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Pushes to Privatize USPS Threaten the Oldest Universal Communications Network and Efficiency of Mail-in Ballots



Photo of USPS mail being sorted by Ericka Woolever used with permission

August 3, 2020 — The economic fallout resulting from the COVID-19 pandemic has dramatically worsened the financial condition of the United States Postal Service, necessitating financial relief if it is to continue operating through fiscal year 2020.

Analysts predict that the agency will run out of money by spring.

As the Trump administration is in the midst of fierce negotiations over what should be included in an upcoming stimulus package, a call for federal aid backing USPS has amassed nationwide attention and support.

The bipartisan Postal Service Board of Governors has asked Congress to provide USPS with $25 billion in emergency aid to offset coronavirus-related losses. This proposal was included in the House Democrats’ HEROES Act.

“The HEROES Act includes $25 billion for USPS for revenue losses during the COVID-19 pandemic, $15 million for oversight of this funding and additional protections for USPS workers,” said Rep. Jennifer Wexton, D-Va. The act gives priority to the purchase of personal protective equipment for USPS employees, she added.

Yet the GOP proposed coronavirus relief bill, known as the HEALS Act, overlooks calls for federal funding to support USPS.

On Friday, House Speaker Nancy Pelosi, D-Calif., accused Republicans who are opposed to the funding of wanting to “diminish the capacity of the Postal System to work in a timely fashion.”

“The money that USPS needs for lost revenue and expenses is COVID-19 related,” said Judy Beard, legislative and political director for the American Postal Workers Union, in a recent Institute for Policy Studies webinar.

Beard noted that other companies “have gotten billions, while the postal service has gotten zero dollars” in federal relief.

Former Postmaster General Megan Brennan projected USPS will lose $13 billion in revenue due to the pandemic and subsequent economic hardship, which has resulted in fewer people and businesses sending mail this year.

Many believe more must be done in order to preserve USPS, and a recent poll revealed overwhelming bipartisan support of federal assistance for USPS, with 90 percent of Republicans and 96 percent of Democrats approving.

Potential for USPS privatization

However, many Republican members of Congress, as well as the Trump Administration, have continued to push for privatization of the service.

“Privatization could increase prices and would jeopardize the level of service for rural Virginians,” said Sen. Tim Kaine, D-Va., in a letter to Broadband Breakfast. “It would also ignore proposed reforms that would address the Postal Service’s financial challenges.”

Many rural Americans, especially small business owners, depend on USPS for competitive shipping rates.

According to panelists at the Institute for Policy Studies webinar, 70 million Americans live in areas where private carriers charge extra for package delivery. A privatized USPS could cherry-pick which homes get reliable and affordable service, leaving others behind, panelists warned?

“Why do people push for privatization?” Beard questioned. “Profit is the only reason.”

“Privatization is about making millionaires and billionaires even richer,” she continued, adding that the wealthiest one percent of Americans “forget about the public.”

The USPS was the first essential, universal communications network in the United States.

From the delivery of medications and household goods to stimulus checks, absentee ballots and census forms, the USPS continues to be an essential part of Americans’ everyday lives.

New postmaster, new policies

Louis DeJoy, a Trump campaign megadonor, was appointed Postmaster General by four Republicans and two Democrats serving on the USPS Board of Governors on June 15.

DeJoy wasted no time introducing new operational changes, including prohibiting overtime pay, shutting down sorting machines early and requiring letter carriers to leave mail behind when necessary to avoid extra trips or late delivery on routes.

While these decisions cut extra costs in overtime hours, transportation and more, they also promised to delay postal deliveries.

Traditionally, postal workers are trained not to leave letters behind, making multiple delivery trips throughout the day to ensure mail is delivered on time.

The new policies have resulted in a two-day shipping delay in centers across the country.

According to multiple postal workers and union leaders, letter carriers are manually sorting more mail, adding to delivery time. Meanwhile, bins of mail ready for delivery are sitting in post offices because of route changes.

Without the ability to work overtime, workers say the logjam is worsening, with no end in sight.

“You’d think that DeJoy would be pushing for the aid the post office needs,” said Beard, arguing that instead, the new Postmaster “has done things that are disturbing.”

