Postmaster General Patrick Donahoe said Thursday his agency is in “the midst of a financial disaster” and may need an emergency increase in postage rates to keep operating.
“The Postal Service as it exists today is financially unsustainable,” he told the Senate Homeland Security and Governmental Affairs Committee. It’s a message that the postmaster general has been delivering to Congress with regularity over the past several months.
Donahoe pressed lawmakers Thursday for swift action on legislation to fix his agency’s finances. Without help from Congress, the agency expects its multibillion-dollar annual losses to worsen. He warned that the agency’s cash liquidity remains dangerously low.
The post office expects to lose $6 billion this year. Last year, the agency lost $16 billion.
“The Postal Service is quickly moving down a path that leads to becoming a massive, long-term burden to the American taxpayer,” he said.
Donahoe said the rate hike may be needed because his agency’s finances are so precarious and the prospects of quick congressional action are so uncertain.
The Postal Service’s board of governors could decide as early as next week whether to request a special rate increase.
Under federal law, the post office cannot raise its prices more than the rate of inflation unless it gets approval from the independent Postal Regulatory Commission. The Postal Service must cite exceptional circumstances in seeking an “exigent” or emergency rate hike.
Media and marketing firms that depend on postal services have said that a big rate hike could hurt their business.