Postmaster General Patrick Donahoe told senators Thursday that the cash-strapped Postal Service had "little choice" in proposing to raise the price of mailing a letter to 49 cents.
Donahoe's appearance Thursday before the Senate Homeland Security and Governmental Affairs Committee came one day after the post office said it wanted to raise the price of a first-class stamp by 3 cents. He's pressing lawmakers to act quickly on legislation to fix his agency, which expects to lose $6 billion this year.
"We did not want to take this step, but we have little choice due to our current financial condition," Donahoe told a Senate panel considering bipartisan legislation to overhaul the Postal Service.
Bill McAllister, Washington correspondent for Linn's Stamp News, told CBS Radio News that without congressional relief the Postal Service could run out of money next month.
"If the Postal Service can't pay its suppliers and pay its workers, I think then you do have a really major crisis that has to be acted on by Congress immediately," McAllister said.
The Postal Service's Board of Governors, in its rate hike request, cited the agency's "precarious financial condition" and the uncertain prospects for postal overhaul legislation in Congress.
"Of the options currently available to the Postal Service to align costs and revenues, increasing postage prices is a last resort that reflects extreme financial challenges," the board's chairman, Mickey Barnett, wrote customers.
The rate proposal must be approved by the independent Postal Regulatory Commission.