DeJoy cut a deal with the Treasury Secretary to secure a $10 billion loan for USPS, instead of calling for the direct aid many believe USPS needs.

On March 27, Congress passed the Coronavirus Aid, Relief, and Economic Security Act, which included a compromise that allowed USPS to borrow up to $10 billion from the Treasury if the USPS determines that, due to the COVID-19 emergency, it will not be able to fund operating expenses without borrowing money.

But accepting this aid would only work to put USPS further in debt.

“The agency said they were aimed at cutting costs,” said Sarah Anderson of the Institute for Policy Studies. The federal government is pushing USPS “to the brink of bankruptcy at a time when we need them more than ever.”

Concerns over mail in ballots and voter suppression

As states look to dramatically expand the use of mail-in ballots this fall, postal workers across the country are worried that DeJoy’s enforced operational changes could lead to chaos in November.

“Money to assist with vote-by-mail is desperately needed,” Beard said, adding that workers want to be safe and alert when carrying election materials.

Vote-by-mail boosts voting participation rates. When the service was introduced in the state of Maryland, voter participation immediately doubled.

Mail-in ballots are often utilized by low income individuals, who may not be able to make it to a polling center on election day due to conflicting work schedules.

“Preventing mail-in ballots disproportionately impacts low income people,” said Scott Klinger, senior equitable development strategist at Jobs with Justice.

In the upcoming election, it is predicted that 60 percent of votes cast will be via mail-in ballots, due to safety concerns surrounding the COVID-19 pandemic.

Yet in the past few weeks, President Donald Trump has continuously attacked the legitimacy of mail-in ballots via Twitter and spread unsubstantiated claims that the Postal Service cannot manage or be trusted to deliver voting materials.

Critics have claimed that Trump’s main grievance with the vote-by-mail system may be that it will hurt him politically, particularly in swing states.

Trump claimed via Twitter that vote-by-mail will make it impossible for Republicans to win in certain states.

“In an illegal late night coup, Nevada’s clubhouse Governor made it impossible for Republicans to win the state,” he tweeted. “Post Office could never handle the Traffic of Mail-In Votes without preparation. Using Covid to steal the state. See you in Court!”

Many have accused the manufactured USPS slowdown as being an act of voter suppression.

“We have an underfunded state and local election system and a deliberate slowdown in the Postal Service,” said Wendy Fields, the executive director of the Democracy Initiative, a coalition of voting and civil rights groups.

Fields argued the President was “deliberately orchestrating suppression and using the post office as a tool to do it.”

Panelists further voiced fears of what privatization would mean for the future of elections, arguing it would inherently undermine their legitimacy.

“I know I wouldn’t feel comfortable handing my ballot over to a private corporation,” Anderson said.

Hazard pay and the pandemic’s effect on workers

“Lack of funding and recent changes have been devastating to workers,” Beard said, noting that USPS does not have the option of laying off workers, as they often do not have enough.

The coronavirus has led to worsened staff shortages. According to Beard, 2,000 to 3,000 members have been diagnosed with COVID-19 and at least 25,000 have had to quarantine, while 15-20 percent of rural letter carriers have been unable to work due to illness or family care.

Beard depicted the fear frontline workers are continually experiencing as they are forced to wonder if they have been infected by the virus while working.

As USPS faces staffing shortages, new operational policies and higher rates of mail-in ballots, workers have only expressed increasing anxiety.

“I’m a little frightened,” said a postal employee in Pennsylvania. “By the time political season rolls around, I shudder to think what it’s going to look like.”

Beard maintained that employees need to be paid competitively in order to preserve an energized workforce, able to tackle demanding shifts.

If passed, the HEROES Act would provide hazard pay and protective equipment to USPS workers.

“Employees aren’t getting overtime because they want to pad their paycheck — they’re demanded to work overtime [due to the volume of work],” Beard said.

Suggestions for the future

Going forward, panelists argued that it is crucial that the federal government support innovations that will make USPS an even greater public asset for generations to come.

Klinger recommended that the government start by investing in funding for bigger vehicles.

