chairman will return shortly meanwhile i want to welcome the ranking member mister chaffetz members of the subcommittee hearing witnesses and all of those attending today today's hearing is intended to discuss the postal service's recently proposed initiative to study the activities of nearly three thousand two hundred postal stations and branches across the country for consolidation purposes as well as to examine the postal service's cost cutting and consolidation related efforts including mail delivery route adjustments and related impacts the chair ranking member and subcommittee members will each have five minutes to make opening statements and all members will have three days to submit statements for the record at this time i would like to ask unanimous consent that the congressional research service's july twenty three two thousand and nine report on postal retail facility closures be entered into the record hearing no objection so ordered ladies and gentlemen today's hearing comes on the heels of the postal service as you may have read being placed on the government accountability office's two thousand and nine high risk list which is largely due to the service's abysmal financial condition an issue this subcommittee has followed closely but even before the postal returned to gao's high risk list alarms had already sounded regarding the postal service's revenue generating problems for the first time in decades the organization postal service targeting of six dollars ten cents billion in cuts while we may be unable to pinpoint whether the recent economic downturn the steady diversion of mail to other mediums or a combination of both is to blame for the current troubles what we do know is that mail volume has dropped precipitously from roughly two hundred and thirteen billion pieces in fiscal year two thousand and seven to a total of two hundred and three billion pieces in two thousand and eight and projections for this year in that the volume will continue to fall by possibly twenty eight billion pieces to a total low of one hundred and seventy five billion  pieces the writing is on the wall and the postal service obviously has to make some tough decisions if it expects to weather this current storm these decisions may involve more across the board cuts  work hour reductions as well as accelerated consolidations of facilities and operations which brings us to the subject of today's proceeding making sense of it all an examination of usps's recently proposed station and branch optimization initiative although at first glance the initiative seems to simply be the latest step in the postal service's multi prong reduce its costs by removing excess network capacity we all know that the devil is in the details and that is what we are here to find out this morning it is critically important that even in the preliminary phases of studying the consolidation of nearly three thousand two hundred station and branch locations we all have some level of understanding about the potential impact such changes could have on costs perhaps more importantly we need to understand what effect these proposed changes may have on postal customers committed employees and communities in general to that end today's oversight hearing has been convened the subcommittee is interested in having the postal service fully articulate its recently proposed station and branch consolidation initiative today's hearing also is intended to take an in depth look at the postal service's efforts to achieve greater delivery efficiency through the adjustment of letter carrier this subcommittee looks forward to learning more about route adjustments the impacts associated with these changes and the savings achieved from these actions it is my hope that the testimony and feedback we receive from adopted our approach by marking up the bill on july th to this date it is still very disappointing that the democrats have chosen not to bring up this bill to the floor with such broad bipartisan support the u s postal service correctly advised us at the time that the legislation while substantial would not completely resolve all of their financial issues that has certainly turned out to be the case just this week the gao announced that the u s postal service would be designated as high risk this is sobering news in two thousand six the postal accountability enhancement act was passed in part to help get the postal service off the high risk list which it did thus gao's renewed designation should serve as another powerful reason for congress to act and act quickly in passing h r twenty two and any other legislation which will help get the postal service out of the financial swamp it now finds itself in consolidating branches is important and complex consolidation can best take place on the merits for the system to work a primary reason the postal service is in trouble right now is because it lacks some of the flexibility to adapt in a changing environment the u s postal service has experienced the largest drop off in mail volume in its two hundred and thirty four year history greater than the declines during the great depression a number of major mailers are in financial straits bulk mail volume and advertising mail is down this is due in part to the poor state of the economy also the postal monopoly does not extend to email and internet advertising which continues to grow the forecast for the return of these volumes are not optimistic the postal service must right size itself to the market it serves when looking to make cuts and finding long term solutions one must evaluate the entire operation of the postal service i look forward to discussing the rearranging of delivery routes and other potential structural changes but even that is not a complete solution one of the changes being pondered is an exigency rate increase of two point four percent to be established only when justified by exceptional or extraordinary circumstances