By Cailley LaPara, Bloomberg News
The U.S. Postal Service plans to seek money from Congress to help fund its operations, an unusual request by an agency that’s working to stem an ongoing financial crisis.
The mail carrier plans to request a “relatively modest” appropriation in an upcoming legislative plan that it will submit to lawmakers, Postmaster General David Steiner said Friday during remarks at the USPS’ board meeting. The USPS plans to recommend that the appropriation be revisited periodically to account for inflation, and could be reduced in the future as the agency becomes more profitable, he said.
Seeking money from lawmakers highlights the depths of the postal service’s financial woes. The agency has historically been funded by revenue generated by its own operations, without regular appropriations from Congress.
The agency has raised prices and been aggressive in efforts to control expenses, Steiner said, but the USPS faces “a continuing and urgent financial crisis” as it provides universal mail service across the US.
“As things stand, the Postal Service is expected to be self-sustaining while, at the same time, fulfilling mandates that are inherently unsustainable and do not cover their costs,” Steiner said.
Years of staggering losses brought on by high operational costs and declining mail volumes have pushed the agency to the brink. Steiner has said that USPS is set to run out of cash by early next year.
USPS on Friday reported a net loss of $2.5 billion in its fiscal third quarter, an improvement from the $3.1 billion loss a year ago.
Without an agreement on a legislative package, Steiner said the USPS will need to make changes such as “taking a look” at current service levels, closing thousands of unprofitable post offices and further price increases. Any action wouldn’t take place until 2027 following peak shipping season around the winter holidays, he said.
The agency has taken other steps in recent months bolster its finances, including charging more for stamps and parcel shipping and halting pension payments. Earlier this year it retained the services of restructuring adviser Alvarez & Marsal to develop a plan to confront the crisis, Bloomberg previously reported.
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