Mail volume. The budget estimates for 1967 are based on expected volume of 77.7 billion pieces of mail, compared to 74.4 billion anticipated for 1966 and 71.9 billion in 1965.

The 1967 forecast includes 41 billion first-class letters and cards; 1.9 billion airmail items; 9.2 billion magazines, newspapers, and other publications; 20.9 billion pieces of printed matter and small parcels; and 1 billion zone-rate parcels, catalogs, and other fourth-class matter. Comparisons of these and other items of postal workload and related 1967 revenues with corresponding 1966 estimates and 1965 results appear in the table on page 742.

Financing. Six separate limitations are enacted for the Post Office Department for operation of the postal service and other assigned responsibilities. The limitations apply to the postal fund which is financed by the deposit therein of postal revenues and other receipts and by an appropriation from the general fund of the Treasury for the balance.

Only the appropriation from the general fund to the postal fund (being equal to the excess of obligational authority over revenues) is considered new obligational authority for purposes of the Federal budget. Further, only the excess of the Department's disbursements over its receipts (exclusive of the general fund appropriation) is considered as budget expenditures.

The six individual limitations control obligations incurred by the Department and are therefore requested and accounted for in terms of obligations. However, the program and financing schedules show funded accrued costs for each prinicpal activity reconciled in total to obligations.

The schedule of revenue and expense shows operating costs on a full accrual basis including provision for employees' accrued annual leave and costs funded by other agencies. Costs attributable to public services as defined by 39 U.S.C. 2303 and amended by Public Law

87-793 are shown in total on the revenue and expense statement.

The Postal Policy Act of 1958 (Public Law 85-426), as amended by the Postal Service and Federal Employees' Salary Act of 1962 (Public Law 87-793), provides that postal rates and fees be adjusted as required to produce the amount of revenue approximately equal to the total cost of operating the Postal Establishment less the amount determined to be attributable to the performance of public services.

Following is a summary of financial transactions and estimated revenue deficiency (in millions of dollars):