Treasury agrees to lend Postal Service $10 billion in trade for rivals' shipping contracts [View all]

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Source: Washington Post

Economy

Treasury agrees to lend Postal Service $10 billion in trade for rivals' shipping contracts

The debt-laden mail service will provide the agency proprietary information on its agreements with private-sector competitors

By Jacob Bogage
July 29, 2020 at 12:36 p.m. EDT

The Treasury Department agreed to loan the U.S. Postal Service $10 billion in emergency coronavirus relief funding on Wednesday in exchange for proprietary information about the mail service's most lucrative private-sector contracts.

The Postal Service, subject to confidentiality restrictions, will provide Treasury copies of its 10 largest "negotiated service agreements," or contracts with high-volume third-party shippers such as Amazon, FedEx and UPS, and receive a crucial injection of cash that postal officials say will keep the debt-laden agency solvent for at least another year, according to a copy of the loan's term sheet obtained by The Washington Post.

The Postal Service contracts with private-sector shippers for "last-mile" delivery from distribution centers to consumers' homes, and it offers those firms small discounts because of the volume of packages they provide.

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Jacob Bogage
Jacob Bogage writes about sports for The Post, where he has worked since 2015. He previously covered the automotive and manufacturing industries for the Business section. Follow https://twitter.com/jacobbogage

Read more: https://www.washingtonpost.com/business/2020/07/29/postal-service-treasury-loan/