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POST OFFICE DEPARTMENT

Mail volume.-The budget estimates for 1966 are based on expected volume of 73.8 billion pieces of mail, compared to 71.6 billion anticipated for 1965 and 69.7 billion in 1964.

The 1966 forecast includes 39.3 billion first-class letters and cards; 1.6 billion airmail items; 9.0 billion magazines, newspapers, and other publications; 19.5 billion pieces of printed matter and small parcels; and 1.1 billion zonerate parcels, catalogs, and other fourth-class matter. Comparisons of these and other items of postal workload and related 1966 revenues with corresponding 1965 estimates and 1964 results appear in the table on page 668. 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.

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):

Obligations under limitation...
Proposed for later transmission: (a) Con-
struction, postal facilities.....

Total obligations.

Net revenues.

New obligational authority used..
Net change in selected working capital...
Budget expenditures.

Conversion to accrued cost...

Only the appropriation from the general fund to the postal fund (being equal to the excess of obligational New obligational authority used. 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 principal 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.

Net operating loss..
Attributable to public services..--- - - - -

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Deficiency in postal rates and fees. 199

1 Preliminary.

Transactions outside the postal fund.-Postal money orders issued and cashed, postal savings system, and deposits resulting from U.S. savings bond sales are excluded from the tables of this chapter. The postal money orders outstanding are included in the figure for checks outstanding for the Government in table 5 of the budget, and a corresponding sum is included in Treasury cash. Balances for the postal savings system and savings bond sales are included in part II of this document.

667

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Revenue from mail and other services of the Post Office Department is placed in the postal fund, which was established as a revolving fund in 1950 (39 Ú.S.C. 2202). In addition to the obligations and expenditures under limitations enacted in annual appropriation acts, the fund is also used without annual action by Congress for the purchase of stamp-embossed envelopes and for payment of certain indemnities, claims, and judgments.

Postal revenue comes primarily from private_postal patrons. It also includes receipts from various Federal agencies for the handling of official mail and the payment by the Congress for franked mail. Reimbursements received for nonpostal services and other recoveries are likewise deposited in the postal fund.

Total other funded costs..

Total operating expenses (payable
from Postal Fund, funded)...
Other operating expenses (nonfund):
Depreciation and amortization of fixed
assets on books of:
Post Office Department..
General Services Administration...
Expendable equipment and other charge-
offs

Building maintenance and custodial
services provided by General Services
Administration..

Unemployment benefits paid by Depart-
ment of Labor..

Total other operating expenses
(nonfund).

Total operating expenses.

Net operating loss:
Attributable to public services 1
Deficiency in postal rates and fees.

Net operating loss for year.

The aggregate of postal revenues is less than the obligations authorized for payment from the postal fund. An indefinite appropriation is made from the general fund of the Treasury to make up the difference. After taking into account anticipated changes in funded working capital, the net budget expenditures for the postal service Adjustment to prior year losses for 1966 are estimated to be $714 million, compared to $718 million for 1965, and $578 million for 1964. The increases in 1965 and 1966 are principally due to the recently enacted salary increases amounting to $222 million in 1965 authorized by Public Law 88-426.

Legislation will be proposed to authorize the Post Office Department to undertake a program for the Federal construction of major postal facilities. Financing of this program will be proposed through a new appropriation, Construction, postal facilities in the amount of $92.2 million.

Net loss for the year..

Analysis of retained earnings or loss:
Brought forward-start of year....
Loss funded by other agencies.
Portion of appropriation applied to losses:
Current year.

Prior years-

Carried forward, end of year...

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1 Under the provisions of Public Law 87-793, approved October 11, 1962, costs Fund as revenue, but are to be determined and excluded for purposes of determining and losses deemed attributable to public services are not reimbursable to the Postal overall revenue objectives. The above estimates for public services are preliminary.

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Does not include contingent receivables based on contested CAB orders in the amount of $2.8 million at June 30, 1964, and 1963, respectively;

The changes in these items are reflected on the program and financing schedule. Liabilities do not include: (1) Undetermined amounts of postage in the hands of the public which, for practical considerations, have been accounted for as revenue then sold, and (2) the following contingent and future obligations which by law the Department may not fund or account for as obligations until payments are due: contingent liabilities for pending suits and damage claims of $43.2 million and $37.1 million at June 30, 1964, and 1963, respectively, a substantial portion of which are expected either to be settled at less than the amount claimed or disallowed; and undetermined amounts for long-term leases.

CURRENT AUTHORIZATIONS OUT OF POSTAL

FUND

ADMINISTRATION AND REGIONAL OPERATION

For expenses necessary for administration of the postal service, operation of the inspection service and regional offices, uniforms or allowances therefor, as authorized by the Act of September 1, 1954, as amended (5 U.S.C. 2131), including services as authorized by section 15 of the Act of August 2, 1946 (5 U.S.C. 55a); management studies; not to exceed $25,000 for miscellaneous and emergency expenses (including not to exceed $6,000 for official reception and representation expenses upon approval by the Postmaster General); rewards for information and services concerning violations of postal laws and regulations, current and prior fiscal years, in accordance with regulations of the Postmaster General in effect at the time the services are rendered or information furnished, of which not to exceed $25,000 for confidential information and services shall be paid in the discretion of the Postmaster General and accounted for solely on his certificate; and expenses of delegates designated by the Postmaster General to attend meetings and congresses for the purpose of making postal arrangements with foreign governments pursuant to law, and not to exceed $20,000 of such expenses to be accounted for

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