Issa Postal Service Control Board Plan Advances in U.S. House

A measure that may put the U.S. Postal Service under a control board, end to-the-door mail delivery and close post offices using the same process as military-base shutdowns was approved by a U.S. House panel.

The bill, sponsored by Representatives Darrell Issa, a California Republican, and Dennis Ross, a Florida Republican, was approved today with Republican support and Democratic opposition.

“If the Postal Service were a private business it would have to declare bankruptcy and completely reorganize itself,” Ross said at a meeting of the Federal Workforce Subcommittee of the House Oversight and Government Reform Committee. “By next summer, the Postal Service will not make payroll, and mail delivery will begin to grind to a halt.”

The control-board provision, if adopted, may take effect almost immediately, as Postmaster General Patrick Donahoe has said the Washington-based service won’t make a $5.5 billion payment for future retirees’ health benefits that’s due to the U.S. Treasury by Sept. 30. The Issa-Ross measure is among several Congress may consider. The Postal Service has said it faces insolvency without changes in laws governing it.

President Barack Obama this week asked a 12-member congressional committee looking for ways to reduce the federal budget deficit to allow the Postal Service to cut a day of mail delivery each week and refund $6.9 billion it’s paid into a federal retirement program. Obama didn’t endorse a Postal Service proposal to break contracts with labor unions to allow it to fire employees as it tries to cut 220,000 workers.

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net