postal receipts; of $3,818,342.78, or 8 per cent., in the expenditures and estimated outstanding liabilities; and of $2,468,725.91, or 5 per cent., in the estimated total cost of the postal service. SUSPENSE ACCOUNTS AND BAD DEBTS. From the report of the Auditor it will appear that the sums involved by "bad debts" and "suspense accounts" closed during the last fiscal year were as follows, viz: Amount of balances due from late postmasters and charged to bad debts $12, 656 02 48177 12, 174 25 The amount of the net loss is chargeable to the revenue of the fiscal year in which the accounts are closed, without reference to the periods when the losses actually accrued. AMOUNTS DRAWN FROM THE TREASURY. The following amounts were drawn from the general Treasury, within the last fiscal year, on account of special and deficiency appropriations, viz: For deficiency in the postal revenues for the year ended June 30, 1883, under act approved May 4, 1882, Stats., vol. 22, chap. 116, page 55. For deficiency in the postal revenues for the year ended June 30, 1884, under act approved March 3, 1883, Stats., vol. 22, chap. 92, page 455. For deficiency in the postal revenues for the year ended June 30, 1885, under act approved July 5, 1884, Stats., vol. 23, chap. 234, page 157. For deficiency in the postal revenues for the year ended June 30, 1886, under act approved March 3, 1885, Stats., vol. 23, chap. 342, page 387. Total drawn during the year... $520, 770 00 528,098 81 3, 165, 553 21 4,500, 000 00 8,714, 422 02 The amount appearing in the report of the Auditor as drawn from the Treasury, is $8,751,070.73; but these figures represent the amounts drawn from October 1, 1885, to September 30, 1886, while the foregoing was the sum actually drawn within the fiscal year proper. TRANSACTIONS AT TREASURY DEPOSITORIES. The receipts and disbursements at Treasury depositories during the past fiscal year may be briefly stated as follows: Deduct deposit made in quarter ended June 30, 1885, and counterentered in quarter ended September 30, 1885........... Amount of warrants paid during the year ended June 30, 1886....... Balance at depositories June 30, 1886. Amount of warrants outstanding June 30, 1886... Balance subject to draft June 30, 1886..... 26, 593, 85 64 29,709, 758 45 22 70 29, 709, 735 73 24, 279, 336 10 5,430, 399 6 108, 415 0 5,321,983 65 The balance on hand at the Treasury depositories subject to draft on the 30th June, 1886, was $2,285,048.25 in excess of the amount on hand on the 30th June, 1885. Of the $17,879,463.62 of postal revenue, $74,214.39 was deposited through national-bank depositories. The balance on haud on June 30, 1885, in national-bank depositories was $45,138.04, and on June 30, 1886, it was $2,062.61, a decrease of $43,075.43. The number of warrants drawn upon the Treasurer of the United States and assistant treasurers during the year was 72,999, comprehending payments to the amount of $24,308,814.69. Accounts were kept with the Treasurer, nine assistant treasurers, and forty-one designated national-bank depositories. REVENUE FOR 1886. The last fiscal year marked a favorable turn in the tide of the postal receipts, which had been receding for the two previous years. The period from 1879 to 1882 was an unprecedently prosperous one for the postal revenue. The average annual rate of increase of ordinary revenue for the three years was nearly 12 per cent., as against an annual average of only a little more than 5 per cent. for the nine years preceding 1879. A depression of the business interests of the country had, however, set in, and the year ended June 30, 1883, exhibited an increase of only 8.6 per cent. in the postal receipts. The gross receipts for that year amounted to $45,508,692.61, and this was the greatest amount ever realized in any one year of the history of the postal service. It was an increase of $15,466,709.75, or 51.4 per cent., over the receipts of the year ended June 30, 1879. A still more important factor than the unfavorable condition of business intervened to curtail the volume of the postal receipts. On October 1, 1883, the rate of postage on first-class matter was reduced from 3 cents to 2 cents for each half-ounce or fraction thereof. This was a large reduction, and it affected by far the greatest of all the sources of the postal revenue. An immediate falling off in amount was only a natural result, though partial compensation was to be expected from the stimulus to an increase of business afforded by a cheaper rate of postage, and the tendency to a substitution of sealed inclosures at letter rates for printed matter and postal cards. The gross revenue exhibited for the year ended June 30, 1884, was $43,325,958.81. This was $2,182,733.80, or 4.7 per cent., less than the revenue of the previous year. The new rate of postage had now been in effect for nine months, and under ordinary circumstances the succeeding year should have shown a handsome increase. In actual results, however, the gross receipts for the year ended June 30, 1885, were 8765,114.98, or 1.7 per cent., less than those of 1884, and $2,947,848.78, or 6.4 per cent., less than those of 1883. This fact sufficiently attested the extreme severity of the depression in business which prevailed during the year 1884–85. The six months ended December 31, 1884, showed a decrease of $1,060,070.33, or 4.8 per cent., and the six months ended June 30, 1885, an increase of $294,955.35, as compared to corresponding periods of the previous fiscal