Businesses divided on Saturday mail

Businesses from greeting-card makers to Internet service providers are
split on the U.S. Postal Service’s (USPS) proposal to end Saturday mail
delivery.

Some companies say scaling back to five days of delivery is a necessary evil to help the USPS overcome severe budget shortfalls. But other businesses believe the move could hurt their bottom lines by pushing more people away from traditional mail services.

{mosads}“There are a lot of organizations, including ours, that are split on the question,” said Art Sackler, a lobbyist for the Coalition for 21st Century Postal Service, which is made up of direct marketing and retail companies.

Sackler also lobbies for the National Postal Policy Council, whose members include AT&T, Pitney Bowes and State Farm Insurance. That group is also neutral on the five-day delivery plan.

At stake in the debate is how to resolve the postal service’s roughly $7 billion debt for fiscal 2010. The USPS introduced a comprehensive plan to pay down the debt in March.

Along with a reduction to five-day delivery, the USPS proposal includes mailing-rate increases and an end to overpayment of pension funds for retirees. The reduction of Saturday service alone would save $3.1 billion, the USPS says.

The USPS plan has been submitted to the Postal Regulatory Commission for review. The commission is expected to make its recommendation in October, which will likely spur legislative action on Capitol Hill. Since the commission can only issue an advisory opinion, the postal service could choose to ignore its recommendations.

The proposal to end six-day delivery service has drawn opposition from postal workers’ unions and from lawmakers with rural constituencies.

Sen. Jon Tester (D-Mont.) said in a statement last week that keeping mail coming six days “is part of what keeps rural America strong and thriving” after the Senate Financial Services Appropriations subcommittee marked up its spending bill to include language stating its support for six-day mail service.

One of the biggest supporters of six-day delivery is Hallmark, which needs the service to keep its greeting cards moving quickly around the country.

“Our sense is Saturday is when a lot of people choose to send their mail,” said Rafe Morrissey, vice president of government relations at the Evans Capitol Group. “When you lose that, the public can become very frustrated. … It will cause them not to use the postal service and consider using alternatives.”

{mosads}Morrissey lobbies for Hallmark and for the Greeting Card Association. He estimates about 7 billion greeting cards get sold for each year, with about 60 percent of them ending up in the mail.

Hallmark has paid Morrissey’s firm $40,000 in lobbying fees this year, according to lobbying disclosure records. The greeting card company has paid an additional $80,000 in lobbying fees to Capitol Tax Partners, records show.

One of the more surprising supporters of the postal service’s five-day mail delivery proposal is Netflix, the popular movie rental company.

Netflix is dependent on the USPS for its business and is lobbying for the service cut to keep the agency viable. In 2010, it has paid Monument Policy Group $20,000 in lobbying fees, according to lobbying disclosure records.

“We believe the impact on Netflix’s subscribers will be minimal, because they will change their behaviors,” Steve Swasey, a spokesman for the company, said. “Most people watch their movies on the weekend. They return them to us on Monday.”

With 15 million customers across the country, Netflix is a frequent user of the postal service, shipping 2 million DVDs on average per day, Swasey said. The company’s highest mail volume day is Tuesday — with customers mailing back movies they watched over the weekend — while Friday and Saturday are its slowest.