house oversight and reform committee.

>> welcome, everybody to today's hybrid hearing pursuant to the house rules, some members will appear in person and others via web. those that are appearing in person let me first remind everyone pursuant to the guidance from the house attending physician's office all individuals attending the hearing must wear a mask. members are not recognized unless they are wearing a facemask. let me also make a few reminders for those appearing in person we will only see members and witnesses appearing remotely on the monitor in front of you when they are speaking and what is known as active speaker or stage view. a timer is visible in front of you. for the members appearing

remotely i know you are familiar but let me remind you of a few points. first you will be able to see each person speaking during the hearing whether they are in person or remote as long as you have your website to active speaker or stage view. if you have any questions about this, please contact the committee staff immediately. second we have a timer that should be visible on the screen when you are in the active speaker review. members who wish to pin the timer should contact the committee staff. the house rules require that we see you so please have your camera is turned on at all times. fourth, members appearing remotely who are not recognized should remain muted to minimize background noise and feedback. i will recognize members verbally but those retain the right to seek recognition verbally in regular order. members will be recognized in

seniority for questions. last if you want to be recognized outside of the regular order, you may identify that in several ways. you may use the function to send a request. you may send an e-mail to the majority staff or unmute your microphone to seek recognition. obviously we do not want people talking over each other, so my preference is members use the chat function or e-mail to facilitate formal verbal recognition. staff will ensure that i am aware of the request and i will recognize you. we will begin the hearing in just a moment when they tell me that they are ready to begin the live stream and thank you everyone for coming. the committee will come to order without objection the chair is authorized to declare recess of the committee at any time. i now recognize myself for an opening statement.

good morning and i want to welcome all of the witnesses and thank everybody for participating in this important hearing on the future of the postal service. the postal service is one of the nation's most vital and respected institutions. it provides service across the country to every single address and adds over a million delivery points every year. it binds the nation together in a way no other agency or organization does. unfortunately the postal service is facing a dire financial situation that requires us to act. on friday we circulated the legislation with proposals to address some of the most important factors driving up the cost of the postal service. i will address one of those proposals medicare integration and some of my colleagues will address the other provisions. first while all postal employees pay into medicare through their careers not all and roll when

they reach age 65. approximately 73% are enrolled but the other 27% are not. the postal service has paid about $35 million into medicare since 1983. the draft bill would require current employees to enroll when they reach 65. those who are already over 65 will be given a three month period two and roll with no penalty while employees and retirees would keep the federal health benefits through a new health plan, medicare would be the primary payer. keep in mind these employees have already paid into the system. this reform known as medicare integration would cut long-term costs by reducing the copayments and other medical costs for the retirees. it would also save the postal service about $10 billion over ten years.

these are critical savings that will help the postal service become more financially sustainable. in addition to the medicare integration my colleagues will discuss how the bill would eliminate the requirement that the postal service benefits for 75 years into the future eliminating this unfair provision would take approximately $35 billion off of the postal service. they will also discuss how the bill would increase transparency to ensure that service standards are met. on that note we know the postal service implemented a number of changes last year that resulted in widespread service deterioration across the country. part of that was caused by the coronavirus pandemic and postal employees who are on the front lines that this has hit especially hard. the other part of the problem

was postmaster general louis dejoy's actions as concluded he did not adequately assess the impacts of the changes on service and he didn't adequately consult with congress and others before doing so. many people across the country and on this panel have grave concerns and recent events have aggravated them for example we have been trying to get information about the new strategic plan which is yet to be made public. of course my own views are a matter of public record and all members of the committee are entitled to express their own views. however even as the committee continues conducting vigorous oversight of current operations, we will not be delayed or detoured from our northstar. we need to pass meaningful reforms and hopefully bipartisan

reforms. to put the postal service on more sustainable financial footing for years to come. with that i now recognize the distinguished chairman of the government operations subcommittee mr. conley for his opening statement. >> thank you madame chairwoman and for your leadership and focusing on the long-term success. for the linchpin of 1775 it employs 650,000 people and the foundation for more than 1.7 trillion industry that has

more than 7.5 million people. while the reform is necessary to return to the postal service to viability, financial health and to enjoy the postal service is survived well into the future. these efforts are not new. i was elected shortly after the lame-duck session of 2006 in which the enhancement act was cast into law under the guise of being a reform bill. i believe, however, that is the root cause of much of the postal service financial difficulty and decline. for nearly 15 years the postal service struggled to comply with the law and especially the pre- payment requirement. a unique obligation that no other entity in the world is required to meet.

