(The Center Square) – The U.S. Postal Service reported a $1.7 billion loss in the third quarter adding to ongoing losses for the once self-sufficient agency.
The U.S. Postal Service, an independent federal establishment that is mandated to be self-financing, said the third quarter losses were “almost exclusively to the non-cash impact of the Postal Service Reform Act in April 2022.” The act removed the Postal Service’s obligation to pre-fund retiree health benefits and eliminated all previously imposed pre-funding requirements that remained unpaid, among other changes. The law was intended to improve the Postal Service’s financial sustainability.
“Continued rising costs in several areas of our business pose a challenge,” Chief Financial Officer Joseph Corbett said in a statement. “We continue to manage the costs within our control, such as by reducing work hours by 6 million hours compared to the same quarter last year and by focusing on transportation and other operating costs.”
Postmaster General Louis DeJoy said the Postal Service continues to face inflation and other pressures.
“Our team is working hard to reduce our cost of performance which is helping to offset still sizeable inflationary and economic pressures,” he said in a statement. “We are setting the stage for long-term financial sustainability as we continue to modernize our processing, transportation, retail and delivery networks.”
Congress designed the U.S. Postal Service to be self-sustaining, but in fiscal year 2007, expenses overtook revenue. This has led to losses of $87 billion through 2020. The agency is further saddled with $188 billion in unfunded liabilities and debt, according to a 2021 report from the U.S. Government Accountability Office.
The U.S. Postal Service is the largest postal service in the world, delivering an estimated 49% of all mail sent globally.