POSTED: Thursday, November 15, 2012 - 7:00pm
UPDATED: Thursday, November 15, 2012 - 7:04pm
NATIONAL NEWS (CNN) — The U.S. Postal Service announced a record loss of $15.9 billion for the fiscal year 2012, which it blamed primarily on a mandate to set aside billions of dollars for a retirement heath fund.
The Postal Service said that its loss includes $11.1 billion in payments it owes to "prefund" its retiree health benefits. Postal officials have complained for years about these prepayments, which are required by Congress, arguing that its Federal Employees Retirement System is overfunded by $11 billion dollars as of October. They also point out that other federal agencies don't have similar mandates for prefunding.
The Postal Service defaulted on two prefunding payments during its 2012 fiscal year, which ended on Sept. 30.
Its total losses of $15.9 billion are more than triple the $5.1 billion in losses it posted in the prior year, the Postal Service said.
The Postal Service has been struggling with declines in mail revenue, which is a casualty of a sluggish economy as well as email.
The agency has made various efforts to reduce costs. It plans to cut 150,000 workers through 2015, reduce existing staffers' work hours and hike the price on first-class stamps.
Officials have threatened to scale back service to five days, shuttering their low-volume, low-revenue, Saturday service. But the notion of five-day service is intensely unpopular in Congress and unlikely to prevail.
Unlike other federal agencies, the Postal Service does not receive taxpayer support, though it has borrowed money from the U.S. Treasury.
Like its business rivals FedEx and United Parcel Service, the Postal Service is an independent enterprise.