that is what this vision does. the pre- funding requirement requires the postal service to pay between 5.4 and $5.8 billion each year for ten years into the health benefits fund. the decrease in revenue starting around 2006 coincidentally forced the postal service to forgo since 2010 because of the last-minute decision in 2006 to require an owner's pre- funding. the money sits in the treasury waiting for those not yet born even to fortify is struggling postal service to replace vehicles for example in the

second largest in the country would remove a manufactured yet liability from the books rising to $35 million of debt from the postal services ledger books. the provision is not a panacea but it is a critical pillar of the bipartisan comprehensive reform plan that we are focused on today. this provision removes the distraction of the multibillion-dollar debt of congress' own creation and gives the postal service time to build a practical business model that can be adjusted for the changes and technology in the marketplace. we have a moral obligation to fix the problem. most importantly it would allow the postal service to focus on serving the american people and delivering their packages every single day, especially during

the pandemic. i've been working for 12 years to build broad coalitions with stakeholders who rely on the postal service for their business nonprofits and those that get their prescription medications in the mail, rural americans that rely on package deliveries to make it through the pandemic and individuals who pay their bills and individuals who use the bill for their commercial transactions. i am prepared to meet this moment and join with you and my colleagues on the committee to enact meaningful reform to deliver for this nation. congress cannot afford to miss this moment. thank you for your leadership and i will yield back. >> thank you and i recognize the distinguished representative mrg statement.

>> thank you chair man jerry connolly further work on this important issue beginning with the draft text of the postal service reform act of 2021, we now have an opportunity to take a viable path towards enhancing the financial viability of our most trusted the government institutions. this legislation is reflective of a fundamental reform need but is the subject of bipartisan and stakeholder consensus. its purpose is to ensure the postal service and its dedicated workforce are equipped to carry and help in the long term and as the chair man pointed out, the strength really rests with 650,000 letter carriers, clerks, male handlers and postmasters

who work to process and deliver the mail to every home and business in america. six and even sometimes seven days a week and any meaningful effort we undertake to enact postal reform must have a commitment and sacrifice of the american postal workers. as the chairman stated earlier the integration of the postal retirees benefit plans with medicare is one of the core reforms included in the draft. the proposal comes down to a basic question of fairness. today to the postal workers have been required to pay nearly 35 billion into medicare since 1983 and it remains the second largest federal workforce medicare contributor after the defense department. meanwhile, one quarter of postal employees never receive any medicare benefits, yet all bear the cost of resulting higher

retirees premiums. so with that i would strongly support the act for common sense and bipartisan reform legislation. this is an extremely important to a lot of rural communities that rely heavily on the postal service. and with that i would urge my colleagues on both sides of the aisle to get behind a good reform bill and i will yield back the balance of my time. thank you. >> thank you and i will now recognize the distinguished representative lawrence who was a postal worker for 30 years and has been a great partner in the work to save the postal service. you are recognized for your opening statement. i want to begin by thanking the chairwoman maloney, connolly and lynch for your partnership as we have worked to craft this reform legislation. for years, the financial situation facing the postal

service has grown more and more dire prior to the factors outside of their own. excuse me, control. i am thrilled with this this cos prioritizing the reforms as one of its major initiatives during the 117th congress. our reform provision would require the postal service who desperately need it financial assistance. i want to focus on another important aspect of this package which our service standards and accountability. in the 30 year career with the postal service, i and other workers took great pride in the efforts to meet the service standards and performance targets. it is what drove the work. the agencies unofficial motto best sums up the work force wore commitments to achieving those

goals neither snow, rain, heat stops these couriers from the completion of their appointed rounds. for a large period of the last year, the postal service was in the news for the wrong reasons, consistently delayed mail delivery. while more than 600,000 employees of the postal service have heroically continued to uphold their mission to deliver mail in the midst of a global pandemic questionable operational changes implemented by the postmaster have hindered their work and caused the postal service to miss the mark. congress must include language to emphasize the need for service performance targets while we have only heard reports at this time, i am concerned

about any proposal to alter the postal service first class system. anything that would reduce the agency's ability to meet its standards. after months of persistently slow delivery time and those concerning reports mandating targets for service performance is necessary to hold the agency accountable. last year 91% of americans had a favorable opinion of the postal service that number is based on the agency's more than two centuries of robust service standards. something that the american people have come to expect. if we do not make every effort to affirm that commitment it

