House Passes Bill to Repeal 'Debilitating' USPS Prefunding Mandate

The House of Representatives on Tuesday passed bipartisan legislation that would eliminate a mandate requiring the U.S. Postal Service to prefund retiree health benefits decades in advance, a major contributor to the mail agency's financial woes.

"We are one step away from securing a critical victory for postal workers, the Postal Service, and the public."

Approved by a vote of 342-92--with every no vote coming from House Republicans--the Postal Service Reform Act represents lawmakers' most ambitious effort in nearly two decades to aid the USPS, whose performance has lagged recently due to the coronavirus pandemic and sweeping operational changes imposed by Postmaster General Louis DeJoy, a major Trump donor.

The compromise legislation, which now heads to the evenly divided Senate, would require future USPS retirees to enroll in Medicare, saving the Postal Service nearly $23 billion over the next decade. Repeal of the prefunding mandate would save the Postal Service around $27 billion over 10 years.

Additionally, the bill would wipe clean $57 billion of the mail service's financial liabilities, require the agency to deliver mail and packages at least six days per week, and allow the USPS to offer certain "non-postal" services in partnership with state, local, and tribal governments.

In a statement following the House vote, the 200,000-member American Postal Workers Union (APWU) applauded lawmakers for working to remove "the onerous and financially debilitating prefunding mandate," which was put in place by Republican-authored legislation that President George W. Bush signed into law in 2006.

"After 15 years of fighting for much-needed and long-overdue reforms, we are one step away from securing a critical victory for postal workers, the Postal Service, and the public who rely on us," said APWU president Mark Dimondstein. "The strong bipartisan support for this legislation is a testament to the unrivaled service postal workers provide to people and communities across this country, no matter who we are or where we live."

Since taking charge of the Postal Service in June 2020, DeJoy has cited the agency's ailing finances as a justification to plow ahead with a series of highly disruptive changes to mail delivery operations, leading advocates and Democratic lawmakers to accuse him of deliberately sabotaging the USPS.

Late last year, DeJoy--with the support of a majority of the Postal Service Board of Governors--began implementing a 10-year plan that critics warn will further slow the mail service, shutter package processing facilities, and raise costs for consumers and businesses. Dozens of Democratic lawmakers have urged the postal board to fire DeJoy, but it currently lacks the votes to do so.

"It's amazing to see Louis DeJoy outlast Donald Trump," Citizens for Responsibility and Ethics in Washington (CREW) lamented Tuesday. "With the USPS Board of Governors' continued negligence, he's been allowed to do basically whatever he wants."

In his remarks at a postal board meeting on Tuesday, DeJoy expressed support for the Postal Service Reform Act, which is the product of months of negotiations between the postmaster general, postal worker unions, and members of Congress.

"We are excited about the bipartisan progress we have seen in the last couple of weeks," DeJoy said. "I am hopeful that the Senate votes on it in a timely manner."

Porter McConnell, campaign director at Take on Wall Street and co-founder of the Save the Post Office coalition, said in a statement Tuesday that "the Postal Service Reform Act is about the only thing we agree with Louis DeJoy on."

"Now," McConnell added, "it's time for the Senate to pass the bill and send it to the president's desk."