THE BULLETIN BOARD
August 2011
[August 15th]Postal Service plan includes pulling out of TSP
from an article by Stephen Losey, FederalTimes.com
The U.S. Postal Service's plan to pull out of the current health and retirement plans and create their own systems has certainly caused a stir. One of their proposals is to drop the defined benefit pension plan for new employees, and only provide a defined contribution plan "which incorporates private sector best practices concerning employer contributions, portability, investment options, eligibility, designated providers, and overall administration."
But the federal government already has a defined contribution plan that's not far off from a 401(k) plan, and a pretty good one at that — the Thrift Savings Plan. And as I read the USPS proposal, it wasn't entirely clear whether they planned to have future employees rely solely on the TSP for their retirement, or drop out of TSP entirely and come up with their own system.
But according to a statement the Postal Service sent us, it's the latter. "Under our proposal we would not participate in the TSP," spokesman David Partenheimer wrote. "We would move to a 401(k) plan like the private sector."
TSP Legislative Director Tom Trabucco today said the Postal Service hasn't contacted them about their plans. He wouldn't comment on what losing hundreds of thousands of postal employees and retirees might mean for TSP.
"What I can say is that we have been pleased to serve the retirement savings needs of Postal Service employees and hope to continue doing so," Trabucco wrote in an e-mail. "TSP eligibility is a matter of federal statute. Historically we have deferred to Congress and the Administration regarding who is eligible to participate in the TSP."
[August 8th]USPS Scraps Executive 'Bonuses' (or whatever they are)
posted from the print version of Federal Times— an article by Sean Reilly
When is a bonus not a bonus? When it's a U.S. Postal Service executive bonus.
The agency has spent at least $4.2 million this fiscal year on "lump sum/bonus payments" for senior executives at headquarters. But on July 1, it abruptly halted further payments in a move to conserve cash. (Backdrop: The agency expects to suffer more than $8 billion in losses this year.)
Postal Service spokesman Greg Frey explained the payments are not actually bonuses, as their name suggests, but rather payments to executives that reflect individual and agency performance in the preceding year. "It's not very straightforward," Frey acknowledged. Asked why the payments are labeled as bonuses, he replied that accountants don't always use accurate line items. "They try to fit expenditures into categories that used to exist or existed at some point," Frey said. After the inquiry from Federal Times, the Postal Service is revising some of those categories.
Compensation for postal officers and executives under the agency's pay-for-performance program will also be frozen until further notice, Saunders said in a separate news release.
The payments showed up in the USPS' year-to-date statement of revenues and expenses for May filed with the Postal Regulatory Commission. Besides $4.2 million in payments to members of the Postal Career Executive Service, the filing also shows $12.5 million through May of fiscal 2011 in "bonus payments" for postal headquarters. Frey, however, said those funds were connected to this year's nationwide early-out program that offered participants $20,000 to leave or retire.
Besides halting the pay-for-performance program for officers and top executives this month, the Postal Service also suspended incentive awards for both executives and other employees - mainly postmasters, supervisors and midlevel managers - covered by the agency's Executive and Administrative Schedule. All told, those steps are expected to save about $11 million a year. Postal employees represented by unions are not affected.
[August 1st]Destroying Unions Won't Fix the Postal Service
Letter to the Editor, published in the Washington Post
The July 28 editorial "A better route for USPS" endorsed the strategy that is being employed by Republican governors who use budget deficits to attack collective-bargaining rights while ignoring other methods of closing budget gaps.
Nearly every analysis of the Postal Service recognizes that the cause of its financial "crisis" is a misguided 2006 congressional mandate requiring the service to pre-fund 75 years' worth of retiree health benefits over 10 years. No other government agency or private business is required to do this.
The editorial said the mandate is a hedge against a future bailout, but it is the pre-funding requirement that has driven the Postal Service to insolvency. Without it, the service would have had a surplus of $611 million over the past four years. Congress created this mess, and Congress can fix it.
The Postal Service has shed more than 200,000 workers over the past decade. Many independent reports have shown that the service has overfunded its two pension accounts by billions of dollars.
The editorial characterized these overpayments as "a cache that has given those unwilling to change the status quo an argument for postponing critical structural reforms." Apparently, those "unwilling to change the status quo" include the postmaster general, the Postal Regulatory Commission, the USPS Office of the Inspector General, the Congressional Research Service, and Democratic and Republican members of Congress, all of whom have said the Office of Personnel Management should be able to credit the service's pension overpayments to the health benefits' liability.
The policy that the editorial promoted, including "renegotiating collective bargaining agreements", put The Post squarely in the camp of Wisconsin Gov. Scott Walker (R) and the Tea Party.
The writer is president of the American Postal Workers Union.
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