but raising the price of an item will only reduce sales in my opinion not increase them especially when demand is clearly decreasing thus the rate increases appear counter  to any sound economic logic and will only serve to further complicate the u s postal service's woeful financial circumstances i will not support nor do i believe we need a rate increase on postage stamps there are those who suggest postal service is a dinosaur living in a modern world it is certainly a paper based labor intensive service at a time when most americans are more and more comfortable with email and internet communication however the postal service remains essential vital in want of a constitutional imperative  in my own personal opinion i think the postal service as a whole has done a very substantial amount of work to decrease the costs associated with it not only do we need to look at cutting the costs we also need to look a how to make the postal service more relevant in the modern world it is vital to our communities it is vital to business interest and i think we all support and want to see the postal service thrive i know that is why the gentleman representative is here today one thing that i would hope that we would explore madam chair with the discussion today is the difference between the rural components and the urban components because there are factors that are distinctly service leadership has leapt to the conclusion that the only way to keep the postal service solvent in addition to passing h r twenty two is to cut back on hours and even days of operation i believe that any short term steps must be taken in the context of consideration the long term business model for the postal service short term cuts and service will have long term impacts on utilization of the postal service we must learn how the postal service intends to remain solvent during future cycles of economic growth and contraction cuts in hours and service for post offices represent a major loss of service for northern virginians for example without operating in the evening most residents are not able to use their post office due to the length of commutes in our region william county had the longest commute in the united states unfortunately changes in hours have been executed in the past without coordination or even notification of elected officials this examination is particularly important in light of gao's recommendation that usps consider restructuring to address its current and long term financial viability efficiencies that can be derived without loss of service or jobs should be considered first before employees or consumers are asked to make those sacrifices the postal service should identify all the savings that can be realized through area mail processing consolidations and network distribution center closures and make every possible effort to avoid layoffs associated with those closures i appreciate the opportunity madam chairwoman to explore these issues and look forward to hearing about the protections the postal service must employ to protect their consumers and their employees in the final analysis however usps must move to a new business model one that takes cognizance of vigorous competition and the impacts of technology on the traditional rain snow sleet or hail model that has provided exemplary service to the republic for over two centuries i thank you and yield back condition and i appreciate the magnitude of the task that is ahead for the postal service to ensure that it continues to be a postal service on july th the postal service announced sixteen post office branches in the greater cleveland area would be reviewed for possible consolidation after reading the testimony and the gao report for this hearing and after hearing from my constituents i have many concerns i am concerned that final decisions regarding each branch under consideration for consolidation will be made without full community participation and input i am concerned that people in my community and communities across the country will face a significant and unnecessary reduction in access to crucial services i have concerns about the private sector taking over services that these facilities provide because privatization of a public need like the postal service would be a disaster and i think this committee ought to be very wary of privatization being an undercurrent in the post  office i can tell you as chairman of the domestic policy subcommittee the general topic of privatization is something that we are looking into i just want to say that this review process has to be done at the local level and must consider the unique demands on each individual facility to ensure that the concerns of the community customers postal workers and the effects on the local economy are fully considered madam chair beyond the serious local concerns that i have about cleveland look what is happening in our country right now over the last few decades we have seen a de industrialization insurance redlining mortgage redlining the subprime loan fiascos the foreclosures bankruptcies high unemployment business closings even churches and schools closing and look at the communities that are affected the most exactly the communities that have the highest need for postal service towns i have concern about the finance of the post office but it is very interesting when you talk about maintaining universal postal service which is really a right in a democratic society good people say well how are you going to pay for it where was that question when the tarp came out how are you going to pay for it seven hundred billion dollars thrown away to wall street trillions of dollars given to big banks banks parking money right now at the fed fed paying banks not to loan money to businesses in our community how are you going to pay for it three trillion dollars at least how are you going to pay for it no one really asks that question when it is the postal service something