USPS Surprises with Unilateral Five-Day Delivery Announcement; Senate Holds Hearing on Postal Crisis
February 25, 2013
Despite years of declarations that a move to five-day delivery required congressional action, the United States Postal Service (USPS), on February 6th, announced its intent to eliminate Saturday delivery of mail beginning August 5, 2013 – with or without congressional action. In a statement released the same day as the announcement, MPA expressed concern, but a willingness to cooperate with the Postal Service as they seek to right-size their infrastructure.
While the Postal Service anticipates significant savings as a result of the reduced delivery schedule, the measure will not in itself cure the financial ills that plague USPS. Days after the announcement of the five-day delivery plan, the Postal Service reported a loss of $1.3 billion for the most recent quarter. The USPS has also reached its statutory borrowing limit ($15 billion) from the U.S. Treasury, making continuing losses unsustainable. Congressional action will still be necessary as the Postal Service’s financial crisis comes to a head.
Shortly after the surprise announcement, on February 13, the Senate Homeland Security and Governmental Affairs Committee held a hearing entitled “Solutions to the Crisis Facing the U.S. Postal Service.” Joel Quadracci, Chairman, President, and Chief Executive Officer of Quad/Graphics, Inc., testified on behalf of the entire mailing industry, outlining how critical a healthy Postal Service is to business mailers, and highlighting the concerns of the magazine industry. (The testimony and video of the hearing can be viewed here.)
MPA will stay vigilant on its members’ behalf and will keep you informed of developments relating to postal reform legislation and the Postal Service’s attempted implementation of five- day delivery.