Postmaster General's Pay Package Under Fire

WASHINGTON, Feb. 17, 2009— -- These are tough times for the post office, but not for the postmaster general.

Even with stamp prices set to rise another two cents this May, the U.S. Postal Service is awash in red ink. In January, Postmaster General John Potter told Congress that he might be forced to cut back on mail deliveries to five days per week.

"I am forced to consider every option due to the severity of the challenge at hand," Potter said in testimony last month in front of a Senate Homeland Security and Governmental Affairs subcommittee. "If current trends continue, we could experience a net loss of $6 billion or more this fiscal year."

Potter's base salary rose from $186,000 in 2007 to more than $260,000 last year. On top of that, he received a "performance" bonus of $135,000. Between Potter's salary, bonuses, retirement benefits and other perks, total compensation was more than $850,000.

"$800,000 doesn't pass the basic sniff test," said Rep. Jason Chaffetz, R-Utah, who is the ranking member for the House subcommittee on the Postal Service. "It can't be right."

Potter declined a request for an interview. A statement from the Postal Service Board of Governors to ABC News outlines that federal law requires the Postal Service to provide comparable private sector compensation to its employees for comparable services.

"The governors adjusted certain salaries and added performance-based incentives to some of the compensation packages to try and address the issue of pay comparability, and the fact that even in these very difficult times, the postmaster general continues to exhibit visionary leadership," the statement said.

Potter's spokesman also pointed out that the post office receives no taxpayer money and that Potter's salary is far lower than that of other corporate executives in the private sector. FedEx's CEO made almost $9 million last year and the CEO of UPS took home almost $3 million.