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Ronald Stroman, in town for a mailer's expo, says Wednesday in Portland that Congress must act and the Postal Service must retool if it is to compete.
(Mike Francis / The Oregonian)
How bad is the outlook for the U.S. Postal Service? Ronald Stroman, deputy postmaster general, doesn't hesitate.
We're defaulting on our retiree health benefit obligations, he explains during a Wednesday stop in Portland.
We owe the Treasury $15 billion, he says.
First class mail volume is declining about 4 percent a year, he notes.
The Post Office should spend about $10 billion to upgrade its fleet of delivery vehicles and improve its sorting equipment to reflect the growing importance of package delivery, he adds.
It's not a pretty picture. It helps explain why the Postal Service is talking about unspecified new products it expects to roll out and upgrades such as next-generation postboxes, which could hold packages for customer pickup.
(To the question, "Will you deliver groceries?," Stroman wouldn't answer.)
The hulking problem that looms over the Postal Service is the Congressionally imposed requirement that it pre-pay its retirees' pensions and health benefits. On paper, this is why the Postal Service reports quarterly losses in the $2 billion range.
Postal officials, the Government Accountability Office and others have pushed for Congress to restructure the agency's obligations. Sen. Tom Carper, D-Del., has offered a bill that would help reduce the burden of the prepaid benefits, but it has encountered resistance.
"People don't want us to change," Stroman said Wednesday, alluding to uproars that follow when the agency talks about cutting Saturday service, closing or reducing service hours at its branches or raising postage rates.
A bright spot for the Post Office is the growing volume of package shipments, driven largely by the growth in online buying. But it's difficult for a company with 600,000-plus employees to pivot quickly to focus on a growing segment of its business, especially as it is "hamstrung" by its financial obligations and regulatory requirements, Stroman said.
Stroman, who's visiting to attend a mailer's expo in Vancouver on Thursday, said the problem is "urgent."
"We're pressing Congress for change," he said, "but we're not waiting."
The Postal Service is looking for ways to extract new sources of revenue from its national delivery system, he said. Operating tests are being carried out, but as to specifics, he said, "I can't go into it."
Carper has pushed previously to allow the Post Office to deliver beer and wine, as private delivery companies do. He's also supported efforts by the Postal Service to provide services offered by state and local governments.
-- Mike Francis