Members of the House Government Reform Committee introduced legislation yesterday that would let the U.S. Postal Service lower its payments to the Civil Service Retirement System pension system and keep rates steady until 2006.
A review last year by the federal Office of Personnel Management found that the USPS would overfund its obligations to the Civil Service Retirement System by $71 billion based on current contribution levels. A General Accounting Office report last month concluded that the postal service has already overfunded the CSRS by $4.1 billion.
Pension contributions are fixed by law, however, and cannot be changed without congressional approval. The legislation was introduced by Reps. John McHugh, R-NY; Henry Waxman, D-CA; committee chairman Tom Davis, R-VA; and Danny Davis, D-IL.
The bill calls for some of the savings from lower CSRS contributions to be used to pay down the postal service's debt. Other savings would be used to keep postage rates unchanged until at least 2006 and to fund retiree health benefits.
In addition, after 2005, the bill requires the postal service and OPM to calculate the difference between the cost to fund CSRS under the bill and the cost under the old law. This amount would be held in escrow until Congress acts on a USPS proposal outlining what should be done with the funds.
Sens. Susan Collins, R-ME, who chairs the Senate Governmental Affairs Committee, and committee members Tom Carper, D-DE, and George Voinovich, R-OH, were expected to introduce similar legislation as early as last night.