The Government Accountability Office report on excess mail processing capacity in the US Postal Service.
From letter to Lawmakers:
The U.S. Postal Service’s (USPS) dire financial situation has increased the urgency for agreement on an effective strategy to better align USPS’s postal services with its costs and revenues. USPS has noted that the decline in First-Class Mail volume accelerated more than expected and predicted that volume will continue to fall. By fiscal year 2020, USPS expects to lose over 60 percent of the First-Class Mail volume that it had in fiscal year 2006. Declining First-Class Mail volumes, development of automated mail processing equipment, and “workshare” initiatives (e.g., mailers applying bar codes, presorting the mail, and entering mail into the postal network closer to its final delivery point) have led to a mail processing network—including postal facilities, staff, equipment, and transportation resources—that is larger than needed to process and distribute current and projected levels of mail.
From GAO Report:
Since 2006, the U.S. Postal Service (USPS) has closed redundant facilities and consolidated mail processing operations and transportation to reduce excess capacity in its network, resulting in reported cost savings of about $2.4 billion. Excess capacity remains, however, because of continuing and accelerating declines in First-Class Mail volume, automation improvements that sort mail faster and more efficiently, and increasing mail preparation and transportation by business mailers, much of whose mail now bypasses most of USPS’s processing network.
In December 2011, USPS issued a proposal for consolidating its mail processing network, which is based on proposed changes to overnight delivery service standards for First-Class Mail and Periodicals. Consolidating its network is one of several initiatives, including moving from a 6-day to a 5-day delivery schedule and reducing compensation and benefits, that USPS has proposed to meet a savings goal of $22.5 billion by 2016. This goal includes saving $4 billion by consolidating its mail processing and transportation network and reducing excess capacity as indicated in the table below. The Postal Regulatory Commission is currently reviewing USPS’s proposal to change delivery service standards.
Stakeholder issues and other challenges could prevent USPS from implementing its plan for consolidating its mail processing network or achieving its cost savings goals. Although some business mailers and Members of Congress have expressed support for consolidating mail processing facilities, other mailers, Members of Congress, affected communities, and employee organizations have raised issues. Key issues raised by business mailers are that closing facilities could increase their transportation costs and decrease service. Employee associations are concerned that reducing service could result in a greater loss of mail volume and revenue that could worsen USPS’s financial condition. USPS has said that given its huge deficits, capturing cost savings wherever possible will be vital. USPS has asked Congress to address its challenges, and Congress is considering legislation that would include different approaches to addressing USPS’s financial problems. A bill originating in the Senate provides for employee buyouts but delays moving to 5-day delivery, while a House bill creates a commission to make operational decisions such as facility closures and permits USPS to reduce delivery days. If Congress prefers to retain the current delivery service standards and associated network, decisions will need to be made about how USPS’s costs for providing these services will be paid, including additional cost reductions or revenue sources.
What GAO Recommends
GAO is not making new recommendations in this report, as it has previously reported to Congress on the urgent need for a comprehensive package of actions to improve USPS’s financial viability and has provided Congress with strategies and options to consider. USPS had no comments on a draft of this report.
enuf… (redundant bs)
I’m talking about the GROWTH in USPS flat/parcel business, despite legislators not allowing actual cost via reasonable postage to cover actual costs. And speaking actual costs: UPS and FedEx both use ‘last mile’ USPS service to deliver THEIR parcels, so us union workers are subsidizing those private companies. Subsidizing, as in working harder, getting harassed by postal mismanagers, and propaganda hacks such as you with your redundant bs.
Mojo:
Get back the parcel business? Obviously, you know nothing about the historical aspect of what you vomit on this site. USPS made UPS who they are today. Check your facts going back to the early to mid-seventies when USPS handed the parcel business to UPS on a silver platter. AND…also check subsequent UPS Teamster strikes where USPS had a GOLDEN opportunity to get that work back and REFUSED to do so. Then…take a look at how FedEx became USPS largest contractor and how they took over airport operations from USPS and USPS took it in the rear and even helped them become who they are. Mojo…you must be fed the crap you believe from those so-called unionists that want you to think that it’s everyone else’s fault other than their own. You know….the unionists that created a self-preservation clause in the contract that protects junior non-vets from excessing and from the impacts of automation & lower mail volumes because they are union stewards while senior returning veterans from the war are booted out. Yeah, that’s right…someone has to stay behind to file grievances on the size of lockers and important stuff like that. It’s not propaganda mojo…it’s the cold hard facts. By the way…how are those dues assessments working out for ya?
“don’t argue guys, just support privatize usps”?
richard are you and enufisenuf lovers?
Drill Baby Drill
S.1789 has the support of both parties.
We have to pass this bill or there’s gonna be a lot of drastic things done to the postal service,” Grassley said.
Grassley admits the bill up for debate in the Senate, next week, would still make cuts. But, “if we pass this bill, I think we’re gonna have less layoffs, less post offices closed, and fewer sorting centers closed,” Sen. Grassley said.
The Senate bill would end door-to-door delivery in favor of so-called “central delivery points”– clusters of mailboxes at the curb, or on the corner, but there are exceptions for the disabled. The bill would also change medical and retirement benefits for postal workers, take this out.
“The bill also takes money out of the retirement fund because it has been overpaid into the fund, and use that money to help postal service operate,” said Grassley. ” $2-billion of that $10-billion overpayment would be used to encourage early retirements reducing layoffs later.”
Senator Tom Harkin of Iowa says that’s a good place to start.
But, maybe the biggest sticking point? The end of Saturday delivery within two years. Harkin worries about cuts that could “cripple the ability of the Postal Service to carry out its mandate for universal service.”
