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U.S. Postal Service defaults on $5 billion; hours at dozens of local centers may be cut

By Fritz Mayer
October 3, 2012

RIVER VALLEY — The U.S. Postal Service (USPS) was supposed to send a check for $5.6 billion to the U.S. Treasury by September 30 to prefund the cost of health benefits for future retirees. But for the second month in a row, USPS could not make the payment because it didn’t have the money. The payment, however, is only part of the agency’s problem.

Unlike most federal agencies and private businesses, USPS is required to fully fund its retiree healthcare benefits for 75 years into the future, because of a law Congress passed in 2006. In April of this year, the U.S. Senate passed a law that would ease those payments, but that money, while it is intended to fund only future retirement healthcare benefits, is also considered to be part of the federal budget; therefore any easing of payments would make the federal deficit look even worse than it currently is.

The Senate bill would have also allowed the post office to make other changes to modernize its operation and once again become profitable, but the House of Representatives did not take any action on the matter before its members left Washington for the election break. It’s not clear if they will take action when they return at the end of the year.

What is clear is that the USPS needs to make adjustments to the changing patterns of postal usage. Mostly because of the growing use of the Internet for correspondence, the number of first-class items mailed has dropped by 25% since 2006.

In its attempt to save money, USPS officials say they are not seeking to close a large number of post offices, but are instead looking to cut back on hours of operation. This is from a new release sent out in May. “The postal service is committed to serving America’s communities and providing a responsible and fair approach for our employees and customers,” said Megan Brennan, Postal Service Chief Operating Officer. “The post offices in rural America will remain open unless a community has a strong preference for one of the other options.” Those other options include “offering service from a nearby post office.”

It seems likely that most communities will choose to keep their post offices, but USPS is considering opening them for fewer hours. That could impact hundreds of post offices across the country. The post office in Lake Huntington, NY, for instance, is proposed to be cut from eight hours per day to four hours per day.

Proposed cuts in hours to local offices

In PA:
Damascus, PA: eight to six
Greeley, PA: eight to six
Lackawaxen, PA: eight to six
Lake Como, PA: eight to four
Milanville, PA: eight to four
Pocono Manor, PA: eight to four
Shohola, PA: eight to six
Tyler Hill, PA: eight to four

In NY:
Barryville, NY: eight to six
Bethel, NY: eight to four
Callicoon Center: NY eight to four
Cochecton, NY: eight to four
Kenoza Lake, NY: eight to four
Long Eddy, NY: eight to six
North Branch: NY eight to four
Obernburg, NY: six to two
Smallwood, NY: eight to six
Yulan, NY: eight to four