Coalition opposes H.R. 756, the “Postal Service Reform Act of 2017”
We, the undersigned organizations, representing millions of taxpayers and consumers nationwide, urge Congress to oppose H.R. 756, the “Postal Service Reform Act of 2017” introduced by House Government Oversight Committee Chairman Jason Chaffetz, and the Committee’s Ranking Member Elijah Cummings.
For years, the U.S. Postal Service (USPS) has suffered from operational and financial inefficiencies, and while reforms are needed, H.R. 756 misses the mark and may actually exacerbate the issues facing USPS.
The USPS enjoys a monopoly on the delivery of first-class and standard mail and is exempt from state and local sales, income, and property taxes. The USPS also has the power of eminent domain, is not subject to local zoning ordinances, and has borrowed billions from the Treasury at subsidized interest rates.
Despite such special treatment, which is estimated to be $18 billion annually in indirect subsidies, USPS’s financial health is continually waning. Since 2007, USPS has posted more than $50 billion in losses and faces $125 billion in unfunded liabilities. Much of this stems from USPS’s inability to adapt to changing markets, congressional impediments, and union quagmires.
Many of the reforms provided for in H.R. 756 lead USPS further away from the core mission of mail delivery, unfairly shift the Postal Service’s financial burdens onto the American public, and fail to address many of the underlying issues facing USPS.
Postal Rate Reforms and Increases. Chairman Chaffetz’s reform bill would allow the Postal Service to increase rates by 2.15 percent on monopoly products such as stamps. Monopoly products generate the bulk of USPS profits. Increasing rates will only reduce revenue and further drive more consumers away from USPS products and services.
Diversion to Nonpostal Products and Services. Key provisions contained in H.R. 756 would allow the Postal Service to divert resources away from the core mission of mail delivery to providing nonpostal products and services to state, local, and tribal governments and federal agencies. The Act creates a “Chief Innovation Officer” tasked with managing the development and implementation of nonpostal products. While intended to generate new sources of revenue, such provisions are only a point of distraction, and will see the Postal Service further competing with private firms.
Postal Service Governance Reform. The USPS Board of Governors is comprised of nine members, not including the Postmaster General and Deputy Postmaster General, who are Presidentially appointed and confirmed by the Senate and serve seven-year terms. Since 2015, the Board of Governors has had only one Governor serving due to congressional hurdles. H.R. 756 would reduce the USPS Board of Governors from a nine-member board to a five-member board. This hollow reform does nothing to actually improve USPS governance, and instead reinforces the fact that most of the provisions in the bill are simply reforms for the sake of reforms, having no real impact on the status quo.
We recognize the need for reforming the U.S. Postal Service. However Chairman Chaffetz’s Postal Service Reform Act ignores basic needed reforms to USPS, and instead increases rates, shifts USPS’s financial burden onto the American public, and allows for the diversion of resources away from the core mission of mail delivery.
It is for these reasons that we ask members of Congress to oppose this legislation.
Grover G. Norquist Adam Brandon
Americans for Tax Reform Freedom Works
David Williams George C. Landrith
Taxpayers Protection Alliance Frontiers of Freedom
Jim Martin Mario Lopez
60 Plus Association Hispanic Leadership Fund
Phil Kerpen Sabrina Schaeffer
American Commitment Independent Women’s Forum
John M. Palatiello Andrew Langer
Business Coalition for Fair Competition Institute for Liberty
Norm Singleton Kory Swanson
Campaign for Liberty John Locke Foundation
Andrew F. Quinlan Seton Motley
Center for Freedom and Prosperity Less Government
Jeffrey L. Mazzella Willes K. Lee
Center for Individual Freedom National Federation of Republican Assemblies
Col. Francis X. De Luca Kevin Kosar
Civitas Institute R Street Institute
Tom Schatz Karen Kerrigan
CAGW Small Business & Entrepreneurship Council
Chuck Muth Ryan Alexander
Citizen Outreach Taxpayers for Common Sense
Katie McAuliffe Judson Phillips
Digital Liberty Tea Party Nation