WASHINGTON (ABC 4 News) - In an effort to address part of its immense financial problems, the U.S. Postal Service on Wednesday announced that it will cease delivering mail to residences and businesses in 2013 -- a move that could save the agency $2 billion every year, officials said.
Already dealing with substantial financial losses, a changing postal landscape, and an uncooperative U.S. Congress, the agency said that it essentially has no choice but to eliminate Saturday service. However, package delivery -- a much more profitable service for the USPS -- will continue on Saturdays.
"Our financial condition is urgent," said U.S. Postmaster General Patrick Donahoe. "The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America's changing mailing habits."
Package delivery for the USPS has increased by 14 percent since 2010, while delivery of letters and other mail has declined with the country's increasing use of email and other Internet services.
For years, the Postal Service has wanted to switch to a Monday through Friday delivery schedule but the U.S. Congress has mandated Saturday service. Now that Congress is currently operating under a temporary spending measure, the USPS believes it can make the change itself -- without congressional approval. Once the temporary spending measure expires Mar. 27, the Postal Service hopes Congress will not reinstate its long-implemented ban on Monday-Friday delivery.
The USPS reported an annual loss of nearly $16 billion last year. Officials say the biggest drain on cash are the future retiree health benefits of its employees -- which accounted for $11 billion of last year's loss alone. Donahoe said implementation of the new delivery schedule should save the agency $2 billion annually.
The U.S. Postal Service is an independent government agency, but gets no tax dollars for its day-to-day operations. However, it is still subject to congressional control.
Donahoe said the five-day delivery schedule will take effect in August