would chip away at the foundation of what makes the agency so great. while the legislation provides the agency with financial reform, we cannot allow lost operational changes to be a drop in the commitment to the timely service to compromise our mission. we must tear down these reforms with strong language to repair and require robust service standards. at this time, madam chair, during the pandemic is not the time to begin the service standards. thank you so much and i will yield back. >> i will turn to the ranking member, but before i do, i would like to extend my sincere thanks for his graciousness and willingness to consider working with us in a bipartisan way and with that i will recognize the

ranking member. >> thank you madam chair for holding this hearing and thank you for allowing the hearing to be hybrid and thank you for what i think is your sincere desire for bipartisan reform after all the talk about the postal service over the past year, i'm very happy we are finally doing something that has the potential to address the issues facing the postal service with improved service delivery for the american people. but i must add that last year in this committee, democrats spun wild conspiracy theories about the postmasters plan to steal the election by removing unnecessary blue postal boxes and underused mail sorting machines. history has already shown that baseless conspiracy theory to be untrue, and it will go down in

history with other baseless conspiracy theories like the one adam schiff spun in the intelligence committee. he was attacked for trying to tackle problems with postal operations that must be addressed. having the trucks leave on time and reducing the massive amounts of overtime postal workers accumulate again, republicans debunked the democrats mailbox myth and said repeatedly we should devote our energies towards fixing the postal service is broken business model. with the election year politics behind us i'm grateful they've agreed to take on the task of the postal reform preserving and shaping the u.s. postal service is one of the most fundamental and important jobs of the committee. these core issues that flagged flag thepostal service is relaty straightforward. the demand for the first class

mail and costs say the same thing. no business should be expected to survive in such a scenario without making tough decisions. a second issue is emerging. demand for packages has exploded in the postal service isn't equipped for the demand increase. there are other issues most of which should be the needs of the american public which together create a very complex challenge to address. one issue likely to be front and center today how to pay for the benefits the postal service promises to its employees which now make up well over $100 billion in the unfunded liabilities. as of now there is no plan for how to pay for these promises. by some estimates it will be depleted by the year 2030.

the postal service cannot be left to devolve on its retirees. it would require creative solutions and sacrifices from all interested parties and there are many to make this work. we cannot ignore this problem. there are realities we must confront and address. the delay in the mail delivery across the country hurt small businesses, prevented the timely delivery of medication and bills from being delivered were numerous other problems. i've spoken to the postmaster about these delays and i'm eager to learn more today about how the issue is being addressed and what needs to be done to prevent it from happening again.

but i will say this. mr. louis dejoy is finalizing a business reform plan. the last postmaster general that you will remember promised us to deliver a plan in 2019 but it never arrived. most of you will remember that hearing when elijah cummings and mark meadows the former postmaster general why haven't you brought a plan, that plan never arrived. the status quo with the postal service is not sustainable. postmaster general should be commended for doing the hard work to confront the realities facing the postal service. i'm eager to work with my republican and democratic colleagues to ensure that the fiscal sustainability and improve service to the american people. we must tackle and address the issues facing the postal service and i look forward to hearing the ideas to improve the postal

service. now i would like to yield to the ranking member and government operations subcommittee from georgia. >> thank you for calling this hearing today. and we all agree that the postal service is critical for the country. and it calls for a serious debate. but i would agree with the ranking member that for this past year, democrats spread false information and blamed republicans and the previous administration and the post office for an attempt to co-opt the 2020 elections. we are dealing with that and just by way of remembering i've got some quotes that were made right here in this very room and attack on the postal service and

attempt to dismantle the postal service out of a selfish desire to sabotage our democracy and maintain a grip on power is an attack on all of us. so somehow last year we were being accused of sabotaging our democracy the speaker said the cronies and republicans in congress continue to wage their assault to ensure the integrity of the 2020 election so somehow we were all involved in an attempt to destroy the election and there was another member of the committee. you will probably remember this. he sat in this room and had to hear this straight up. he said how dare you disenfranchise so many voters. you know that it's a felony for the postal service officer or

employee to delay delivery of mail. somehow you can delay all the mail and get away with it they can be prosecuted, you can't. even if your actions are a million times worse and then he said is your backup plan to be part like roger stone. how unfair to make those kind of unbelievable allegations and accusations and the representative went on and suggested that maybe we arrest you to have you show up here for a hearing which was unnecessary. you did it voluntarily. ..

