U.S. Postal Service Tries to Cut Mail Delivery to Five Days a Week

The U.S. Postal Service (USPS) has come one step further in its quest to deliver mail just five days a week instead of six.

Joe Davidson, writing in the May 21, 2009 Washington Post, reports that postal officials testified the prior day at a congressional hearing and presented their case for a law that would allow them to adopt the reduced schedule. According to Davidson, the USPS has been so hard hit by the recession that lawmakers are seriously considering the agency's request.

USPS runs on revenue primarily from postage, box rentals and packaging material sales. Although it currently receives no tax dollars, Rep. Jason Chaffetz (R-Utah) indicated he might be willing to consider some type of mixture of delivery cuts and a taxpayer subsidy, Davidson writes.

USPS senior vice president William P. Galligan told the Congressional panel that compared to the same period during the prior year, total USPS mail volume fell nearly 15 percent. He said that revenue was down more than 10 percent, adding that the agency lost nearly $2 billion in the second quarter. The USPS projection for loss for the current fiscal year exceeds $6 billion.

According to the Post, USPS plans to process 180 billion pies of mail this year. However, this figure is 32 billion under what the agency handled in fiscal year 2007. The drop is reportedly the biggest since the Great Depression.

USPS officials have already put into place a number of actions to reduce operating costs. They include a hiring freeze, closing some district offices and cutting work hours.

According to FederalTimes.com, over the last few years, the agency trimmed the size of the workforce by attrition and early retirements. USPS has also increased automation, stopped construction projects, reorganized delivery routes and upped employee contributions to health care costs. However, in recent years, mail volume has plummeted due to the popularity of e-mail, online bill payments, other Internet-based tools and fewer mailed advertisements.

John D. Waller, an official with the Postal Regulatory Commission, speculates that USPS will run out of cash this year. What USPS is asking for is approval to alter the way it funds health-care benefits for its retirees and to drop the sixth weekly day of mail delivery. Although speculation suggests that the day might be Saturday, that's not certain.

One of the problems with these plans, analysts suggest, is determining whether USPS estimates of potential savings are accurate. Congressional support is tied to this factor. Last year, USPS estimated that if the volume of mail remained constant, lopping off 1 day a week for delivery would save the agency $3.5 billion a year. However, the Postal Regulatory Commission disagreed. They made the assumption that mail volume would decline if the mail were delivered just six days a week, resulting in an estimated savings of $1.9 billion annually.