Grassley says it’s a trade off; one that some Iowans are willing to make.
“My constituents, particularly in the more rural parts of Iowa, would rather not have Saturday delivery, than close the post office,” Grassley added.
The motivation here is a May 15th deadline. That’s when a postal service moratorium on closing post offices and processing centers expires. By the way, Grassley said he supports the bill as it’s written.
Grassley said the Senate was supposed to debate the bill back in January. But, Majority Leader Harry Reid pulled the bill and didn’t put it back on the Senate schedule until now.
There are layoffs coming according to the Congress, so this alleviates some of them by the Early Retirement incentives, the USPS is going to change, they may amend the controversial parts, let’s hope they do, or layoffs will be a reality.
don’t argue guys, just support privatize usps.
Tman,
All excellent ideas from someone with actual experience!. Sadly this lack of experience is severely limiting those that guide this behemoth(Titianic?). The Fss has a feeder(the part where the flat mail enters to be read and then sorted) that will never separate the mail as reliably as a letter mail machine, and even those cannot separate 100% of the time. I have worked on MPE for over 20 years and can’t recall seeing so much capital invested for such little return on investment as the Fss.
Tman, if I could, I would select you to head up a VP of technology to get us at least even with the competition.
Our main flaw in the system is relying on clerks to get us out in the morning . Waiting on parcels and flates x 20 carriers x 30 min downtime is killing us.
Why when our databases are used by mailers to print parcel labels do they not include route numbers on the label. Then any flunky could throw them.
Scanners need to upload data in real time like all other services. We have a 2 nd generation scanner $500 million dollars that does practically nothing new. Wtf why did the dc geniuses not look at competition and say lets do it better. Ssdd
With new android phones apps could be developed to real time scan , check coa
info , map routes, prevent misdeleveries with gps location. , track carriers, signal parcel stops , warn abot bad dog locations , document deliveries, photo verify certifides.collect ccard payments.
Fss machines either dont work or are not fully utilized. We throw 2 feet a day of perfect fss mail. Magazines, catalogs. Etc. did the contract for theses machines not include performance gurantees? Routes were increased due to fss and we still get out of office the same times .
Intrerim fix would be to stick the fss mail if we have down Time. it goes up in abot 10 min since its in order. And saves working out of 3 bundles Abot 20 min on street. Let carriers decide on what works for us Instead of blindly following upper mngmt doctrine. When its all run on fss carry it as is.
We need to charge for hold mail and forwarding mail past 60 days. We are going broke not charging for thes labor intensive services.
Stop accepting all this crazy sized mail that is not fss compatible . Or upcharge for non standard size or thickness. Mail that runs on fss gets a discount. Mailers will quikly conform to standards if you have them in place.
Insulted is right on the money. I see volumes (that’s total pieces of letter mail)run through our machines that have remained steady for the last 4 quarters. The staffing has not, however, and as a result, we call O.T. to get the mail out. We seem to have wasted money on the FSS. If we had taken the cash and purchased a decent package tracking system along with an improved package sorting network then maybe we would be looking at an even bigger jump in the parcel business than is being reported. I hear priority is up 18%. I just don’t understand why congress fails to see that they created this whole mess with the prefunding requirement of healthcare. So simple to fix. I mean just 1 simple bill to eliminate prefunding and the rest will take care of itself. The economy will improve, many many CSRS employees will soon retire, and the Service has always had the ability to right size itself. No need to have more legislation for any of these, just the prefunding. Our own OIG says that if USPS did not put another penny into the funds they would still be fully funded in twenty years on the interest alone! Congress seems to be doing what they did to us in 2006. I wish they would just follow the acronym that was drilled into us former military types: KISS Keep It Simple Stupid!!!!!!!!
yup, the po always focuses on the weakest link. amazon is slowly killing walmarts profits, which means more packages for the usps.the po unfortunately invested heavily in machinery that is getting less and less use. they were so intent on getting rid of loyal workers with machines that they couldn’t see what tomorrow brings. what big companies have not lost money lately? so it’s first class,it’s flats, express mail, etc.– the po will cry about something and everything. took a monopoly and ran it into the ground. can’t believe upper management still have jobs after the fiasco they have created. must be who you know, not what you know. yah some people read a piece of mail and think they are experts on the po, i usually see a name and ignore the useless post.
Why do they not talk about Standard mail? Standard mail is machine sorted. The USPS has allowed much of what was first class mail, to be heavily discounted Standard mail. Why is the recession not ever mentioned? The whole dang economy is trashed! What about fuel costs? Do you think sending discounted mail with rising fuel costs makes business sense? The USPS sold itself out. At least get the facts straight!
The above post (‘enufisenuf’) always seems to post propaganda that leaves out important variables like increasing parcel busines (due to e-bay, Amazon and other internet sales) and the old stand-by catalogs and sales flyers (offered at less expensive rates in door-to-door delivery form). Typical anti-worker, anti-union troll.
And, of course, this will be disputed by the APWU who is facing a drastic drop in membership (hence also dues money) which has led several locals and remaining members to call for a corresponding drastic reduction in staffing at 1300 L Street in Wash DC. In lieu of any such reductions APWU is enjoying the fruits of their imposed assessments on TV vis a vis 30 second commercials. Meantime…dead man walking keeps walking and die hard lemmings keeps paying dem dues!
Lies, lies, and more lies. They make up whatever numbers serve their purpose. Please start by eliminating 25% of management (who DO NOT touch the mail), reduce all the silly reports that lead to silly discipline and grievances, and let the backbone of the USPS (the letter carriers) do what we do and make this thing work. That’s how it was meant to be and the only way it is going to work.