>> put the american people the postal service. if i bring all this up because we endured all of this last year, all year long, but let's remember what louis dejoy actually did firstly remove the first blue boxes. but then in so doing was that an attempt to sabotage the election. absolutely not. it is routine process in fact over the last couple of decades, 35000 it of those drop boxes have been removed from 12000 of under president obama's watch. you'd think anything about it then, only when louis dejoy continues the process of scaling down. for the other things he did was take out mail sorting machines, perhaps that had something to do with the fact the mail volume has drastically declined in these machines take up a lot of room.

they are needed packaging processing any also reduced over time. let's by remembrance, that the postal inspector general is the one who documented over time use and abuse. the cost of which was over $1.1 billion in 2018 alone. if that much overtime is more than the operating procedures of the postal service, then yes, there's a serious problem. with over time. now perhaps all of this that i am saying is water under the bridge at this point. i certainly hope so. now maybe we can get back to the real issue at hand which is authentic reforms of the postal service. and maybe the efforts of postmaster louis dejoy will be put behind us and at this point, the election is over, perhaps things will calm down. because it relates to the

rhetoric that is been so consistent this past year from the democrats. or maybe it won't, we will see. but as we roll it with this debate as chairwoman melanie has had kim's yolks is to be a bipartisan movement, but again that i would say just yesterday, another member of this made the following quote louis dejoy political hack, a crony of donald trump in a massive republican donor. he is taking a wrecking ball to the u.s. postal service. so i don't know that we are going to get over some of the rhetoric or not. and quite frankly, i would venture to raise the question with that kind of statement made just yesterday are we now to assume that the biden administration is not going to have anyone in any position appointed not giving money to the democrats.

we assume for the kind of statement that now republicans of the reelected state day in and day out go after member of the biden administration that is donated in the past to the democrats. while today's hearing is both postal service, not supposed to be about louis dejoy but i doubt that will be the case. what is all this matter. at the end of the day, i like the ranking member have any concerns about the poor performance of the postal service over the recent months. our office has been coming up with complaints predict and louis dejoy is the captain of the ship. in the buck stops with him. but the important thing at the end of the day is of the postal service has strong leadership and they have a plan to improve rather than sit back and wait for more taxpayer bailouts and assistance printed for voided demand reform which we should, why should we believe there will

be more of the same damaging rhetoric is in the past and i hope i am wrong with that. why should we believe that any steps other than those in the draft bill which really erases tens of billions of dollars in misplaced payment and unfunded liabilities, it was frankly, i support the concepts in this draft bill. but those things are not enough. but why should we believe that that resistance is not going to continue. if moving the blue boxes and mail servers and try to bring sanity to overtime uses is somehow viewed as criminal activity by the postmaster, then one in the world is a business plan he comes up with. and was any postmaster general be it louis dejoy or somebody else going to do to try to right the ship at the postal service.

i'll be very much interested in hearing some of these questions answered today. we have got to get input and deal seriously with reform issues and get beyond nonsensical insane rabid rhetoric that is been coming for the past year. and i hope we will be able to do that. >> now i will introduce our witnesses. it our first witness today is postal service or the governor chair ron bloom and then we will hear from postmaster general louis dejoy. and next we will hear from service inspector general, with come in next we will hear from the president of the american postal union. next we will hear from another, president chairman and ceo. and finally we will hear from

doctor kempner and kevin resident scholar of the american enterprise institute. the witnesses will be muted so that we can swear the men. please embrace your watch and turn right hand. if you swear or affirm that the testimony you are about to give is in truth, the whole truth and nothing but the truth so help you god. >> and let the record show that these witnesses answered in the affirmative. thank you and without objection coming written statements will be made part of the record and with that, chairman bloom of iraq recognized for your testimony. >> chairwoman and members of the committee, thank you for inviting me to be her before you today printed my name is ron bloom and i am honored to chair the board of governors of the united states postal service and this is not my first involvement in public service. served in the obama administration first as a member

of the task force helping to lead the restructuring of gm and chrysler and later on the white house staff. in my 40 plus year career, failed leadership roles of labor unions and financial institutions. specializing restructuring revitalizing large complex organizations. in addition to the postmaster general, i'm joining the board by five other governors, each of whom brings significant experience to our desk. my involvement with the postal service began a decade ago by an advisor to the largest union, the national association of letter carriers. that experience along with my work on the board, is only deepened my appreciation for the extraordinary dedication of the more than 645,000 women and men of the united states postal service. throughout this pandemic, postal service employees performed with distinction. it is most evident during november's election. they delivered 4.6 billion

