USPS Warns It Could Close Thousands of Post Offices

If you have a small post office in your town, the folks running the U.S. Postal Service just put it on notice. Postmaster General David Steiner told the USPS Board of Governors that the agency could shut down thousands of post offices, cut back service, and raise prices again unless Congress steps in with new legislation and funding. That is not a quiet internal memo. That is the guy at the top saying the current setup does not work.

The Postal Service runs more than 31,000 post offices across the country, and plenty of them lose money. Steiner laid out the situation as a simple either-or. Either Congress helps cover the cost of the services USPS is legally required to provide, or the agency goes it alone and makes the kind of hard cuts nobody wants to see. Here is what he actually said, and what it could mean for the blue box down the street.

The either-or Steiner put in front of Congress

Steiner framed it as a choice with no middle ground. Congress can pass legislation and provide federal money to support what the Postal Service calls its public-service obligations, or it can leave USPS to chase financial break-even on its own with more aggressive moves. Those aggressive moves are the scary part. According to his warning, without action this year the agency would have to review delivery levels, close thousands of unprofitable post offices, and push prices higher.

A subcommittee focused on government operations is said to be working on a bipartisan basis to change and modernize the Postal Service. That is the polite version. The blunt version is that USPS says its whole business model is set by Congress, and that model limits how fast it can react to a world where people mail fewer letters every year.

A $2.5 billion loss that counts as good news

Here is the strange part. The most recent quarter was actually an improvement, and it still ended with a $2.5 billion net loss. For its fiscal third quarter of 2026, USPS reported operating revenue of $19.9 billion, up 6.1 percent from the same stretch a year earlier. The net loss shrank from about $3.1 billion to $2.5 billion. The controllable loss, which is the number the agency can do the most about, dropped from $1.6 billion to roughly $1 billion.

Shipping and packages did well, with revenue up 7.7 percent even though the actual volume fell 3.4 percent. First-Class Mail revenue rose 4.3 percent while its volume dropped 3.5 percent. See the pattern? People are sending less mail, but each piece costs more. Marketing Mail was the exception, with both revenue and volume going up. Even so, the agency said this better quarter did not fix what it flatly called a severe liquidity crisis. In plain English, it is short on cash.

Why does revenue keep climbing while USPS keeps losing money? Costs. Operating expenses hit $22.5 billion in the quarter, up 2 percent, with higher retirement payments, worker compensation, and transportation all adding weight. When you spend $22.5 billion to bring in $19.9 billion, the math does not care how much better this quarter looked than the last one.

Stamps already jumped, and another hike is coming early

You probably noticed your Forever stamps got pricier. On July 12, 2026, USPS raised the first-class Forever stamp from 78 cents to 82 cents, blaming a severe financial crisis and rising costs. That was not a one-off. Higher postage has been the agency's main lifeline. Steiner said price increases pushed total revenue up in 14 of the last 16 quarters, even as fewer people mailed anything.

Now he wants to move faster. Steiner is asking for the authority to raise prices in January 2027 instead of waiting until July 2027. Moving that increase up by six months could bring in somewhere between $600 million and $800 million in what he called desperately needed cash. So if you buy stamps, expect the next bump sooner rather than later.

Shipping prices climbed too

It is not just letters. Package rates went up back on January 18, 2026, and they add up if you ship often. Priority Mail started at $10.20 for packages weighing a pound or less, and a temporary 8 percent surcharge pushed that closer to $11. Priority Mail Express rose 5.1 percent, starting around $33 and hitting $35.65 with the surcharge. That service still promises delivery in one to three days with a money-back guarantee.

USPS Ground Advantage, the two-to-five-day option, jumped 7.8 percent to a starting rate of $7.30, or about $7.90 with the surcharge. PO Box prices went up 3 percent too. The agency says growth in Ground Advantage has been one of its brighter spots, which is exactly why it keeps leaning into shipping as part of a longer modernization plan. Packages are where the money is. Letters are fading.

A new bill could cost USPS $800 million

This is the part that stings, because it is coming from inside the building. Steiner pointed to a bill approved by a Senate committee that would add dozens of new ZIP codes. Sounds harmless, right? He estimates it could cost the Postal Service around $800 million. That is roughly the same amount he is trying to raise by moving the stamp hike up to January. In other words, one hand is trying to claw back money while the other hand is being asked to spend it.

That tension is the whole story of USPS finances. The agency is required by law to serve every address in the country, from a downtown high-rise to a ranch at the end of a dirt road. Steiner argues Congress should compensate the agency for those universal service duties instead of piling on more of them. Adding ZIP codes without adding funding, from his seat, just deepens the hole.

Borrowing from retirement funds to stay open

Back in June, Steiner said something that should stop anyone who mails a birthday card. He said the agency was out of cash and had been borrowing from employee retirement funds just to keep the lights on and the trucks running. That is not a sustainable way to operate anything, let alone a service used by nearly every household in America.

To ease the cash crunch, USPS has also asked the Postal Regulatory Commission for more flexibility. It has been pushing for legislative and regulatory changes it says are needed for long-term stability. The core request keeps coming back to the same idea. The Postal Service wants either the freedom to run more like a business or the money to cover the obligations it cannot drop.

The bigger numbers behind the panic

Zoom out and the quarterly loss looks small. USPS recorded a $9 billion net loss in fiscal year 2025. That was actually an improvement from the $9.5 billion loss the year before. Operating revenue in 2025 climbed to $80.5 billion, helped by Ground Advantage growth and, you guessed it, price increases.

For the full 2026 fiscal year, the agency's own financial plan projects another $8.1 billion net loss, even while forecasting revenue of $83.8 billion. Think about that. Revenue is expected to grow, and the agency still expects to lose more than $8 billion. When you lose billions every single year no matter how much you take in, raising stamp prices a few cents at a time is a bucket against a flood.

What this means for you

No specific post offices have been named for closure, so there is no list to check yet. This is a warning, not a schedule. But the direction is clear. Prices are set to keep rising, and the next stamp increase could land in January 2027 rather than the middle of the year. If you send a lot of mail or run a small business that ships, stocking up on Forever stamps now locks in the current 82-cent rate, since Forever stamps stay valid no matter how high the price climbs later.

The post office closure question really sits with Congress. Steiner drew the line and handed lawmakers the pen. If they pass legislation and provide funding, the smallest and least profitable offices have a better shot at staying open. If they do nothing this year, the agency says it will start reviewing delivery levels and closing offices to reach break-even on its own. For rural towns where the post office is one of the last public buildings still standing, that is the difference between keeping a piece of Main Street and watching it get boarded up.

The mail is not going away tomorrow. But the version of it that includes a counter clerk in every small town, a flat stamp price, and a truck that shows up six days a week is the version now up for debate. Keep an eye on your local branch, and do not be shocked if the next book of stamps costs you a little more.