Kasey Ferrell

Staff Writer

        It has been debated for months, but on Wednesday (Feb. 13) the U. S. Postal Service will finally announce that it will no longer be delivering first-class mail on Saturdays.  The postal service’s announcement, planned for about 10 a.m. EST, is expected to say that packages, mail-order medicine, and express mail will continue to be delivered on Saturday, but not letters, bills, cards, or catalogs.  Post offices which are now open on Saturdays will continue to be open on Saturdays.

        The move meant to save the financially struggling agency about $2 billion annually as it wrestles with the rising popularity of e-mail and social media eating away at its core business (delivering mail), and with the climbing costs of providing health benefits to its workers.

        In January, the USPS’ board of governors directed management to accelerate the restructuring of postal service operations in the face of declining revenues.  The USPS, it has been said, could no longer afford to wait for legislation to salvage its business.

        The agency reported an annual loss of a record $15.9 billion for the fiscal year ended September 30, triple the prior year’s loss and capping a year in which it was forced to default on payments to a health benefit trust fund managed by the Treasury Dept.  THe rising costs for future retiree health benefits accounted for $11.1 billion of the losses.

        The USPS, being an independent agency of the gov., does not receive tax money to fund its day-to-day operations.  But it is subject to congressional control, as well as congressional foot-dragging.

        On January 27, the USPS raised the price of postage stamps by one cent to 46 cents to help revenues.  “We are currently at losing $25 million per day,” Postmaster General Patrick Donahoe warned in January.

       The move is yet another milestone in the long-running political dance between Congress and Postal Service managers over how to finance the delivery of mail to 151 million addresses, nearly 40% of the world’s “snail mail” volume.  Congress has created a set of rules that all but guarantee billion-dollar losses, though its Capitol Hill critics complain that the Postal Service should be made to operate “more like a business.”

     These losses are almost entirely the result of the now-defaulted “pre-funding” requirement for retiree health insurance and other accounting charges.

        The USPS faces other constraints.  It’s banned from setting up retail outlets, for example, that could generate profits to help subsidize delivery costs.  Worse, it’s barred by Congress from charging the full cost off providing the service it’s required to deliver.