pieces of election political mail and insured and 99.89 percent of mail-in ballots were sent back to election officials within our guidance to the voters. our season began immediately at their after the while the postal service delivered 1.1 billion packages over the holidays, we felt our fall far short of her service targets freighted with covid-19 somebody and employees, any of them fed americans including your constituents experience significant delays in the delivery of mail packages. this level of service is acceptable to no one in the postal service. we were working to urgently address this. but as we improve service and we are and we will, we must face hard truths. it has presently with the postal service ability to service 20 mandate, divine the nation together and remain financially self-sufficient is profoundly

doing. for too long the postal service has been burdened with unsustainable liabilities and its own failure to adapt to the changing need of its customers pretty as we look ahead, we continue in a hard path unaware projected to lose $160 billion over the next ten years. the postal service succeeded in the long-term, we cannot just throw money at the problem, we must address the systemic issues plaguing this outdated model coordinate for these reasons, the postmaster general and management have been working with the board of governors on a comprehensive plan to invest in and revitalize the postal service unit's plan is still being finalized. so i am not in the position to reveal any specifics today. but i can tell you is focus is on ensuring the postal service is able to perform its essential public service mission and radar universal service obligation and are reliable and affordable manner to one or 60 million american or 161 million american

households, six and seven days each week. this plan will require tough choices. as i mentioned earlier, have significant experience in revitalizing restructuring large complex enterprises. including the integrated steel industry, chrysler and dozens in between. if i have learned one thing, it is that the single largest impediment to achieving a successful outcome, is a stakeholders supporting the abstract need for change and will seek to avoid any change that impacts their particular interest. the steps of restructuring simply cannot work that way. we must be ready. it must all be ready to do our part. it congress has a vital role to play. our plan will ask you to give the postal service relief from his current requirements to pre- fund its health benefits and will be allowed to fully integrate our retiree health plans with medicare. this change will save us more

than $40,000,000,000.25 percent of the whole that we are trying to help. we will also be asking the biden administration to calculate obligations to the pension plan using actuarial crystals which will save an additional $12 million. and today, the postal service fans at a crossroads, facing enormous challenges and significant opportunities what happens next is up to us and we can continue to ignore these challenges and demanded that nothing changes while this great organization slowly dies or we can come together and do something really important for the united states postal service and the people we serve. thank you. >> postmaster general louis dejoy, you are now recognized for your testimony. dejoy: good morning chairwoman and members of the committee. i want to applaud the subject

part proposals postal service in a more sustainable path while addressing performance. you put your finger on the precise culmination of success factors that the postal service leadership and i have been focused on for the past eight months. building a financially sustainable organization that fulfills our responsibility to the american people and to our employees. it and then enables excellent reliable service that meets the expectations of our customers. there is difficult challenges ahead of us to physics since systemic problem that has plagued the postal service but i am confident that together these problems can be solved in a see a bright future ahead for the postal service in the public we serve. if we have the collective private parties to act. his tangible reflection of our optimism for a long-term viability of the postal service, is our yesterday production

contract for the next generation delivery vehicles. let me say at the outset that we must acknowledge that during this peak season, we fell far short of our target. any americans were left waiting for weeks for imported deliveries of mail in packages this is unacceptable and i apologize for those customers about the impact. all of us at the postal service from our board to our leadership team to our union association leadership and to every employee, strive to do better in our service to the american people and we will do better. that said, the fundamental challenges that the postal service confronted in 2020, made the urgent change that we need to for so even more evidence. the years of financial stress underinvestment, and achievable service standards and lack of operational foot decisions have resulted in the system that does

not have adequate resiliency to adjust and adapt to the changing circumstances. i'm proud of the dedication of our employees who worked to meet our public service mission during the most trying of circumstances per unit while performance during election was tremendous, the service performance issues that would otherwise experience during much of the year, demonstrate why we must make mental changes to provider customers with the service they expect and deserve. we need to frankly confront the problems we face and be candid and realistic about the magnitude of the solution that we require and embrace the few crucial elements of legislative help we need from congress. and above all my messages that that status quo is acceptable to no one. because the solutions are within reach if we can agree to work together printed our dire financial trajectory operational network misalignments and outdad