“USPS vehicles are old and small,” he said. “New vehicles are already designed and ready to go — USPS just needs funding to buy them.”

“Many U.S. auto workers are out of work right now,” he continued. “Why not put them back to work building bigger vehicles for USPS?”

Klinger believed that USPS could do even more in terms of being a public asset.

He detailed his vision of future service, in which USPS would play a role in countering food insecurity, facilitating education and communication and closing the digital divide.

Globally, postal services play a wide variety of roles, he pointed out.

“Japan’s postal service has digital technology representatives that visit people’s homes to teach elderly populations digital skills,” Klinger said. “France’s postal service developed the watch-over-my-parents program, in which a representative checks on people’s elderly family members and provides a report on how they’re doing.”

USPS buildings could be an instrumental tool in closing the digital divide, Klinger said, if their fast and reliable internet service was used to facilitate hot spot connections and more.

Klinger said he came to understand what government was through the post office.

“It is not a service,” he said. “it is essential.”

The USPS should remain an independent establishment of the federal government, Klinger concluded, saying that America is “not a democracy without a postal service.”


Middle Mile Infrastructure Will be Key to Support BEAD Builds: Experts

Experts cited a lack of middle mile as the biggest obstacle to reaching many unserved areas.



Photo of panel 2 at the BEAD Implementation Summit, left to right: Chas Eberle, Dr. Tamara Holmes, Joel Daly, Laurel Leverrier, Kathryn de Wit

WASHINGTON, September 25, 2023 – An absence of middle mile infrastructure is the biggest barrier to affordable broadband in rural areas, experts said at the Broadband Breakfast BEAD Implementation Summit on Friday.

“Middle mile” refers to the infrastructure running between communities that connects their local networks to the internet backbone. Money from the $42.5 billion Broadband Equity, Access and Deployment program can be used for middle mile infrastructure, but last mile builds — internet connections to individual homes and businesses — are prioritized.

“Middle mile is the problem in terms of affordable rural broadband. Plain and simple,” said Joel Daly, a senior vice president at network company Zayo. “If you’re far away from a major internet exchange, that infrastructure is expensive.” 

The National Telecommunications and Information Administration approved in June nearly $1 billion for middle mile projects, over $90 million of which went to Zayo for projects in three states. All told, the money will fund over 12,000 miles of fiber-optic cable to supplement the BEAD program. 

Laurel Leverrier, the assistant administrator of the US Department of Agriculture’s Rural Utilities Service Telecommunications Program, said her experience working on rural broadband projects reflected Daly’s observation. She recounted laying hundreds of miles of fiber and an undersea cable before even breaking ground on last mile connections in Alaska.

“In a lot of places where we see these unserved locations, it really is the lack of middle mile service that is driving that,” she said. “Oftentimes if there’s a good middle mile facility, companies and communities can extend off of that.”

Keeping additional middle costs down will be key for reaching every unserved area – those with the slowest and sometimes nonexistent internet – panelists said.

Dr. Tamarah Holmes, director of the Virginia Office of Broadband, said her state is facilitating partnerships between utility companies and unserved communities to make use of their existing fiber infrastructure and avoid some of this cost.

Through its Utility Leverage Program, the state is using over 3,800 miles of existing fiber across 17 projects to aid last mile builds. 

“It’s been a game changer for us,” she said.

Chaz Eberle, director of outreach at the Treasury Department’s Capital Projects Fund, a $10 billion program set up with the American Rescue Plan Act, noted that CPF funds can be used to support middle mile builds so long as they directly benefit last mile infrastructure.

He pointed to Tennessee, which was awarded $158 million for middle mile builds under the program. The state pitched these as primers for BEAD projects, but other states have successfully applied by providing evidence of current demand for broadband in unserved areas, Eberle said.

If you missed the BEAD Implementation Summit, sign up for Broadband Breakfast’s BEAD Starter Pack for $35/month (cancel anytime). You’ll get access to all the videos and each of the three Breakfast Club reports prepared for the BEAD Implementation Summit:

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Broadband's Impact

Tech Trade Group Report Argues for USF Funding from Broadband Companies

Consulting firm Brattle Group said in a report the move would be economically sound.