that everyone uses how are you going to pay for it it is the same kind of crummy debate that is going on right now over universal health care where the insurance companies are hovering over washington if we are committed to university of service then we are going to take a stand on behalf of postal retirees who the u s postal service right now is looking at cutting into their retirement benefits if we are going to take a stand on behalf of universal service then we have to do it and challenge  those who somehow believe that if the government has to pick up an increased cost here then somehow that is anathema well we have to ask what is the government for is it just for war is it just for being a gas station for wealthy special interest groups or are we a government of the people as lincoln prayed we are about to find out chair recognizes the gentleman from california mister bilbray of reflect again with my colleague from cleveland that there are a whole lot of things this town does and a whole lot of money that the federal government spends that has no nexus to the constitutional responsibilities postal service is one that is specifically enumerated in the constitution it is specifically a responsibility solely of the federal government it is not an incursion onto states or local rights it is not an expansion beyond the founding fathers intention for us to maintain and enhance the postal service so i think this is one place that republicans and democrats should finally find a middle ground we can  cooperate and agree on i yield back mister lynch i thank the gentleman in full disclosure as well i have mentioned this on numerous occasions but i think at last count i have seventeen members in my family extended him for five minutes actually it is the custom of this committee to swear witnesses who are to provide testimony before it so could i please ask you to stand and raise your right hand properly inform and involve the public in the closing process i am very concerned about the postal service's recent announcement to consider closing more than three thousand retail post offices i understand that the postal service's financial problems are daunting i know they are having problems operating but no amount of financial stress should relieve them from providing a transparent closing process with significant community involvement post offices are an important part of communities i witnessed this firsthand my experience with the closing of a postal service in the lafayette station in jersey city with almost no notification to the public or public officials the reason giv they responded by putting a mobile station where the post office was a few weeks later again the mobile station was removed no reason given other than security and there was was able to involve the other two members of congress plus the two senators in this post office closing very little information came forward from the postal service regarding the reason why this post office was closed and when you think of two senators and three congressmen not getting information to me that is just not the way it is supposed to be i don't think even the president could have saved this post office to me it showed a lack of compassion and a lack of sensitivity to communities and we finally after many many months find out why the reason of the closing of th this is the reason why i introduced my bill basically the bill limits the effect of financial reason on closing of the post office it doesn't eliminate it but it is not the office but the satellite post office they can close at any time without any reason i am not an expert on post office but i know at least in the urban area i don't know outside the urban areas and suburban areas are one main post office with many satellite post offices that this bill does it increases the notification to the public and it extends the public comment from sixty to ninety members that have signed on to this post office bill and i do hope that in the hearings that you have in the future that you recognize that finances are important but i think community what it does to an area access to people who do not have the ability to drive seniors that you take all those into consideration because like it was state before in the constitution it does state that this is one of the services that we have to provide so i thank you for allowing me to testify here today and i do hope that in the end we can make this postal service a little more of the people in the area plus the fact that it was just closed from one day to the next there was no plan other than say well there is a post office a mile away deal with that district yet clearly we have to do some sort of consolidation certainly there are some criteria by which we need to consolidate some of the facilities the number may or may not be right what are those criteria  to come to that decision should it be a brac like process how do you see this happening mister sires i don't think that is such a bad idea something like that or in terms of what else can we do for the post office whether we have to i know you don't believe in giving them more money but if this is a service that must be provided i am not opposed to that mister chaffetz well i actually think there is probably more justification for using federal funds to help fund the postal service given its constitutional designation than probably most every other thing that we do in this government so i am not necessarily out of hand just opposed to supplementing what is happening there mister sires i agree with you on that issue specifically about that review process that open comment process how do you see that happening because the difference between thirty days or sixty days or sixty days to ninety days if the process itself doesn't allow for the dialog to happen and true consideration of maybe some of the other factors that go into how important that post office is in that community help me  