pricing infrastructure underinvestment in aquatic people engagement and insufficient gross strategy, all demand immediate action. we have a detailed plan for the section which we will finalize soon and with your help we can restart the postal service to the market people that they truly deserve. to confront these urgent issues, our team is been working on a tenure strategy that will reinforce the postal service obvious strengths and address are obvious weaknesses. the key commitments of this plan will include a commitment to six and seven day delivery service to every address in the nation, not just because it is the law, the because it is the key ingredient to our future success. a commitment to stabilizing and strengthening our workforce especially for our associates who are not yet in the career position. whenever postal employee to have full training and support of the necessary to enjoy long-term

career with us. and three a commitment to investing in our network structure including vehicles, technology and start eating equipment and we demonstrate this commitment with our board yesterday we look forward to working with congress to determine if electrical vehicles can be accelerated. in the week they had a look forward to sharing more information engaging in discussions about this strategy to the public policy makers and unions and management association, our employees, stakeholders and the american people. to be self-sufficient we also need legislation. and thank you for your leadership in addressing our unfair and unaffordable employee retirement health benefit costs that will give us a fighting chance when combined with other elements of our plan, for financial sustainability. importantly, these changes can be made also standing and improving these valid benefits to our employees printed our board and i and our management team and unit associations

leadership look forward to working with you and the administration to revitalize the postal service and thank you. >> thank you the next person is now recognized for your testimony. it. >> thank you. good morning chairwoman and members of the committee. thank you for inviting me here today to discuss the postal service recent service issues since they relate to potential reform. the mission is to ensure the efficiency accountability into integrity tour postal service with independent oversight under the authority of the inspector general act of 1978. we decommission very seriously. the ability of the postal service is always important especially during that current pandemic when americans are relying so heavily on it. to deliver critical items like checks, medicines, packages. and even before the pandemic, the processing network is not operating and optimal speed and

postal service drive to push the mouth through its networks deleted service roles actually costly inefficiency due to lack of coordination and integration between mail processing transportation and delivery operations. additionally, the use the transportation network and high-level to mitigate delays. causing extra trips and furthering increasing costs printed when the pandemic case, it brought a perfect start of postal challenges. mail volume and revenue, surge and parcel volume which offset the loss the required costly operational shifts and reduce employee availability due to illness and quarantine. the postal service was able to modify operations in the beginning of the pandemic to mitigate the impact and needed operation of universal service however starting in early summer, the postal service introduce various operations on the organizational changes. when deployed on top of absence

ace due to covid-19, these changes negatively impacted quality and timeliness of mail deliveries. some areas were hit harder than others. the pandemic impacted that service in other ways, the 2020 primaries and general elections on record numbers of people mail-in ballots and our plan in action readiness we devoted significant resources to monitoring where mail-in ballots were process. in the weeks leading up to november 3rd, we sent 500 employees over to 2000 services nationwide targeted generally deep and effectively prioritized and delivered ballots during the election season we also release our work on service performance during the general election. in subsequent runoff. after the election at the peak holiday mail was severely challenged. improvements and concerns about service remain. we are currently focused on

service issues as well as specific areas where concerns have been raised. in response to request for members of this committee, and others, we are looking at service performance in a number of low performing districts including atlanta georgia, houston south carolina, and detroit michigan. in addition we are evaluating rescinded and embargoed with postal service stopped accepting mail at certain overwhelmed facilities. were currently finalizing a project printed specifically focused on the cleveland, ohio plant. were commercial drivers are experiencing excessive wait time. were studying development of service performance targets and measurements and broadly at reasons why there are challenging for the postal service. any discussion about service must be put into the context of the postal service's difficult financial condition. the combination of declining first class mail volume and revenue an ever-growing number of delivery point and large retirement related payments has

resulted in a postal service recording and net loss annually from was 15 years. other no easy answers, there potentially informs to help move towards financial solvency. our work supports various measures that can reduce the unfunded retirement liabilities including medicare integration alternative investment strategies had addressing the prefiling requirements. we also identified more equitable ways to distribute the responsibility for csr is covering the postal employees. for the post office department and the postal service. another way to address the financial problems is exploring opportunities for new revenue. in the postal service in six historically played an important role in supporting and expanding the countries infrastructure. from building roads to developing eco system to providing nonpositive government services. we believe that opportunities to provide additional services.

