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Federal Eye
Posted at 06:00 AM ET, 09/01/2011

The Postal Service has too much extra space, report says


This rural post office in Brownstown, Wash. is slated for closure. (Gordon King - AP)
The money-starved U.S. Postal Service operates more than 33,000 facilities and owns or leases millions of square feet it no longer needs, according to a new watchdog estimate.

Eye Opener

With tens of thousands of post offices, about 500 mail processing facilities and dozens of regional offices, the nation’s mail delivery service occupies about 284 million square feet. Of that, about 67 million square feet — representing 24 percent of its real estate — is extra space it doesn’t need, according a new report by the Postal Service Inspector General. Postal officials dispute the figure.

Those levels exceed the national commercial vacancy rate of 13.4 percent, and “the Postal Service has a much greater opportunity to aggressively optimize excess space through disposal or leasing” than it currently plans to do, the report said.

Postal officials are expected next week to outline plans to shrink its national mail processing and delivery networks. The changes could result in job losses and include closing dozens of its mail processing plants, in addition to the thousands of post offices it’s already planning to shutter.

That’s encouraging, according to the watchdog report, because the Postal Service’s current plans to consolidate would result in trimming just 1 percent of its real estate.

Postal officials quoted in the report said they appreciated the audit, but disputed the estimates on excess space.

But the report said the Postal Service lacks a reliable way of knowing exactly how much space it owns or leases.

Meanwhile, USPS said Wednesday that it plans to pay into a government fund compensating federal employees for work-related injuries as required by law.

The assurances come as the Labor Department is warning lawmakers that the fund will run out of cash later this year if the Postal Service fails to make its payments, which last year totaled about $1.2 billion.

Reuters first reported news of the department’s concerns.

David Partenheimer, a Postal Service spokesman, said USPS should at least be able to provide enough money to keep the $2.7 billion fund afloat into the next fiscal year, which begins Oct. 1.

There would be no penalty against the Postal Service if it failed to make its payment, Labor Department Assistant Secretary Brian Kennedy told lawmakers in August.

With more than 560,000 employees, USPS is the largest employer covered by the Federal Employees Compensation Act. Its workers claim 40 percent of the benefits paid each year, according to the office of Rep. Darell Issa (R-Calif.).

The California Republican, who chairs the House Oversight and Government Reform Committee, is pushing legislation that would allow the Postal Service to restructure itself, but permit Congress to establish a receivership-like authority if it defaults on its debt obligations to the federal government.

On Wednesday, Issa's office is launching a new Web site, SavingThePostalService.com, to tout his legislation.

Follow Ed O’Keefe on Twitter: @edatpost

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By  |  06:00 AM ET, 09/01/2011

Categories:  Eye Opener, Postal Service

 
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