In stopping Saturday mail delivery without asking Congress, Postmaster General Patrick Donahoe may be gambling the Postal Service's whole farm.
First, the Postal Service is far from a traditional government agency. In 1970, the Postal Reorganization Act turned it into a unique hybrid mixture of agency and private sector business. Like a business, the Postal Service gets no tax dollars. Like a government agency, the Postal Service pays no federal, state or local taxes or fees and is also bestowed with competitive advantages not available to private sector businesses.
While the Postal Service gets no tax dollars to fund its regular operations, it is allocated funds annually by Congress to cover the costs of providing postage-free mailing for blind persons and for election ballots mailed-in by U.S. military personnel and other U.S. citizens living overseas. In addition, Congress allocates funds to the Postal Service to assist state and local child support agencies in locating the addresses of persons who dodge their payments.
As the Congressional Research Service (CRS) points out in a January 27, 2012 report to Congress, nothing in the federal postal law (Title 39 of the U.S. Code) requires the Postal Service to deliver mail six days per week.
However, most appropriations bills providing funds for the Postal Service passed by Congress since 1984 have included a provision requiring that "6-day delivery and rural delivery of mail shall continue at not less than the 1983 level, as much as practicable."
Eagle-eyed Postal Service lawyers say the temporary continuing appropriations resolution under which the government is currently operating does not contain the 6-day mail delivery requirement. And, by the way, that temporary continuing appropriations resolution expires on March 27, with a government shutdown looming should Congress fail to pass a replacement or extension.
So the Postmaster Played His Hand
In announcing the end of Saturday mail, Postmaster General Donahoe is basically gambling that Congress will not include the 6-day mail delivery requirement in whatever new appropriations bill it passes before March 27.
Donahoe may feel his hand is strengthened by a poll he cited showing that 70% of Americans support the end of Saturday mail delivery as a good way for the Postal Service to save money.
But the $2 billion a year saved by cutting Saturday mail is a drop in the bucket compared to the Postal Service's latest annual loss of nearly $16 billion.
The changes the Postal Service needs to make to really solve its financial woes will unquestionably require the approval of Congress. For example, only Congress can rescind the requirement for the Postal Service to prefund its health care plan for future retirees, a requirement now costing it over $10 billion a year.
And Sen. Reid Called His Bet
While a some members of Congress have backed the Postmaster General's risky no more Saturday mail gamble, Senate majority leader Harry Reid (D-Nevada) certainly did not.
"Given the importance of the Post Office to communities in Nevada and across our nation, such a drastic policy change cannot be enacted without approval from Congress," stated Sen. Reid in a press release.
"Instead, the Postmaster General relied on flawed legal guidance to claim that he can circumvent Congress' authority on the matter," he added. "The postmaster general's actions have damaged his reputation with congressional leaders and further complicates congressional efforts to pass comprehensive postal reform legislation in the future."
Looks like the Postmaster has gone all-in.