A Senate bill headed for a final vote that would require the U.S. Postal Service to designate a single, unique ZIP code for 83 communities would be costly to implement and would undermine cost controls at an agency that has lost $14.7 billion over the past 21 months, Postmaster General David Steiner said Friday.

The Homeland Security and Governmental Affairs Committee approved the measure Thursday by a 10-3 vote, clearing the way for consideration by the full Senate. Companion legislation passed the House of Representatives last year.

The bill is intended to address situations in which residents in a town share split ZIP codes, with some using the same ZIP code as a neighboring town. The ZIP code system, introduced by the Postal Service in 1963 to automate mail sorting, was designed around logistics rather than municipal boundaries, and disputes over split assignments have surfaced periodically across the country. Supporters say the lack of a uniform ZIP code can lead to misdelivered or delayed mail and slower emergency response because drivers are confused about where to go. Beyond mail delivery, split ZIP codes can complicate address-dependent functions such as insurance rating, census data collection, and local government service boundaries.

Steiner urged Congress to reject Senate bill S. 4505l, saying it would cause “irreparable harm” to the Postal Service and its customers. He argued that requiring ZIP code changes by congressional mandate would add costs and create delivery problems. As an alternative, he pointed to separate legislation approved by the committee that would establish a pilot program to reform the ZIP code modification process. That measure would require more explicit criteria, including feasibility and impact studies for address changes and a written explanation to local officials when requests are denied.

The clash over the bill reflects a broader tension between Congress, which oversees USPS as a government entity, and postal management, which under its current reform plan is consolidating facilities and tightening delivery operations to stem multiyear losses. Postal leadership has repeatedly warned that legislative mandates imposed without corresponding funding undermine those cost-reduction efforts.

“In a calendar quarter where our 630,000 hard working men and women struggled and strived to improve performance by $600 million, with a single action, with the stroke of a pen, Congress proposed to give it all away for no good reason. [… The Zip codes bill] will not only eliminate the $600 million improvement, it will further erode our performance as we estimate costs from the bill to be well over $800 million. It will also affect service, not only for these ZIP codes, but for the areas around those ZIP codes,” Steiner told the Postal Service board of governors at a meeting Friday.

The USPS reported a fiscal third-quarter loss of $2.5 billion, reducing losses by $584 million from the same period in 2025.

“Even as the Postal Service takes one step forward, Congress imposes yet another money losing mandate that pushes us two steps back. This process has to stop,” Steiner said.

S. 4505 was sponsored by Sen. Joni Ernst, R-Iowa, who has spent years trying to resolve the city of Urbandale’s ZIP code boundary dispute, which she said has created challenges for local businesses and services. New Hampshire’s Senate delegation supported the bill because residents in the neighborhood of North Swanzy complained that their mail was often sent by mistake to addresses in neighboring Keene even though they live in Swanzy.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Write to Eric Kulisch at ekulisch@freightwaves.com.

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