AMHERST, Mass. (WWLP) - The nation's postal service is projecting yet another cash shortfall, but this time, the deficit will bring the first-ever default on billions of dollars in payments for the ailing agency.
The agency continues to aggressively pursue new revenue amid growing debt that is nearing $11 billion. In a recent financial report, the postmaster general announced the agency doesn't have the money to pay the required $5.5 billion for retiree health benefits that is due to the U .S . Treasury, tomorrow. It is one of the many looming payments for the postal service, they are also projecting a default on the annual billion dollar payment to the Department of Labor; due in October.
Among the numerous cash shortfalls is a decline in profits coming in from mailings. In the last year, the agency lost $1.7 billion in mail revenue; namely first class and standard mail.
And that's something Hadley's Craig Holmes doesn't understand, because he uses the post office almost every day.
"People around my young middle age are still coming to the post office but I know some kids that have never been in a post office. Teenagers that I know that have never bought a stamp," said Holmes outside the University Drive post office Tuesday afternoon.
Mailings will drop even more next year when the federal government stops using the postal service to mail paper checks for millions of people on social security and other benefits.
But deflecting mail out of the system is a shift that's also happening among businesses in Hampshire County, like the Riverbend Animal Hospital in Hadley. The surgical practice no longer uses film for x-rays.
"Three, four years ago we went digital. A lot of the information is coming and going digitally. We don't have as many of the large film envelopes that we are running back and forth to the post office," said Ann McEwen inside her Hadley office.
The hospital administrator says they are even phasing out of their monthly postcard reminders and are building an electronic database.
The agency says the projected mail volume will threaten staffing and the existence of mail processing sites; but for now the default will not affect day to day mail service or payroll.