Postal Service reports 12th year of financial loss

Associated Press

WASHINGTON

The U.S. Postal Service on Wednesday reported a financial loss for the 12th straight year, citing declines in mail volume and the costs of its pension and health care obligations, as the agency braces for an upcoming report ordered by President Donald Trump to address its “unsustainable financial path.”

Postal officials said they expected next year’s finances to be helped by a strong holiday season of package deliveries and a just-approved increase to the price of its first-class stamp, from 50 cents to 55 cents. It takes effect in January.

But they pleaded anew for help from Congress to relieve the Postal Service of onerous health and pension prepayments and for help from regulators to grant the agency more flexibility to increase prices so it can return to profitability.

“Absent legislative and regulatory change, we cannot generate enough revenue or cut enough costs to pay off our bills,” said Postmaster General and CEO Megan J. Brennan. “The flawed business model imposed by law continues to be the root cause of our financial instability.”

The Postal Service reported a loss of $3.9 billion for the budget year that ended Sept. 30, compared with a $2.7 billion loss the year before.

A nearly 7 percent increase in package delivery was unable to offset drop-offs in letter mail, which makes up more than 70 percent of total revenue. First-class mail volume fell by roughly 2.1 billion pieces, or 3.6 percent, as people in the digital age rely more on email for online bill payments.

Revenue was $70.7 billion, compared with $69.6 billion last year, but there were higher transportation and labor costs from delivering more packages.

Trump in recent months has asserted without evidence that the Postal Service is “losing a fortune” and reporting annual losses because it is not charging higher shipping rates for online retailers.