By David Shepardson
WASHINGTON (Reuters) – The United States Postal Service said on Wednesday it is adopting new service standards that will save the money-losing agency at least $36 billion over 10 years.
USPS has lost more than $100 billion since 2007, including $9.5 billion in the 12 months ending Sept. 30. Outgoing Postmaster General Louis DeJoy warned in November that the agency must continue to cut costs or it would face a “government bailout or the end of this great organization as we know it.”
Under the new approach that will be phased in starting April 1, most mail will retain the same service standard and some will have faster or slightly slower standards.
On Friday, President Donald Trump said he was considering merging the Postal Service with the U.S. Commerce Department, a move Democrats said would violate federal law.
Democratic Senator Gary Peters said any attempt by Trump to seize control of the postal operation, which has about 650,000 employees, and fire its board of governors would be illegal.
Under a 1970 reorganization, USPS was made an independent agency under the executive branch, free of direct political control. An 11-member board of governors, of whom nine are nominated by the president, is in charge while an independent regulator oversees postage rates.
As electronic communications have proliferated, the postal service has been hurt by an 80% decline in first-class mail volume since 1997, and it is now at its lowest level since 1968.
In 2022, President Joe Biden extended $50 billion in financial relief over a decade to USPS while Congress separately forgave a $10 billion loan.
The postal service announced a restructuring plan in 2021 that aimed to eliminate $160 billion in predicted losses over the next decade. USPS now projects $80 billion in losses over the period and plans further cuts to address the shortfall.
(Reporting by David Shepardson; Editing by Leslie Adler)
