Postmaster General Garners Support Among Catalogers

The plight of the U.S. Postal Service has been well documented. The federal agency lost nearly $16 billion in its latest fiscal year, and things aren't getting any better this year. In addition to legislative changes that the USPS says are critical to its future viability — namely no longer being required to pre-fund retiree health benefits as well as cutting the mail delivery week from six days to five days (Saturday would be the day cut) — the losses keep mounting.

At the helm of this sinking ship is Postmaster General Pat Donahoe, who took the time this week to address the attendees of the American Catalog Mailers Association's National Catalog Forum. His message was clear: The USPS and catalogers should view themselves as partners. If catalogers are profiting from putting their books in the mail, they're going to increase circulation which, of course, benefits the USPS.

Donahoe also took the opportunity during his presentation to outline his five-year plan for restoring the USPS back to profitability, which he says if implemented will enable both mailers and the USPS to prosper. That plan doesn't include rate increases, which was music to the ears of the catalogers in attendance. Pricing increases scares volume away, Donahoe said, adding that the Postal Service doesn't want to go down the road of an exigency rate case. What he does want to do is convince Congress to give his organization the flexibility it needs. This includes multiple steps, including the following:

• moving out of the federally sponsored healthcare plan and allowing the USPS to create its own plan, which would eliminate the need to pre-fund these benefits;
• refund overpayments made to the federal employees retirement system (FERS);
• adjust mail delivery frequency from its current six-days-per-week schedule to five days per week;
• streamlining a mail deliverance system (Donahoe mentioned the possibility of centralized delivery in the future);
• give the USPS the authority to expand its products and services (e.g., its growing packages business);
• allow the USPS to appeal worker compensation and EEOC cases; and
• give the USPS more flexibility in how it prices its products and services.

The USPS has begun to take steps to decrease its costs. The service closed over 200 processing facilities last year and has over 150 plant closures slated for this year. It's also made a concerted effort to rightsize its workforce, including offering retirement incentives to employees and imposing hiring freezes. Within the last year, the USPS has increased its percentage of "noncareer flex workers" (i.e., part-time employees) to 20 percent of its entire workforce. More is needed, however.

Without the passage of postal reform legislation, the USPS board of governors will have no choice but to impose an exigent rate case, said Louis Giuliano, a member of the Postal Service's board of governors. We have no other way to pay the bills, he said.

While there's been plenty of debate on Capitol Hill about postal reform and how it should be handled, there's one thing everyone seemed to agree on at the National Catalog Forum, whether it was catalogers, printers, paper suppliers, other speakers, Postal Regulatory Commissioner Mark Acton, etc.: the catalog industry has an advocate in Postmaster General Pat Donahoe. That won't solve all its problems, but it's a good start.