Postal workers sort mail at a USPS processing and distribution center in Oakland, California in April.

Postal workers sort mail at a USPS processing and distribution center in Oakland, California in April. Ben Margot/AP

Bipartisan Senate Bill Would Provide $25 Billion to Postal Service

As losses during pandemic mount, senators pitch emergency funds to not "let so vital an agency fail."

A bipartisan group of senators is pushing for emergency funding for the financially-strapped U.S. Postal Service, which has cautioned the economic impact of the novel coronavirus pandemic has deeply exacerbated its ongoing fiscal crisis. 

The Postal Service Emergency Assistance Act (S. 4174), introduced by Sen. Susan Collins, R-Maine, and cosponsored by Sens. Diane Fienstein, D-Calif., Steve Daines, R-Mt., Doug Jones, D-Ala., and Jon Tester, D-Mt.,  would provide $25 billion to the mailing agency on the condition the funds be used to cover COVID-19 related losses or expenses. It would require USPS to develop a “plan to ensure the long-term solvency” of the agency and ensure it has immediate access to the $10 billion line of credit with the U.S. Treasury that Congress authorized in April. Treasury Secretary Steve Mnuchin has sought to place conditions on the loan, leading to the resignation of USPS Board of Governors member David Williams. 

The Postal Service previously requested $75 billion in financial assistance from Congress, citing the fallout of the pandemic. While postal management said earlier this year it would likely run out of cash by the end of September, the agency said in a financial document in May that by accessing a $10 billion loan from Treasury and prioritizing some payments over others "it expects that it will have sufficient liquidity to continue operating through at least May 2021." 

Mail volume and revenue have dropped precipitously in the Postal Service’s regular mail delivery—its most profitable offering—but those declines have been offset somewhat by huge upticks in package business. First class mail volume dropped by 14% in May 2020 compared to May 2019, while package volume spiked by 61%. Package delivery is more labor intensive, however, leading to expenses growing faster than revenue last month and a loss of $651 million, not accounting for inflationary changes to workers’ compensation costs. 

Postal management has stressed increases in package revenue would not offset overall losses from the pandemic and it does not expect the boon to continue as more sectors of the economy reopen. 

“While we continue to conserve capital and reduce expenses in areas where volumes are declining, our ability to continue to serve the nation will require substantial funding from the federal government or other sources,” Joe Corbett, the USPS chief financial officer, said in May. 

Collins said her bill would ensure the Postal Service remains viable well into the future. 

“The COVID-19 pandemic has changed our daily lives in fundamental ways, and the Postal Service is needed now more than ever,” the senator said. “The agency’s dedicated employees go to work each day, facing increased risk as they continue to ensure reliable delivery of needed prescriptions, safety-net benefits, and other critical services that might otherwise be unavailable.” 

Under the measure, USPS would have to prioritize the purchase of personal protective equipment for employees and take additional steps to sanitize vehicles and facilities. It would have nine months to submit its long-term plan to Congress and through September 2022 to spend the $25 billion.  

“Congress must provide emergency funding for the Postal Service just as it has for other essential industries,” Feinstein said. “We cannot let so vital an agency fail.”

The same group of senators joined five of their colleagues in signing a letter pushing the Senate to appropriate funds for the Postal Service. Collins, Feinstein, Tester and Daines all sit on the Senate Appropriations Committee. House Democrats have passed a new coronavirus relief package that included $25 billion for USPS. While there appears to be bipartisan momentum for another aid package of some sort in the coming weeks, it remains unclear whether Republican leadership in the Senate would support postal relief. President Trump has said he does not support additional assistance for the Postal Service. 

Two recent polls show American overwhelmingly support financial assistance for the Postal Service.