Thank you for contacting me about the novel Coronavirus (COVID-19) and the United States Postal Service (USPS). I appreciate hearing from you.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted into law on March 27, 2020, authorizes the USPS to borrow up to $10 billion from the U.S. Treasury Department to fund operating expenses if doing so is deemed necessary by the USPS due to the coronavirus emergency. The CARES Act disallows those funds from being used to pay any outstanding debt of the USPS. Should the USPS borrow money from Treasury, it will be based on terms and conditions mutually agreed upon by the Treasury Secretary and the USPS.
The financial condition of the USPS has been deteriorating for over a decade before the COVID-19 pandemic. The USPS has reported net losses for thirteen years in a row, having lost $78 billion during that span. According to the Government Accountability Office (GAO), the USPS has missed nearly $50 billion in required payments for retiree health and pension benefits. If the USPS fails to make any more payments, the retiree health benefit fund will be depleted within a decade, according to the Office of Personnel Management (OPM). Furthermore, USPS's expenses are now growing faster than its revenues due in part to rising compensation and benefit costs and a continuing decline in the volume of First-Class Mail.
In December 2018, the Treasury Department released a report from the Task Force on the United States Postal System. The report, available at https://home.treasury.gov/news/press-releases/sm566n, contains various policy recommendations that can help return the USPS to a sustainable financial path. Additionally, it contains an extensive list of USPS employee organizations and mailing industry trade associations that provided input to the Task Force. The report, as well as nearly a decade of GAO recommendations, makes clear that administrative and legislative reforms are necessary to create a more sustainable business model.
I recognize that the USPS provides an important service, especially in rural America where it conducts a large percentage of deliveries. Efforts to preserve the USPS must be done in a fiscally responsible way that does not shift costs to taxpayers. Although I am not a member of the Senate Homeland Security and Governmental Affairs Committee, which has jurisdiction over issues pertaining to the USPS, please be assured that I will have your thoughts in mind should Congress consider making any legislative reforms or providing further financial assistance to the USPS.
Thank you again for your correspondence. Do not hesitate to contact me in the future if I can be of assistance.