• Federal agencies are trying to eliminate underutilized space in their buildings. But a watchdog report found the Postal Service generally isn’t asking those same questions. The USPS inspector general’s office found the agency hasn’t collected space utilization data for more than 60% of its properties. USPS operates more than 34,000 properties across the country. The IG’s office said that by not collecting this data, the agency missed out on an opportunity to save nearly $15 million.
  (Excess and underutilized space - US Postal Service)
• The Trump administration is trying to ease concerns from federal managers who are worried about pushback against new employee performance standards. The Office of Personnel Management said there is an “extremely limited scope” for which managers would be personally liable when disciplining poor-performing employees. Most of the time, agencies themselves are held accountable for any performance-based actions. OPM’s clarification comes as the administration seeks to limit how many feds can be rated top performers and quickly discipline those deemed poor performers.
  (Personal liability for managers and supervisors conducting personnel management functions - Office of Personnel Management)
• As digital surveillance of federal employees becomes more widespread, the Government Accountability Office is alerting agencies to both positive and negative impacts. GAO said, for example, that monitoring employees remotely may help improve agency operations. But at the same time, there are potential consequences of watching employees’ work that closely. Increasing digital surveillance can negatively impact employees’ mental health, as well as lead to inaccurate assessments of employee performance.
  (Digital surveillance: Potential effects on workers and roles of federal agencies - Government Accountability Office)
• A federal court has indefinitely blocked the Trump executive order eliminating four small agencies. A federal judge in Rhode Island issued a permanent injunction barring the administration from taking any further action to eliminate the Institute of Museum and Library Services, the Minority Business and Development Agency, the Federal Mediation and Conciliation Service, and the Interagency Council on Homelessness. President Donald Trump signed an executive order in March, eliminating these agencies “to the maximum extent” possible. The judge found the decision to conduct widespread layoffs and cuts at these agencies “undermined their ability” to perform functions required by law.
  (Federal court blocks Trump administration’s plan to scrap 4 small agencies - Federal News Network)
• In fiscal 2025, 317,000 employees left federal services. At the same time, agencies hired about 68,000 new employees. The Office of Personnel Management said the government exceeded the White House's goal of four reductions for every one new hire. There are now about 2.1 million federal employees. For 2026, agencies will submit annual headcount plans to OPM and OMB in the coming weeks. OPM said these plans should focus on the agency's critical mission objectives only and should be built from the bottom up to determine how many people are needed to meet their priorities.
  (317,000 feds have left the government this year, surpassing OPM's goal - Federal News Network)
• The Senate breathed some life into the Technology Modernization Fund for 2026. After receiving no new funding for the last two years, the TMF could be getting a small influx of new money. The Senate is allocating $5 million for the governmentwide IT modernization account in its version of the Financial Services and General Government appropriations bill. The House version of the FSGG bill didn't include any new money for the TMF, meaning the final version would have to find a compromise between the two chambers of Congress. So far in 2025, the TMF Board has made only one new award for an agency modernization project.
  (Senate to give TMF $5M for 2026 - Senate Appropriations Committee)
• More than two weeks after the record-long government shutdown ended, some Defense Department civilian employees say they have yet to receive the back pay they are owed. At Laughlin Air Force Base in Texas, more than 150 people in a unit of more than 400 civilians are still waiting for as much as four weeks of back pay. The Defense Department said all civilians whose updated time and attendance records have been received have been paid, and that anyone still experiencing issues should contact their Agency Customer Service Representative or supervisor. But several civilian workers told Federal News Network that going to a supervisor has not worked.
  (Some DoD civilians are still waiting for back pay weeks after shutdown’s end - Federal News Network)
• As the Defense Department moves to implement Defense Secretary Pete Hegseth’s sweeping acquisition reforms, Space Force leaders warn that the depth of workforce cuts is threatening to cripple the service’s ability to execute them. Maj. Gen. Stephen Purdy, acting assistant secretary for space acquisition at the Air Force, said that the service is “in a situation where it barely has enough acquirers to do all of the work that they have now.” The Trump administration push to reduce the size of the federal workforce has had an “outsized impact” on the Space Force. The service has lost nearly 14% of its civilian workforce, much of it coming from Space Systems Command, the Space Force’s acquisition hub.
  (Deep personnel cuts jeopardize Space Force’s ability to implement Hegseth’s acquisition reforms - Federal News Network)

The post IG reports that USPS is slow to identify underutilized spaces first appeared on Federal News Network.

The Postal Service is seeing deeper financial losses than expected this year, but does not expect to veer much from a 10-year reform plan that it is nearly midway through completing.

USPS, however, is far from the plan’s “break-even” goal, and is calling on Congress and the Trump administration to take a familiar wish list of reform efforts that are outside the agency’s control.

The agency saw a $9 billion net loss in fiscal 2025 — significantly higher than the nearly $7 billion net loss it expected.

USPS said it saw increased compensation costs, including offering early retirement incentives to more than 10,000 of its employees, which contributed to higher operating expenses this year.

The agency reported this summer that it spent $167 million in early retirement incentives to mail handlers who work in the agency’s mail processing facilities, and other USPS employees who work in a variety of support positions.

Still, USPS saw better financial results than it did the year prior. It ended fiscal 2024 with a $9.5 billion net loss.

USPS Chief Financial Officer Luke Grossman said the agency delivered 3.7 billion fewer pieces of mail in fiscal year 2025, compared to the previous year, but saw an $848 million, or more than 1% increase in revenue.

