is the post office funded by the federal government

Its expenses are also growing faster than its revenue because of increased wages, a decrease in mail volume, and something known as pre-funded healthcare — a hot topic within the postal community. Package shipping revenues in the second quarter surged by 53.6 percent over the second quarter of 2019, which kept the USPS net loss to $2.2 billion for the quarter compared to a loss of $2.3 billion a year earlier. The U.S. Finally, I did not direct the elimination or any cutback in overtime.” Nevertheless, on August 18, DeJoy committed to suspending his long-term reform initiatives until after the November election. From 2008 to 2018, it reported $69 billion in losses. If you are unable to resolve an issue with a federal government agency, contact the office of the Inspector General (IG) of that agency. Trump has raised a valid issue in … What’s the ECB doing in response to the COVID-19 crisis? Provisions of personal protective equipment to employees, a decrease in the ability to use air transportation for deliveries, increased paid sick leave, and low customer demand have all contributed to surging costs and declining revenues. There’s been a lot of buzz surrounding the United States Postal Service lately, from the speed of mail delivery to the uncertainty of its future. Cost-cutting efforts at the USPS were already underway when DeJoy was sworn in as Postmaster General in June 2020. The COVID-19 pandemic has severely threatened demand and revenue for USPS, straining its already fragile finances. 1-800-222-1811 (Track and Confirm a Package) TTY: 1-877-889-2457. The Board appoints the Postmaster General, who acts as the CEO. Postmaster Louis DeJoy has been invited to testify in front of the House Oversight Committee “in a sign of congressional concern over the possibility of delays.”, The testimony was reportedly requested "to examine recent changes to U.S. With a probable mail-in ballot voting system set for this election year, the pressure is on to settle financial unrest and questions of whether the postal service will be equipped to handle the process. In the CARES Act, Congress provided a $10 billion emergency loan to the USPS. In addition, USPS provides health benefits to its retirees, as other government employers—but not all large private employers—do. However, combined with President Trump’s comments questioning the security of mail-in voting, changes to Postal Service operation—some of which were in train before DeJoy’s appointment—have been particularly controversial. View an A-Z index of federal agencies. UPDATE: Some text in the final paragraph has been revised. Postal Service (USPS) to achieve sustainable financial viability.”, “USPS has lost $69 billion over the past 11 fiscal years — including $3.9 billion in fiscal year 2018. Before 1971, it was a department of government, supported by taxes. For many years, the USPS was the only federal agency subject to a pre-funding mandate on future retiree health benefits. In August 2020 testimony to the House Committee on Oversight and Reform, DeJoy said he didn’t explicitly order the practices that have generated criticism: “First, I did not direct the removal of blue collection boxes or the removal of mail processing equipment. And have him take a look at that, because that’s the way to solve the problem.” In April, the post office requested $75 billion in emergency funding to continue processing and delivering some 48 percent of the world’s mail. The Hutchins Center on Fiscal and Monetary Policy, All six of the current independent governors were appointed by President Trump, factors that arose well before coronavirus, it lost $8.8 billion on $71.1 billion of operating revenue, First-Class Mail decline from a peak of 103.5 billion pieces in 2000 to just shy of 55 billion pieces in 2019, This has provoked criticism from President Trump, as nearly as practicable the entire population of the United States, the Postal Service had been significantly over-paying into its pension fund, USPS has missed $42.6 billion of required payments on its health benefits since 2010, which kept the USPS net loss to $2.2 billion for the quarter compared to a loss of $2.3 billion a year earlier. Postal Service (USPS) had largely completed Post Office Structure Plan's (POStPlan) implementation prior to a 2014 POStPlan arbitration decision and expected millions in cost savings. Since the Postal Service’s … It's the only government agency that's actually profitable that I can think of. All federal pension and retirement benefits are paid from the U.S. Treasury. As a result, USPS has missed $42.6 billion of required payments on its health benefits since 2010 and $5.6 billion in required contributions to its pension plan since 2014. Even before the novel coronavirus struck, impacting people and businesses across the country and around the world, the USPS was in serious financial trouble. It currently has 140,837 of them, down from 164,099 in 2013. In addition, the bill—which is unlikely to pass the Senate—mandates that the USPS must reverse any policy changes that have led to delays in mail delivery and refrain from any new policies that would reduce its mail delivery performance until the end of the COVID-19 public health emergency. But the story's more complex than that. In 1971, Congress replaced the Department with the United States Postal Service, an independent entity within the executive branch. Getty. It was one of the original functions of Government, mentioned in the Constitution. Postal Service) they actually do receive funding from the federal government via the annual budget in the form of “subsidies”. For the 2019 fiscal year, it lost $8.8 billion on $71.1 billion of operating revenue. The Second Continental Congress appointed Benjamin Franklin as the first Postmaster General in 1775. The Postal Service receives NO tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations. Post was not sent - check your email addresses! Today we have the flip side of that myth- the belief that the US Postal Service isn’t part of the federal government. The Post Office Department issued its first postage stamps on July 1, 1847. As First-Class Mail volumes have declined, the USPS has been reducing the number of blue mailboxes for years. There is established in the Treasury of the United States a revolving fund to be called the