Postmaster: U.S. Postal Service to run out of money by October…

by
March 3, 2011

By RANDOLPH E. SCHMID, Associated Press

WASHINGTON (AP) — The Republican-controlled House opened the envelope of postal finances on Wednesday and what it pulled out wasn’t pretty.

Unless things change, the post office will run out of money by the end of the fiscal year in October, Postmaster General Patrick R. Donahoe told the House Oversight subcommittee on the postal service.

Donahoe said that as of Sept. 30 his agency will owe the federal government a payment of $5.5 billion to fund medical costs, in advance, for future retirees, and in November it will need to make a $1.3 billion payment for worker’s compensation.

“The Postal Service will not have the cash available to make both of these payments. We need legislation this year to address that fact,” he said.

If it does come down to crunch time, said Donahoe: “We will deliver the mail.” Employees will be paid, as will suppliers, he said. “The thing we will not do is pay the federal government.”

To read more, visit:  http://hosted.ap.org/dynamic/stories/U/US_POSTAL_FINANCES?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-03-02-16-32-28

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