USPS faces drastic cuts to branches and mail delivery without Congress action

USPS faces drastic cuts to branches and mail delivery without Congress action ‘The Postal Service has a broken business model and action is needed by Congress to fix it’ - Bookmark - CommentsGo to comments Become an Independent member to bookmark this article Already a member? Log in The United States Postal Service will be forced to implement major cuts to retail branches and other services unless Congress intervenes, its chief warned on Tuesday amid widening losses and an ongoing funds crisis. The agency reported a net loss of $6.5 billion for the 12 months ending Sept. 30, compared to a $9 billion net loss the previous year. "We will need to make drastic changes in the number of Post offices and marketing mail service levels, and we will need to look at other areas to generate the cash we need to meet our obligations to our employees and to the American public," Postmaster General David Steiner said at a meeting on Tuesday. In June, Steiner requested more funding during an appearance before lawmakers. "The bottom line is that we are out of cash. We are borrowing from our employees’ retirement funds to continue operations," Steiner's written testimony before a U.S. Senate committee said, warning the agency could run out of operating cash within months without deferred obligations. "The Postal Service has a broken business model and action is needed by Congress to fix it." Steiner wants Congress to compensate the agency for money-losing operations and institute broader reforms. In March, the Postal Service announced it was hiring restructuring advisers to help address its financial challenges. A central issue is whether USPS should continue six-day delivery to 170 million addresses, which costs $3.4 billion annually—with 70% of those routes losing money, Steiner said. About 58% of its 18,000 Post Offices also operate at a loss. Net losses at the Postal Service have totaled around $120 billion since 2007, driven by a steep decline in first-class mail, its most profitable offering, as digital communications expand while expensive nationwide delivery requirements remain. USPS announced in May that it was pausing non-essential spending on travel, office supplies, and consultants. In a memo to officers, Steiner said the measures were "to protect core operations and ensure we can continue meeting all essential obligations." Also in May, the Postal Service said it would temporarily suspend employer payments toward a federal pension program and raise first-class stamp prices to 82 cents from 78 cents, effective July 12. Pausing the employee pension payments will conserve $2.5 billion through September 30 and potentially up to $15 billion by 2030. Join our commenting forum Join thought-provoking conversations, follow other Independent readers and see their replies Comments