for example, they could partner with internet providers to improve broadband connectivity. it utilizes vast network to access to government services are provided thanking financial services printed by leveraging its extensive reach, they can both increase revenue and provide valuable services to the american public targeted blanket for the opportunity to discuss our work. i'm happy to answer any questions. >> thank you. >> thank you and i welcome this opportunity to testify. on the president of the american postal workers union representing 200,000 of the 6,130,000 postal workers who probably accept process or transport and deliver mail to 161 million addresses a day. over the years we have worked close both with the other three postal unions all equally dedicated to the postal mission of providing use service at affordable rates and working

with congress to build consensus on legislation. the pandemic is underscored the vital role of the postal service. in the constitution and overwhelmingly supported by the public. our mission to find the nation together, carried out by moving critical information necessary good life-saving medicine and it on nonpartisan basis providing voters access to the ballot box. like other front-line workers, the polls workers have been nothing short of courageous. in these dangerous and stressful times printed last year's revenue appreciation for the postal service. and also exposed the need to address his long-term stability. the system is suffering and the strains of the pandemic, decades of understaffing and underinvestment and at times misguided policies printed services fallen to unacceptable lows. this committee we believe can help raise the ship with both the following legislative colors.

first, repeal the unprecedented did in 2006 mandate health benefits decades in advance prayed in the accounts for over 84 percent have reported postal losses since the passage of the postal accountability. we were encouraged by a strong bipartisan support for pre- funding repeal in the last congress rated we look forward to this swift passage. and second, the $45 million currently in the postal retiree health benefits fund, is invested solely and low yield treasury bonds and is been far outpaced by rising medical costs. postal service is enforced make up the difference of billions in lost in revenue. we should get a minimum of 50 percent invested in well proven pse flight fund which strong oversight. and third, only as a companion to the first two. integrate unperfected basis postal retirees into the

medicare system thereby reducing the postal service is cost and in any cases of the costs. it will to be carefully designed as a postal plan under the federal employee umbrella to make sure that health benefits retires and burned through the dedicated service are not revised. an appropriately to be corrected. these proposals to 1 degree or not another, bipartisan support in the past and should form the foundation of new legislation. there's also no question that your oversight and legislative needed to address the card chaotic of the mail delays. the goal should be to be approved this service, not reduce the standards. in fact we support the restoration of the july 2012 service standards. the log requires the people deserve and postal workers are

committed to providing the prompt reliable and efficient services under the postal reorganization act. furthermore, our experience last year cost voter action as well interview. the bipartisan board of governance, four to $5 billion in emergency covid-19 relief last spring. twice passing this decision, including $2 billion as a down payment. emerging covid-19 legislation should include the additional 15 billion to help stabilize the postal service during this crisis printed we also urge congress to pass an additional $25 billion of a monitors in unanimous basis by the post- abortive governments. this proposal was passed by the house in the last congress as part of hr two. this will allow the postal service to upgrade its fleet and

facilities and expand and enhance postal services. postal service is a national treasure and trusted cornerstone of our economy. a market postal workers union looks forward to working with this committee on nonpartisan and bipartisan basis. to ensure the long-term sustainability of the people's postal service and welcome any questions rated thank you. >> thank you. >> good morning. and distinguished members of the committee. thank you for your leadership in pursuing bipartisan postal reform legislation after holding this hearing. [inaudible]. reminder of how important it is to our way of life. we all relied on the postal service for the groceries and

other basic goods which has sustained the economy of the pandemic. [inaudible]. and now we support the workers by enacting meaningful postal reform legislation and we are so pleased to support the chairwoman's discussion draft. [inaudible]. think it fortunate to lead now sandy can't company in critical industry. each year, 8 billion pieces of mail originates from 104 plants. this accounts for just over the overall marketing down the country and means that registry intrinsically willing. [inaudible]. i'm also volunteering on behalf of the 31st century postal service. it was mailers every kind of the supply chain, the 21 represents a broad cross-section of that in 2019. [inaudible]. employed $73m workers.

given that foundation of the circumstances of the past year, our coalition in the industries as a whole are alarmed and question the continued ability and the postal service to provide affordable universal service. we firmly believe that raising prices. [inaudible]. or reduce services, will shut down volumes and revenues printed. [inaudible]. increases authorized by the prc, to the recent delivery has shaken the confidence of the industry in the postal system. postage is now more than mailing of these. [inaudible]. and with the prc proposed rate, the number one job to nearly 70 percent or more. and disproportionally affecting mill decisions every day.

