Post Service Faces Closures, Consolidation

As Americans Turn to Internet to Pay Bills, Stay in Touch, Federal Postal Service Faces $7B Loss

(AP)  The local post office long has been the center of many American communities, but with people turning increasingly to the Internet to send messages and pay bills, financial losses are forcing the Postal Service to consider consolidating or closing hundreds of local facilities.

The post office is facing a $7 billion loss this year despite a 2-cent rate increase. The agency has shed 150,000 workers since 2000, removed hundreds of mail collection boxes and taken other steps to save money.

Now the agency has sent a list of nearly 700 potential candidates for closing or consolidation to the independent Postal Regulatory Commission for review, and officials say more may be added.

Some of the offices could be closed while others might have some of their functions consolidated with other offices. For example, in some cases preparing mail for delivery may be shifted from Office A to nearby Office B, but the first office still might offer services such as selling stamps and mailing parcels and letters. In other cases one of the offices might be closed.

Postal Vice President Jordan Small told a congressional subcommittee that local managers will study activities of approximately 3,200 stations and branches across the country, considering factors such as customer access, service standards, cost savings, impact on employees, environmental impact, real estate values and long-term Postal Service needs.

No changes are expected before the end of the current fiscal year on Sept. 30.

There are 32,741 post offices across the U.S.

"We anticipate that out of these 3,200 stations and branches (being reviewed), under 1,000 offices could be considered as viable candidates to study further" for closing, Small said.

In addition to the switch of business to the Internet, the recession has hurt the post office by reducing advertising mail. Last year's high gas prices also siphoned millions of dollars from its coffers.

Just last week the Government Accountability Office added the Postal Service to its list of troubled agencies, saying there are serious and significant structural financial challenges currently facing the agency.

"Every major postal policy, from employee pay, to days of delivery, to the closing of postal facilities must be on the table. Without major change, the day will soon come when the Postal Service will be unable to pay its bills," the GAO said.

Congress is considering a bill to change the way the post office funds its retiree health benefits over the next two years that could save $2 billion annually.

In addition, Postmaster General John Potter has asked Congress for permission to reduce mail deliveries from six days-a-week to five.

Last year, mail volume fell by 9.5 billion pieces to a total of 203 billion pieces. It is expected to fall by 28 billion pieces this year to a total of 175 billion pieces.

At the same time population growth and new business mean the post office has to serve 1.2 million new addresses every year.

[John_Merritt]

The USPS is a symptom of 'bloat' of the entire government system. Inefficiencies abound everywhere. The only question I have "Can you deliver my bills and payments on time, and is it going to cost me more for you downsizing or conducting business?"

[TyroneHoglegg]

There is going to be a plethora of enraged/crazed Cliff Clavens out there soon...Prepare for Armageddon my friends....

[sewold]

Our non-profit bulk mailing permit costs us $185/yr. plus about $40 each month for the mailing. What happened to customer service? Clerks are rude in informing me that what I've done is wrong when the fact is that regs have changed since the last time I mailed. Whey can't they let us know. They have a record of permit holders.

[omnibus66]

To you bellyachers out there who like to complain about things they know nothing about:

The Postal Service is the only government agency that receives NO tax funds. They are totally self sufficient. Opinion polls consistently rate the postal service with a 85% - 90% positive rating, higher than almost any company on the Fortune 500. Bonuses paid to managers are based on their ability to perform within their budget, and are modest in comparison to what is paid by large private corporations.

The single largest expense to the postal service is the retirement system. If their retirement program was funded by tax dollars like other federal agencies, they would have no financial problem.

[tomadams99]

Let's see now...the US Government could not run a ***** house in Nevada, they cannot run Medicare and Medicaid, they cannot run VA, they cannot run Social Services and Social Security, they cannot run a simple program like Cash for Clunkers (what a cute name), so...yea that's it...let's put Obama and the bumbling congressional fools in charge of our healthcare! Yea, that's it...change we can count on...change from your pocket to the government's!! Good Lord. The libbies are like lemming over the cliff.

[azure13]

Oh, and the private sector is doing such a great job eh? That's why my local emergency rooms are crowded with uninsured people all day long that we have to foot the bill for. That's why 3 out of 5 personal bankruptcies are due to medical bills. Yea, great system. Oh yea, we don't have a system. It's a health industry.

