May 9, 2012, Postmaster General, Patrick Donahoe, is trying to alleviate concerns over the possible closing of 3,700 post offices, which were to begin in May.  Now the USPS will try to keep as many open as possible, by drastically reducing their operating hours.

The reduction of operating hours would also take place in post offices that are not slated for closing, as many as 13,000 post offices could see hours reduced by two to six per day.

The other option is the creation of Village Post Offices, which would replace the standard post office.  The Village Post Office would operate through a retail business such as WalMart, Walgreens, etc.

Of course Congress has to approve the new plans.

The USPS is also considering letting go any employee who is not protected by labor contracts, and they’re going to do another round of early retirement buyouts.

The Postal Service, which makes its money off the services they provide, not taxes, is facing an $11 billion USD future retirement pre-payment later in the year, as well as health payments.  There are some people who say the U.S. Treasury is actually using the money for other things.

In September 2011, National Association of Letter Carriers president, Fredric Rolando, said most of the blame is on Congress: “I’m here to tell you that the Postal Service is not broke. The Postal Service just needs access to its own money. And Congress needs to get busy and give them that access.”-PBS Newshour interview

He also pointed out that the USPS does not make its money from taxes: “The Postal Service actually has somewhere between $50 billion and $125 billion in their other funds that is not taxpayer money. They haven’t used a dime of taxpayer money in over 30 years! And the Congress just needs to act responsibly and quickly to give them access to that — those funds.”

Postmaster General, Patrick Donahoe agreed: “Fred is exactly right around the issues that we have faced in the last few years. In that same time, we have been required [by Congress] to prepay employee retirement funding.”-PBS Newshour interview

Congress has made concessions, by releasing some Postal Service money, but requiring that the money be used only to reduce the number employees with early retirement buyouts!

The latest Senate bill would allow the USPS to use taxpayer money for the first time in 30 years.  The Senate bailout bill would give the Postal Service $34 billion in tax revenue.

To make matters worse, Northrop Grumman (the third largest USPS contractor) and the USPS are suing each other!

The dispute involves a 2007 automated mail processing contract.  Northrop Grumman says the USPS owes them $180 million USD.  The Postal Service says Northrop owes them $341 million!

They both claim the other failed to meet numerous contractual agreements.