Washington, D.C. - U.S. Office of Personnel Management (OPM) Acting Director Dan G. Blair testified before the Senate Homeland Security and Governmental Affairs Committee this week that the administration remains firm in opposing efforts to shift Postal Service pension costs to the U.S. taxpayer. Blair appeared with Department of the Treasury Assistant Secretary Timothy Bitsberger during a hearing on Postal Service reform.

"The president laid out clear guiding principles for postal reform legislation," Blair told the committee. "The committee has made good progress toward incorporating many of the administration recommendations into its reform proposal. However, the administration holds firm to the principle of ‘self-funding' as the means of ensuring the Postal Service continues to meet all its financial obligations. That means revenue from ratepayers, not taxpayers, funds the employer obligations, including recognizing military service in its retirement funding planning."

Legislation pending before the committee, Senate Bill 662, would relieve the Postal Service of $27 billion in pension obligations for funding military retirement credit for postal employees covered by the Civil Service Retirement System (CSRS) by shifting pension liabilities from the Postal Service to the taxpayer.

The Postal Service was granted pension relief of $78 billion by Congress in 2003. Blair told the committee that additional efforts represent a step backward from sound pension funding.

Blair reminded the committee the Postal Service remains obligated to follow veterans' preference law, and benefits from its employment of veterans. "Returning veterans from the War on Terror deserve the protection offered by veterans' preference laws," Blair said.

Blair noted that newly hired veterans would be entitled to earn full pension benefits under current law and urged the committee not to take actions which could destabilize future retirement funding.