WASHINGTON – The U.S. Postal Service is renewing its drive to drop Saturday delivery in an effort to fend off a projected $7 billion loss this year, and also is planning a rate increase.

Without drastic action, the agency could face a cumulative loss of $238 billion over 10 years, Postmaster General John Potter said in releasing a series of consultant reports on agency operations and its outlook.

“The projections going forward are not bright, (but) all is not lost. We can right this ship,” Potter said at a media briefing.

Frederic V. Rolando, president of the National Association of Letter Carriers, urged Congress to provide the post office with “financial breathing room,” but he opposed eliminating one day of delivery.

“I do not believe that weakening our commitment of six-day service to the public will enhance the long-term position of the Postal Service as a critical element in our nation’s economic infrastructure,” he said.

As more Americans switch to electronic communications, the number of items handled by the post office fell from 213 billion in 2006 to 177 billion last year. Volume is expected to shrink to 150 billion by 2020.

At the same time, the type of material sent is shifting from first-class mail to the less lucrative standard mail, such as advertising. And as people set up new homes and businesses, the number of places wheere mail must be delivered is increasing.

The agency has asked Congress for permission to reduce delivery days and has previously discussed the need for other changes, such as closing some offices. Cutting back Saturday home delivery, however, does not mean post offices would close that day.

There seemed to be concern on the part of Congress that officials had not looked at all possible options, Potter said. That was part of the reason for the three consultant studies.

Later this month, Potter said, the Postal Service will ask the independent Postal Regulatory Commission to review its plans for the service reduction to five days, which Potter hopes will begin next year.

Under the law, the agency is not supposed to raise rates more than the amount of inflation, but there is a loophole allowing for higher increases in unusual situations such as a recession or a drop in mail volume.

“We intend to use that tool,” Potter said.


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