WASHINGTON — The debt-ridden U.S. Postal Service said Wednesday that it is scrapping plans to close thousands of post offices and instead will drastically reduce hours at most of its rural operations to as few as two a day. The shorter hours will affect more than a third of the country’s 31,509 post offices.

The abrupt shift in strategy – 10 months after officials announced that 3,700 money-losing post offices would probably be shuttered – comes as Congress appeared headed toward deadlock on a plan to address the agency’s multibillion-dollar deficit.

Postmaster General Patrick Donahoe said he is responding to an outcry from rural areas fighting to preserve jobs, service and identities offered by their post office.

“When we announced those closures, what people said to us was, ‘Keep our post office open,’ ” he said. “We have to have shorter hours. But if we can shrink the labor costs, we can keep the buildings open.” Plans to close 223 mail-sorting hubs remain, he said.

Although low revenue and poor foot traffic had made rural outposts vulnerable for closure, lawmaker opposition was hurting prospects for a House bill to overhaul the Postal Service’s finances. The agency is headed for $14 billion in losses this year, and postal officials have said that without congressional intervention, they are so squeezed on costs and revenue that they will default on their obligations.

A bill passed by the Senate last month placed restrictions on most post office closings, placating senators from Maine to Wyoming. But the House bill, which demands more cost savings, allows the closings to proceed, prompting bipartisan opposition from House members representing rural districts.

“If the House bill came to the floor, there would have been an uprising in both parties,” said Rep. Peter Welch, D-Vt., who has joined forces with Rep. Michael Grimm, R-New York, in fighting the closures.

Vermont would have lost 15 post offices. Though he called two hours of daily service “not adequate” and “treating rural Americans like second-class citizens,” Welch praised the plan for shorter hours as a compromise that’s “better than closure.”

Donahoe said the Postal Service’s new strategy would take effect over two years and save $500 million in labor costs, up from an estimated $200 million that the closures of 3,700 post offices would have saved. The Postal Service plans to offer early retirement incentives to 21,000 postmasters; about 13,000 are currently eligible for retirement.

Rural offices will be staffed by part-time workers who make far less than postmasters. The new structure will employ a combination of part-time career employees and hourly contract staff. Most will receive reduced benefits or none.In the past year, the Postal Service studied about 17,000 rural post offices, a majority of which lose money. It concluded that 13,000 should operate on a reduced schedule.


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