Alaska’s bypass mail subsidy is being targeted by a California lawmaker looking to trim costs and generate more revenue for the financially ailing U.S. Postal Service. Republican Congressman Darrell Issa the chairman of the House committee on Oversight and Government Reform is a primary sponsor of legislation called the Postal Reform Act of 2011. Within the legislation, section 408 would require the state of Alaska to reimburse the Postal Service for the cost of bypass mail. Congressman Issa was not available for comment today but Alaska district Postal Service spokesman Ernie Swanson says the subsidy costs USPS at least $70 million a year.
“That’s the amount that we lose basically on it. It undoubtedly costs us more than that, I know the representative was citing a number of about a hundred million dollars and that may be close to the total cost that it is to the postal service,” Swanson said.
Bypass mail is unique to Alaska and was put into place years ago through the efforts of the late Senator Ted Stevens. The Postal Service contracts with private carriers to fly mail to off road communities. Without it the price of everyday items would be cost prohibitive.
“Bread, milk, food, that sort of thing. It’s already expensive of course, but if the bypass mail system wasn’t subsidized it would be outrageously expensive and I can’t tell you if it would be 10, 20, 30, 40, 50 percent more but it would be significantly more than even the high price they pay now,” Swanson said.
Swanson says USPS takes no position on legislation designed to help them stop hemorrhaging billions of dollars, but he says recent measures the agency has taken to trim costs has gotten the attention of Congress and Issa’s proposal is one of several pieces of legislation being proposed to aid that effort. Swanson says USPS lost $8.5 billion last year and at the close of the fiscal year next week, he says they’re projecting $9-10 billion in losses for 2011.
“The amount of revenue we might possibly receive from the state of Alaska if this legislation were ever passed would just be a small, small portion of the losses we’re experiencing.”
Senator Lisa Murkowski sent a flurry of letters against the measure Thursday. One asks senators on the Homeland Security and Government Oversight Committee to oppose the legislation. Another went to the Postmaster General Patrick Donahoe asking him to affirm that he will preserve the bypass mail program. And Murkowski sent a third letter to Senator Daniel Akaka requesting a hearing of Senate Indian Affairs, saying that remote Native communities where often no internet is available would be harmed by the effort. Murkowski wrote that congress must not abandon the principle of ‘universal service at universal rates.’
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