[formrusmcsgt]

That's why 3 out of 5 personal bankruptcies are due to medical bills.
by azure13 August 4, 2009 8:12 AM EDT

According to Zhu, having a serious medical condition makes you 50% more likely to file for bankruptcy, but not because of medical bills; medical bills are only a very small percentage of the overall debt of bankrupts, and are not significantly correlated with higher credit card debt, which one would expect if people were keeping down their medical bills by charging them to Visa. Presumably it's the income effect of disability or caretaking responsibilities.

Job loss may precipitate bankruptcy, but bankrupts don't report being laid off at a significantly higher rate than the control group. The difference is, the control group had savings to cover its financial emergency.


http://meganmcardle.theatlantic.com/archives/2009/02/what_causes_personal_bankruptc.php

[laffman99]

When they close 1000 Post Offices, don't you think they should get rid of the overprice managers, since most of these offices will be moving in with another office, they don't need that many manager of supervisors, one of the reasons the USPS is in financial ruins, it's the likes of the way the USPS manages,and how much they pay these people. This is the only place that I know, if you cost the post office say $100,000 because you don't want to follow the contract, so you get your bonus, you can, and nothing happens to the manager. And folks that's why the USPS is dying, and yes there are craft employees that shouldn't have a job, but nothing like a lot of the management team, and yes there are some good ones, but they are far a few between.

[azure13]

So you don't think this has anything to do with it?:

"Last year, mail volume fell by 9.5 billion pieces to a total of 203 billion pieces. It is expected to fall by 28 billion pieces this year to a total of 175 billion pieces.

At the same time population growth and new business mean the post office has to serve 1.2 million new addresses every year. "

[formrusmcsgt]

The number of new addresses is misleading. New subdivisions, for example, do not have individual mail boxes for each home, but rather, a panel of boxes that the carrier delivers to and each resident picks up their mail from.

Apartments also count and they as well have panel boxes.

Same for corporate delivers in large building - private mail rooms for the internal delivery.

So the real delivery point numbers are no where near the total number of addresses issued each year.

[Richard_Saunders]

I'd pay $0.05 or 1/2 a penny per e-mail to get USPS validated mail and eliminate spam.

Heck, I'd pay a full penny per e-mail if it included proof of receipt.

That would quickly put them in the black.

[azure13]

Excellent idea.

[formrusmcsgt]

Gee. I wonder why USPS is losing money.

Years ago, the carrier would arrive in the neighborhood, get his trike bag carrier out, load his mail, and walk house to house pushing the trike and delivering the mail.

Now, they drive mailbox to mailbox. Starting and stopping every 30 ft and burning fuel the entire time they're picking the mail for each residence.

Trike pushing seems to have become so difficult over the last couple of decades for some reason......

[Benton09]

And you expect today's Postal Loafers to actually walk. Surely you jest my friend. The Postal Service is a dying delivery method and needs to be shut down. Postal Workers can start to deliver papers...oh wait..that's another dying industry....sorry!

[azure13]

Lol Benton, you probably sit at a desk all day.
The Postal Service is a dying delivery method that needs to be shut down? Why, because you say so?
Another a'hole who spouts hatred and blathers on about something he knows nothing about. Just another hater who takes pleasure when bad things happen to others. You're a pos.

[grumpygeezer]

It isn't just the convenience and economy of the Internet.
Rude, arrogant and lazy postal employees have driven customers away.
I have personal experience with clerks refusing to give me my property and loudly arguing their "right" to do so.
The local post office is only a block away, but years of nastiness have me avoiding contact with them as much as possible.
Sadly, if the postal service fails entirely (almost a dead sure likelihood), we shall have to pay off their enormous debt.

[azure13]

I've never had a single problem with the postal service. This is the first I've ever heard anyone complain either. You sound like the typical cynical a'hole who hates everyone and enjoys when bad things happen to them.
You probably love the fact that GM has had to lay off so many workers too. One of those people who love to spit hatred about American cars and products.

[iheardthisbefore]

Give customers away to who?
Letter mail sent by ANY other carrier is MASSIVELY MORE EXPENSIVE.
And what debt would that be that WE would have to pay back? Postal
debt is only in the tens of billions that they have had to borrow
RECENTLY....this compared to TRILLIONS that the regular Federal
Government has....the USPS is not a part of the US Government and is
not a part of the US Government budget....they are almost entirely
funded by revenue from use of their services....which is WHY they are
in such short term trouble.

[brianbwb-2009]

700,000 disgruntled ex-postal workers kicked out into the streets. Have fun, y'all.

[woeisme1]

Are you aware of the spamming policy at CBS?