Postal Service to cut Saturday mail delivery

WASHINGTON -- The Postal Service said Wednesday that it plans to cut back to five-day-a-week deliveries for everything except packages to stem its financial losses in a world radically reordered by the Internet.

"Our financial condition is urgent," declared Postmaster General Patrick R. Donahoe.

Congress has voted in the past to bar the idea of eliminating Saturday delivery, and the announcement drew protests from some lawmakers and approval from others. The plan, which is to take effect in August, also brought objections from farmers and the letter carriers' union.

The proposed change is based on what appears to be a legal loophole. Congress has long included a ban on five-day-only delivery in its spending bills, but because the federal government is now operating under a temporary spending measure rather than an appropriations bill, Donahoe says the agency believes it can make the decision.

Under the plan, mail would be delivered to homes and businesses only from Monday through Friday but would still be delivered to post office boxes on Saturdays. Post offices now open on Saturdays would remain open.

The change would eliminate through buyouts and attrition the equivalent of 22,500 jobs from a workforce of 521,000 career employees.

The Postal Service, which lost $15.9 billion in the past budget year, said it expected the move would save $2 billion annually. Mail such as letters and magazines would be affected. Delivery of packages of all sizes would continue six days a week.

The plan reflects one of the agency's strong points: Package delivery has increased by 14 percent since 2010, officials say, while the delivery of letters and other mail has plummeted. Email has decreased the mailing of paper letters, but online purchases have increased package shipping.

"Things change," Donahoe said.

Change is not the biggest factor in the agency's predicament -- Congress is. The majority of the service's red ink comes from a 2006 law forcing it to pay $5.5 billion a year into future retiree health benefits, something no other agency does. Without that and related labor expenses, the mail agency sustained an operating loss of $2.4 billion last year, less than the previous year.

An independent agency, the service gets no tax dollars for its day-to-day operations but is subject to congressional control.

Two Republicans on Capitol Hill committees overseeing the postal service supported the elimination of Saturday mail. It's "common-sense reform," Rep. Darrell Issa of California and Sen. Tom Coburn of Oklahoma wrote Senate and House leaders.

Sen. Tom Carper (D-Del.) said he's "disappointed" by the Postal Service's move.

With Bloomberg News