Postmaster General David Steiner sat before the Senate Homeland Security and Governmental Affairs Committee this morning for a hearing titled “Reforming the U.S. Postal Service’s Broken Business Model.” If you work for USPS, this was the most important hearing of the year so far — because Steiner laid out, in blunt terms, exactly how dire the agency’s finances are and what he wants Congress to do about it. And several of his proposals would land directly on your route, your post office, and your retirement.
Here’s what he actually said, stripped of the political noise, and what it means for postal workers.
The Headline: “We Are Out of Cash”
The single most important moment came when Steiner corrected the record on the agency’s financial runway. Earlier in June, the Postal Regulatory Commission had told Congress that the recent FERS payment suspension bought USPS “at least another several years” of breathing room. Steiner shut that down hard.
“I do want to clear up a misconception,” he told the committee. “Let me be very, very, very, very clear: we are out of cash.” He went further, confirming what postal workers have suspected since the spring: the agency is borrowing from its employees’ retirement funds to keep operating. That’s not a metaphor — that’s the literal mechanism keeping the lights on right now.
As of May 31, 2026, USPS had about $8.9 billion in cash on hand. Against that, it has nearly $31 billion in missed payments on retirement and other obligations. If the agency stopped deferring those payments and paid what it owes, it would run out of cash by the end of this fiscal year.
What Steiner Asked Congress For
Steiner’s pitch was that USPS cannot fix this alone. “I’m here to tell America that we can do anything they desire, but we can’t afford to do everything they desire without more help,” he said. His specific asks:
Raise the borrowing cap to $30–40 billion. The current $15 billion limit has been frozen for more than three decades. Steiner argued that, adjusted for inflation and current revenue, it should be more than doubled. This is the single biggest near-term lever — and it’s the same ask all four unions made in their joint letter to Congress on May 1.
Resume the public service reimbursement. This is a congressionally authorized payment to compensate USPS for money-losing services it’s legally required to provide. Reviving it would offset some of the cost of universal service.
Allow retirement funds to be invested beyond Treasury notes. Right now, USPS pension assets can only be held in low-yield Treasury securities. Letting them be invested more broadly — like most large pension funds — could improve returns. This was also in the unions’ joint letter.
Reform workers’ compensation (FECA). Steiner argued the federal workers’ comp program costs USPS $400–800 million per year more than private-sector equivalents, citing examples like benefits still being paid to recipients over 100 years old.
He also pointed to pricing. The current First-Class stamp is 78¢ — which Steiner noted is the lowest-priced in the industrialized world (France is nearly $3, the UK $2.50). He argued that raising the stamp to 90–95¢ would “largely solve our controllable loss” while still leaving US postage among the cheapest anywhere. That’s separate from the 5% increase to 82¢ already set for July — it signals where prices are headed longer term.
The Parts That Could Hit Your Job
This is where postal workers need to pay close attention. Steiner was clear that if Congress doesn’t provide relief, USPS will be forced toward cost-cutting measures it can partly undertake on its own. The big ones:
Five-Day Delivery
Steiner told the committee that cutting delivery from six days to five would save an estimated $2.9 to $3.5 billion per year. The Postal Service Reform Act of 2022 currently mandates six-day delivery, so this would require Congress to change the statute. But the PMG put a hard number on it, which signals it’s a serious lever, not a talking point.
What it means for you: Fewer delivery days reshapes routes, headcount, and overtime. For carriers, it could mean route restructuring and changes to the six-day schedule that overtime is currently built around. It’s one of the biggest potential structural changes on the table, and it would be felt first by the craft.
Closing Post Offices
Steiner noted that roughly 60% of post offices operate at a loss, and asked Congress to remove the legal provision that currently prevents closing a post office solely because it loses money. He gave the clearest route-level numbers yet: 84% of city delivery routes and 52% of rural delivery routes are financially underwater. Small post offices alone cost about $2.5 billion a year to operate.
What it means for you: Retail consolidation affects clerks and postmasters at smaller offices most directly. If the legal barrier to deficit-based closures is removed, the pace of consolidation could accelerate — with excessing and reassignment following.
Workforce: Fewer Career Jobs
This is the line that matters most for long-term job security. In today’s written testimony, Steiner said USPS has reduced its overall complement by 28,675 employees from FY2021 to FY2025, alongside cutting 56 million work hours. He framed this as evidence the agency is controlling the costs it can control.
The deeper concern comes from his earlier testimony. At the March 17 House hearing, Steiner said USPS is “moving toward more of those employees being pre-career rather than career,” said the agency is “absolutely looking at” a hiring freeze (though not for the people who actually deliver mail), and would not rule out involuntary layoffs through a reduction in force (RIF), saying “when you’re in a crisis, everything has to be on the table.” Nothing in today’s testimony walked any of that back.
The Pension Warning Buried in the Testimony
One detail didn’t make most headlines but should concern every FERS and CSRS employee. In his written testimony, Steiner projected that continued pension defaults could deplete the CSRS fund by 2034. And if FERS assets were then called on to fund both FERS and CSRS annuitants, the FERS fund could be depleted by 2041.
That is a projection under a worst-case continued-default scenario, not a prediction — and federal annuities have backstops beyond the fund balances. But it’s the clearest statement yet of why USPS leadership is treating the retirement-funding question as existential, and why the FERS contribution suspension happened in the first place. We break down what is and isn’t protected in our FERS suspension explainer.
Worried about how all this affects your numbers? Run your current pay and FERS estimate with our free calculators — built on real USPS pay scales.
Open the Calculators →What Happens Next
The hearing was oversight, not legislation — nothing was decided today. But it sets up the fall fights that will matter:
The borrowing cap. This is the cleanest, fastest form of relief and has union backing. Watch for any markup activity in the House Oversight and Senate Homeland Security committees. Committee Chairman Rand Paul, a noted fiscal hawk, pushed back hard on more funding and called for a complete hiring freeze — so this is not a guaranteed path.
The Alvarez & Marsal recommendations. The restructuring consultants USPS hired are expected to report by the end of FY2026 (September 30). If they target delivery days, retail footprint, or workforce structure, that report becomes the blueprint for the next round of changes.
The union contracts. With NALC in mediation and NPMHU at impasse, everything Steiner said about ability-to-pay becomes ammunition at the bargaining table and in arbitration. The financial picture he painted today directly shapes those outcomes.
We’ll track each of these as they develop. For the full financial backdrop, see our USPS financial crisis guide, and for where the job-security risk stands, our layoffs and RIF explainer.
Sources: Senate HSGAC hearing testimony (June 24, 2026), Steiner written statement to the committee, Federal News Network, Washington Examiner, Quartz, Government Executive.