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House Passes Overhaul of Postal Service Budget to Relieve Billions in Debt

The bill relieves the agency of $57 billion of its over $200 billion in debt.

A USPS truck drives on a local street on February 24, 2021, in New York City.

On Tuesday, the House passed a bill that relieves tens of billions of dollars of debt for the United States Postal Service (USPS), a financial burden that agency advocates and leaders say has been preventing the agency from operating efficiently for years.

The legislation relieves the agency of $57 billion of its financial liabilities, brought on largely by a requirement imposed in 2006 that the postal service pre-pay Medicare costs for employees decades before they retire. The bill also gets rid of that mandate, which will save the agency an estimated $50 billion more over the next 10 years.

Legislators say that the bill will be transformative for the agency, which has been struggling under debts that have ballooned to over $200 billion in the past decades. USPS leaders have been asking for a change for years, saying that the agency’s financial burdens are barring it from modernizing and making necessary overhauls to its services.

Sen. Chuck Schumer (D-New York) has said that the Senate will take up the bill before the end of week.

The bill passed on a bipartisan basis, 342 to 92, with all Democrats voting yes. Democrats have said that the bill has the ability to revitalize the Postal Service, which is crucial for mailing things like ballots and medications.

“Today’s historic bipartisan vote brings us one step closer to finally putting the Postal Service on a sound financial footing so it can continue serving all Americans for years to come,” Rep. Carolyn B. Maloney (D-New York), who introduced the bill, said in a statement. “These reforms ensure the Postal Service continues as an independently operated organization that Americans can continue to rely on for the years to come.”

The bill contains transparency measures mandating that the agency create an online dashboard that allows customers to see service performance data. It also requires the agency to deliver mail and packages at least six days a week.

Republicans voted for the bill because they view it as an endorsement of GOP Postmaster General Louis DeJoy and his plans for the agency. DeJoy has incorporated the bill into his 10-year plan for the Postal Service, which has been the subject of widespread derision for its initiatives to slow deliveries while raising prices. The plan took effect last September.

“The Postal Service Reform Act is about the only thing we agree with Louis DeJoy on,” Porter McConnell, campaign director for Take on Wall Street and co-founder of the Save the Post Office Coalition, said in a statement. “Now it’s time for the Senate to pass the bill and send it to the president’s desk.”

Democrats originally wanted to include additional provisions in the bill, like electric vehicle funding and mail-in voting protections. They also wanted to restrict the ability of the postmaster general and the Postal Board to participate in political campaign activities, which has been the subject of scrutiny after reporting revealed that a number of board members have ties to the Republican Party establishment.

The bill was shaved down in negotiations with Republicans, DeJoy and the postal unions, as reforms like voting rights protections would have stood little chance of getting enough Republican approval to pass the Senate.

The USPS recently faced pushback from the Biden administration for its plan to spend billions of dollars on a gas-powered mail fleet despite the White House’s push to electrify the fleet instead. Under the new plan, only 10 percent of the fleet would be electric; the Environmental Protection Agency (EPA) has pointed out that mail trucks are especially harmful for the climate and local air quality because of how much gas they require to operate.

DeJoy has also faced a years-long campaign to oust him from the agency, with critics citing his complicity in Donald Trump’s plan to invalidate the 2020 election. However, the Postal Board currently doesn’t have the votes to get rid of him, and two of Joe Biden’s Democratic nominations, who could flip the board in favor of replacing DeJoy, are still waiting to be confirmed by the Senate.

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