US Post Office reports record loss of nearly $16 billion

The Postal Service on Thursday reported losing a record amount in a single year – $15.9 billion – putting it one step closer to insolvency. 

AP reports that the postal service was forced to default on billions in payments in order to avert bankruptcy. Because of the cash shortage, the post office defaulted on two payments into its mandatory retiree health benefits system that totaled $11.1 billion of the losses. 

Without that $11.1 billion cost and other related labor expenses, the post office would have sustained an operating loss of $2.4 billion. Still a large amount but smaller than last year's loss of $5.1 billion.

The postal agency said it will run out of cash in October 2013 unless Congress intervenes. 

"It's critical that Congress do its part and pass comprehensive legislation before they adjourn this year to move the Postal Service further down the path toward financial health," Postmaster General Patrick Donahoe told the Wall Street Journal.

"We're walking a financial tight rope—we can't sustain these large losses," Donahoe said. 

But despite the huge losses, the agency said mail would continue to be delivered as normal and that employees will be paid on time. 

The New York Times reports that the post office received a boost of $500 million in revenue from the election season when candidates, political parties and other interest groups sent out campaign mail.

The holiday season is also expected to help boost the bottom line and help the agency stay afloat until Congress can pass legislation to overhaul the post office. 

The Times reports that the postal agency has been pushing Congress to allow it to cut Saturday mail delivery, reduce the annual payments required for its future retiree health fund, and allow it to earn revenue from new business ventures like delivering beer and wine by mail.