Postal Service posts $5.1 billion loss
Ed O'Keefe
The U.S. Postal Service says it lost $5.1 billion last year — and it can thank Congress for not losing more.
USPS said Tuesday it would have lost about $10.6 billion in the fiscal year that ended in September if Congress hadn’t agreed to postpone about $5.5 billion in annual payments to prefund retiree health benefits. Lawmakers haven’t said yet whether the Postal Service will need to make the payment after the current short-term spending measure expires Friday.
Mail volume dropped to about 168 billion pieces delivered, a drop of 3 billion pieces from the previous year. Deliveries of first-class mail, the most popular delivery option, dropped 6 percent.
Total operating revenue reached $65.7 billion, about $2 billion less than the previous year; operating expenses dropped by about $5 billion to $70.6 billion.
Postal officials said Tuesday that they expect operating revenue to drop to about $64 billion this year.
Amid the losses, USPS delivered some good news: Revenue for Priority Mail and Express jumped $530 million last year, or 6 percent. The increases came as more customers used the Internet to purchase and ship products, USPS said. Standard Mail, normally used to deliver solicitations and catalogs, generated $495 million in revenue, a 2.9 percent jump.
(Justin Sullivan - Getty Images)
Postmaster General Patrick R. Donahoe said Tuesday that USPS remains on course to cut $20 billion in operating expenses by 2015. Much of those cuts depend on Congress passing laws that would permit the end of Saturday mail delivery, the closing of thousands of post offices and mail processing facilities and changes to how USPS pays its workers and retirees.
A Senate committee last week approved a measure that would give USPS about $7 billion to pay for employee buyouts and other debts, allow a renegotiation of postal worker health care benefits and require two years of studies before ending Saturday mail deliveries. A Republican-backed bill in the House awaits a full vote. It would establish a financial control board to overhaul USPS finances — a move that critics fear would result in hundreds of thousands of postal worker layoffs.
“The news cannot get much worse,” said said Art Sackler, coordinator of the Coalition for a 21st Century Postal Service, representing major private-sector mail customers. “If nothing is done to stem these losses, USPS will be forced to shut down within a year. There are 8 million private-sector jobs that rely on the Postal Service, and these jobs will be put at risk unless Congress quickly enacts bold reforms.”