House Oversight hearing spotlights postal service troubles, calls to pause ‘Delivering for America’

A House Oversight and Reform subcommittee hearing on the future of the U.S. Postal Service centered on the agency’s Delivering for America (DFA) plan, recent service declines, large planned capital investments and proposed fixes ranging from a temporary pause of DFA to pension-investment reforms and more public–private partnerships.

Witnesses and members repeatedly warned that service degradation—particularly in rural areas—and steep upcoming postage and commercial-rate increases threaten mail reliability and the Postal Service’s financial health. Several witnesses urged the new Postmaster General, David Steiner, and the Postal Service Board of Governors to pause DFA implementation to allow a full assessment.

Why it matters: The Postal Service delivers to a nationwide network and carries critical items—prescription drugs, ballots and business mail—into rural and urban homes. Witnesses said current financial stress and changes to processing and transportation could significantly affect access, costs and daily delivery reliability, with downstream consequences for veterans, seniors and rural communities.

Several witnesses testified that the Delivering for America plan has overemphasized new package-processing capacity at the expense of last-mile performance. Jim Cochran, CEO of the Packaged Shippers Association, said the plan’s “insourcing of workload” and reduced prices on packages have led the Postal Service to “poach customers from business partners” and to overbuild processing facilities while last-mile capabilities lag. Mike Plunkett, president of the Association for Postal Commerce, said DFA has produced “unprecedented rate increases and service degradation,” and urged a moratorium on discretionary capital spending and any further insourcing until a new leadership assessment is complete.

Several witnesses, including Paul Steedler of the Lexington Institute, called for sharper governance and financial changes. Steedler said the Postal Service must be “right sized” and recommended revising how the Postal Service’s large retirement funds are invested to earn higher returns. Witnesses cited Postal Service figures that at the end of fiscal 2024 it reported about $249 billion in pension assets and roughly $25 billion in its retiree health benefits fund, both legally limited to government bonds. An Office of Inspector General analysis, cited in testimony, suggested that a more diversified investment approach over many decades could have materially improved the agency’s fiscal position.

The Postal Regulatory Commission’s (PRC) advisory opinion on the regional transportation optimization (RTO) initiative was raised repeatedly. Witnesses and members said the RTO—which reduces some end-of-day collections and moves more traffic through regional hubs—has slowed pickup and delivery for many rural places, potentially widening the “digital and economic divide.” Representative [Bridal/Brial] and others cited constituent concerns from remote communities such as Aberdeen and Forks, Wash., where the nearest regional processing center is more than 100 miles away.

Labor, safety and statutes: Brian Renfro, president of the National Association of Letter Carriers, underscored on-the-job hazards, citing the recent death of a Dallas letter carrier and urging Congress to pass the bipartisan Protect Our Letter Carriers Act. Renfro and other union witnesses stressed that modernization must preserve workforce protections and the Postal Service’s universal service obligation—six‑day delivery and uniform pricing—rooted in federal law and overseen by the PRC.

Cost, rates and mailers: Industry witnesses warned that the July postage increases and commercial rate changes (witnesses cited an example of a July stamp price rising to 78¢ and referenced commercial-rate filings that could raise certain mail rates by double-digit percentages) risk driving volume declines and further revenue loss. Mike Plunkett said postal customers asked the Board of Governors to postpone rate increases and assess implementation impacts; the letter from industry was attached to his written testimony, he said, and the governors had not responded.

Proposals and directions but no formal actions: Witnesses and members suggested a set of nonbinding steps for new leadership: (1) a temporary moratorium on selected DFA capital projects and discretionary spending while the new Postmaster General conducts a review; (2) a pause or reconsideration of insourcing efforts and certain product changes; (3) renewed emphasis on public–private partnerships, particularly for middle‑mile logistics and downstream entry near destinations; and (4) legislative fixes to allow more diversified investment of Postal Service retirement assets and to address structural funding gaps, including a possible direct appropriation to cover the universal service obligation if Congress chooses that path. Committee leaders said they plan follow-up meetings with Postmaster General David Steiner and Board members but took no formal votes at the hearing.

Support for rural service and veterans: Lawmakers emphasized the Postal Service’s role in delivering 1.2 billion prescriptions per year and about 330,000 veteran prescription deliveries daily; witnesses warned that privatization or aggressive cuts to universal service could raise costs or eliminate service on unprofitable routes.

Forward look: The subcommittee’s chairs said they intend further oversight, follow-up questions and meetings with the Postal Service leadership and governors. No formal committee vote or legislative action was taken at the hearing.

Ending note: The hearing brought together industry groups, unions, academics and members of Congress who largely agreed on the Postal Service’s public value but differed on the best remedies. Witnesses repeatedly recommended a management pause, more transparency on financial assumptions behind DFA, and targeted reforms aimed at restoring service and stabilizing long‑term finances.