USPS posts $16B loss

The U.S. Postal Service is calling for legislative reform after recording a fiscal 2012 net loss of $15.9 billion, a record loss for the pseudo-governmental entity. The USPS posted a $5.1 billion loss in fiscal 2011.

The postal service's fiscal year that ended Sept. 30 included expenses of $11.1 billion related to two payments to prefund retiree health benefits. The USPS, which is required by law to prefund the benefits, defaulted on the payments. The expenses accounting for 70 percent of the postal service's fiscal net loss, according to a news release.

USPS officials are calling for the prefunding requirement to be resolved and to allow more commercial flexibility to manage the entity as a business.

“It’s critical that Congress do its part and pass comprehensive legislation before they adjourn this year to move the postal service further down the path toward financial health,” Postmaster General Patrick Donahoe said in the release. “We continue to do our part to grow revenue and reduce expenses by making our operations more efficient and by providing our customers with new and expanded services to meet their mailing and shipping needs."

In addition to the prefunding requirement and being allowed to sponsor its own health care program for employees and retirees, other legislative goals of the postal service's business plan include:

• allowing the USPS to set delivery frequency;
• enabling the entity to offer nonpostal products and services; and
• developing a more streamline process for governing the postal service that would allow for quicker pricing and product decisions.

Other fiscal 2012 financial notes:

• The postal service's revenue from package businesses increased by $926 million, or 8.7 percent, on a volume increase of 244 million pieces compared to fiscal 2011.
• Operating revenue decreased to $65.2 billion from $65.7 billion.
• First-class mail revenue dropped 3.9 percent and standard mail revenue decreased by 4.3 percent.