Screenshot of Chip Pickering, INCOMPAS CEO

WASHINGTON, September 19, 2023 – Tech company trade group INCOMPAS and consulting firm Brattle Group released on Tuesday a report arguing for adding broadband providers as contributors to the Universal Service Fund.

The USF spends roughly $8 billion each year to support four programs that provide internet subsidies to low-income households, health care providers, schools, and libraries. The money comes from a tax on voice service providers, causing lawmakers to look for alternative sources of funding as more Americans switch from phone lines to broadband services.

The Federal Communications Commission administers the fund through the Universal Service Administration Company, but has left it to Congress to make changes to the contribution pool.

The report argues that broadband providers should be one of those sources. It cites the fact that USF funds are largely used for broadband rather than voice services and that broadband adoption is increasing as phone line use decreases.

“The USF contribution base needs to change to account for the fact that connectivity implies not just voice telephone services, but predominantly broadband internet access,” the report says.

It also rebuts arguments for adding tech companies like INCOMPAS members Google and Amazon to the contribution pool, saying they represent a less stable source of income for the program and that added fees for services like streaming could affect . 

The report is the latest salvo in an ongoing dispute between tech companies and broadband providers over who should support the USF in the future, with broadband companies arguing big tech should be tapped for funding as they run businesses on the networks supported by the fund.

Sens. Ben Lujan, D-N.M., and John Thune, R-S.D. established in May a senate working group to explore potential reforms to the program. The group heard comments in August  from associations of tech and broadband companies, each outlining arguments for including the other industry in the USF contribution base.

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Universal Service

Rural Providers Urge FCC to Verify Unsubsidized Coverage Ahead of Enhanced ACAM Awards

The FCC’s challenge process is insufficient to allocate Enhanced ACAM funds, the Rural Broadband Association said.



Screenshot of Michael Romano, executive vice president of the NTCA

WASHINGTON, September 18, 2023 – Rural broadband companies are pushing the Federal Communications Commission to require unsubsidized providers to prove their coverage in rural areas.

The calls come weeks after the FCC announced funding offers under the Enhanced Alternative Connect America Cost Model, or Enhanced ACAM. The model allocates support to providers already receiving funding through the Universal Service Fund.

The new allocation of funds takes into account whether an area is already served at the required speed threshold – 100 Mbps download and 20 Mbps upload, faster than the previous Connect America Cost Model – by an unsubsidized provider. Areas the FCC deemed to be served only by an unsubsidized provider were excluded from awards and less money was made available to recipients operating in the same area as an unsubsidized provider.

Providers who were offered Enhanced ACAM funding must accept or decline their offers by September 29, but the FCC will accept challenges from awardees and make adjustments to the awards until 2025.

In a September 15 filing to the FCC, NTCA – The Rural Broadband Association said the process for challenging these determinations is insufficient and urged the agency to require unsubsidized carriers to certify their reported coverage where Enhanced ACAM funds .

The challenge process is lacking, the association said, because it relies on the FCC’s broadband map and the accompanying challenge procedures. 

The map data includes maximum speeds available at a given location, but it does not reflect potential decreases in speed that happen when many people are simultaneously using a fixed wireless network – the technology many rural providers use – and does not include information on standalone voice service, which a provider must offer to meet the agency’s definition of an unsubsidized competitor.

The agency told Enhanced ACAM recipients to submit concerns on these and other issues not captured by the map via public comment in its docket system and to challenge unsubsidized coverage and speeds through its standard broadband map challenge process

FCC speed data is also difficult to challenge, the NTCA said in its filing. Challenges alleging a carrier’s provided speed is lower than that recorded in the data cannot be submitted in bulk, but must be submitted individually. That makes it difficult to determine if an unsubsidized provider offers lower speeds than they reported for large areas.

Requiring certifications from unsubsidized providers would provide “a well-structured and well-defined supplemental process,” for submitting challenges to Enhanced ACAM allocations, the association wrote.

The NTCA met with agency officials ahead of the award announcements to ask for the same certification, according to an ex parte filing from July 24.

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