Oversight Hearing Request 2.16.10

May 23, 2011Other Legislative Issues

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February 16,2010

The Honorable Stephen F. Lynch
Chairman
Subcommittee on Federal Workforce, Postal Service,
and the District of Columbia
United States House of Representatives
Washington, DC. 20515

Dear Mr. Chairman:

I write to urgently request the Subcommittee to investigate and take action to correct the harm
imposedup on the United States PostalService by the billions of dollars in overpayments it has
been required to make into the Civil Service Retirement System, as directed by the U.S. Office
of Personnel Management. Administrative and legislative corrective actions are called for to
remedy this situation, including most immediately an oversight hearing by the Subcommittee.

As you know, the financial stability of the Postal Service remains threatened by the continued
and severe economic downtum, declining mail volume, and the significant burden created by the
Postal Service's statutory obligation to set aside $5.5billion each year through 2016 for its future
retiree health benefits. These significantfinancial challenges have been dramatically
compounded by the recent finding that the Postal Service has overpaid over past years as much
as $75 billion into the Civil Service Retirement System (CSRS),according to the January 20
report of the Office of Inspector General (OIG) of the Postal Service (ReportNumber: RARCWP-
10-001). Inappropriate assumptions and calculations by OPM, at variance with federal law,
have contributed to the overcharge, according to the report.

If the OIG report is correct (and I believe it is), remedial action crediting the Postal Service for
the CSRS overcharge would contribute significantly to the improvement of the PostalService's
financial health. As the OIG report notes, if "the overcharge [were] used to prepay the Postal
Service's health benefits fund, it would fully meet all of the Postal Service's accrued retiree
health care liabilities and eliminate the need for the required annual paymentsof more than $5
billion."

I urge the Subcommittee to promptly schedule an oversight hearing into the Postal Service CSRS
overpayment issue, exploring the actions that contributed to the underlying situation, as well as
corrective administrative and legislative action, including:

  • Representing supervisors, manogers and postmasters in the United States Postal Service
  • OPM's recalculation of the Postal Service's CSRSpensionobligation, using the more equitable,reasonable and financially-stable "yearsof service" methodology;
  • Crediting by OPM and the Department of the Treasury of the Postal Service's CSRS overpayments to the Postal Retiree Health Benefit Fund (PRHBF);
  • Congressional revision of current law to recognizethePostal Service's satisfaction of all prefunding payments into the PRHBF through 2016; and
  • Congressional waiver of budget scoring rules to permit statutory revision of the USPS prefunding payment schedule without triggering enlargementof the federal deficit.

The Inspector General's report spotlights a potentially significant error by the federal
government in its stewardship of the civil service retirement system, calling for prompt
correction. Additional remedial action by the Congress will also help to contribute to the
restorationof the financial stability of the PostalService.Thank you for your leadership and
your consideration of these views.

Sincerely,

Ted Keating
President

cc:
The Honorable Ed Towns
The Honorable Darrell Issa
The Honorable Jason Chaffetz

 



 

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