Postal Service could lose $300 million this year

DAILY BRIEFING

Postal Service could lose
$300 million this year

The Postal Service could lose as much as $300 million this fiscal year, its first loss since 1994, Postmaster General William Henderson said Tuesday.

Revenues are down due to a decline in first-class cards and letters, and the agency has faced unexpected costs in gas prices, lawsuits and modernization projects, Henderson said at a monthly meeting of the Postal Board of Governors, according to an Associated Press report.

The Postal Service does not receive any tax revenues, and the agency is required by law to break even over the long term.

In March, USPS announced a plan to eliminate 9,000 positions by 2004. The immense popularity of e-mail and the mailing industry's opposition to raising postage rates were cited as the major reasons behind the downsizing. Over the next four years, the Postal Service wants to cut costs in purchasing, transportation and operations as well.

USPS wants to increase revenues by raising postage for first class stamps one cent next year. The issue is currently before the Postal Rate Commission.