The Postal Service is less than a year away from running out of cash and is calling on Congress to increase its limit to borrow money from the Treasury Department.<\/p>\n
Postmaster General David Steiner told members of the House Oversight and Government Reform Committee<\/a> on Tuesday that USPS is set to run out of cash in less than 12 months and that lawmakers need to act soon to keep the agency running.<\/p>\n \u201cLess than a year from now, the Postal Service will be unable to deliver the mail if we maintain the status quo,\u201d Steiner told the government operations subcommittee.<\/p>\n Congress passed long-awaited reform legislation<\/a> in April 2022 that saved USPS $107 billion in total costs. USPS warned lawmakers that it was also on the verge of running out of cash at the height of the COVID-19 pandemic, and received $10 billion in pandemic relief funds.<\/p>\n ]]><\/p>\n Several House Republicans who played a critical role in passing the Postal Service Reform Act said they were skeptical of providing further assistance to USPS.<\/p>\n \u201cEverything that you\u2019re talking about today, we did five years ago,\u201d Committee Chairman James Comer (R-Ky.) said.<\/p>\n Without help from Congress, Steiner warned USPS may have to consider cutting delivery days or closing post offices \u2014 proposals that faced intense public opposition in the past.<\/p>\n \u201cIf you want the same number of delivery days and post offices, we can do that. But someone has to pay for it. If you want to have a discussion about reducing services, we can do that. But the one thing we can\u2019t do is the status quo,\u201d he said.<\/p>\n Steiner said USPS is not \u201cgoing to save our way out of the hole that we\u2019re in.\u201d But Republican lawmakers questioned whether the mail agency has done all it can to cut costs on its own.<\/p>\n \u201cMost agencies today have hiring freezes,\u201d Comer said. \u201cWhy would that not be something you would be looking at to reduce cost, instead of asking Congress for a bailout?\u201d<\/p>\n Steiner told Comer that \u201cwe\u2019re absolutely looking at that,\u201d but said there are some parts of its workforce where a hiring freeze won\u2019t be possible.<\/p>\n ]]><\/p>\n \u201cThere\u2019s folks that actually deliver the mail. You don\u2019t want to do a hiring freeze there, because if we do that, then we won\u2019t deliver mail,\u201d he said.<\/p>\n Steiner said USPS has shrunk its workforce by about 35,000 employees over the last four years, and that the agency is \u201cmoving toward more of those employees being pre-career rather than career.\u201d<\/p>\n Last year, more than 10,000 USPS employees accepted<\/a> the agency\u2019s early retirement offer. Steiner told lawmakers that he hasn\u2019t ruled out nonvoluntary layoffs through a reduction in force.<\/p>\n \u201cWhen you\u2019re in a crisis, everything has to be on the table,\u201d Steiner said.<\/p>\n Subcommittee Chairman Pete Sessions (R-Texas) said that a 10-year reform plan from former Postmaster General Louis DeJoy sought to \u201crevive\u201d USPS, but \u201cthose expectations were not reached.\u201d<\/p>\n That reform plan envisioned the agency reaching a \u201cbreak-even\u201d point by fiscal 2024. But USPS fell well short of those goals. USPS ended fiscal 2025 with a $9.5 billion net loss<\/a>.<\/p>\n Rep. Virginia Foxx (R-N.C.) said lawmakers want to know which elements of a 10-year reform plan remain ongoing, and which have been stopped.<\/p>\n \u201cWe were told the Delivering for America plan was a long-term strategy to steady Postal Service finances, improve operations and protect the future of the mail system, but the UPS losses continue. Productivity has declined. Americans get repeated rate increases, slower services,\u201d Foxx said. \u201cGiven what\u2019s going on, the very negative things that are happening, what evidence suggests the current plan is working? And why should Congress expect different results if the DFA plan continues?\u201d<\/p>\n Steiner said USPS is facing a long-term financial crisis because of a \u201cdrastic reduction in the use of mail.\u201d<\/p>\n ]]><\/p>\n Over the last 20 years, USPS mail volume fell nearly in half \u2014 from 213 billion pieces in 2006, to about 109 billion pieces today. If all that lost volume was paid at the current price of a stamp, that\u2019s about $81 billion.<\/p>\n \u201cNo company could weather that much revenue loss,\u201d Steiner said.<\/p>\n USPS is asking Congress to increase its maxed-out $15 billion borrowing limit with the Treasury Department. Steiner said USPS needs greater borrowing authority to continue to make long-deferred investments in its delivery network \u2014 and that these investments are necessary for USPS to capture a greater share of a competitive package industry.<\/p>\n \u201cThe reality is, until the recent changes to the network, we didn\u2019t have a network that could even compete with FedEx and UPS and Amazon. It just couldn\u2019t compete. And so, what we\u2019ve designed now is a network that can compete, but it competes at a lower level,\u201d Steiner said.<\/p>\n UPS and FedEx each deliver nearly 10 billion packages a year. USPS delivered about 6.8 billion packages<\/a> in fiscal 2025, down from 7.3 billion packages the previous year.<\/p>\n \u201cWe deliver 110 billion pieces per year,\u201d Steiner said, accounting for both mail and package volume.\u00a0 \u201cThis network is so much more sophisticated than those networks because of mail.\u201d<\/p>\n Sessions said lawmakers will consider the Postal Service\u2019s legislative requests, but said USPS must \u201cprove that they have exhausted their options already.\u201d<\/p>\n \u201cCongress needs to have confidence, not only that they\u2019ll be able to pay it back, but that they\u2019re on the right road to achieve financial security for Congress to consider this request,\u201d he said.<\/p>\n Some lawmakers, however, appeared open to moving forward on legislation to address the Postal Service\u2019s financial challenges.<\/p>\n \u201cGive us some ideas on legislatively how we can fix this, because I\u2019m not interested in beating up the post office. I\u2019m interested in fixing it,\u201d Rep. Gary Palmer (R-Ala.) said.<\/p>\n In addition to its congressional wish list, Steiner told lawmakers that \u201cwe need higher prices on both our package and our mail products.\u201d<\/p>\n USPS is free to set its own pricing on packages, but its regulatory agency recently capped the frequency of higher mail prices for the next few years.<\/p>\n In January, the Postal Regulatory Commission\u00a0limited USPS to raising mail prices once per year<\/a>, through September 2030.<\/p>\n Steiner said the regulator\u2019s ruling will cost USPS up to $1 billion each year.<\/p>\n \u201cWe are regulated like a monopoly, though we ceased to be one long ago,\u201d Steiner said. \u201cIn fact, we are regulated worse than a monopoly, because even a monopoly is allowed to make money.\u201d<\/p>\n Subcommittee Ranking Member Kweisi Mfume (D-Md.) said USPS continues to lose money \u201cat an alarming rate, while performance has continued to suffer.\u201d<\/p>\n \u201cAmericans have to pay higher prices for a service that is not as good as it was last year,\u201d Mfume said.<\/p>\n