The agency has generally raised mail prices every January and July. USPS raised the price of a first-class stamp to 78 cents in July. However, the agency announced it will not raise mail rates in January 2026.

Despite the deeper-than-expected losses, Postmaster General David Steiner told the USPS Board of Governors on Friday that he does not expect USPS to deviate from the 10-year reform plan set forth by his predecessor.

“While we may change specific initiatives, as we move forward, and our execution needs improvement, I do not see the need for a fundamental reassessment of our processing of the logistic modernization strategies at this time,” Steiner said.

The Delivering for America plan led by former Postmaster General Louis DeJoy envisioned the agency reaching a “break-even” point last year.

The agency, however, continues to see multi-billion-dollar losses annually, even after Congress passed long-awaited reform legislation in 2022, eliminating a requirement to pre-fund retiree health benefits far into the future.

“Without a doubt, the Postal Service is in a better place today than it would have been without these initiatives,” Steiner said.

USPS is delivering 110 billion fewer pieces of mail than it did 18 years ago. Factoring in today’s prices, that drop in volume accounts for an $85 billion loss in revenue.

“No business could overcome that magnitude of a revenue drop. So it’s not surprising that the Postal Service has struggled,” Steiner said.

Meanwhile, a bipartisan group of lawmakers and the Postal Service’s own regulator have urged USPS not to proceed with the next phase of its reform plans.

The Postal Regulatory Commission warned in January that the next phase of the 10-year reform plan would slow mail delivery for a “significant portion of the nation,” but wouldn’t save USPS enough money to justify the changes.

Steiner said that on-time deliveries had recently fallen below “an acceptable range from our targets, with some stakeholders questioning whether the Postal Service could reliably deliver.”

Those metrics have improved. USPS delivered 88.89% of first-class mail on time in FY 2025, compared to 89.45% last year. Households in fiscal 2025 received mail in 2.5 days, on average, in fiscal 2025, compared to 2.7 days the year prior.

“While these improvements should be noted, service is still not where we expect it to be, nor is it what our customers deserve,” he said.

Most USPS customers can expect delivery of their mail and packages in less than three days on average. Nearly half of USPS packages and mail are delivered earlier than the service standard.

Steiner said USPS will continue to find ways to cut costs and increase revenue, but stressed that the agency “cannot cost-cut our way to prosperity.”

“Service is foundational to our success and enables a financially viable Postal Service. It drives business and revenue. I know that we can have both excellent service and lower costs,” he said.

Steiner said USPS will continue to rely on $3 billion in Inflation Reduction Act funds to deploy more electric vehicles. But Republican lawmakers have threatened to claw back those funds.

Grossman said the agency expects to see continued increases in first-class mail revenue, despite long-term declines in volume. He said USPS also expects to see a continued decline in international mail because of the Trump administration’s tariff policies.

In June, the United Nations’ Universal Postal Union said international mail volume coming into the United States fell by more than 80% once the Trump administration eliminated a tariff exemption for small packages went into effect. Nearly 90 postal operators across the world have suspended some or all services to the United States for now.

Grossman said USPS is seeing continued revenue growth for its standard package service, Ground Advantage, as well as lower transportation costs.

Steiner said USPS is asking Congress and the Postal Regulatory Commission “for more flexibility and common-sense modifications in how we’re regulated.” That includes a greater ability to borrow money to fund infrastructure improvements. USPS has maxed out its $15 billion borrowing limit from the Treasury Department.

Board Chairwoman Amber McReynolds said the agency’s $15 billion borrowing limit with the Treasury Department hasn’t changed since 1991, and “needs to be updated to reflect the organization’s current financial needs.”

“For the Postal Service to succeed in the long term, it is essential that Congress and the administration work together to make some of these changes and provide the Postal Service with the same tools and flexibility that are used by other organizations in both the government and private sectors. This is urgent, and it is time for action,” McReynolds said.

USPS has repeatedly called on the Office of Personnel Management and Treasury to adjust what it pays into the Civil Service Retirement System (CSRS), which covers most federal and postal employees hired before 1984.

OPM calculates what USPS must contribute every year to cover retiree benefits. USPS and its inspector general’s office both claim the agency has overpaid into the CSRS fund.

USPS is looking for great flexibility in its pension investment options. By law, it can only invest its retiree and pension funds in low-risk, low-reward Treasury bonds.

USPS has sought these legislative and administrative changes for much of DeJoy’s tenure, but Congress and the executive branch have yet to take up these requests.

McReynolds said USPS has an “urgent need” for Congress and the Trump administration to get the agency to reach long-term financial sustainability, and that the agency can’t carry many of its most impactful changes on its own.

“The Postal Service must be clear-eyed about the things the Postal Service can control and the things it cannot control,” she said.

USPS is gearing up for the peak holiday season, its best opportunity to improve its financial outlook in fiscal 2026. The agency has significantly increased its package-processing capacity in recent years, and expects to hire 14,000 seasonal employees this year.

Ron Stroman, a member of the board and former deputy postmaster general, said service performance improvements are “setting a strong foundation” for USPS heading into its peak season.

Steiner said USPS, as part of its reform plan, is looking to capture a greater share of the e-commerce industry from private-sector shippers.

“We have the capacity to meet a much larger percentage of America’s shipping needs. We just need to utilize our assets efficiently and effectively,” Steiner said.

Roman Martinez, a former chairman of the board, is stepping down from the board next month once his carryover term expires. Once he steps down, the board will only have four of its nine presidentially appointed and Senate-confirmed seats filled.

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