year. It was apparent that a reaction had set in; but still the situation on the 1st of July, 1885, was not such as to promise an increase of revenue for the year then begun. There were some prospects of an improvement in the general business of the country; but they were not sufficiently pronounced at that time to justify confident hopes of the immediate future. Moreover, two important changes in postal legislation, injuriously affecting the postal revenue, went into effect on the 1st of July, 1885. These were, first, a reduction in the rate of postage on second-class matter from 2 cents to 1 cent per pound, and second, an increase of the unit of weight of first-class matter from half an ounce to a full ounce. It was estimated that these two changes would result in a loss of nearly two million dollars for the first year; and the chances of offsetting this loss, and of making a better showing of revenue for the year ended June 30, 1886, than that of the previous year, were left to depend upon very decided improvement in the business of the country. Fortunately all the signs during the late summer and the autumn of 1885 pointed strongly to an early return of national prosperity. It was in the light of these indications that it became necessary in November last, in connection with the preparation of the annual report, to submit estimates of the postal revenue for the current and the last fiscal years. The work was attended by more than the usual degree of uncertainty as to results. It was possible to approximate somewhat closely the revenue to be expected from second-class matter, notwithstanding the doubt as to how far the reduction in the rate of postage would lead to an increase in the volume of matter committed to the mails. In the estimate for 1886 allowance was made for an increase of 8 per cent. in weight of matter over that mailed during the previous year. The amount called for by the estimate was $1,091,426 as against $2,021,159.26 collected during the preceding year. The increase of weight contemplated by the esti mate was less than a normal one, the average rate of increase for the six preceding years having been a little more than 12 per cent. The effects of the increase of the unit of weight of first-class matter were largely a matter of speculation. It was estimated, upon such statistics as were available, that between 4 and 5 per cent. of all the letters mailed were in excess of half an ounce in weight; and it was in these that a loss was to be suffered by the increase of the unit to one ounce. By way of compensation the new unit offered an inducement to the inclosure under seal, at letter rates, of circulars and parcels of merchandise previously sent at third and fourth class rates of postage; but the gain in this direction would naturally be gradual in its progress, and for a time at least it was not likely to overcome the loss on letters weighing more than half an ounce. The net loss for the first year of the change was roughly estimated upon the best available data at $800,000. The only new source of revenue was through the special-delivery system established to take effect on October 1, 1885, but the gain from this source was not expected to constitute a considerable factor in the revenue of the year. But, after all, the greatest element of uncertainty was in the future of the business condition of the country. With the purpose of measuring the indications in the light of expe rience, a review was made of the revenue by quarterly and annual pe riods for a series of years past. The postal service furnished a fair reflex of the general business situation; a separate tracing of the revenue was made as between thirty of the larger and all of the remaining postoffices. The thirty large offices in question included all the great commercial centers of the country, and they collected nearly 40 per cent. of the entire postal receipts. It appeared from the examination that upon the approach of a period of commercial depression the larger offices are the first to show a check in the flow of the receipts; that they suffer at a disproportionate rate while the depression continues; and that they are the first to give evidence of a return to prosperity by an augmentation of the revenue. The smaller offices, while slower to feel the effects of a change, either for better or worse, in the situation of business, show a greater increase of revenue than the larger offices in the midst of a period of national prosperity. As already seen, there has been a gain of 1.3 per cent. for the six months ended June 30, 1885, as compared to the corresponding six months of the previous year; and this was the latest information available from all the post-offices, the returns for the quarter ended September 30 being still in process of adjustment by the Auditor. Special returns were, however, obtained from the thirty principal offices for the four months from July 1 to October 31. These returns showed an increase of about 4 per cent. for the quarter ended September 30, and of about 10 per cent. for the month of October, as compared to the corresponding periods of the previous year. The receipts from second-class matter were excluded from the computation, but the increase was in spite of any losses that may have resulted from the change of the unit of weight of first-class matter. The returns, and particularly those for the month of October, were indicative of a great improvement in business, the same offices having shown a gain of