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Federal Eye
Posted at 10:00 AM ET, 06/03/2011

Uncle Sam is using more snail mail

Rein

The federal government delivers Social Security checks and processes tax returns electronically, but its use of the old-fashioned mail systems is soaring nonetheless, according to a new study.

Declining mail volume caused a plunge in the U.S. Postal Service’s total revenue in recent years, but the federal government’s use of first-class mail jumped 11 percent from 1997 to 2010, according to research by two top officials with the Postal Regulatory Commission, which oversees the Postal Service.

In fact, the federal government was the largest single user of the mail system, accounting for more than two percent of the money spent on first-class mail last year, the authors said. States spend about the same each year.

Government agencies spent at least $1 billion a year on mailing and shipping over roughly the same period, plus another $200 million to $250 million on packages sent through private companies such as FedEx and UPS, the study by Michael J. Ravnitzky and J.P. Klingenberg concludes.

Ravnitzky, chief counsel to the commission chairman, and Klingenberg an economist with the agency, argue that the switch by federal, state and local governments to electronic mail for their communicating to the public may be overblown. And, they say, the Postal Service can continue to count on governments as major customers, even as it fights for survival amid the surge in electronic communications. The authors’ views do not necessarily reflect those of the commission.

“One vital function of the United States Postal Service is to form an essential communications backbone of the government . . . ensuring reliable and timely delivery of communications essential to the functions of government,” the authors write. Their paper was presented this week at a conference at Rutgers University on the economics of the Postal Service.

Permits, benefits, voting materials, warning letters, surveys, military correspondence, employment and tax information, immigration documents, product recalls, security clearances, retirement information, regulatory compliance — all of this communication between government and its citizens is done the old-fashioned way, through snail mail or contracts with UPS and FedEx Express.

Part of the reason is that the government needs to make sure its missives are delivered to real people with real addresses, and electronic communication poses a risk that that may not happen.

The federal agency most active with the mail in 2010 was the Social Security Administration, which spent $237.7 million despite a move to electronic delivery of some benefit checks. Next came the Department of Commerce, which paid $223.9 million; the Department of Veterans Affairs, at $223.5 million; and the Treasury Department, which came in fourth at $210.8 million. The data was collected from the General Services Administration.

Most of this mail is postmarked as single, 44-cent pieces. The authors found that pre-sorting the mail would qualify the government for a discount.

A small number of federal agencies do this now, including the Department of Homeland Security and the U.S. Navy Anacostia Office, which accept mail from other nearby government offices. If all federal agencies pre-sorted, the government would save at least $100 million a year, the report concludes, and the Postal Service would gain efficiencies.

Some have suggested privatizing some postal operations to limit the Postal Service’s losses, a change that could diminish service to some areas of the country where mail delivery is not profitable. But the authors say the case for contracting weakens if the government has a say, because the government cannot pick and choose to whom it sends letter..

“A government entity must serve everyone,” they say.

In other news:

• The Federal Diary reports on a House bill that would cut funding for airport screeners

• In the Loop briefs us on how Garden State Gov. Chris Christie got himself in hot water this week. GovLoop commenters weigh in on the proliferation of social media experts.

•The deadly E. coli strain that has sickened more than 2,000 Europeans would be legal if it were discovered on meat or poultry in the United States, Lyndsey Layton reports.

•The Agriculture Department scraps the food pyramid for a plate.

•Departing Commerce Secretary Gary Locke laments government’s ”aversion to failure.”

•Watchdogs say the U.S. government is at risk of wasting billions of dollars in Iraq and Afghanistan because of poor planning.

By  |  10:00 AM ET, 06/03/2011

 
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