USPS to mount nationwide review of post office network

The US Postal Service looks likely to ask regulators within days for a formal opinion on its plans to review post offices across the United States for possible closure. The Postal Regulatory Commission said today that it was expecting the USPS to file for the advisory opinion soon, and although the USPS has not yet confirmed the filing, sources on Capitol Hill have suggested that the request could be made around July 27.

Postal Regulatory Commission (PRC) chairman Ruth Goldway told Post&Parcel today that a commitment has been made to USPS to complete an advisory opinion on the matter within 90 days of the USPS filing.

The US Postal Service has already briefed staff in both the US Senate and House of Representatives on the retail network review, which forms part of a major effort to “right size” the retail network in the light of declining mail volumes and a reduction in the public use of post offices.

USPS has already been reviewing a number of post offices for closure, and last month the PRC chairman wrote to USPS chief executive Patrick Donahoe to express concern that the scale of the review was sufficient to have a nationwide impact.

Under US law, moves by the USPS that would have nationwide repercussions on postal services requires an advisory opinion from the Commission.

The USPS declined to comment on the nationwide retail review today, with spokesperson Sue Brennan stating that an announcement is to be made on Tuesday (July 26), which would see the Postmaster General producing a list of post offices to be assessed for possible closure.

Donahoe has previously said this year that he plans to close around 2,000 post offices to help reduce the struggling Postal Service’s costs. The financial situation at USPS has worsened in recent weeks.

The Postal Service revised its procedures for post office closures earlier this month, ahead of its review to examine which post offices should be closed based on workload, customer demand and proximity to alternate access points for postal products and services.

USPS currently owns and operates 36,222 post offices. The latest Household Diary survey, submitted to the PRC earlier this month, stated that more than 64% of US households visit a post office at least once a month, with more than 52% making three or more visits per month.

The report suggested that even with internet access to postal products, “in-person visits to postal facilities remain stable”.

Advisory opinion

Speaking to Post&Parcel today, the Postal Regulatory Commission Chairman said the normal advisory opinion process can take a “good deal of time”, but with the Postal Service facing a race against time to cut its costs in the light of its $8.3bn-a-year losses, the Commission hopes to provide an opinion within a few months.

“We have made a commitment to the Postal Service. We will do everything we can to complete this within 90 days,” said Goldway.

Delays to the process could come if USPS fails to provide enough information – something it has been accused of in the past – but Goldway said she was not expecting that to be an issue this time.

“I expect that there will be a good deal of information provided,” she said, adding: “and we already have a lot of information on the process and reviews of existing post offices being reviewed for closure.”

Even if the Commission rules against the Postal Service’s plans for a nationwide post office closure review, USPS can legally go ahead with the plan anyway.

The PRC Chairman said even if this was the case, the advisory opinions process was likely to help improve USPS plans. “From past experience, the public review process can itself cause the Postal Service to adjust its plans,” she said.

There would also be opportunities to hold USPS to account after the fact, she said: “Another tool we have at our disposal is the annual compliance determination at the end of the year, if we believe the Postal Service is doing anything outside the law. They would then have to show how they will come back within the law.”

Appeals

Post offices slated for closure by the Postal Service are open to a 30-day appeals process for communities to object to the USPS conclusion on their local facility.

According to the PRC chairman, the Postal Service has been making commitments to close its post offices before the complete conclusion of the appeals process.

Yesterday, Chairman Goldway issued a personal dissenting opinion alongside a ruling of her Commission on the appeal process for a post office closure in New Jersey, which stated that in her view the Postal Service should not be closing post offices before all the appeals have been heard and decided.

Goldway explained to Post&Parcel that at present, it appeared that the Postal Service was making commitments to close post offices before the Commission had ruled on final appeals, although she conceded that the appeals process had been taking a little longer than it should.

“If the Postal Service goes about spending money on closing post offices – ending leases, disposing of property and so on – before an appeal is decided, it puts them at risk of having to reopen a post office if the ruling does not go their way,” she said.