USPS not pleased with overpayment report

The U.S. Postal Service says it is disappointed with a new government report skeptical of the agency’s claim that it substantially overpaid into a federal retirement program and deserves a refund.

The Postal Service’s own inspector general, the Postal Regulatory Commission and two private firms have all estimated that USPS paid between $50 billion and $75 billion too much into the Civil Service Retirement System (CSRS).

But the Government Accountability Office, in a Thursday report, said that while those findings are actuarially sound, the question of whether USPS overpaid into CSRS is more of a policy choice.

And, the report adds, taxpayers could be on the hook if the federal government did transfer billions of dollars back to USPS because of the overpayment claims.

In its response, USPS essentially says that GAO mistakenly endorses a 1974 law as key to figuring out the agency’s obligations to CSRS, instead of later legislation and actuarial practices.

“In conclusion, the report offers no room for compromise, relying almost entirely as it does on the mistaken assumption that the 1974 law represented Congress’ final determination on the fairness of the allocation of pension costs between the Postal Service and the U.S. Treasury,” Joseph Corbett, the Postal Service’s chief financial officer, wrote to the GAO.

The question of whether USPS overpaid into CSRS dates back years. The modern Postal Service was established as a quasi-independent agency tasked with taking care of its own obligations through postal revenues.

The agency is now facing stark financial troubles, with mail traffic having declined swiftly in recent years as consumers increasingly use digital communication.

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