the future of the Postal Service. The Postal Service is one of our Nation’s most vital and respected institutions. It provides service across the country to every single address and it adds over a million new delivery points every year. It binds our Nation together in the way that no other agency or or- ganization does. Unfortunately, the Postal Service is facing a dire financial situa- tion that requires us to act. On Friday, we circulated draft legisla- tion with proposals to address some of the most important factors driving up costs for the Postal Service. I will address one of those proposals, Medicare integration, and some of my colleagues will address the other provisions. First, while all postal employees pay into Medicare through their careers, not all retirees enroll when they reach age 65. Approxi- mately 73 percent of retirees are enrolled, but the other 27 percent are not. The Postal Service has paid about $35 billion dollars into Medi- care since 1983. The draft bill would require current employees to enroll in Medicare when they reach 65. Retirees who are already over 65 would be given a three-month period to enroll with no pen- alty. (1) 2 While employees and retirees would keep Federal health benefits through a new health plan, Medicare would be the primary payer. Keep in mind that these employees have already paid into the system. This reform, known as Medicare integration, would cut long-term costs by reducing copays and other medical costs for re- tirees. It would also save the Postal Service about $10 billion over 10 years. These are critical savings that will help the Postal Service become more financially sustainable. In addition to Medicare integration, my colleagues will discuss how the bill would eliminate the unfair requirement that the Post- al Service prefund retiree health benefits for 75 years into the fu- ture. Eliminating this unfair provision would take approximately $35 billion off of the Postal Service’s books. They will also discuss how the bill would increase transparency to ensure that service stand- ards are met. On that note, we all know the Postal Service implemented a number of changes last year that resulted in widespread service de- terioration across the country. Part of that was caused by the coronavirus pandemic, and postal employees who are on the