NALC: USPS finances are rebounding strongly as economy improves

August 9, 2013—Statement from Fredric Rolando, president of the National Association of Letter Carriers, about today’s Postal Service financial report for the third quarter of Fiscal Year 2013:

The Postal Service’s latest quarterly report makes clear that its finances are rebounding strongly as the U.S. economy improves.

nalcbudgetAlthough it reported a loss of $740 million, the agency would have reported a profit of $660 million absent the $1.4 billion payment it was charged for pre-funding future retiree health benefits—a bill no other company or agency in the country is required to pay. Operating revenue is up 3.6 percent compared to the same period last year.

That good operating picture was fueled by a sharp 8.8 percent rise in package delivery revenue from online orders, which offset the effect of online bill-paying, as well as by workers’ compensation interest adjustments.

The sharp improvement over 2012 reflects the fact that the opportunities offered by the Internet (delivering goods ordered online) increasingly are offsetting Internet challenges (online bill-paying), which augurs well for the future.

All of the Postal Service red ink for the entire year to date stems from an external political factor: the 2006 congressional mandate to pre-fund future retiree health benefits, which no other entity in the country is required to do.

Given this, it makes no sense to degrade service or dismantle a network that is performing well and that provides Americans and businesses with the world’s most affordable delivery network.

The congressional priority should be to address the actual source of red ink: the $5.5 billion annual pre-funding albatross that is hampering the Postal Service. This mandate is not only onerous, it is unnecessary, because the Postal Service already has put aside sufficient money to meet the needs of future retirees for decades to come. Few, if any, companies can say the same.

The path to profitability is clear: Address the pre-funding fiasco and give the Postal Service the freedom to innovate and grow in the digital era. Do not eliminate Saturday delivery, which would raise costs for small businesses open weekends, and do not force people to traipse around their neighborhood looking for cluster boxes. Such steps would inconvenience the public and would destroy the Postal Service by driving mail—and revenue—out of the system.

The latest financial results should finally convince Congress to deliver a postal reform plan that eliminates pre-funding; strengthens and protects the existing Postal Service network; provides a more business-oriented governance structure; and frees the Postal Service to meet evolving customer needs in the digital era. Unfortunately, the advancing House legislation and the recently introduced Senate bill fail to achieve these goals.

  • shamon

    What will happen if no postal legislation passes?

    • postalnews

      I suspect what will happen is nothing. When the USPS first “defaulted” on a trust fund payment, there were all kinds of stories about what it meant, and about postal bankruptcy, etc. What happened then? Nothing- the USPS continued delivering the mail. Nothing has changed since then, so I wouldn’t expect the outcome to be any different this time around. If push comes to shove, and it looks like employees or contractors won’t get paid, Congress will pass a stopgap measure to free up some funds- no bailout required- there’s $47 billion in the “trust fund”. There will no doubt be some grandstanding from the teabaggers, but there will be a pragmatic majority to kick the can down the road again, at least until the next election…

      • shamon

        Might be a good thing then. Don’t care for the new legislation.

  • texas mailman

    The trick will of course be getting congress and the PMG to stop misleading the public and their colleagues.

    • CHUCK U. FARLEY

      2nd part of that trick is to get the NALC to listen to its members and get rid of Saturday delivery like the majority of them want.

      • common sense

        Funny- “the majority of them” elected the current leadership- who have always made it clear that they support 6 day delivery. Guess you’re wrong!

        The NALC doesn’t have to “listen to its members” because it IS its members. They voluntarily decided to join, and they elected the current leadership. You’re welcome to disagree, but you don’t speak for the carriers. They speak for themselves.

        • RacerRay

          GOOD CALL

      • RacerRay

        The NALC wants to preserve good paying jobs. But as long as you keep yours,that is all you care about.

        • Joemac

          CCA at 14.50 an hr is not a good paying job

  • steve

    Remember, when a private company fails it goes out of business. When government fails it just keeps failing…..

  • herman

    CUT SATURDAY

  • Joemac

    I think it’s time both sides stop misleading the people. Nalc should fight to save door to door delivery and keep our health care and retirement out of the hands of yhe USPS. The people that i see on my rt every day really don’t care about sat del so maybe it’s time to listen to the people and the membership and get something done to save the po

    • RacerRay

      Funny. The majority of my customers want to keep Saturdays. But most of mine are elderly.

      • Joemcd

        There you go again. I find it hard to believe that MOST of your customers are elderly but kind of expected that from you You seem to always say what they tell you to say

        • mike wllace

          He says what his elderly customers tell him to say?

        • RacerRay

          Hey idiot. I deliver to a senior citizens home. You are the puppet who can’t handle thinking on your own. You are just a follower who wants to eliminate Saturdays because others say it too.

  • Bob Andreas

    What’s your definition of economy rebounding strongly ?

  • Joemac

    He knows who THEY are

  • Joemac

    Racerray. I also have elderly housing on my rt (100 stops). My rt has 450 del do the math thats not MOST of my customers. I have been a member of the nalc for over 35 yrs 6yrs as asst shop steward so i am not anti union i just do not agree with them on THIS issue.maybe its time for you to stop del to eldely housing and move into one

    • RacerRay

      Well if you have 35 years, it is obvious that you are already part of the senior citizens movement. So retire so you can have your precious Saturdays off!!

  • Joemac

    Racerray. In one of your earlier rants you claimed you had 36 yrs service. If thats not a lie then that puts us both in the same movement. When i posted my first comments i thought it was a good way to get my opinion out there. Didnt expect the mindless postings and name calling from people like racerray

    • RacerRay

      Actually it will be 38 in September. And you say that ” I say what they tell me to say” but then you cry when someone calls you out. Strange. And what do you do with the rest of your day with those few stops. We have 650 and over.

      • Joemac

        Hey ray ray no crying here. I have 450 stops and you have over 650. Wow you win

        • RacerRay

          You got one thing right. But that is not just one route. I t is most here.

  • Joemac

    Hey ray ray. You do double the work for the same pay. Whos the fool here