DeJoy, Postal Service at a crossroads ahead of restructuring plan

Postmaster General Louis DeJoy is set to release a 10-year reorganization plan soon. Democrats may want to go their own way.

March 11, 2021

Two weeks ago, Postmaster General Louis DeJoy told the House panel tasked with overseeing the U.S. Postal Service to “get used to me,” despite the recent change in administration and his clashes with Democratic lawmakers.

But as President Biden looks to make his mark on the beleaguered USPS and DeJoy is set to release a 10-year restructuring plan to a likely buzzsaw of criticism in Congress, his future at the helm of the mail carrier isn’t assured.

DeJoy—a Trump administration holdover—has been a polarizing figure. His relationship with Democrats has been combative at times, which he noted during his latest congressional hearing on Thursday, this time before the House Financial Services and General Government Appropriations Subcommittee.

“Yes, there are times where I leave these sessions and I’m a little embarrassed about my behavior,” said DeJoy, a former Republican fundraiser who worked for years as an executive in the logistics industry. “But I would also offer [that] I’ve been accused of many, many, many things.”

DeJoy and the Postal Service, which delivers about 150 billion pieces of mail every year, are at a crossroads. The postmaster general is set to unveil his restructuring plan soon—perhaps this month—which he says aims to bring the struggling USPS into a stable financial condition, while a new administration and a Democratic-controlled Congress appear to be at odds with some of his prescriptions.

During Thursday’s hearing, DeJoy made some assurances about his upcoming 10-year plan but was light on details. DeJoy said the USPS was committed to six- and seven-days-a-week delivery, and that it would continue to serve rural communities overlooked by private parcel carriers.

“We’re in a broken business model, and changes need to happen,” he said. “When we roll out our plan, I think any reasonable person will understand the challenges that we face, but they will also see the optimism of the plan.”

The plan will reportedly seek to have the USPS rely more on ground transportation than air carriers, change where the agency offers two-day delivery, implement region-specific pricing, and make more service cuts.

That would be a continuation of the cuts from last summer that Democrats already oppose, Rep. Matt Cartwright said at the hearing.

“Last summer there were efforts to dismantle sorting machines, cut overtime, restrict deliveries, remove blue mail boxes, all in the name of operational efficiency,” Cartwright said. 

When asked by Cartwright why he believed he still deserved to be postmaster general, DeJoy pushed back.

“Why should I stay?” DeJoy said. “Because I’m committed to seeing this change. I have the expertise to do so. I have the tenacity and the stamina to undergo this type of questioning.”

DeJoy’s latest hearing comes as Democratic lawmakers have introduced a series of Postal Service-related bills in the past two weeks.

Additionally, some Democrats are upset about the USPS awarding a contract worth as much $6 billion to Wisconsin-based Oshkosh Corp. to begin replacing the aging postal-vehicle fleet. The new vehicles will be largely gas-powered. Because of financial constraints, the USPS can order only 10 percent of the 165,000-vehicle contract as electric-powered vehicles, DeJoy has said.

Reps. Marcy Kaptur, Tim Ryan, and Jared Huffman introduced a resolution Tuesday calling on the Biden administration to halt the contract until it can conduct an investigation into the way it was awarded and whether it is consistent with the administration’s pledge to electrify the federal vehicle fleet.

The Postal Service’s troubles began long before DeJoy’s tenure. A 2006 bill required the service to pre-fund health benefits for future retirees. That provision has sent the mail carrier into a financial tailspin, posting some $188 billion in unfunded liabilities and debt at the end of fiscal 2020. Still, it ended 2020 with cash on hand after the CARES Act gave the agency a $10 billion loan from the federal government.

House Transportation and Infrastructure Committee Chairman Peter DeFazio reintroduced the USPS Fairness Act in February. That bill would repeal the requirement that the USPS prepay its future retirement health benefits. The House passed that legislation in the last Congress by a bipartisan margin, but the measure died in the Senate. Sens. Brian Schatz and Steve Daines have introduced a version in the upper chamber.

House Oversight Committee Chair Carolyn Maloney introduced two postal-overhaul bills in early March. The Vote by Mail Tracking Act would mandate that mail-in ballots use a bar code to enable election boards and individuals to track them. That language made it into H.R. 1, the For the People Act, which the House passed March 4. 

The Nonpartisan Postmaster General Act would designate the Postal Service Board of Governors, the postmaster general, and the deputy postmaster general as “further restricted employees” under the Hatch Act. DeJoy and others would be barred from holding any political position while in office.

Maloney’s committee is also circulating draft legislation to solve the pre-funding issue and address USPS service more broadly. The bill would set performance targets for the USPS and require employees who want to receive federal health insurance to enroll in Medicare Part A and B, helping relieve the financial burden of pre-funding health plans. DeJoy has endorsed the draft legislation.

Maloney, whose committee has oversight over the USPS, has called for DeJoy’s suspension in the past but has moderated her rhetoric as she works on the reform bill. Other Democrats have called for his ouster. But to do so, the composition of the Board of Governors, which selects the postmaster general, would need to be changed.

The board’s current composition appointed DeJoy in May 2020 and has backed his recent changes. Over the summer, DeJoy cut overtime and mail-processing infrastructure. Critics said that led to the steep delays in service through the fall and winter, which drew the ire of Democratic lawmakers.

In February, Biden nominated two Democrats and a voting-rights advocate to fill three of the four open positions on the nine-member Board of Governors. The move is an attempt to assert control of the board.

The White House tapped for the board former Deputy Postmaster General Ron Stroman; Anton Hajjar, former general counsel of the American Postal Workers Union; and Amber McReynolds, the chief executive of the National Vote at Home Institute, which promotes practices such as mail-in-voting.

The three additions to the board would create a majority of members allied with Democrats, which could lead to replacing DeJoy. Some Democrats also hope a more progressive-leaning board could implement a broad overhaul in the services the USPS provides, including banking and broadband internet. 

The Biden administration hasn’t formally sent the nominations to the Senate Homeland Security and Governmental Affairs Committee, according to an aide for the committee, which is led by Chairman Gary Peters.

“Getting the board filled with qualified nominees who are committed to protecting the USPS’ service standards is a top priority for Senator Peters, and he’s committed to quickly considering these nominations once they are submitted,” the aide told National Journal.

By:  Casey Wooten
Source: National Journal Daily