Tag: North America

Facing falling mail volume and limited control over its prices or costs, the U.S. Postal Service is relying on post office consolidation to stem losses, but the effort faces stiff political resistance.
The self-supporting agency on June 19 sent Congress an outline of how it hopes to save money by streamlining a network of 37,000 post offices and 400 large mail-processing plants.
The outline did not provide any details indicating how many facilities the Postal Service might consider closing or consolidating.

Sharp declines in first class mail leave the network larger than needed, allowing the agency to eliminate facilities — and related maintenance costs — without sacrificing service; Deputy Postmaster General Patrick Donahoe told the House Oversight and Government Reform Postal Service Subcommittee Thursday.

The Postal Service is largely blocked from lying off employees, but an effort that involves considering closing facilities in hundreds of congressional districts nevertheless draws opposition from lawmakers, postal unions and other stakeholders.
Members have regularly used appropriations bills to protect individual postal facilities from closing.

Acknowledging that challenge, Donahoe asked the subcommittee for help.

Laws requiring mandatory arbitration in contract disputes leave the Postal Service’s labor costs fixed at about 80 percent and the recent postal reform act put inflation-based caps on mailing rates. That means the agency can change its bottom line only through increasing market share or cutting operational costs, witnesses said Thursday.

Without dramatic cost reforms “there will be serious and rapid financial consequences for the nation’s mail system,” Postal Service Inspector General David Williams testified.
Williams warned the agency might have to “borrow substantial funds if [it] cannot generate substantial savings.” He noted the agency is likely to borrow heavily this year.

Williams and Phil Herr, Government Accountability Office director for physical infrastructure issues, urged the agency to improve communications about the network plan with affected parties, though they noted recent improvement.

Acknowledging that stakeholder resistance regularly derails Postal Service plans to close facilities, Herr said “part of the problem [has] stemmed from USPS’s limited communication with the public.”

Oversight and Government Reform Federal Workforce Subcommittee Chairman Danny Davis, D-Ill., pressed the agency to avoid service problems.

National on-time performance scores for the delivery of First-Class Mail set another new record for highest level of service during the third quarter of fiscal year 2008.
National overnight delivery service climbed a full percentage point from the previous fiscal quarter, reaching an average of 97 percent on-time delivery, the highest score ever achieved by Postal Service employees.
In fact, delivery service performance reached record highs for all three categories of mail the Postal Service tracks:
• Overnight service was 97 percent on-time, up from 96 percent the same period last year.
• Two-day service was 95 percent on-time, up from 93 percent the same period last year.
• Three-day service was 94 percent on-time, up from 91 percent the same period last year.
The third quarter covers April, May and June 2008.
Since 1990, the Postal Service has contracted with an outside entity to measure First-Class Mail service performance independently and objectively.
First-Class Mail performance is measured by IBM Global Business Services. The review measures First-Class Mail from the time it is deposited into a collection box or lobby mail chute until it is delivered to a home or business.
Thirteen of the Postal Service’s 80 districts lead the nation with a 98 percent on-time score for overnight delivery. They are: Northern Virginia, Arkansas, North Florida, Big Sky (the state of Montana), Baltimore, Fort Worth, Suncoast (western central Florida from Tampa/St. Petersburg to Ft. Myers), Dakotas, Greater South Carolina, Mid-Carolinas, Mid-America (northwest Missouri to the south, central and southeastern Missouri, and eastern Kansas), Portland and Central Plains (Nebraska, southwest Iowa, and the majority of Kansas).