should be informed that this is happening i think that there should be some sort of announcement by the post office long before that the reason i extended it to ninety days is to get more participation in this process to me it is just plain wrong to go in there and close the post office without giving any reason why i mean there has to be a better reason than just finances to close a post office although i have suburban i have nineteen towns that are more suburban in nature but i represent a significant part of the city of boston and the city of brockton which are clearly urban i just want to say i agree with the gentleman's observation that these post offices and stations and branches are intensely local institutions they are not only commercial centers they are also social centers and i think we remember that when we ask the general public to grade public employees they consistently grade their postal workers their mail handlers  carriers postal supervisors and postmasters the highest of any public employee so those relationships between the communities and the post office at that local level is intensely personal and when we see the disruption that is created by a closing it has very real and dramatic impact on the people that we represent so it creates a real dilemma for us and we need to figure out a way to be able to guide the community when something like this has to happen someone once said there is nothing more disruptive to the human condition than the power of a new idea people just hate change and unfortunately we have seen nine billion pieces of mail taken out of the system last year twenty three billion projected out of the system this year because of the economy and people moving to electronic media like email and electronic payment systems we clearly have to reconcile our revenues with the size of our system  so that is going to be a very delicate process i do agree with the gentleman that whole process needs to be more inclusive with the community and with the representatives who are responsible for those areas and size their system based on cost it leaves them with very little opportunity they have very limited power right now very limited flexibility and this is a challenge not for the post office alone it is for all of us it is for the employees for the unions our task is to preserve high quality affordable universal service through the postal service and we need to  changes that collapse we are on the verge of somewhat of a collapse here in terms of the funding mechanism and what that might bring it might bring a lot of changes that none of us the customer the unions the users the mailers none of us want i just don't want to see us by default allow the economic forces to define what the postal service will look like in the of branch post offices it addresses the need for notification to the community and elected officials is that correct mister sires yes and financial reason is not the only reason for closing a post office connolly let me just suggest to you that certainly in my urban area that is as much an issue as how many branches there may or may not be particularly with long commutes evening hours are very important for people to access postal services and to do their business and i would just suggest to you that we may want to think about adding that to the notification procedures to local officials and the community it may or may notice so that he is able to represent the people who elected him which is a very basic right and obligation a right in terms of the people to be represented and an obligation on the gentleman to do his job but to do that he needs notice and he needs to know what the rationale the reasoning is for any proposed closing he needs a fair opportunity to address that he needs to know what the factors are that have been placed behind this decision and he needs to have and the people that he represents need to have a part in this process so that essential services are not eliminated and that the employees here the letter carriers the mail handlers the clerks the postal supervisors and postmasters are treated fairly during this process and they are not just blind sided by this i actually think if  that type of conduct were to be the norm that you experienced it would stop it would basically stop any changes because we can't have it done that way and that simply  news release a media communication that ends up somewhere on the front page or on one of the pages that people read be a so much better way of informing the public than putting it back and basically and let's face it it is a financial situation for papers to put it in the legal notifications but i will tell you something being a mayor being a county worker i just found that legal notifications were the worst way to notify the public of anything mister sires well i was a mayor for twelve years i know exactly what you are talking about but i still say that is just not the only reason through the news to inform the public there are some type of ads finance papers and i know papers are the next crisis that we are all talking about mister sires i don't necessarily mean the legal notice that you are talking about the small section in the back but there are other ways of noticing it mister bilbray ok and your issue of it shall not be solely for finance particular district not other districts i have four senior citizens buildings around this post office large senior citizen buildings they need access to the post office basically they come down they walk a block or two and they are at the post office that could be a consideration access to the most needy also you have people doing business small businesses mom and pop shops that need some of this post there is a bill already in congress that takes into consideration a number of issues before closing a post office i just don't want in my bill the financial aspect to be the only aspect the other ones that are in the bill are fine also