less than one-half of one per cent. for the quarter ended March 31, and of less than 4 per cent. for the quarter ended June 30. In the expectation of a still further improvement, the ordinary revenue, exclusive of the receipts from second-class matter, for the year ending June 30, 1886, was estimated at an increase of 6 per cent. on the revenue derived from the same sources during the previous fiscal year. The amount of the estimate was $42,538,596.34, and it contemplated an increase of $2,407,845.07, in face of an anticipated loss of $800,000 from the change of the unit of weight. It was equivalent to an increase of 7.9 per cent. on the basis of the half-ounce unit which had prevailed during the previous year. The estimate appeared to be an extravagant one in the light then afforded; but it was verified with a surprising degree of accuracy, as was also the estimate of the revenue from second-class matter. The receipts from the money-order business were estimated by the Superintendent of the Money-Order System at $400,000, being a decrease of $107,323.81, as compared to the revenue of the previous year. The total estimated gross receipts for the year ending June 30, 1886, amounted, therefore, to $44,030,022.34, consisting of $1,091,426, from second-class matter; of $42,538,596.34 of ordinary postal revenue, excluding the receipts from second-class matter, and of $400,000 from money-order business. In actual results the receipts from second-class matter proved to be $1,099,625.89, the ordinary postal revenue $42,498,245.19, and the receipts from money-order business $350,551.87, making a total of $13,948,422.95. The receipts from second-class matter were $8,199.89 more than the amount at which they had been estimated; the ordinary postal revenue was $40,351.15 less than the amount at which it had been estimated, and the money-order receipts were $49,448.13 less than the amount of the estimate. In the two former items the net difference between the estimates and the actual results was only $32,151.26, or less than a twelfth of 1 per cent. of the total amount involved. The money-order receipts were $49,448.13 less than the estimate, a part at least of the falling off having been due to the decrease, made in January last, in the fees on foreign money-orders. In the aggregate the receipts were $$1,599.33 less than the estimates. As compared to the previous year, there was a decrease of $921,533.37, or 45.5 per cent., in the revenue from secondclass matter; an increase of $2,367,493.92, or 5.8 per cent., in ordinary postal revenue, excluding second-class matter; and a decrease of $58,381.43, or 14.2 per cent., in money-order receipts. The net increase in the gross receipts was $1,387,579.12, or 3.2 per cent. The following are the sources and the amounts of the revenue collected during the last fiscal year, viz: 1. Letter postage paid in money. 2. Box-rents and branch offices.. 3. Fines and penalties 4. Sale of postage-stamps, stamped envelopes, newspaper wrappers, and postal cards 5. Amount taken from dead letters for which no owners could be found 6. Revenue from money-order business 7. Miscellaneous.. Total....... $60,004 ×0 2, 018, 048 04 13,472 35 41, 447,095 83 8.858 33 350,551 87 50,391 68 43,948, 422 95 As compared to the year ended June 30, 1885, there was an increase of $59,810.99, or 3 per cent., in the receipts from box-rents; of $1,390,869.19, or 3.4 per cent., in the sale of postage-stamps, staniped envelopes, newspaper wrappers, and postal cards; of $6,082.58, or 13.7 per cent., in miscellaneous receipts. There was a decrease of $7,523.06, or 11.1 per cent., in the amount of letter postage paid in money; of $39.55, or .02 per cent., in the amount received from fines and penalties; of $3,239.60, or 26.7 per cent., in the amount taken from dead letters; and of $58,381.43, or 14.2 per cent., in the revenue from money-order business. The three items of increase amounted to $1,456,762.76, and the four items of decrease to $69,183.64, leaving a net increase of $1,337,579.12, or 3.2 per cent., as previously shown. In the foregoing detailed statement of revenue, the sales of postagestamps include the revenue from second-class matter (payable with stamps of special design), but the amount realized from this latter source is ascertained from special returns made to this office. This amount was accordingly deducted in the computation of ordinary revenue, which, however, includes the receipts from all other sources save that of the money-order business. A closer analysis of the ordinary receipts of the last fiscal year, aud an examination of the influences by which they were affected, will contribute to a better understanding in submitting the estimates for the current and the ensuing fiscal years. It will be necessary to consider only the ordinary postal revenue, omitting, for obvious reasons, the receipts from second-class matter and from the money-order business. The ordinary revenue for the year amounted, as already shown, to $42,498,245.19. Of this amount, $9,700,463.05, or 22.8 per cent., was collected during the quarter ended September 30, 1885; $10,994,326.16, or 25.99 per cent., during the quarter ended December 31, 1885; $11,179,047.72, or 26.3 per cent., during the quarter ended March 31, 1866; and $10,624,408.26, or 25 per cent., during the quarter ended June 30, 1886. As compared to the corresponding periods of the previous year there was an increase of $185,056.11, or 1.9 per cent., for the quarter ended |