Postal Service Fund which shall be available to the Postal Service without fiscal-year limitation to carry out the purposes, functions, and powers authorized by this title (other than any of the purposes, functions, or powers for which the Competitive Products Fund is available). In 2002, the Office of Personnel Management found that the Postal Service had been significantly over-paying into its pension fund, leaving it with cash beyond what was needed to meet its employee retirement liabilities. ... to catch up on the pre-funding of its retirement health benefit obligations after years of a … I really hope president Trump take a look at this and realize it's hurting business it's hurting their growth and people realize that the post office could be so much more. The fundamental problem is that while the USPS generates enough revenue to cover its operating costs, its pension and retiree health care liabilities push its bottom line into the red. The Task Force produced a report in December 2018, urging cost-cutting and price increases. Main Address: USPS Office of the Consumer Advocate 475 L'Enfant Plaza, SW Room 4012 Washington, DC 20260-2200. Under the mandate, they were on the hook to pay between $5.5 and $5.8 billion a year, and postal losses mounted. Postal employees are federal employees. Earlier this week we dealt with the popular belief that because the US Constitution mentions post offices, it would take a constitutional amendment to eliminate or privatize the USPS. “There is no question that the post office at the ... federal government to ease economic fallout from the virus included a $10 billion loan to the USPS, though there was no direct funding. It was headed by the postmaster general.. Because of the rise of email and digital communication, USPS has seen the volume of First-Class Mail decline from a peak of 103.5 billion pieces in 2000 to just shy of 55 billion pieces in 2019. A new analysis explains just how much the USPS benefits from the subsidies it receives from the federal government. EDIT- "The Board of Governors of the United States Postal Service sets policy, procedure, and postal rates for services rendered, and has … “Now they need that money in order to make the post office work so it can take all of these millions and millions of ballots,” Trump incorrectly said in a Fox Business interview. The US postal service (despite quibbles by some) is a “quasi-governmental" organization. Postal Service has been a matter of both contention and confusion since the 1970 Postal Reorganization Act (PRA) put the Postal Service on a self-sustaining basis, exempting it from general budget and funding laws and denying the executive branch control over its finances. The unique drag on the Postal Service comes from this congressional requirement. The United States Postal Service is federally funded government agency that we take for granted as a utility that will always be there, like roads or water. Postal workers receive federal benefits, but are not actually considered federal employees. The United States Post Office Department (USPOD; also known as the Post Office or U.S. Mail) was the predecessor of the United States Postal Service, in the form of a Cabinet department, officially from 1872 to 1971. But there is no “quasi” about it: the USPS is a government agency. The Fairness Act passed in the House of Representatives in February 2020, and a Senate vote is pending. USPS has tried to increase the delivery of marketing mail and has tried to compete with UPS and FedEx in the parcel delivery sector, including by forging a delivery deal with Amazon. The postage rate was based on the number of sheets in the letter and the distance it would travel. Second, I did not direct the cut back on hours at any of our post offices. Unlike other employers, though, the USPS is required by the Postal Accountability and Enhancement Act (PAEA) of 2006 to pre-fund retiree health costs out of current income. (This has provoked criticism from President Trump.) Guidance for the Brookings community and the public on our response to the coronavirus (COVID-19) », Learn more from Brookings scholars about the global response to coronavirus (COVID-19) ». Forms: Postal Service Forms. The Larry Doby Post Office is located at 194 Ward Street in Paterson, New Jersey, across the street from my congressional office. The administration then offered a $10 billion loan under terms in which control over the mail service would shift to Treasury Secretary Steven Mnuchin, and package rates would be quadrupled in exchange for the funding. Postal workers receive federal benefits, but are not actually considered federal employees. USPS is operated by a 11-person Board of Governors (which resembles the board of directors of a public corporation)—the Postmaster General, his deputy (currently vacant), and nine governors appointed by the President and approved by the Senate for seven-year terms. The conditions that the Treasury imposed on the loan led the vice chairman of the USPS board, David Williams, a former USPS inspector general, to resign, alleging that the Treasury demands threatened to turn the agency into a “political tool.”. Except that the post office is taxpayer-funded : Democrats and U.S. the Task Force on the United States Postal Service, with Postal Service Board Chairman Robert M. Duncan, we may see mail left behind or mail on the workroom floor or docks, testimony to the House Committee on Oversight and Reform, Why Trump’s attack on USPS is an attack on the Constitution, democracy, and racial equality. Postal Service officials are seeking a $75 billion bailout from taxpayers. Sorry, your blog cannot share posts by email. That’s because the post office is a quasi-federal agency, and as such, is not funded by the U.S. government. GAO cites a deteriorating financial situation, insufficient cost savings, and unfavorable trends as the reasons behind the post office’s poor financial performance. I do believe. But actually, the post office isn't funded by tax dollars. In that law, Congress instructed USPS to contribute approximately $5.6 billion per year from 2007 to 2016 and to stretch any additional obligations over the almost 40 years from 2017 to 2056. The Postal Service Act, signed by U.S. president George Washington on February 20, 1792, established the department. While they seek to blame the COVID-19 coronavirus pandemic, the