DeLauro Statement on Postal Service’s Retiree Health Benefit Default

Calls on Republican Leadership to Repeal the Obligation

WASHINGTON, DC—Congresswoman Rosa DeLauro (D-CT) released the following statement today on the United States Postal Service (USPS)’s default of a $5.5 billion payment for retiree health benefits. The payment is required under a 2006 reform bill and is a major cause of the Postal Service’s precarious financial situation.

“Republicans in the House of Representatives have managed 30-odd votes on repealing health care reform and dozens more protecting the interests of Big Oil and Wall Street, yet they have not found time to ease the pressure on USPS,” DeLauro said. “Instead of kicking the can down the road we should shore up the financial position of this American institution. And repealing the $5.5 billion burden USPS faces—alone among our federal agencies—is a crucial part of getting them on the right fiscal track.

“USPS is the only enterprise in the country, public or private, required by law to prefund retiree benefits. Having to prefund 80 percent of a 75-year liability in 10 years would put a strain on any company’s resources, no matter how well-managed. We need to address the long-term challenges facing the Postal Service so we can remove the uncertainty surrounding possible closures and job losses, including those in Connecticut.”

The Senate passed a reform bill in April and shortly after Republican leaders in the House of Representatives said they would take up their own legislation on the subject before August. However that plan was postponed with no explanation.

While today’s default will not immediately affect mail delivery and other customer services, cut backs and closures remain a possibility if comprehensive action is not taken. This includes possible closure of the Wallingford, CT processing facility and a loss of jobs in Connecticut and across the country.

DeLauro is a cosponsor of the USPS Pension Obligation Recalculation and Restoration Act, which would remove the retiree benefits pre-funding burden from USPS and transfer the billions in overcharges back to the Postal Service.