WATCH LIVE: Postmaster General Steiner testifies at House hearing on USPS’s financial future

The U.S. Postal Service will run out of cash within a year unless Congress lifts a decades-old cap and allows the agency to borrow more money, the new postmaster general warned in an interview this month.

The session is scheduled to begin at 2 pm EST. Watch the live stream in our video player above.

If that doesn’t happen, the Postal Service may not be able to pay its employees or vendors by February 2027, with potentially dire consequences for mail delivery, Postmaster General David Steiner told The Associated Press.

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“How long will employees work and vendors show up if we don’t pay them?” Steiner said in an interview on March 4:

The Postmaster General is scheduled to testify before Congress on Tuesday about the Postal Service’s financial difficulties and the need to change long-standing rules and regulations that he considers burdensome. He pointed to the $15 billion borrowing limit that has been in place since 1990.

The Postal Service is an independent agency that is funded mostly by mail revenues and the services they provide. It has all the burdens of a government agency, such as having to deliver mail six days a week to every address, but none of the advantages, such as an annual appropriation from the federal budget, Steiner said.

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“We have to have a conversation with the American public,” Steiner said. “If you want us to deliver everywhere, every day, we will do it. That’s not a problem. But who’s going to pay for it?”

Steiner, the former CEO of the nation’s largest waste management company and a former FedEx board member, took over the struggling postal service last July. Raising the borrowing limit is the easiest thing lawmakers can do immediately to help the agency, he said.

“It will buy us time to make the repairs we need to make, and we can move on down the road,” he added.

He called for expanding the service’s revenue base, including expanding last-mile delivery to more entities. Last-mile delivery refers to the final step of getting a package from the local distribution center to the customer’s door, and is the most labor-intensive part of the delivery process.

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USPS’s net loss for fiscal 2025 was $9 billion, although total operating revenue increased by $916 million, or 1.2%, largely due to its Ground Advantage shipping service. Net losses in fiscal year 2024 amounted to $9.5 billion.

Ultimately, other changes are needed as well, Steiner said, including giving the Postal Service the authority to raise mail rates enough to cover losses. He said increasing the price of a first-class stamp to 95 cents, from 78 cents today, would be enough to “fix” the Postal Service’s financial problems. A decade ago, a first-class stamp cost 47 cents, although postal officials point out that it is still the lowest price in the industrialized world and covers a delivery range 10 times farther than in other countries.

But he said an independent agency created by Congress to oversee the Postal Service would not allow that.

“If the Postal Regulatory Commission adopts our pricing model, the problem will be solved,” he said, adding how the package delivery side of the company could support the mail side.

Steiner and other Postal Service officials also called for reforms to pension obligations and retiree health benefits, including the ability to invest money in something other than Treasury bonds.

Several postmaster generals over the past two decades have repeatedly asked Congress or regulatory agencies to change various rules governing the Postal Service. In 2022, Congress passed the Postal Service Reform Act, which ended the requirement that the agency prefund retiree health benefits, but left other restrictions intact.

Meanwhile, the Postal Service has seen annual volume decline dramatically from about 220 billion pieces to about 110 billion today as more people pay bills and communicate online.

He said: “Take those 110 billion and put a 78-cent stamp on them. That is, $86 billion in revenues evaporated in 15 years.” “If FedEx or UPS lost $86 billion in revenue, they wouldn’t have any revenue.”

But instead of helping the Postal Service, Steiner said regulators and Congress imposed costly mandates.

“I would say we were kind of thrown overboard on a ship in cold water, right? Instead of being thrown a lifeline, we were thrown an anchor,” he said.

Calls to some members of Congress who oversee the Postal Service were not immediately returned. A message was also left with Keep Us Published, an advocacy group launched in 2021 in response to price increases and service delays. Last month, the organization warned that the USPS was “moving toward a taxpayer bailout” given its cash flow issues. The group urged Congress to pass legislation it says would limit rate increases to once a year, tying them to service performance, among other measures.

Steiner admitted that he did not realize the depth of the Postal Service’s cash crunch until he took over as postmaster last year.

“It’s interesting that I’m not sure some people in the Postal Service realized how dramatic it was,” he said.