facts are plain. You see this in news stories often- FedSmith ran a column just a week ago referring to … Government … Toll Free: 1-800-275-8777. The Post Office has broad limitations about making routine business decisions that its private-sector competitors do not. The federal government conducted the last major analysis of its Charter Schools Program in 2015, when it said the program had provided $3.3 billion since its … And how is it changing during the coronavirus pandemic? Although COVID-19 has choked off the USPS revenue in recent months, factors that arose well before coronavirus have contributed to the unsustainability of the Postal Service’s financial situation for years. In a Washington Post article on the U.S. Mail delivery is a service you receive, but not one you pay for — outside of the postage that you purchase. The United States Postal Service (USPS; also known as the Post Office, U.S. Mail, or Postal Service) is an independent agency of the executive branch of the United States federal government responsible for providing postal service in the United States, including its insular areas and associated states. In fact, it existed, in some form, even before the United States came into existence. The New York Times reported that Mnuchin was unusually involved in the Postmaster General recruitment process, with Postal Service Board Chairman Robert M. Duncan, a former chairman of the Republican National Committee, suggesting Louis DeJoy, who has a background in the logistics business. Stay tuned for more on the future of the USPS during this unprecedented time. Shortly after the requirements were passed, the economy sank into the Great Recession and digital competition intensified, driving down revenues. It is one of the few government agencies explicitly authorized by the United States Constitution. Combined with strong performance in the early 2000s, this unexpected windfall positioned USPS to catch up on the pre-funding of its retirement health benefit obligations after years of a “pay-as-you-go” approach before the passage of PAEA. As of 2017, the USPS held a market share of over 19 percent in U.S. package delivery. The Postal Service receives no direct taxpayer funds. It would have ranked number 44 on the 2019 Fortune 500 if it were included. Locate a Post Office. He promised that there would be no changes to Postal Service retail hours, that collection boxes and processing equipment will remain where they are (though no commitment was made to return boxes and equipment already removed), and that overtime hours would be granted to employees as necessary. The Post Office has been losing billions of dollars a year for many, many years. Postal Service operations and standards and the need for on-time mail delivery during the ongoing pandemic and upcoming election, which as you know may be held largely by mail-in ballot.". Allow for 50% prefunded pensions and watch the post office grow. USPS Workers Are Reporting That Mail Deliveries Are Intentionally "Slowed Down", Girl Who Loves Writing Letters Started a Whole Correspondence Effort with the USPS, How This Guy Scammed UPS Shouldn't Have Been This Easy, But It Was, Republicans Are Planning to Challenge Biden’s Victory, but It’s a Long Shot. The United States Postal Service (USPS) is big. It relies on revenues from stamps and other service fees. Postal Service’s continuing problems, Ed O’Keefe calls the USPS “a quasi-government agency enshrined in the Constitution but required by law to act like a business.”. Article continues below advertisement. Clearing this misconception up is the number one item on their Top Thirteen Things You Should Know about the U.S. Internal memos outline new policies to avoid late departures and extra delivery trips, even if it means that “we may see mail left behind or mail on the workroom floor or docks.”. The first stamps were issued in 1847, and city delivery got its start in 1863. They used to be but I think like 20 years ago the post office went private and is now only overseen by the gov't. Despite partial deferrals from Congress and the proposed USPS Fairness Act to eliminate pre-funded health benefits, the agency has accrued a reported whopping $120 billion in pension and other post-employment unfunded liabilities. Designing the Main Street Lending Program: Challenges and options. The budget status of the U.S. In March, the $2 trillion Coronavirus Relief Bill reserved $25 billion for the USPS under the CARES Act, which was blocked by the Trump administration. It is classified as an “independent establishment of the executive branch of the Government of the United States” and operates independently of government control, run by its own non-political directors. As CNN reports, the USPS told Congress it would be out of money by September back in April of 2020. As of now, the funding is still hanging in the balance. In April 2018, President Trump created the Task Force on the United States Postal Service, chaired by Treasury Secretary Steve Mnuchin. This burden applies to no other federal agency or private corporation. Despite websites claiming they receive zero tax dollars like this one: “The Postal Service receives NO tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.”, (Top twelve things you should know | Postal Facts - U.S. Previously, letters were taken to a Post Office, where the postmaster would note the postage in the upper right corner. The U.S. Government Accountability Office (GAO) calls the post office’s financial viability a high-risk issue, saying, “Comprehensive legislative reform and additional cost-cutting measures are needed for the U.S. By law, the Postal Service has an obligation to provide universal service—that is, to deliver mail to “as nearly as practicable the entire population of the United States.”  This forces USPS to deliver to more addresses each year, even as fewer pieces of mail are being delivered. The Post Office Department was created in 1792 and became a Cabinet department in 1872. Increases in volume for packages are not expected to make up for continued weakness in marketing mail volume (down 37.2 percent, year over year) and First-Class mail volume (down 6.4 percent) as the pandemic continues. Its official statement is, “The Postal Service receives NO tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.”. 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