Statement of Postmaster General John Potter on PRC Ruling

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Fully Paying Retiree Health Benefit Mandate

We are disappointed to learn that the Postal Regulatory Commission (PRC) has denied our price filing. But we are encouraged by their acknowledgment and understanding of the larger financial risk we face through the mandated prefunding of Retiree Health Benefits.

Clearly, the Postal Service is a viable business. Maintaining that status requires elimination of several legislatively-imposed constraints that hamper our ability to operate efficiently and profitably.

Specifically: 1) enable us to alter frequency of delivery consistent with use of the mail; 2) allow us to close unprofitable post offices; 3) restructure our obligation under a 2006 law to prefund retiree health benefits, an obligation not applicable to any other private or government entity; 4) permit us to create and offer products and services beyond mail; 5) assure that arbitrators consider the financial health of the Postal Service when agreement cannot be reached with our labor unions; and 6) resolve overfunding of our pension systems. Legislation has been introduced in Congress to address these issues.

We will need to take a much closer look at the ruling from the PRC in order to make an informed decision about what options we have and what may be the best course of action for our customers, our employees, our stakeholders and the American public.

The Postal Service ends the current fiscal year with approximately $2 billion cash and available credit, meeting all our end-of-year financial obligations, including a $5.5 billion payment to the Retiree Health Benefit Fund as required by law.

As we have stated repeatedly throughout the year, the Postal Service sought a deferral of this $5.5 billion payment to minimize the risk of defaulting on our financial obligations in Fiscal Year 2011. Unfortunately, no legislative action has been taken at this time.

The financial risk remains. We will carefully manage every dollar we spend in the upcoming fiscal year. Our current forecast shows that we will not have sufficient cash to make the $5.5 billion payment due on Sept. 30, 2011, and any major disruption, whether in volume loss or unforeseen circumstances, could cause us to default on financial obligations earlier in FY11.

In the midst of financial and regulatory challenges, the Postal Service achieved record productivity gains in 2010 and a reduction of over 100,000 career employees and cost savings of over $10 billion during the last three years.

As always, service to our customers remains our number one priority. No financial challenge or uncertainty will change that. We will continue to work with Congress and our stakeholders to implement necessary changes to ensure a viable Postal Service for decades to come.

John E. Potter
Postmaster General of the United States
CEO of the U.S. Postal Service

10 thoughts on “Statement of Postmaster General John Potter on PRC Ruling”

  1. We will be PRIVATIZED! Never think it can’t or won’t happen! It gives the enemy an advantage! We work on a DEATH STAR and the PMG is DARTH VADER!

  2. Please STOP wiping your rear end on everyone, except yourself and your lack of Management skills, You have no intentions of trying to save the USPS, your actions speak louder then your words, by continuing to CUT SERVICE, and in your statement above, SEE WHAT WE CAN “CLOSE” come on, it’s way over due for you to be REPLACED with someone who is interested in what the United States Postal “SERVICE” is (SERVICE) some where along the way you lost sight of that, Yes we should make $$, however we are here to SERVE the AMERICAN PUBLIC..I just wish someone in Washington, PRC, Postal Board of Governors or even Obama, that has the power to REMOVE you, would do so ASAP.. It’s very clear that you are trying to Sabotage the USPS so we fail just to try to get us PRIVITIZED- that will never happen, NOT WITHOUT A FIGHT! Do us all a favor and step down….

  3. stop dumping money in that stupid mystery shop scam!!!!!
    and wasting money changing the name to RCE!!!!

  5. We as USPS employees are extremely disappointed in our PMG’s statement(?) regarding the PRC’s denial of a rate increase. It seems to me that someone is not happy with being told that they have not earned their supper. Blaming other people is not what I would consider an appropriate response for an individual in a leadership position. Please lead. Accomplish the mission. Cut the crap of laying out excuses. This mission can be achieved. Perhaps we need a group of management personnel who are here to accomplish this mission. Alot of postal employees in the bargaining unit do not feel that those management personnel are currently in the saddle. Accept your responsiblities and take the directions provided to save the USPS. We do not need any asistance. Simply effective leadership.

  6. Reading between the lines in this article and unknown to most Americans is that the Postal Service is curently negotiating new contracts with two of its largest unions. Mr. Potter suggests that some nuetral arbitrators should take into consideration the financial health of the service when deciding on wages and benefits. How coincidently timely. The perfect storm of contract negotiations and a phoney financial crisis. Hey America, wake up, don’t believe what you hear. The Postal Service is making huge money. They are just having trouble keeping the books. 70 to 80 Billion in overpayments to imaginary government accounts, lost forever to the Service. The Postal Service is thriving and you America purchasing stamps are the reason.

  7. How very, very sad that every household in America thinks the Postal Service is in trouble financially. When is the overpayment to CSRS and FERS going to be credited back? It is over 60 BILLION dollars. How did Congress ever expect USPS to prefund retirement benefits. The 2006 Postal Accountabilty and Enhancement act is an anvil around the neck of the organization requiring 5 BILLION dollars plus a year be paid in every year. No other government agency has ever been required to do this. The Service is actually in great shape and has overpaid near 70 Billion dollars into the governments pocket. Tell America that!
    Tell America that the people who still work the mail are proud of the job they do. Tell them the Postal Service is the most efficient in the world, and we are all proud of that. Tell them we toil 24 hours a day 365 days a year to make this happen. Stop the insanity. Be honest with America.

  8. “Carefully manage” ?? lol, why spend billions on fsm machines after opm told you they would not be profitable ? why are there 100 clerks sitting in a room dowtown doing nothing when there are 1000’s of carriers having to wait 30 minutes a day for the mail to be ready because they are short a clerk ? Why is my office alloted 3 mgmt people but we have 5 ? why do we ignore the ot list on a daily basis then end up paying people on the ot list who did’nt do any work double time ? I could go on and on. We have the most imcompetent mgmt in the world, UPS has one mgmt person for every 48 employees, what is the postal ratio ?

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