[inaudible]. [inaudible]. serving our customers is paramount. route requiring all aspects of the effort work together is now more than ever that we live in a real-time world and service delays heard. usps is a vital partner serving the american public and missing delivery and in home-based, reduces or eliminates the value of the door, the greeting card from grandma coming a hometown newspaper, magazine and we all know how frustrated we get when our liberties are delayed to predict missed deadlines and the confidence in the mail the volume declines. [cheering and chanting]. chairwoman's discussion draft is an important step forward there coalition supports. full heartedly but we believe more needs to be done. first, by the prc. [inaudible]. we recommend that the committee to conduct the second time limit

vented review to recalculate rates by 2020 and the impact of the belt and the other postal develops on them which are considered in this initial review. and second of at least some of the usp retirement assets were invested in instrument outside of the government, expected to the usps billions of dollars. [inaudible]. third the time has come to the mandate of delivery of six days per week and combine it with a directive that the post that right integrated. we also want to bring your attention to the postal service for the civil service retirement system. anywhere from 50 - $111 billion predict they should be returned to the usps. threaded tipping point, the impact of covid-19 with his financial system. maintain a self-funded status.

that is critical to the american public. [inaudible]. price of the mountain taxpayers will be forced to pay the cost per unit the cbs cannabis deficits proposed, remain self-funded by enacting the commonsense reforms proposed with the chairwoman's develop along with the additional reforms i laid out for you. but we must act now. thank you. >> thank you. you are breaking up a little bit. were going to have the you and try to corrected the questioning here. >> thank you and i apologize. >> thank you and you are now recognized doctor for your testimony. >> thank you chair. members. [inaudible]. >> you are breaking up a little bit as well. >> all right, thank you for

inviting me to testify. thank you for dividing your time and energy to this issue. i've been with the postal service for a long time. nineteen from 2003 - 2014 at work for this committee a lot of this. in the subsequent years, i continued to run the postal service challenges and i think you for coming back to the committee. it's very important stuff for unit time is limited and so much that we discussed, i come is in the issue of the postal service's troubled business model. last year demonstrating with usps, america instructed home, and delivery of parcels and absentee ballots. billions and billions of other pieces of mail everything from catalogs coming to jury summons prescription drugs. in 19 and galloped on the soap

postal service is the nation's most popular federal agency. this is not private. people like the postal service so much it's a model in a self-funded government agency. this model and the public pays no taxes to support postal service and everyone in america receives mail free of charge. no postal service in itself funding model for 19 and 70 because of mail volume grew every year. admitted 2007, then postmaster general john came to congress and said, a model is broken. he noticed the revenues would not cover enough of the operating cost but he could not have known that the very next year, it would be the onset of the great recession. between 2008, declined it about 40 percent. last year in 2020, the postal services revenue was 73 billion. that's actually little bit less than agency revenues from 28. last year, the operating for

5 million in 2008 printed. [cheering and chanting]. and as i note, those figures excluded the cost related and. [inaudible]. in 2020 postal service lost $4.4 billion in the retiree health benefit cost would be more than 9 billion. it's a critical question that i have congress grapples with his what reforms are needed for the agencies cost and revenues can be made to better align or how can we make the postal service self funding and working in the 31st century. postal service. [inaudible]. businesses and little reason to believe they would start growing again printed. [inaudible]. [inaudible]. parcel revenues will continue to

increase once the covid-19 passes, maybe they will go back in person. [inaudible]. regularly warns of the financial statement the most deliveries come from a few big companies. in those companies are building out there and delivery networks which creates the alarming possibility of revenues decreasing for the postal service. this is a tough situation i think congress needs an estimate of what the revenues likely will be in the next five years. and publishing probably have a mission inspector general and should be companies all get together to provide feedback to congress. last year the postal service actually went up to an all-time high, attributed to covid-19. in the postal service had some success and cost control over the last ten years but it's been an uphill battle. they alluded to, a natural

postal service is cost. delivery network as more americans make the delivery point in collective bargaining also uprights the cost in healthcare costs and all americans etc. [inaudible]. congress should consider empowering the postal service and control the cost of the game be better aligned with revenues. with that i will conclude my remarks. i am happy to respond immediately questions printed. >> thank you, i understand we are having connection problems. we are going to take a very brief break for five minutes to see if we can get them corrected it. his mother witnesses are breaking up and that delivery is breaking up. so it will be very brief, five minutes of recess to try to correct this. [inaudible].