Saturday mail delivery to continue — for now

Earlier this year, the U.S. postmaster general proposed eliminating mail delivery on Saturdays, but so far, Congress isn’t going along with it.

The U.S. Postal Service (USPS) is a government enterprise, but since 1970, Congress has required it to be self-supporting. The problem is: Recession and the Internet are reducing mail volume and thus cutting postal revenue. USPS lost $3.7 billion last year. On top of that, a relatively new requirement by Congress that USPS “pre-fund” its retirees’ medical benefits is costing USPS over $5 billion a year. USPS has now amassed $41 billion in its future retiree health fund, enough to fund retiree benefits for decades.

Ending Saturday delivery was proposed as a cost-cutting measure, and it was supposed to happen at the beginning of October. Postal unions fought the proposal vigorously.

And Congress didn’t agree to it. On Sept. 29, Congress adopted a “continuing resolution” to fund the federal government through early December. In the resolution, Congress didn’t approve ending Saturday delivery, but it didn’t help USPS out of its financial squeeze either. Senate Republicans voted unanimously to block a provision that would have deferred $4 billion of the $5.5 billion payment to future retiree health benefits. Congress deferred the payment last year. The provision was backed by the National Association of Letter Carriers (NALC).

USPS made its payment Sept. 30, and is as a result very short on cash — less than $2 billion. And according to the postmaster general’s current forecast, USPS won’t have enough money to make next year’s payment on Sept. 30, 2011.

Home | About