Postal Service Reform Act puts black ink on USPS ledger
By Bill McAllister, Washington Correspondent
Thanks to the Postal Service Reform Act of 2022, the United States Postal Service finally showed some black ink on its financial ledger.
Postal officials were quick to note that the results were the result of a “one-time, non-cash benefit of $59.6 billion” from the new legislation.
They said the USPS will need to continue its plan for another stamp price increase in January, rejecting calls from some mailers to skip the planned boost.
Thanks to the noncash benefit, the USPS said it recorded a net profit of $59.7 billion for the third quarter of fiscal year 2022, which ended June 30, and a $57.5 billion profit for the first nine months of the fiscal year, which ends Sept. 30.
It was the first time in years that the Postal Service has been able to show a profit.
Officials said that without the new law, the USPS would have shown an adjusted loss of $459 million in the third quarter because inflation pushed many of its costs higher.
Revenues inched up to $18.7 billion from $18.5 billion in the same quarter a year earlier despite a 5 percent drop in first-class mail volume.
Revenues for the first nine months of fiscal 2022 rose to $59.9 billion from $58.9 billion in the previous year.
First-class mail revenues were flat in the third quarter, while shipping revenues fell slightly.
“The enactment of the PSRA is a key component of restoring the Postal Service to financial stability,” said Joseph Corbett, the Postal Service’s chief financial officer, in an Aug. 9 news release.
“But the one-time, non-cash impact this quarter of the statute is not reflective of true financial condition,” he said.
Postmaster General Louis DeJoy did express delight in the Postal Service’s improving delivery times and financial results.
He said the USPS is “making appreciable progress” with his 10-year Delivering for America plan.
He called the one-time bonus “significant but also distortive.”
“The fact of the matter is that we have a long road and a lot of hard work ahead in our 10-year transformation to ensure the long-term financial sustainability of the Postal Service, but we are confident that we will achieve what we have set out to accomplish,” DeJoy said.
The Postal Service Reform Act, which was enacted April 6, “repealed the requirement that the Postal Service annually prepay future retiree health benefits and canceled all past due prefunding obligations,” the USPS said.
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