POSTMASTER GENERAL WILL RESIGN IN MAY 2001

Bill McAllister. Media News Washington Bureau Chief William J. Henderson, one of only five career postal employees ever to rise to postmaster general, has decided to leave the federal agency in May after three, often turbulent years at the helm of the US Postal Service, The Denver Post has learned.

A 28-year career postal executive who battled against the rise of E-mail and soaring labor costs, Henderson told the Post Wednesday night that he ""planned to fulfill his commitment to the board.'' He declined to comment further.
Confirmation of his decision to leave the huge agency came in a week in which it approved a one-cent increase in the price of a first-class letter, effective Jan. 7. But the agency complained that increase is not enough to offset the constantly soaring costs, mostly from paying its 800,000 workers, that the Postal Service has battled since its creation.

Postal sources said that Henderson and the agency's board of governors had reached a "mutual decision'' in closed door meetings this summer not to extend his three-year contract beyond its expiration this spring. Henderson privately had told the board when he was hired in 1998: ""In three years, I'm out of here.''

Some members of the board wanted to keep Henderson in the job another year in hopes that he could complete negotiations to use some of the large fleet of FedEx cargo jets to carry mail. Any hopes that Henderson would remain died when the board told Henderson they would not increase his salary above the current $157,800, postal sources said.

Without the promise of a pay raise, Henderson, who at 53 is one of the youngest chief executives in the agency's history, decided he would seek a job in the private sector, the officials said. The agency had planned to announce Henderson's decision to leave next month, but word of the action leaked after this week's governors meeting.

The board, a panel of nine presidential appointees who oversee the agency and select the postmaster general, has been interviewing executive search firms and reportedly settled this week on a firm to review candidates for the nation's 72nd postmaster general. Much of the attention in that search is likely to focus on Deputy Postmaster General John Nolan, who like Henderson, is a career postal executive and has been given key a number of high-profile assignments.

In selecting Henderson to head an independent agency that is second only to Wal-Mart in the number of civilian employees it has (more than 800,000), the board defied tradition of having an outsider run the nation's mail system. But the young North Carolina native had won widespread kudos for his efforts to bolster delivery service after it fell sharply during the mid-1990s.

The son of a career postal clerk, Henderson is likely to be known for pushing the agency to deliver a record 94 percent of first-class letter overnight in the nation's major cities. He also developed a strategy to counter the
impact of electronic mail and Fax machines on the erosion of letters from the agency.

Henderson also appeared to be blind sided earlier this year by an out cry that developed after it was disclosed that he had approved payments totaling about $250,000 to two postal executives who moved to new homes in the Virginia
suburbs. The executives did not change their job locations, but remained in financial jobs at postal headquarters.

That episode undercut Henderson's credibility with the governors and may have hurt his chances for extending his tenure as the agency's chief executive, some of the governors said privately at the time. Soaring labor costs also pushed the agency to its first loss in five years with the agency recording a $199 million deficit in the just-ended fiscal year.