Postal Service bleeds another $3.3 billion

The U.S. Postal Service announced Thursday that it lost $3.3 billion in the first three months of the fiscal year as the agency continues to hemorrhage money.

The majority of the losses, some $3.1 billion, occurred because the USPS had to pre-fund its retirement plan.

The USPS said it's up to Congress to stop the losses.

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“The return to financial stability requires legislation which gives the Postal Service typical commercial freedoms, including delivery flexibility, returns over $10 billion of amounts overpaid to the Federal Government and resolves the need to prefund retiree healthcare at rates not assessed any other entity in the United States.”

One bright spot for USPS was increased revenue from the holiday shopping season, but it was not enough to offset the decline in revenue from the decline in first-class mail.

“Technology continues to have a major impact on how our customers use the mail,” said Postmaster General Patrick Donahoe. “While it has helped us grow our Shipping Services businesses, it has had a significant negative impact on some of our much larger sources of revenue, particularly First-Class Mail.”

The mailing industry’s Coalition for a 21st Century Postal Service said the losses show the need to pass a stalled Senate postal reform bill and to take up a rival House version.

Authored by Sens. Joe Lieberman (I-Conn.), Tom Carper (D-Del.), Susan Collins (R-Maine) and Scott Brown (R-Mass.), the bill would return the billions paid into the retiree funds.

The House bill authored by Reps. Darrell Issa (R-Calif.) and Dennis Ross (R-Fla.) does not return the money, and instead makes deeper cuts to the service.

The USPS might run up against its debt ceiling this fall, forcing action on the bills.

"While today's announcement that the U.S. Postal Service lost $3.3 billion in the first quarter of fiscal year 2012 is disappointing, it unfortunately does not come as a surprise. While the magnitude of the losses themselves is bad enough, the fact that they came during a period of the year that is usually the most successful for the Postal Service is truly shocking," Carper said in a statement. 

Carper urged Congress to take up his bill, noting it is the only postal measure with bipartisan support.

"If we do nothing, our nation could face a future without a Postal Service," he said.

Issa noted that USPS has said that even if it no longer needs to pre-fund its employee benefits, it will still reach its debt limit in the fall.

"USPS has reached a new, deeper level of crisis,” Issa said in a statement. “No accounting gimmick will restore it to solvency. Congress must pass legislation that allows USPS to reduce its operating costs and realign its network in line with America’s declining demand for paper mail.”

— This story was last updated at 12:55 p.m.